M-Choice UK Ltd v A UKEAT/0227/11/DA

Appeal against a ruling by the ET that the claimant had the requisite 12 months continuous employment and so had the jurisdiction to hear her claim of unfair dismissal. Appeal allowed.

The claimant was given 6 months notice of termination of her employment after she had worked at the respondent's for 6 months. The notice period given meant that the effective date of termination resulted in her acquiring the 12 months continuous service required to bring a claim of unfair dismissal, which she did a couple of weeks before the notice period expired. The respondent then dismissed her summarily before the notice period had expired, and argued that as she did not now have the 12 months continuous service, the Tribunal could not hear her claim of unfair dismissal. The matter was further complicated by the claimant initially claiming ordinary unfair dismissal and then applying to amend the ET1 and claim automatic unfair dismissal instead, on the basis that she had been dismissed because she had brought a claim of unfair dismissal. The issue before the Tribunal was to work out the effective date of termination: was it the date of the end of the notice period or had the date been brought forward as a result of the summary dismissal? The Tribunal ruled that the effective date of termination, as defined in s97 of the ERA 1996, was the date of expiry of the notice period, and therefore allowed the claim to proceed to a full merits hearing. The respondent appealed.

The EAT considered the case of Stapp v The Shaftesbury Society and decided that it was not distinguishable from the present case, saying that 'where an employee is dismissed while he or she is working out their notice, the date of the ending of their employment is brought forward from the date on which their notice would have expired to the date on which they were summarily dismissed, even if the effect of that is to leave the employee without the necessary period of continuous service to present a complaint of unfair dismissal'. The issue before the Tribunal was now to decide whether the claimant had been dismissed for bringing a claim of unfair dismissal or for another reason.

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Appeal No. UKEAT/0227/11/DA

EMPLOYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 6 July 2011

Judgment handed down on 10 August 2011

Before

THE HONOURABLE MR JUSTICE KEITH (SITTING ALONE)

M-CHOICE UK LTD (APPELLANT)

A (RESPONDENT)

Transcript of Proceedings

JUDGMENT

**APPEARANCES**

For the Appellant MISS SARAH WATSON (of Counsel)

Instructed by: Allen & Overy LLP One Bishop's Square London E1 6AD

For the Respondent MR ALEXANDER ROBSON (of Counsel)

Instructed by: Thring Townsend Lee & Pembertons Kinnaird House 1 Pall Mall East Londo SW1Y 5AU

**SUMMARY**

JURISDICTIONAL POINTS – Claim in time and effective date of termination

The employee was dismissed on notice expiring on 1 February 2011. On its expiry she would have had sufficient qualifying service to present a complaint of unfair dismissal. On 11 January 2011 during her period of notice she presented a complaint of unfair dismissal. On 21 January 2011 her employers purported to dismiss her summarily. By that date she did not have sufficient qualifying service to present a complaint of unfair dismissal. The issue was what the effective date of termination was. It was held (applying Stapp v The Shaftesbury Society [1982] IRLR 326 which was said not to be distinguishable) that, notwithstanding the literal words of section 111(4)(c) of the Employment Rights Act 1996, the effective date of termination was the date on which she had been summarily dismissed.

