Managing director's breach of contract claim fails after affirming contract
A managing director who resigned over delayed wages and a missing company car lost his breach of contract claim after the tribunal found he had affirmed the contract by continuing to work and claim mileage.
1 min read · Last updated 18 May 2026
Case details
- #late-payment-of-wages
- #company-car
- #constructive-dismissal
- #cqc-nominated-individual
- #affirmation-of-contract
Key facts
- The claimant was employed as Managing Director from 1 February 2021.
- The claimant resigned on 1 October 2021 citing breach of contract over delayed wages and lack of company car.
- The claimant unilaterally removed himself as CQC nominated individual without ensuring a replacement.
- The respondent invited the claimant to a disciplinary meeting on 8 October 2021 for gross misconduct.
- The claimant resigned with immediate effect on 6 October 2021 before the disciplinary meeting.
- The tribunal found the claimant affirmed the contract by accepting the wage delay and continuing to claim mileage.
Timeline
-
Contract signed
The claimant signed a Directors Service Contract with Two Fifty Four Limited.
-
Employment started
The claimant began working as Managing Director.
-
Wage delay notified
Mr Madete informed the claimant that his September wages would be delayed by a few days.
-
Claimant resigned
The claimant emailed resignation, citing breach of contract over unpaid wages and lack of company car. He also notified CQC of his resignation as nominated individual.
-
Meeting with franchiser
A meeting was held with the franchiser; Mr Madete was supported to take over as CQC nominated individual.
-
Disciplinary invitation
The respondent invited the claimant to a disciplinary meeting on 8 October for gross misconduct.
-
Claimant resigned with immediate effect
The claimant resigned with immediate effect, stating the disciplinary process was an attempt to dismiss him without notice.
-
Respondent dismissed claimant
The respondent decided to dismiss the claimant, but later accepted the resignation was effective immediately.
-
Claim presented
The claimant presented his claim to the Employment Tribunal.
-
Unfair dismissal struck out
Employment Judge Anstis struck out the unfair dismissal claim due to insufficient service.
-
Final hearing
Employment Judge Iqbal heard the breach of contract claims and dismissed them.
The legal issue
The tribunal had to decide whether the respondent's failure to pay wages on time and provide a company car amounted to a repudiatory breach of contract that justified the claimant's resignation and entitled him to notice pay and a car allowance.
The outcome
The tribunal dismissed both the wrongful dismissal (notice pay) claim and the car allowance claim.
The key reason was that the claimant had affirmed the contract by accepting the wage delay without protest and continuing to claim mileage expenses. This meant there was no repudiatory breach that would allow him to resign and claim damages.
No compensation was awarded as the claims were not well founded.
Lessons & takeaways
- If you accept a breach of contract and continue working without protest, you may be deemed to have affirmed the contract and lose the right to claim constructive dismissal.
- Short-serving employees (under two years) cannot bring unfair dismissal claims, but may still have breach of contract claims if they resign in response to a serious breach.
- Before resigning, consider whether the breach is fundamental enough to justify leaving — and avoid actions that could be seen as accepting the situation.
- Keep clear records of any disputes over pay or benefits, and raise grievances promptly to avoid being seen as having accepted the breach.
When accepting a delay can cost you your claim
This case shows how easily an employee can lose the right to claim constructive dismissal by continuing to work after a breach. The managing director resigned after his September wages were delayed by a few days and a company car was not provided. However, the tribunal found that by accepting the delay and continuing to claim mileage, he had affirmed the contract.
What the employer could have done differently
The employer could have avoided the dispute by communicating clearly about the wage delay and providing the car or a cash alternative sooner. However, the tribunal noted that the delay was short and the claimant had not objected at the time.
Why this matters for similar claims
This case is a reminder that constructive dismissal claims require a fundamental breach that is not accepted. Employees who continue working without protest risk losing their claim. It also highlights that employees with less than two years' service cannot claim unfair dismissal, but may still pursue breach of contract claims if they resign in response to a serious breach.
Similar cases
Constructive dismissal claim fails after employee accepted alternative role
A stores person who resigned after a security breach investigation lost his constructive unfair dismissal claim because he had accepted a new role before quitting.
HR officer with 24 years' service loses constructive dismissal claim after delay in resigning
A long-serving HR officer who resigned after a nine-month disciplinary investigation has lost her constructive unfair dismissal claim. The tribunal ruled she had affirmed her contract by waiting over seven months to resign.
Food service coach loses constructive dismissal claim after working 20 months after alleged incidents
A food service coach who resigned citing racist comments and harassment lost her constructive dismissal and discrimination claims after the tribunal found she had affirmed her contract by continuing to work for 20 months.
Programme Executive loses constructive dismissal claim after resigning for higher-paid role
A Programme Executive with 10 years' service at Rolls Royce Plc failed to prove constructive unfair dismissal after resigning to take a significantly higher-paid job elsewhere. The tribunal found no breach of trust and confidence.