Chelmsford College Corporation v Teal UKEAT/0277/11/CEA

Appeal against a finding that the claimant had the requisite continuity of employment to pursue a claim of unfair dismissal and had presented it in time. Appeal dismissed.

The claimant resigned on 30 November following a decision from the respondent that she would not be paid overtime for the hours she had worked that year. The respondent construed her letter of resignation as a letter of grievance and wrote to her, asking her to attend a grievance hearing on 8 December. At the meeting the respondent agreed to pay her the overtime and would allow the claimant to rescind her resignation which she did. The claimant returned to work on 11 January but then she received an email saying she would not be paid for the period from 30 November to 11 January since she had not worked and her contract was a zero hour contract, meaning that she only got paid for the hours she did. The claimant resigned on 12 February and brought a claim of constructive unfair dismissal on 20 April. The respondent resisted the claim on the bases that she did not have the requisite continuity of employment, and the claim had been brought out of time. They claimed that there had been a break in continuity of employment from the 30 November to 11 January, and that the claim was out of time because the effective date of termination was 30 November. The ET made 2 decisions; 1) a resignation may in some circumstances be withdrawn and in this case the first resignation was so withdrawn by the claimant’s conduct. Furthermore, he held that this withdrawal was with the consent of the respondent and 2) continuity of employment was preserved by the operation of s212(3)(c) of the ERA 1996, given that the grievance procedure followed was an arrangement entered into by 2 December and by the operation of which the claimant was continuing in her employment. The respondent appealed.

The EAT upheld the ET decision although ruled that the ET had wrongly held that what took place was a ‘conditional dismissal’. This was an error of law. However, the ET was correct to find that the unilateral resignation had been withdrawn with the consent of the employer and the employment therefore continued until a further unilateral resignation which was accepted by the employer. Time therefore began to run from the date of the second resignation.

____________________

Appeal No. UKEAT/0277/11/CEA

EMPLOYMENT APPEAL TRIBUNAL

FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON, EC4Y 8JX

At the Tribunal

On 14 November 2011

Judgment handed down on 7 February 2012

Before

HIS HONOUR JUDGE BIRTLES (SITTING ALONE)

CHELMSFORD COLLEGE CORPORATION (APPELLANT)

MRS B TEAL (RESPONDENT)

Transcript of Proceedings

JUDGMENT

**APPEARANCES**

For the Appellant MR JAKE DUTTON (Solicitor-Advocate)

Peninsula Business Services Ltd 5th Floor The Peninsula 2 Cheetham Hill Road Manchester M4 4FB

For the Respondent MR TIMOTHY ADKIN (of Counsel)

Instructed by: Archers Solicitors 78 New London Road Chelmsford Essex CM2 0PD

**SUMMARY**

JURISDICTIONAL POINTS – Continuity of employment

Appeal on the issue of whether the claim was in time to bring a claim for unfair dismissal. The Employment Judge had wrongly held that what took place was a "conditional dismissal". This was an error of law: [CF Capital plc v Willoughby]() [2011] IRLR 985. However, he was correct to find that the unilateral resignation had been withdrawn with the consent of the employer and the employment therefore continued until a further unilateral resignation which was accepted by the employer. Time began to run from the date of the second resignation.

**HIS HONOUR JUDGE BIRTLES****Introduction**
  1. This is an appeal from the Judgment and Reasons of Employment Judge Pritchard, sitting alone at the East London Hearing Centre on 14 January 2011. The Judgment and Reasons were sent to the parties on 16 March 2011. The Employment Judge held that Mrs Teal had the requisite continuity of employment to pursue a claim for unfair dismissal. The claim was presented in time relative to a termination date of 12 February 2010.
  1. The Appellant was represented by Mr Jake Dutton, Solicitor-Advocate, and the Respondent was represented by Mr Timothy Adkin of counsel. I am grateful to both for their written and oral submissions.
**The factual background**
  1. The Employment Judge did not hear oral evidence. At paragraphs 1-20 he made findings of fact. They can be summarised in this way:

(1) The Claimant was a fixed-term lecturer on a contract characterised by the Respondent as a 'zero' hours contract, meaning that she was paid for hours actually performed rather than a fixed salary. On 30 November 2009, her line manager informed her that he would not remunerate her in respect of overtime hours claimed in the academic year. In response, and on the same date, she wrote a letter of resignation stating that "it is with great sadness I have to offer you my resignation with immediate effect". The College construed her letter of 30 November 2009 as a letter of grievance.