**THE HONOURABLE MR JUSTICE KEITH** **Introduction**
  1. The Claimant, A, was employed by the Respondent, M-Choice UK Ltd ("the company"), as the Head of Operations and Finance or Business Development Director (the terms were used interchangeably) of the European internet business of one of the companies in the MIH Group at a salary of £210,000.00 a year. Her employment commenced on 1 February 2010. In due course, she brought a complaint of unfair dismissal against the company. Her complaint was treated by the employment judge who presided over a pre-hearing review of her complaint as containing two separate claims: an "ordinary" unfair dismissal claim and an "automatic" unfair dismissal claim. The company argued that the tribunal did not have jurisdiction to consider A's "ordinary" unfair dismissal claim because she did not have a sufficient period of continuous employment. The employment judge ruled that A had the necessary qualifying period of continuous employment for that claim, and he directed that her "ordinary" unfair dismissal claim could therefore proceed to a full hearing on its merits. The company appealed against that ruling, and this is the Employment Appeal Tribunal's judgment following the hearing of that appeal.
**The facts**
  1. The facts are relatively straightforward. A's contract of employment entitled her to six months' notice of the termination of her employment. It also permitted the company to place her on garden leave during the period of her notice. By a letter from the company's holding company dated 26 July 2010 (which A received the same day), she was given notice "as from July 26, 2010, ending the work relationship as per February 1st, 2011 at the latest". It was common ground that the letter purported to give A's notice of the termination of her employment. The company argued that since she was entitled to six months' notice, the letter should be treated as having brought her employment to an end six months later, i.e. on 26 January 2011. The employment judge must be regarded as having rejected that argument because he found that the letter terminated A's employment with effect from 1 February 2011. There is no appeal by the company from that finding.
  1. A's ET1 claiming unfair dismissal was presented on 11 January 2011, i.e. before her employment came to an end on any view of the effect of the letter of 26 July 2010. In it she said that her employment was due to end on 1 February 2011. She was entitled to present her complaint before her dismissal took effect because section 111(3) of the Employment Rights Act 1996 ("the Act") provides:

"Where a dismissal is with notice, an employment tribunal shall consider a complaint under this section if it is presented after the notice is given but before the effective date of termination."

  1. If matters had rested there, no problem would have arisen, but the waters were muddied by a letter from the company's holding company to A dated 21 January 2011. A received it the same day. It informed her that the company no longer required her to be on garden leave, and that her employment would terminate that day with immediate effect. She was to be paid up to 25 January 2011 since that was when the company treated the notice which it had previously given her as expiring. That letter prompted A to amend her ET1 to add a second complaint of unfair dismissal, namely that she had been dismissed on 21 January 2011. Indeed, the date she gave in her amended ET1 for the date upon which her employment had ended was changed from 1 February 2011 to 21 January 2011. Her amended ET1 claimed that the principal reason for her summary dismissal on 21 January 2011 had been that she had lodged a complaint of unfair dismissal. That was said to have amounted to the assertion by her of a statutory right, and had rendered her dismissal on 21 January 2011 automatically unfair by virtue of section 104(1) of the Act.
**The pre-hearing review**
  1. The pre-hearing review proceeded on the basis that A was bringing two separate claims of unfair dismissal: an "ordinary" unfair dismissal claim based on the letter of 26 July 2010 giving her notice of the termination of her employment on what the employment judge found to be 1 February 2011, and an "automatically" unfair dismissal claim based on the letter of 21 January 2011 dismissing her with immediate effect. Indeed, both sides were saying that A was bringing two separate claims for unfair dismissal, rather than just one complaint in which her dismissal had taken effect either on 21 January 2011 (if the letter of 21 January 2011 had brought her employment to an end immediately) or on 1 February 2011 (if it had not). Two things make that clear. First, when A's solicitors wrote to the tribunal applying for permission to amend her ET1, they described the amendment as "a new claim" which could have been brought by the issue of a new ET1, but in order to save time and costs was being brought by way of amendment to the existing claim. Secondly, in the company's solicitors' skeleton argument for the pre-hearing review, it was argued that the tribunal did not have jurisdiction to consider A's claim for "ordinary unfair dismissal", thereby inferring that it might have jurisdiction to consider A's claim for "automatic" unfair dismissal.
  1. At this stage, I should say something about the period of continuous employment which an employee needs to have before being able to bring a complaint of unfair dismissal. The right not to be unfairly dismissed by one's employer is to be found in section 94 of the Act. In these circumstances, the governing provision for present purposes is section 108(1) of the Act, which provides:

"Section 94 does not apply to the dismissal of an employee unless he has been continuously employed for a period of not less than one year ending with the effective date of termination."

