Employees have a contractual right to receive pay for work done in accordance with their contract of employment. Refusing to pay wages to an employee is usually a fundamental breach of contract by the employer (the notable exception being where the employer has a right to deduct from wages in the contract and is deducting from pay in line with this).
If the employee responds to a failure to pay by resigning then they could potentially bring a claim of constructive unfair dismissal. This is what happened in the recent case of Kalkan-v-TFC Holdings London Limited. Mr Kalkan was not paid by his employer. He was told that this was because his employer was in financial dispute with his wife’s employer. Mr Kalkan refused to return to work. His employer later offered to pay the wages but Mr Kalkan refused this offer. He claimed constructive dismissal.
The employment tribunal found in his favour. They held that failing to pay Mr Kalkan was a fundamental breach of contract. Mr Kalkan had responded to this breach by refusing to come back to work – effectively resigning. The fact that his employer tried to backtrack and pay Mr Kalkan at a later date had no impact – the breach could not be undone. By this time the claim had already crystallised as Mr Kalkan had accepted the breach by leaving.
Find out how we can help. Our partner, Jon Dunkley, heads the Wollens specialist Employment Department. Contact him today for an informal chat, without obligation on 01271 342268 or via email at [email protected].
