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Communicating the decision to dismissIn an interesting decision recently the Employment Appeal Tribunal has made clear that it is important to construe the reality of the situation when determining a date on which a contract of employment has been terminated.

When a contract of employment is terminated by an employer it is important that this fact is communicated to the employee and if it is not effectively communicated this would mean that the contract of employment is not in fact terminated.

The question as to whether a contract of employment is terminated is clearly relevant to any claim for compensation for dismissal (such as unfair dismissal) and the timing of the termination of the contract is also relevant when considering issues such as qualification of the right not to be unfairly dismissed and whether or not the claim has been presented in time.

The facts in Wason and Wason v Holborn Community Association (decided by the Employment Appeal Tribunal on 2 December 2010) were related to claims for compensation brought by Mrs Wason and her son Mr Wason in connection with claims to have been unfairly dismissed and other claims.

The issues in the appeal are only at relevant to Mr Wason’s case. He had been employed by the respondent as a cleaner in accordance with a written contract of employment and the respondent asked him to sign a new contract which he declined to do.

This culminated in a letter from the Board of Trustees of the respondent which asked Mr Wason to sign a new contract by 31 May 2007 or an assumption would be made and Mr Wason no longer wished to work for the association.

By 7 June 2007 Mr Wason had not signed the contract as requested and the respondent asked him not to return work for the time being while they discussed the matter with their lawyers.

The respondent then wrote to Mr Wason on 28 June 2007 to ask him to return to work from the week beginning 2 July 2007.

However, Mr Wason did not return to work on 2 July 2007 and in fact failed to return to work at all.

By 20 July 2007 the respondent decided that Mr Wason was not returning to work and they arrange, through an agency, for another cleaner to perform his job. Mr Wason was no longer paid after 20 July 2007.

Mr Wason argued before the employment Tribunal that if he had committed misconduct by not returning to work he had to be told he that he was being dismissed for misconduct or his contract of employment continued. However, the Tribunal had found as a matter of fact that the contract of employment had terminated on 20 July 2007 and that as a consequence Mr Wason’s complaint of unfair dismissal which was presented substantially more than 3 months after the termination of his employment was out of time.

Mr Wason appealed to the Employment Appeal Tribunal but his appeal was dismissed. The employment Appeal Tribunal and Mr Wason’s arguments that his contract of employment had continued beyond 20 July 2007 to be unreal. Mr Wason had been contracted to provide cleaning work and he was not providing that work. From 20 July 2007 he would have become aware that he was no longer being paid by him employer for undertaking that work and he must have contemplated prior to that date that his job was at risk. It was unrealistic to treat the contract as continuing when he was no longer providing the work and was no longer being paid and, moreover, the employer had replaced him with another employee.

The Employment Appeal Tribunal commented that the argument put forward by Mr Wason’s representative demonstrated the dangers of losing sight of reality by an over concentration upon legal technicalities which have no proper application to the facts actually underlining the issues to which they are said to relate.

Accordingly it remains the case that scope for dispute as to the date of termination of a contract of employment ought to be avoided at all costs and that caution needs to be excised by employees who consider that they remain employed owing to a failure by their employer properly to communicate a dismissal because if an employee has as a matter of fact been dismissed the limitation clock of 3 months will be ticking.

Stephen Burbidge 14.02.2011