However, there is no qualifying period of continuous employment required if the employee's dismissal was automatically unfair on the footing that he or she had been dismissed for asserting a statutory right within the meaning of section 104 of the Act. That is the effect of section 108(3)(g), which provides (so far as is material):

"Subsection (1) does not apply if – … (g) subsection (1) of section 104 … applies …"

Thus, if A should be regarded as having brought two separate claims for unfair dismissal, the tribunal could have considered her claim of "ordinary" unfair dismissal, but could only have considered her claim of "automatic" unfair dismissal if the principal reason for her summary dismissal was found to be the fact that she had lodged a claim of unfair dismissal. In other words, even if the tribunal could not have considered her claim of "automatic" unfair dismissal, she could still proceed with her claim of "ordinary" unfair dismissal. On the other hand, if A should be regarded as having brought a single claim of unfair dismissal, in which her dismissal took effect either on 21 January 2011 or on 1 February 2011, the tribunal could have considered her claim if her dismissal took effect on 1 February 2011, but could not have considered her claim if her dismissal took effect on 21 January 2011, and if the reason for her summary dismissal was found not have been because she had presented a claim of unfair dismissal. In other words, she would in those circumstances not have been able to proceed with her claim for unfair dismissal at all.

  1. These subtleties were lost on the employment judge because the pre-hearing review proceeded on the basis that A should be regarded as having brought two separate claims for unfair dismissal, and the employment judge thought that he was addressing her claim of "ordinary" unfair dismissal. Having concluded that the letter of 26 July 2010 gave A notice of the termination of her employment with effect from 1 February 2011, the only remaining question which the employment judge thought he had to decide was whether that remained the effective date of termination of A's employment, or whether the letter of 21 January 2011 had had the effect of bringing the effective date of the termination of her employment forward to 21 January 2011. In order to understand how the employment judge resolved that question, it is necessary to have in mind what the Act says about the effective date of termination. The relevant provision here is section 97(1) which provides (so far as is material):

"Subject to the following provisions of this section, in this Part 'the effective date of termination' –

(a) in relation to an employee whose contract of employment is terminated by notice, whether given by his employer or by the employee, means the date on which the notice expires,

(b) in relation to an employee whose contract of employment is terminated without notice, means the date on which the employee's termination takes effect …"

  1. How does that work in a case where the employee has presented his or her complaint of unfair dismissal to the tribunal before the notice which they received has expired? The answer is in section 111(4) which provides (so far as is material):

"In relation to a complaint which is presented as mentioned in subsection (3), the provisions of this Act, so far as they relate to unfair dismissal, have effect as if – … (c) references to the effective date of termination included references to the date which would be the effective date of termination on the expiry of the notice …"

  1. I turn to the employment judge's judgment. The relevant passage is at paras. 12-14 of his reasons:

"12. The concept of the 'effective date of determination' is for these purposes a statutory construct. It is a term that has a specific statutory definition. It is specifically defined by Section 97(1) of the Employment Rights Act 1996. In this case the relevant definition appears in Section 97(1)(a) as this is a case in which it is contended that the dismissal was with notice. Thus for these purposes, Section 97(1)(a) states that the effective date of termination is the date on which the notice expires.

13. The wording of Section 97 does not necessarily makes sense as it stands in a case where the Claimant exercises their right under Section 111(3) to present a claim during the currency of the notice period and it appears that it was for this reason that Section 111(4) was introduced. In effect Section 111(4) requires all the provisions of the Employment Rights Act (as far as they relate to unfair dismissal) to be interpreted subject to Section 111(4). The relevant provision here is Section 111(4)(c) which states that any references to the effective date of termination must be read as including references to the date on which a notice would expire. I therefore find that for these purposes the effective date of termination as defined in Section 97 must be interpreted by applying Section 111(4) and so in this case I find that the effective date of termination for the purposes of Section 97 is 1 February 2011 (this being the date on which the notice would expire). Having reached this finding one must apply the test under Section 108. The test is simple to apply. The requirement is that the employee must have been continuously employed for a period of not less than one year ending with the effective date of termination.

