Appeal No. UKEATS/0039/11/BI
EMPLOYMENT APPEAL TRIBUNAL
52 MELVILLE STREET, EDINBURGH, EH3 7HF
At
the Tribunal
On
17 April 2012
Before
THE HONOURABLE LADY SMITH
(SITTING ALONE)
(1)
VASELLA LTD (IN ADMINISTRATIVE RECEIVERSHIP)
(2) CRERAR MANAGEMENT
LTD APPELLANTS
MS
TRACEY EYRE RESPONDENT
JUDGMENT
THE
HONOURABLE LADY SMITH
Introduction
1.
This is an appeal against the judgment of an Employment Tribunal sitting
at Glasgow, Employment Judge Muriel Robison, registered on 27 May 2011, finding
that the Tribunal had jurisdiction to hear the Claimant’s complaint that she
was unfairly dismissed. The judgment followed a pre-hearing review to
determine the issue of time bar.
2.
I will continue, for the sake of clarity, to refer to parties as Claimant
and Respondents.
3.
The Respondents were represented by Mr Duffy, consultant, before the Tribunal
and by Mr Lindhorst, advocate, before me. The Claimant was represented by
Mr Lawson, solicitor, before the Tribunal and by Mr Douglas Ross, advocate,
before me.
Background
4.
The background facts were mostly not in dispute and can be shortly
stated. The Claimant was employed at the Swallow Hotel in Glasgow as
operations manager. The Swallow Hotel was part of the First Respondent’s
business. They went into administrative receivership in about November 2009
and entered into a contract with the Second Respondent whereby the latter would
manage it and a number of other hotels which were part of the First Respondent’s
business enterprise.
5.
As at November 2010, Mearns Pert was the General Manager of the Swallow
Hotel. He did not work on Sundays. The Claimant knew that he did not do so.
On Sunday 21 November 2010, Hannah MacAskill was working as duty manager. The Claimant
called at the hotel at about 3pm and handed a sealed envelope addressed to
Mearns Pert, to Hannah MacAskill. She asked her to put it into Mearns Pert’s
pigeonhole. Hannah MacAskill told her that Mearns Pert was on leave and would
not back at work until the Wednesday. The Claimant accepted that, left the
envelope (subject to her instructions to put it into Mr Pert’s pigeonhole) and
left the hotel.
6.
In the envelope was the Claimant’s letter of resignation which was dated
22 November 2010 and included the following statement:
“I, Tracey Eyre (McMaster) wish to resign my position with
immediate effect from Crerar Mgmt/Vassella Ltd at the Glasgow Swallow Hotel.”
7.
The letter then went on to explain her reasons for resigning.
8.
That evening – at 18.24 on Sunday 21 November – the Claimant emailed
Tessa Budd, who was the executive PA and group admin manager for the Second
Respondent and cut and pasted into the email the letter which she had delivered
to the hotel. Tessa Budd’s working week was Monday to Friday. She did
not work on Sundays. The Tribunal made no finding which suggested that the Claimant
had any belief that her working schedule was other than Monday to Friday.
Tessa Budd did, however, read the Claimant’s email that evening and
forwarded it to Paddy Crerar of the Second Respondent and to its finance
director.
9.
On 22 November 2010, at 16.40, Tessa Budd responded to the Claimant’s
email attaching a letter to her, dated 22 November, in terms which included:
“Thank you for your resignation letter, sent by email, dated 21st
November 2010, and I confirm that the company accepts your resignation with
immediate effect. Your final date of employment will therefore be Monday 22
November…..”
10.
The Claimant presented a form ET1, containing a complaint of unfair
dismissal, to the Employment Tribunal on 21 February 2011. Accordingly,
depending on the view that is taken of the date of termination of her
employment, her complaint was lodged either just within or just outwith the
three month time limit for presenting such claims.
The Tribunal’s Judgment
11.
One aspect of the Tribunal’s finding in fact – which was not really
material – was disputed. In paragraph 23, the Employment Judge found that
Hannah MacAskill had telephoned Mearns Pert on Sunday 21 November
and he had asked her to read the Claimant’s letter to him. However, the
Employment Judge’s note of the evidence on that matter (provided in response to
an order from this Tribunal) does not support that finding. It is not clear as
to whether or not Hannah MacAskill had herself advised Mr Pert of the
contents of the letter and, moreover, the Employment Judge offers no note at
all of when it was that Mearns Pert was phoned about the matter. In short, the
Employment Judge had no basis for making the findings that she made in
paragraph 23. The material facts were not, however, as above noted, disputed
as between parties.
12.
Having considered the Respondents’ submissions which were to the effect
that the effective date of resignation (“EDT”) was 21 November 2010 and
the Claimant’s submissions that it was 22 November, the Tribunal found in
favour of the Claimant and held that her claim for unfair dismissal was not
time barred.
13.
The Tribunal noted the terms of section 97 of the Employment Rights
Act 1996 and found that, on the facts, the date that the termination took
effect was 22 November 2010. That was because the Claimant’s letter of
resignation was dated 22 November and clearly expressed the intention that that
should be the date of resignation. At paragraphs 57 and 58, the
Employment Judge explains:
“57. In relation to the unfair dismissal claim, the Tribunal
noted that the letter of resignation was dated 22 November 2010. That letter
made reference to the fact that the resignation was to have immediate effect.
