The Court of Appeal (CoA) has upheld a High Court ruling, emphasising that mandatory language in collectively bargained policies can create binding individual rights that limit an employer’s power to delegate authority.
Background:
Dr. MN, a Consultant in Diabetes and General Paediatrics, has been employed by NHS Foundation Trust L since 2018. This litigation arose within the highly sensitive context of the criminal trials of Lucy Letby, a nurse with whom Dr. MN had previously worked at the Countess of Chester Hospital. Following the conclusion of the first Letby trial, in which Dr. MN provided evidence, the mother of a child involved in the criminal proceedings filed a complaint alleging a breach of patient confidentiality by Dr. MN.
In response to these allegations, the Trust initiated a formal investigation and appointed Ms. Y, the Director of Corporate Affairs, as the case manager. This appointment was made by the Trust’s Chief Medical Officer, Mr. Z, who sought to delegate the role. Dr. MN challenged this appointment through a breach of contract claim in the High Court, arguing that under the terms of his employment, which incorporated an NHS policy known as E27, the role of case manager for a consultant could not be delegated and had to be performed by the Medical Director in person. The Trust resisted this claim by arguing that the policy was merely high-level guidance for corporate officers rather than a source of individual contractual rights.
The High Court ruled in favour of Dr. MN, finding that the mandatory language of the policy created a binding contractual obligation that the Medical Director should act as case manager in instances involving consultants. The Trust appealed this decision to the CoA.
Decision:
The CoA dismissed the appeal and upheld the original ruling, confirming that the specific wording of the policy made the Medical Director’s personal involvement a mandatory procedural safeguard for senior medical staff.
The Court’s reasoning was anchored in the natural and ordinary meaning of the text in Paragraph 1.6 of Policy E27. The judges noted that the drafters had used two very different words in the same sentence, specifically “will act” and “may delegate”. The Court reasoned that this contrast was intentional and decisive. By explicitly permitting delegation for junior staff while using the mandatory imperative “will” for consultants, the policy thereby created a “negative implication” that delegation was strictly forbidden in consultant-level cases.
The Judge concluded that, while employers generally have broad discretion to manage their staff, discretion is “constrained” by any express terms they have signed. In this case, the Trust had signed away its right to delegate this specific role.
The Court, however, added a small caveat. While it accepted that there is an implied term allowing delegation in extreme, “exceptional” circumstances, such as if the Medical Director were incapacitated by long-term illness or had a direct conflict of interest. Because the Trust’s reasons in this case—workload and a desire for “independence”—did not meet that high threshold, the breach of contract remained.
Implications:
While this case involved the NHS, the principles established by Lord Justice Singh have significant implications for all employers and employees, particularly those in senior or “professional” roles where internal policies are detailed. This case confirms that collectively agreed procedures governing disciplinary and investigative processes may be contractually binding where they are sufficiently precise, important and workable.
The most significant implication is that a company’s internal manual or policy document can become a binding part of an employee’s contract, even if it is not expressly written within the primary contract. If an employment contract refers to a separate policy, then the specific rules in that handbook may become “incorporated”. Employers can no longer assume they have the “managerial discretion” to bypass their own rules for the sake of efficiency or convenience.
This case serves as a cautionary tale of “loose” drafting. The entire outcome turned on the word “will” being used in one sentence and “may” in another. Moreover, personal inconvenience is not a defence when it comes to a breach of contract. If you are committed to a specific procedure, then you must follow it unless it becomes truly impossible. If an employer finds their own policy to be unworkable, then they must either renegotiate it or else change it formally.