(2) On 2 December 2009, Ms Rachel Jessen, a Human Resources Officer, wrote to the Claimant inviting her to attend a grievance hearing on 8 December 2009, and stating that she could not accept her resignation until the grievance had been resolved. The grievance hearing proceeded as scheduled on 8 December 2009. On 16 December 2009, Ms Jessen wrote to the Claimant. The material part of the letter says this:

"Having investigated your grievance I can confirm that the College will pay you for the 77.5 hours that you have claimed for but has not been paid. This will be paid in your January pay. Further, after careful consideration, the College will allow you to rescind your resignation. However, the College cannot be put in the position again where you walk out on the students because you feel aggrieved. Whilst I accept that you were very unhappy with the situation you were in and regret the effect this has had on the students, our first priority is to the students and this must not happen again. As you are aware, the College grievance procedure is in place to deal with any issues that cannot be resolved with your line manager, and I trust that you will use the appropriate procedures in the future."

(3) By a letter dated 6 January 2009 (clearly a misprint for 2010) Ms Jessen wrote again to the Claimant about payment and ended her letter by saying this:

"Finally, as agreed earlier, I believe it would be best for us to draw a line under this process and move forward (which I know you have also said you wish to do). I look forward to your return and for your continued successful employment at the College."

(4) On 11 January 2010, the Claimant returned to work. On 14 January 2010, Ms Jessen sent an email to the Claimant stating that since she had a zero hour contract and had not worked since 30 November 2009, she would not in fact be paid for the period 30 November 2009 to 11 January 2010. By a further email of the same date, Ms Jessen said this:

"We do not have a policy on this as it is a bespoke situation. However, as you resigned without notice then you did not work during the period that you have claimed for.

Although the College did rescind your resignation it remains the case that we cannot pay you (or any individual) for hours that you did not work."

(5) In response to this the Claimant raised a further grievance on 1 February 2010. This was rejected on 9 February 2010.

(6) By letter dated 12 February 2010, the Claimant resigned. She said this:

"The reason for my resignation is as follows:

Following the outcome of my grievance heard on 8 December 2009, when it was agreed that overtime due to me was to be paid and the College agreed to my previous resignation being rescinded, I was then informed that I would not be paid for December 2009, which is in breach of my contract of employment and an unlawful deduction from wages.

[…]

I lodged a further grievance that was heard on 8 February, and the outcome was that you would not uphold my grievance. This has been the final straw as far as I am concerned.

I consider that there has been a fundamental breach of my contract of employment insofar as the mutual trust and confidence which should exist been employer and employee has broken down due to the actions on (sic) the College and it's treatment towards me.

For the above reasons I find my position with the College untenable and I am unable to continue with my employment."

(7) On 20 April 2010, the Claimant presented her claim to the Employment Tribunal.

**The Employment Judge's conclusions**
  1. The Employment Judge considered the arguments put forward by the advocates at some length: Reasons paragraphs 21-39.
  1. He made two decisions. The first was that a resignation may in some circumstances be withdrawn and in this case the first resignation was so withdrawn by the Claimant's conduct: Reasons paragraphs 22-23; 29; 38-39. Furthermore, he held that this withdrawal was with the consent of the College: Reasons paragraph 39. Second, he held that continuity of employment was preserved by the operation of s.212(3)(c) of the Employment Rights Act 1996, given that the grievance procedure followed was an arrangement entered into by 2 December 2009 and by the operation of which the Claimant was continuing in her employment: Reasons paragraph 33.
**The Notice of Appeal**
  1. The Notice of Appeal raises six separate grounds of appeal. I will take each ground of appeal in turn. Before doing so, I remind myself of the recent guidance of Mummery LJ on the proper approach for this Tribunal to take in considering an appeal. In [Fuller v London Borough of Brent]() [2011] ICR 806 he said this at paragraph 30:

"30. Another teaching of experience is that, as with other Tribunals and courts, there are occasions when a correct self-direction of law is stated by the Tribunal, but then overlooked or misapplied at the point of decision. The Tribunal Judgment must be read carefully to see if it has in fact correctly applied the law which it said was applicable. The reading of an Employment Tribunal decision must not, however, be so fussy that it produces pernickety critiques. Over-analysis of the reasoning process; being hypercritical of the way in which the decision is written; focusing too much on particular passages or turns of phrase to the neglect of the decision read in the round: those are all appellate weaknesses to avoid."