14. Having found for these purposes that the effective date of termination is 1 February 2011, it therefore flows from this that the Claimant did have the requisite one year period of continuous service as at the effective date of termination and therefore she does have the right to pursue her 'ordinary' unfair dismissal as she has the right under Section 94 of the Employment Rights Act. So I find that the Claimant's 'ordinary' unfair dismissal claim can proceed to a full merits hearing on the basis that she did have the requisite period of continuous employment as at the effective date of termination."

This reasoning is unobjectionable as far as it goes, but it is noteworthy that the employment judge did not consider at all the effect of the letter of 21 January 2011 on what would otherwise have been the effective date of termination, nor the authorities which were cited to him about the effect of that letter – Stapp v The Shaftesbury Society [1982] IRLR 326, Patel v Nagesan [1995] IRLR 370 and Harper v Virgin Net Ltd [2004] IRLR 390.

**Two separate claims or a single claim?**
  1. The first question is whether A is bringing two separate claims of unfair dismissal, in which the effective dates of termination were 21 January 2011 and 1 February 2011 respectively, or whether she is bringing one claim of unfair dismissal, in which her dismissal took effect on either 21 January 2011 or 1 February 2011. In my opinion, A has to be regarded as having brought just one claim of unfair dismissal, but that her claim was being advanced in two alternative ways. She was employed on a single contract of employment, and there cannot have been two different dates on which it came to an end. The fact that the company initially brought it to an end by giving her notice expiring on 1 February 2011, and subsequently purported to bring it to an end earlier by dismissing her summarily on 21 January 2011, does not affect that. Either her dismissal took effect on 1 February 2011 on the basis that the letter of 21 January 2011 had not had the effect of displacing the notice bringing her employment to an end on 1 February 2011. Alternatively, her dismissal took effect on 21 January 2011 on the basis that the letter of 21 January 2011 had displaced the notice she had received and brought her employment to an end summarily on that date. If she had been "dismissed" on both 21 January 2011 and 1 February 2011, what was her status between those dates? The correct analysis of A's claim, therefore, is that she was bringing one claim of unfair dismissal, in which her dismissal had taken effect either on 21 January 2011 or on 1 February 2011.
**The effect of the letter of 21 January 2011**
  1. I turn, then, to the critical question in the case, which is what the effect of the letter of 21 January 2011 was. At first blush, Patel provides the answer to that. The matron of a rest home for elderly people was given ten weeks' notice of the termination of her employment on the ground that she would by then have reached the retirement age of 60. During the period of that notice, she presented a complaint of unfair dismissal. She was summarily dismissed the following day. An industrial tribunal upheld her claim finding that there was no evidence to support the employer's contention that there was a normal retiring age of 60 for all employees. In dismissing an appeal against that decision, the Employment Appeal Tribunal said that there had been nothing to compel the employee to retire at 60. However, a new point was taken on behalf of the employer in the Court of Appeal. It was argued that the complaint which the employee had lodged (which related to the termination of her employment at the end of the notice period) had not been valid in respect of the intervening summary dismissal. It was said that once her employer had summarily dismissed her, she had lost any right to pursue the complaint which she had previously lodged, and her summary dismissal had been a separate dismissal requiring a separate application to the tribunal.
  1. The Court of Appeal found that the employee's intervening summary dismissal had not resulted in her losing her right to pursue her original complaint, and it did not proceed to address the question whether her summary dismissal had been a separate dismissal requiring a separate application to the tribunal. The Court of Appeal's reasoning was simple. It was considering the previous version of section 111(4), namely section 67(4) of the Employment Protection (Consolidation) Act 1978 ("the 1978 Act"), which provided (so far as is material):

