United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	NO APPEARANCE OR REPRESENTATION BY OR ON BEHALF OF THE APPELLANT


 


JUDGE PETER CLARK: The Appellant, Mr Lambert, commenced employment with the Respondent, M & J Engineers Ltd on 12^th October 1998. By the 29^th June 1998 he had been promoted to the post of Yard Foreman, according to the Appellant, or Foreman Fitter, according to the Respondent. That distinction does not matter for the purposes of this Appeal.

1. On 29^th June 1998 the Appellant commenced a period of sick leave. He returned to work on 27^th July. That afternoon, he was called into the office by the District Manager, Steve Randall and the Depot Manager, Alf Cashmore and told that he was being dismissed and that he should collect his tools and leave immediately. He signed a document called a "Leaving Notice" which gave as the reason for leaving "unable to fulfil duties due to drink/drive conviction. (See letter dated 22.7.98)" He was also handed a dismissal letter dated 22^nd July but which he had not previously seen. That letter stated that his employment was being terminated "with immediate effect".
2. The Appellant had earlier signed a statement of Terms & Conditions of Employment dated 26^th September 1996. That document incorporated the Plant Hire Working Agreement which provided for 1 week's notice of termination of employment by the employer for an employee of the Appellant's length of service. We pause to observe that 1 week's notice is also provided for under Section 86(1)(a) of the Employment Rights Act 1996 ("ERA") where the period of continuous service is between 1 month and 2 years (the statutory notice entitlement). At the end of the following month (August 1998) the Appellant received a payment expressed to represent one month's salary in lieu of notice (£1,291.66) and accrued holiday pay of 2¾ days pay (£163.41).
3. On 12^th October 1998, he presented an Originating Application to the Employment Tribunal claiming unfair dismissal only. He gave as his dates of employment 12^th August 1996 to 21^st August 1998, just over 2 years. By their Notice of Appearance dated 2^nd November 1998 the Respondent resisted the claim on its merits and further took the point that the employment had ended on 22^nd July 1998, so that he had not completed 2 years continuous service for the purposes of Section 108 ERA so as to found the Employment Tribunal's jurisdiction to entertain the Appellant's complaint of unfair dismissal.
4. A Preliminary Hearing was convened before the London (South) Employment Tribunal for the 3^rd March 1999 to determine the sole issue as to whether the Appellant had completed 2 years continuous service.
5. By a decision with extended reasons promulgated on 17^th March 1999 (the original decision) that full Employment Tribunal, chaired by Ms Christiana Hyde, concluded that the effective date of termination of the contract was 27^th July 1998, when the employment was brought to an end with immediate effect. However, if they were wrong about that, and it was the intention of the parties that the employment be terminated with notice, under the Appellant's contract and under statute he was only entitled to a further week's notice. That would have extended his employment to 3^rd August 1998. In those circumstances, the Appellant's employment would still fall short of the 2 years required under Section 108 ERA.
6. The Employment Tribunal directed that the application be stayed pending the final determination of the Seymour –v- Smith litigation. The current position there is that the European Court of Justice has ruled on the reference and returned the case to the House of Lords for final resolution.
7. Finally, the Appellant made application for a review of the original decision by a letter from his representatives, Kingston & Surbiton Citizen's Advice Bureau dated 23^rd March 1999. That application was dismissed by the Chairman on the grounds that it had no reasonable prospect of success by a decision with reasons promulgated on 1^st April 1999 ("the review decision")

The Appeal

8. The Appellant's Citizen's Advice Bureau representative, Mr Sadler, has indicated that he would not be present at this Preliminary Hearing, held to determine whether the Appeal raises any arguable point or points of law. Accordingly, we have proceeded to consider the matter on the papers, and in particular, the detailed grounds of Appeal (described as "grounds for resistance for Michael Lambert") attached to the Notice of Appeal dated 12^th April 1999.

The Grounds of Appeal

9. These may be summarised as follows:

(i) The Appellant received one month's pay in lieu of notice. Counting on 1 months' notice from 27^th July 1998 the Appellant had completed 2 years service.

(ii) The Respondent did not use the contractual grievance or disciplinary procedures. That was a breach of contract. Had the disciplinary procedure been followed the Appellant would have completed 2 year's service. The Appellant was not informed of his right of Appeal.

(iii) This was not a case of gross misconduct entitling the Respondent to terminate the employment summarily.

(iv) There was no investigation of the disciplinary charge. In any event, a driving licence was not necessary for the performance of the Appellant's job.

(v) The Respondent will not tell the Appellant's advisers what the 1 month's pay represented, other than to say it was compensation. Further, the holiday pay calculation was incorrect. Steps are being taken to recover the balance of holiday pay allegedly outstanding.