**

**Ground 1**
  1. The judge erred in finding that the resignation of 30 November 2009 was a conditional resignation.
  1. Mr Dutton submits that the concept of a "conditional resignation" is unknown to law. That was the phrase used by the judge at paragraphs 26 and 35 of his Reasons. Mr Dutton relies upon B G Gale v Gilbert [1978] IRLR 453 because in this case the Claimant's letter of 30 November 2009 was unambiguous and was not affected by any subsequent words or actions of the Claimant.
  1. He submits that at paragraph 4 of his Judgment the judge said "it is a clear resignation". At paragraph 5 of his Reasons he notes that "The Claimant withdrew her services immediately, without notice". It is difficult to see, on the facts as found by the judge, how he concluded that the resignation was a "conditional" resignation as opposed to an effective resignation.
  1. Mr Adkin submits that the judge correctly directed himself in law and found that the Claimant had withdrawn her resignation by her conduct: paragraphs 28-29, and set out examples of her conduct to support this conclusion: paragraph 28, e.g. concern about her desk, her email account, access to the intranet and the statement "at least I can get on with some work for next term now": paragraph 11.
  1. I cannot agree. At this point, the Judgment is contradictory. It is a clear resignation and the Claimant withdrew her services immediately, without notice. She did no further teaching in December 2009. She did not return to work until January 2010.
  1. In CF Capital plc v Willoughby [2011] IRLR 985, Rimer LJ said this:

"25. First, the giving by an employer to his employee of a notice of dismissal cannot be unilaterally retracted, but may only be withdrawn by consent. See Riordan v The War Office [1959] 3 All ER 552 at 557I-558D; Harris & Russell Ltd v PSG Slingsby [1973] IRLR 221, at paragraphs [3] and [4].

26. Second, employment law is, at least in large part, a branch of contract law. The principles of contract law ordinarily require that a person's intentions are ascertained not by reference to his subjective intentions but objectively, by reference to how a reasonable man would interpret them. His intentions will therefore be ascertained by reference to a consideration of the words used, whether written or oral, in the context in which he used them.

[…]

*

**Discussion and Conclusion***

37. The 'rule' is that a notice of resignation or dismissal (whether given orally or in writing) has effect according to the ordinary interpretation of its terms. Moreover, once such a notice is given, it cannot be withdrawn except by consent. The 'special circumstances' exception as explained and illustrated in the authorities is, I consider, not strictly a true exception to the rule. It is rather in the nature of a cautionary reminder to the recipient of the notice that, before accepting or otherwise acting upon it, the circumstances in which it is given may require him first to satisfy himself that the giver of the notice did in fact really intend what he has apparently said by it. In other words, he must be satisfied that the giver really did intend to give a notice of resignation or dismissal, as the case may be. The need for such a so-called exception to the rule is well summarised by Wood J in paragraph 31 of Kwik-Fit's case and, as the cases show, such need will almost invariably arise in cases in which the purported notice has been given orally in the heat of the moment by words that may quickly be regretted."

  1. My conclusion is (as the judge found in paragraph 4 of his Judgment) that this was a clear resignation. Is it not qualified in any way at all and the Claimant's action in doing no further work (in term time) amounts to a clear and unambiguous resignation. The judge was therefore wrong to hold that this was a "conditional resignation".
**Grounds 2 & 3**
  1. These run together. Ground 2: the judge erred in holding the dismissal was rendered ineffective by the Respondent not accepting it. Ground 3: the judge in attaching weight to Ms Jessen's decision not to accept the resignation.
  1. Mr Dutton submitted that the judge was wrong to rely on the "special circumstances" exception most recently set out by Rimer LJ in the Willoughby case. It is not necessary for me to refer to the authorities in detail. In my judgement, it is sufficient if I refer to what Rimer LJ said in Willoughby at paragraph 27:

"27. Third, the 'special circumstances' exception to which I have referred is one that finds its expression and application in several reported authorities. They are cases in which either the employee has given an oral notice of resignation or (less commonly) in which the employer has given an oral notice of dismissal. The words of the notice so given may, on the face of it, be clear and unambiguous and may take effect according to their apparent terms. Indeed, the general rule is that they will do so. The authorities recognise, however, an exception to that general rule: namely, that the circumstances in which the notice is purportedly given are sufficiently special that it will or may not take such effect. For example, the words of notice may be the outcome of an acrimonious exchange between employer and employee and may be uttered in the heat of the moment such that there may be a real question as to whether they were really intended to mean what they appeared to say. In such circumstances it will or may be appropriate for the recipient of such a notice to take time before accepting it in order to ascertain whether the notice was in fact intended to terminate the employment. If he does not do so and, for example, simply (and wrongly) accepts an employee's purported resignation at face value and treats the employment as at an end, he may find himself on the receipt of a claim for unfair or wrongful dismissal. The general rule and the 'special circumstances' exception to it have been recognised in several authorities of both the EAT and this court."

**

  1. I have already read paragraph 37. At paragraph 38, Rimer LJ says this:

"38. The essence of the 'special circumstances' exception is therefore that, in appropriate cases, the recipient of the notice will be well-advised to allow the giver what is in effect a 'cooling off' period before acting upon it. Kilner Brown J, in paragraph [15] of his Judgment in Martin's case understandably referred to such a period as an opportunity for the giver of the notice to recant, or to withdraw his words; and this is in practice what is likely to happen. I would, however, be reluctant to characterise the exception as an opportunity for a unilateral retraction or withdrawal of a notice of resignation or dismissal since that would be to allow the exception to operate inconsistently with the principle that such a notice cannot be unilaterally retracted or withdrawn. In my judgment, the true nature of the exception is rather that it is one in which the giver of the notice is afforded the opportunity to satisfy the recipient that he never intended to give it in the first place - that, in effect, his mind was not in tune with his words."

**

  1. In the light of that Judgment, it seems to me that the judge was wrong in relying on the "special circumstances" line of cases in reaching his conclusion. However, his conclusion was right but for a different reason. As the Judgment of Rimer LJ makes clear at paragraphs 25 and 37, the resignation notice cannot be withdrawn except by consent.
  1. In this case, Ms Jessen's letter of 2 December 2009 made it clear that she was unable to accept the resignation until she had met with the Claimant at the grievance hearing, which in fact took place on 8 December 2009. She allowed the grievance and in her letter of 16 December 2009 said that "[…] the College will allow you to rescind your resignation". In that context, the word "rescind" can only mean that the resignation was withdrawn by consent.
  1. The Claimant in her letter of reply dated 23 December 2009 said "I am grateful to the College that they agree to rescind my resignation". This was a clear case of an effective resignation being withdrawn with the consent of the College.
  1. Grounds 4-5 refer to the issue of s.212 of the Employment Rights Act 1996.
**Ground 4**
  1. This is that the judge erred in finding that the absence pre-dated the grievance.
  1. The material part of s.212 of the Employment Rights Act 1996 says this:

"212. Weeks Counting in computing period

(1) Any week during the whole or part of which an employee's relations with his employer are governed by a contract of employment counts in computing the employee's period of employment.

(2) […]

(3) Subject to subsection (4), any week (not within subsection (1)) during the whole or part of which an employee is-

(a) […]

(b) […]

(c) Absent from work in circumstances such that, by arrangement or custom, he is regarded as continuing in the employment of his employer for any purpose […]

(d) […]

counts in computing the employee's period of employment."

  1. In paragraphs 30-34 of his Judgment, the judge said this:

"30. An alternative argument has been put on continuity, namely under section 212(3) of the Employment Rights Act that the claimant should anyway have continuity of Employment by reason of the fact that she was then absent by custom or arrangement. It is clear, in a sense, that there was no prior agreement prior to her resigning and leaving work on 30 November that she would be absent by agreement. In fact, there was never any agreement that she should be absent but there was some sort of agreement that her employment should somehow subsist even if she was not at work, such that she would return to work once her grievance had been cleared up. A return next term was never in any doubt in the correspondence, once the grievance had been resolved.