"An industrial tribunal shall consider a complaint under this section if, where the dismissal is with notice, the complaint is presented after the notice is given notwithstanding that it is presented before the effective date of termination and in relation to such a complaint the provisions of this Act, so far as they relate to unfair dismissal, shall have effect – … (c) as if references to the effective date of termination included references to the date which would be the effective date of termination on the expiry of the notice …"

The Court of Appeal acknowledged that under the previous law a dismissal took place when the legal relationship between the parties as employer and employee ceased to have effect, but that was irrelevant since the effect of section 67(4) was that the tribunal's jurisdiction to consider the employee's complaint of unfair dismissal crystallised as soon as her complaint was lodged. Its jurisdiction to consider her complaint could not therefore be undone by the employee's subsequent summary dismissal. The fact that her dismissal would be taking effect earlier than it would have done if she had continued to be employed throughout the whole of the notice period made no difference to that.

  1. The important feature of Patel is that it was only about the jurisdiction of the tribunal. Its effect is that the purported summary dismissal of A on 21 January 2011 did not prevent the tribunal from considering her claim of unfair dismissal, provided, of course, that A had acquired the right not to have been unfairly dismissed by the date of her dismissal (whenever that was). That is because section 111 of the Act, like its predecessor, i.e. section 67 of the 1978 Act, is only about the jurisdiction of the employment tribunal to consider a complaint of unfair dismissal. Part X of the Act deals with unfair dismissal, and it is instructive that section 111 is in Chapter 2 of Part X headed "Remedies for Unfair Dismissal", whereas Chapter 1 of Part X relates to the right not to be unfairly dismissed. The fact that the tribunal had the jurisdiction to consider A's complaint of unfair dismissal did not of itself mean that she had acquired the right not to be unfairly dismissed because that depended on whether she had the necessary period of qualifying service, and the question there is whether her summary dismissal on 21 January 2011 brought forward the effective date of the termination of her employment. That turns on the proper construction of the Act and what the Court of Appeal decided in Stapp.
  1. Mr Alexander Robson for A advanced a beguilingly simple argument. Section 111(4)(c) should be given effect to according to its terms. A's complaint was a complaint of the kind mentioned in section 111(3) because she presented her complaint on 11 January 2011, i.e. after being given notice on 26 July 2010 of the termination of her employment but before 1 February 2011, which was the effective date of the termination of her employment because section 97(1)(b) provided that since she had been given notice of the termination of her employment, the effective date of its termination was the date on which the termination of her employment was due to take effect. Accordingly, the effective date of the termination of her employment was, to use the words of section 111(4)(c), "the date which would be the effective date of termination on the expiry of the notice". That was 1 February 2011. The critical point is that section 111(4)(c) did not continue "or such earlier date if the employee is dismissed without notice in the meantime". Mr Robson argued that that could not have been an oversight since the draftsman was alive to the distinction between dismissal with notice and dismissal without notice as sections 97(1)(a) and 97(1)(b) addressed such dismissals separately.
  1. That construction of section 111(4)(c) is said to accord with the language of section 111(3). Section 111 deals with when a tribunal can consider a complaint of unfair dismissal, and does so by reference to when the complaint was presented. The effect of section 111(3) is that a complaint has to be considered ("shall consider") if it is presented after the notice terminating the employee's employment has been given but before the effective date of termination. The mandatory language suggests that the draftsman did not intend the employee's right to proceed with their claim to be removed by a subsequent summary dismissal. The employment judge was therefore right to apply the language of section 111(4)(c) according to its terms.