(vi) The Chairman was wrong to reject the review application on the basis that the authorities referred to by the Appellant in that application related to the issue of damages for wrongful dismissal at commonlaw, and were not relevant to the issue of qualifying service for the purposes of the statutory claim for unfair dismissal.

Conclusion

10. In our judgment the correct analysis in law in this case is as follows:

(i) Prima facie, the Effective Date of Termination ("EDT") of the contract of employment is to be calculated under one of 3 possible terminating events provided for in Section 97(1);

(a) where the contract is terminated by notice, the date on which the notice expires

(b) where the contract is terminated without notice, the date on which the termination takes effect

(c) expiry of a fixed term contract. That does not arise in this case.

(ii) Was the contract terminated with or without notice?

The letter of 22^nd July was expressed to terminate the employment "with immediate effect". It was not a letter of dismissal with notice.

However, contrary to the Respondent's pleaded case in the form IT.3, a letter of dismissal will not take effect until the employee has a reasonable opportunity to read it. It will be otherwise where the employee deliberately seeks to avoid reading the letter, Brown -v- Southall & Knight [1980] IRLR 130, McMaster –v- Manchester Airport plc [1998]IRLR 112.

It follows, on the Employment Tribunal's findings of fact, that the Appellant did not become aware of the contents of the dismissal letter until 27^th July. That is the earliest EDT. A combination of the oral dismissal in the office on 27^th July, together with handing over a copy of the dismissal letter dated 22^nd July, points ineluctably to the conclusion that, for the purposes of Section 97(1), prima facie the EDT was 27^th July 1998.

(iii) However, Section 97(2) provides that where the contract of employment is terminated by the employer (as here) and the notice required by Section 86 would, if given on the material date expire on a date later than the EDT as defined by Section 97(1), for the purposes of, among other things, Section 108(1), the later date is the EDT.

We have earlier observed that the statutory notice requirement in this case, under Section 86(1)(a), was one week. The Employment Tribunal so found, correctly, and also found that the contractual notice period for termination by the employer was one week. In our judgment the contractual notice period is irrelevant for the purposes of Section 97(2). The EDT is only extended under Section 97(2) by the statutory notice period under Section 86, not the contractual notice period if that is different. Fox Maintenance Ltd -v- Jackson.

On the Employment Tribunal's findings there is no difference between the statutory and contractual notice requirement in this case. The Appellant contends for a one month notice period to be added to the Section 97(1) EFT (here, 27^th July 1999). That contention fails on two counts; first, on the facts, since the contractual notice period was found to be 1 week, not 1 month. What seems to have happened is that the Respondent paid "one month's pay in lieu of notice" partly in satisfaction of the Appellant's actual contractual entitlement to 1 weeks pay in lieu of notice and partly by way of an ex gratia, extra-contractual payment. Secondly, and in any event, even if the Appellant was entitled to 1 month's notice under the contract of employment, he could not count the full contractual notice period insofar as it exceeded the statutory notice requirement under Section 86.

Finally, and for completeness, we should observe that where the Employer is entitled to dismiss the Employee summarily at common-law for gross misconduct, the Employee is not entitled to any notice under Section 86(6). In these circumstances, the EDT will be the date of summary dismissal.

(iv) It follows that in the absence of a finding by the Employment Tribunal that the Respondent was in fact entitled to terminate the employment summarily for gross misconduct on 27^th July, the true EDT is 3^rd August as they found in the alternative by virtue of the operation of Section 97(1) and (2) and Section 86(1)(a). It is that alternative finding which we uphold.

It follows, as the Employment Tribunal concluded, that for the purpose of Section 108(1) the Appellant had not completed 2 years continuous service starting on 12^th August 1996, the EDT of the contract being 3^rd August 1998. The Employment Tribunal had no jurisdiction to entertain the complaint under Section 108, subject to the pending House of Lords determination in Seymour-Smith.

(v) The Review Decision

It is not entirely clear whether this Appeal is directed to the review decision as well as the original decision. For completeness we are quite satisfied that the Chairman was entitled to dismiss the review application for the reasons which she gave. In particular, it is right to say that the authorities relied on in that review application are directed to the issue of damages for wrongful dismissal. For the reasons given, any notional extension of the contract for the purpose of assessing damages for wrongful dismissal (as opposed to extending the duration of the contract for statutory purposes, for example, the time which it would take to complete the contractual disciplinary procedure (See Raspin –v- United News Shops Ltd [1999] IRLR 9)) will be immaterial for the purposes of determining the EDT under Section 97(1) and (2) of Employment Rights Act. There was no breach of contract claim before the Employment Tribunal.

11. In these circumstances the Appeal must be dismissed.