31. I have been shown two important conflicting Employment Appeal Tribunal authorities on this. The respondent principally relies upon the case of Maurice v Walsh Western Ltd [1997] IRLR 562 and the claimant relies upon London Probation Board v Kirkpatrick [2005] IRLR 443. The former is a judgment of Judge Peter Clark, the latter of Judge McMullen. As often with those conflicts of authority the latter authority is can be preferable because it is later and takes into account the arguments in the earlier judgment. The judgment of Judge McMullen states that while the word 'custom' must imply that whatever it is that the employee is absent pursuant to, it must be something that exists before the absence starts. However, he holds that the word 'arrangement' does not have any such qualification. An arrangement can be deemed to exist after the event.

32. I find it hard to understand that conclusion. I have more sympathy with the Maurice v Walsh case, however, I do not need to resolve the conflict between those decisions and choose to prefer one or the other. As the Kirkpatrick case decided he did not actually have to effectively overrule the Maurice case because the case could be decided on a different basis on what he talks about as the Murphy basis, that is following Murphy v A Birrell & Sons [1978] IRLR 458 EAT.

33. In this case one thing that existed before the absence was the grievance. As Mr Adkin rightly points out, there was some arrangement entered into during the week and so the claimant's continuity was not broken. The unit of continuity is a week. This is not an important point; continuity can be broken by one day or five but as long as it is not broken by a whole week or more, there can continuous employment, whatever happens in the intervening days. It is quite clear that although it was not in the letter of 30 November, by 2 December the claimant had raised a grievance and that grievance was dealt with by letter of the same day from Ms Jessen. Therefore, there was an arrangement at that time. That was the same letter that said the resignation was not accepted. Therefore, there was a pre-existing grievance arrangement.

34. The fact that the claimant was not paid for the period when she failed to attend work is not the point here. There are frequent instances in employment relationships where employees still remain employees despite the fact there is no payment. For instance unauthorised absence or continuing on the employer's books after all rights to sick pay have been exhausted and before frustration applies. In those circumstances both reasons are good reasons to uphold the claimant's continuity of employment of one year for an unfair dismissal claim."

  1. Mr Dutton submits that for the week following 30 November 2009, to be governed by a contract of employment, it would have been necessary for both parties to have willingly entered into a contract of employment but Ms Jessen's unilateral decision of 2 December 2009 was not sufficient. It follows that the week following 30 November 2009 was not governed by a contract of employment and thus s.212(1) did not apply. It follows that the absence occurred before the arrangement.
  1. For the reasons I have given earlier in this Judgment, there was a contract of employment because the resignation was withdrawn by consent. The withdrawal of the resignation by consent meant that the resignation was never effective. It follows that s.212(1) does apply. It would make nonsense of s.212(1) read with ss.210-211 if the Claimant was unable to claim continuity of employment for the period between 30 November 2009 (the date of the resignation letter) and 16 December 2009 (when Ms Jessen agreed that the Claimant could withdraw her resignation).
  1. There is nothing in the letter of 16 December 2009 or any subsequent correspondence which suggests that the Claimant commenced a period of fresh employment from 16 December 2009. Indeed, that has never been the College's position. Its case before the Employment Judge was that there was an effective resignation on 30 November 2009 which was not withdrawn and therefore time ran from that date for the service of a complaint to the Employment Tribunal.
  1. It follows that I do not have to decide the application for s.212(3)(c) to the facts of this case. Neither do I have to decide the interesting question of whether an "arrangement" can be retrospective.
**Ground 6**
  1. The judge erred as regards the Employment Protection (Continuity of Employment) Regulations 1996.
  1. Mr Dutton did not really argue this point. Indeed, it seems to be unarguable because the judge in discussing these Regulations at paragraph 35 of the Judgment ended that paragraph by saying that the Regulations were not relevant to the facts of this case. He therefore did not rely upon them in reaching his decision.
**Conclusion**
  1. For these reasons the appeal is dismissed. The effective date of termination was the date of the second resignation which was 12 February 2010. It follows that the claim is in time.

Published: 09/02/2012 17:58

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