  1. That analysis, said Mr Robson, accords with Patel. The effect of Patel was that once the tribunal had jurisdiction to hear the complaint of unfair dismissal, its jurisdiction could not be removed by subsequent events. Since the tribunal acquired jurisdiction to hear Mrs Nagesan's claim of unfair dismissal when the ET1 was presented, her summary dismissal the following day did not affect that. Similarly, if A should be treated as having had the necessary qualifying service (because the effective date of the termination of her employment had been identified by section 111(4)(c) to be 1 February 2011), her deemed period of qualifying service should not be capable of being removed by subsequent events.
  1. Finally, it is said that the contrary view could lead to injustice. Take an employee who is entitled to 12 months' notice of the termination of his employment. He is given 12 months' notice of the termination of his employment after he has been employed for three months. He presents a complaint of unfair dismissal within a few weeks. The hearing of his complaint is likely to take place well before the time when he would have been employed for 12 months. The employers could abort the hearing by summarily dismissing the employee in the nine months after he was given his notice, even though the hearing of the complaint could have taken place within that period. Indeed, if the employee is found within those nine months to have been unfairly dismissed, the employers could get around that finding by summarily dismissing him before he would have been employed for 12 months.
  1. In my opinion, this elaborate and carefully structured argument fails to recognise the limited purpose of section 111(4)(c). But for section 111(3), the presentation of a complaint of unfair dismissal before the employee's dismissal takes effect could well have been regarded as premature. Moreover, if the period of notice to which the employee was entitled was relatively long, and he was given the notice to which he was entitled, the employee could have to wait quite a while to present his complaint of unfair dismissal, which would defeat one of the objects of the tribunal system which is to provide a speedy remedy for complaints in the employment field. Section 111(3) – or to be more accurate its predecessor in section 67(4) of the 1978 Act – is likely to have been enacted to meet these concerns. But that meant that some of the other provisions in the Act had to be refined in case a literal reading of them or of section 111(3) might have resulted in defeating what section 111(3) sought to achieve. Section 111(4)(c) was intended, I infer, to make it clear – in case section 97(1)(b), when read with section 111(3), might have created uncertainty – that the effective date of termination in a case where the employee was dismissed with notice would remain the date when his notice was due to expire, even if he presented a complaint of unfair dismissal in the meantime. It was not concerned at all with – and did not seek to provide for – what should be regarded as the effective date of termination if before the date on which the notice was due to expire the employer dismissed the employee summarily.
  1. This analysis is supported by the use of the word "included" in section 111(4)(c). Section 114(c) does not say that where the complaint of unfair dismissal is presented after the notice of dismissal has been given but before the effective date of termination, the effective date of termination will in all circumstances be treated as the date on which the notice expires. If that had been intended, the word "included" would have been inappropriate, and the word "meant" should have been used instead.
  1. There is one other point to be made before I come to Stapp. Mr Robson's argument freezes things at the time when a complaint is presented. Anything which occurs thereafter which might have affected the effective date of termination is to be ignored. That does not sit easily with something which Mummery LJ said in Roberts v West Coast Trains Ltd [2004] IRLR 788. In that case, an employee presented a complaint of unfair dismissal following his summary dismissal. After the presentation of his complaint, an appeal which he had previously lodged under the disciplinary procedure was successful to the extent that the penalty of dismissal was reduced to demotion, with the period between his dismissal and demotion being treated as a period of suspension without pay. He never returned to work. The issue was whether he had been dismissed. It was held that he had not been. The effect of the decision made on the appeal was to revive retrospectively his contract of employment so as to treat the employee as never having been dismissed. Mummery LJ said at [27]:

"The fact that [the employee] had made a complaint of unfair dismissal to the tribunal at a date when he was still in a state of dismissal, and before the appeal had been heard, does not affect the legal position. It is legally irrelevant. It would have been relevant, if he had never instituted an appeal and/or he had instituted an appeal, he had withdrawn his appeal before a decision was made. In such circumstances, the initial dismissal would have stood. I am unable to accept the submission made by [the employee's counsel] that somehow the date of the issue of the proceedings freezes the position on jurisdiction, and that it is not permissible for the employment tribunal to look at the real world as it existed at the date when the case came on before them at the hearing."

Although the facts in Roberts are very far from the present case, what Mummery LJ said has a resonance here.

  1. Stapp is the high watermark of the company's case, and it is a little surprising that its impact was not discussed by the employment judge in his reasons in view of the reliance placed on it by the company's solicitors at the pre-hearing review. In Stapp, a nurse at a home for the disabled was given one month's notice of the termination of his employment. It was common ground that on the expiry of the notice he would have been continuously employed for a period which entitled him to claim unfair dismissal. The employee invoked the grievance procedure over his dismissal, and during the period of his notice he presented a complaint of unfair dismissal to the tribunal. His employer dismissed him summarily on a date during his notice period but which resulted (if that date was to be treated as the effective date of the termination of his employment) in him not having a sufficient period of continuous employment to entitle him to claim unfair dismissal. The Court of Appeal upheld the findings of the industrial tribunal and the Employment Appeal Tribunal that his summary dismissal had had the effect of bringing his employment to an end immediately, with the result that he did not have the requisite period of continuous employment to entitle him to claim unfair dismissal.
  1. The Court of Appeal's reasoning is sufficiently summarised in the headnote:

"The 'effective date of termination' in section 55(4) of the Employment Protection (Consolidation) Act [which was the predecessor of section 97(1) of the Employment Rights Act and not materially different from it] means the actual date of termination of the employment, whether the employee was wrongfully dismissed or rightfully dismissed. It could not be held, as argued on behalf of the appellant, that a letter of summary dismissal can be disregarded as a nullity because its effect was to bring forward the date of termination so as 'to deprive the employee of his right not to be unfairly dismissed'. In circumstances such as the present case, the employee had no accrued right of which he was deprived. The employer did not deprive him of a right he already had. The employee was only prevented from gaining a right.

If there are no reasons to justify summary dismissal, and if by the summary dismissal the employee is deprived of his right to allege unfair dismissal, the employee may have a remedy by claiming damages for wrongful dismissal at common law. Such damages might include the loss of a right to complain of unfair dismissal which the employee would have had had he not been summary dismissed (per the statement of Lord Denning MR in H W Smith (Cabinets) Ltd v Brindle [1972] IRLR 125 and Browne-Wilkinson J in Robert Cort & Son Ltd v Charman [1981] IRLR 436).

Nor could it be held that the giving of a notice of termination deprives the employer of the right to dismiss the employee summarily before the notice expires. An employer has the right to change his mind after giving notice of dismissal and to give another, shorter, notice. When an employer does change his mind and gives a second and shorter notice, the question when considering whether the employee can present a complaint to the Industrial Tribunal must be determined simply by considering the effective date of termination and not by considering the rights and wrongs of the dismissal."

**

That statement of the law is clear and unambiguous. Where an employee is dismissed while he or she is working out their notice, the date of the ending of their employment is brought forward from the date on which their notice would have expired to the date on which they were summarily dismissed, even if the effect of that is to leave the employee without the necessary period of continuous service to present a complaint of unfair dismissal. Unless Stapp is distinguishable from A's case, it means that her dismissal on notice expiring on 1 February 2011 was displaced by her summary dismissal on 21 January 2011.

  1. Mr Robson contended that Stapp was distinguishable on two grounds. First, part of the reasoning in Stapp was that an employee in the position of Mr Stapp would, in an action for wrongful dismissal, be entitled to damages for the loss of the right to complain of unfair dismissal. That is no longer the law as a result of the Court of Appeal's decision in Harper v Virgin Net Ltd [2004] IRLR 390. To quote from the headnote which accurately summarises the reasoning of the Court of Appeal:

"In order to deal with the problem which arises where a contract is terminated summarily, in circumstances where termination on proper notice would have given the right to compensation for unfair dismissal, the statutory scheme was amended so as to include the provision in what is now section 97(2)(b) of the Employment Rights Act, which postpones the effective date of termination until the end of the statutory notice period. Parliament could have decided to postpone the effective date of termination to the date on which a contractual period of notice, if given, would have expired but chose not to do so. It is not open to the court, through the machinery of an award of damages for wrongful dismissal, to circumvent that deliberate legislative decision.

In the present case, the applicant did not lose the right to claim compensation for unfair dismissal by being dismissed without her contractual notice. She never had such a right because she fell short of the requirement of one year's continuous service which Parliament has prescribed as the gateway to such a right."

Accordingly, it was submitted that applying the Court of Appeal's decision in Stapp would be to deprive A of any remedy either under statute or at common law (putting section 108(3)(g) to one side). That would not only be unjust, but was not the consequence envisaged by the Court of Appeal in Stapp.

  1. I do not think that what the Court of Appeal in Stapp had to say about an employee being able to claim, as part of his damages for his wrongful dismissal, damages for the loss of the right to complain of unfair dismissal was part of its core reasoning. That is because the Court of Appeal was not saying that the employee's ability to claim damages for the loss of the right to complain of unfair dismissal as part of his damages in a claim for wrongful dismissal justified treating the date of the summary dismissal as the effective date of termination. It was the other way round. The fact was that the date of the summary dismissal having to be treated as the effective date of termination had been established for some time, and the Court of Appeal was doing no more than saying that the consequence of that might be mitigated by permitting the employee to include in his claim for damages for wrongful dismissal an element to reflect the loss of the right to complain of unfair dismissal. That, I think, is apparent from the judgment of Stephenson LJ (who gave the leading judgment) at [33].
  1. The second way in which Mr Robson sought to distinguish A's case from Stapp was that in Stapp the reasons given by the employer for summarily dismissing the employee were very different from the reasons advanced by the company for summarily dismissing A. In Stapp, Stephenson LJ proceeded at [28] on the footing – based on an affidavit submitted to the Court of Appeal as a result of observations made by the court when giving leave to appeal – that the reason for Mr Stapp's summary dismissal had been something other than to prevent him from acquiring the right not to be unfairly dismissed. But that did not make a difference to the outcome of the case, because Stephenson LJ acknowledged at [30] that it did not make a difference "whether the summary dismissal is for good cause or for bad, for reasons which are justifiable or for reasons which are not". So whatever the reason for A's summary dismissal, any difference between the reason for her summary dismissal and the reason for the summary dismissal of Mr Stapp was irrelevant. In the circumstances, I do not regard Stapp as distinguishable from the present case, though since there was no reference in any of the judgments in Stapp to section 67(4) of the 1978 Act, it is not possible to say whether that would have made a difference to the outcome.
  1. Finally, Mr Robson relied on a passage in the judgment of Lord Denning MR in Brindle v H W Smith (Cabinets) Ltd [1972] IRLR 125 which was cited in Stapp. At [9] Lord Denning said:

"I would add at this point that I do not think the Act can be got round by wrongfully dismissing a person summarily or by giving him a notice that is too short. No person should be able to take advantage of his own wrong in that way. If an employer should try to escape the Act by giving no notice at all or a notice that was too short, I should have thought that the tribunal, by means of a claim for wrongful dismissal (see section 113 of the Act), or by some such way, would see that the employee would get the same compensation as he would have done if he had been given notice of a proper length."

However, whether someone should not be permitted to take advantage of their own wrong in the particular context being considered there has now been decided by the Court of Appeal in Harper.

**Conclusion**
  1. For these reasons, A's dismissal must be treated as having taken effect on 21 January 2011 when she was summarily dismissed, and she did not have the necessary period of qualifying service. The company's appeal must be allowed, and the ruling of the employment judge that A's claim of "ordinary" unfair dismissal can proceed to a full hearing on its merits must be set aside. The issue for the tribunal when it comes to the merits of her claim will be what the principal reason for her summary dismissal was. If it is found to have been because she had presented a complaint of unfair dismissal, that will have meant that she did not have to have a period of continuous employment to present her claim, and it will no doubt result in a finding of unfair dismissal. On the other hand, if it is found that the principal reason for her summary dismissal was something else, then she needed one year's continuous employment to acquire the right not to be unfairly dismissed, which she would not have had.

Published: 14/08/2011 09:18

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