The letter itself, notwithstanding the date which it was handed in or indeed
e-mailed, being dated 22 November 2010, clearly expresses the intention
that that should be the date of the resignation. There is no ambiguity in the
terms of the letter itself. To interpret the letter otherwise, which is a
stand alone document, in the form in which it was handed in to the hotel, would
not make any sense. Indeed, this was how it was initially interpreted by
Tessa Budd in her letter acknowledging receipt of the letter of
resignation. In that letter, she makes reference to the date of the e-mail but
confirms that the claimant’s final date of employment will therefore be Monday
22 November.
58. Given that under section 97 of the ERA the EDT means the
date on which the termination takes effect, the Tribunal finds that in this
case the termination took effect on Monday 22 November.”
Relevant Law
14.
In terms of section 95(1)(c) of the Employment Rights Act 1996,
an employee is dismissed if he or she terminates their contract of employment
with or without notice in circumstances where they are entitled to do so by
reason of the employer’s conduct. Resignation does not require to be in any
particular form. It is sufficient if the employee communicates to the
employer, clearly and unequivocally, that he or she is treating the contract as
being at an end. Section 97 makes for provision for identifying the date that
the contract is terminated – the effective date of termination (“EDT”):
“97 Effective date of termination
(1) 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 termination takes effect…….”
15.
Parties were agreed that, in this case, section 97(1)(b) was the
relevant provision.
16.
Section 97 was discussed by the Supreme Court in the case of Gisda
Cyf v Barratt [2010] ICR 1475. At paragraph 5, Lord
Kerr of Tonaghmore said:
“5. The effective date of termination of employment is a term of
art that has been used in successive enactments to signify the date on which an
employee is to be taken as having been dismissed. The fixing of the date of
termination is important for a number of purposes. These include, but are by
no means confined to, the marking of the start of the period within which
proceedings for unfair dismissal may be taken.”
17.
The facts in Gisda Cyf were that the employer’s letter of
dismissal had lain unopened at the claimant’s home for a number of days while
she was away on a visit and the court required to determine if it was relevant
to consider whether or not the claimant had had a reasonable opportunity to
find out what the letter contained prior to the date when she opened it. The
court found that the employment tribunal had not erred in considering whether
or not the claimant had had a reasonable opportunity to find out what was in
the letter (paragraph 29). At paragraphs 34 and 35, having referred to Brown
v Southall & Knight [1980] ICR 617 and McMaster v Manchester Airport [1998] IRLR 112, Lord Kerr said:
“34. Underlying both decisions (although not expressly
articulated in either) is the notion that it would be unfair for time to begin
to run against an employee in relation to his or her unfair dismissal complaint
until the employee knows – or, at least, has a reasonable chance to find out –
that he or she has been dismissed. This is as it should be. Dismissal from
employment is a major event in anyone’s life. Decisions that may have a
profound effect on one’s future require to be made. It is entirely reasonable
that the time (already short) within which one should have the chance to make
those decisions should not be further abbreviated by complications surrounding
the receipt of the information that one has in fact been dismissed.
35. These considerations provide the essential rationale for not
following the conventional contract law route in the approach to an
interpretation of section 97. As Mummery LJ said, it is a statutory
construct. It is designed to hold the balance between employer and employee
but it does not require – nor should it – that both sides be placed on an equal
footing. Employees as a class are in a more vulnerable position than
employers. Protection of employees’ rights has been the theme of legislation
in this field for many years. The need for the protection and safeguarding of
employees’ rights provides the overarching backdrop to the proper construction
of section 97.”
18.
The corollary to the above reasoning in a case where the EDT requires to
be identified in a constructive dismissal case must, in my view, be that it
would be unfair for time to run against an employee in relation to her unfair
dismissal complaint from any date that is earlier than the date when she could
reasonably expect her employer to find out that she was resigning. Further, it
must also be that it would be unfair for time to run against an employee in
relation to her unfair dismissal complaint from any date that is earlier than
the date which she clearly and unambiguously states is the date of her
resignation. These matters require, of course, to be tested objectively. That
approach accords with observations made by HHJ David Richardson in the
case of Potter and others v RJ Temple Plc (in liquidation)
UKEAT/0478/03/LA, where an employee’s solicitor had faxed his employers on a
Friday evening, intimating his resignation “effective forthwith” and received a
fax confirmation sheet at that time. The fax had not, however, been read by
anyone on behalf of the employer until some time the following week:
“40. If the effective date of termination is the date on which
the fax was received in the Company’s office, a sensible result is achieved.
This is the date on which Mr Potter, having made his election,
communicated it in the clearest terms. As the Tribunal found, he intended to
resign with effect from that date, and no longer considered himself bound from
that date. He had a fax confirmation sheet to tell him when his communication
was received.
41. If receipt of the fax is insufficient to fix the date of
termination, Mr Potter could not with certainty know what date it was. It
might have been as late as 16th September, when the office
opened on Monday. But if an authorised member of staff read it on the Friday,
Saturday or Sunday, the date would be earlier. It is certainly not out of the
question for a senior member of management to be in the office late, or go in
the office at the weekend. So Mr Potter could not sensibly rely in any event
on the date being later than 13 September.”
19.
In Horwood v Lincolnshire County Council UKEAT/0462/11/RN,
Slade J held that where an employee had written a letter of resignation
“with immediate effect” in clear and unambiguous terms and sent it to her
employers by special delivery on 28 January 2010, the EDT was
29 January. The letter was received and opened on 29 January by a member
of staff although not read by the specific addressee until 1 February. It
was held that the EDT could not be a later date because once the employee’s
unequivocal resignation had been received at the employer’s offices, opened and
date stamped, communication was effective (see paragraph 49). There was no
suggestion that the claimant in that case could reasonably have expected her
letter to be effectively communicated to her employers later than the day after
she had sent it by special delivery or to be read as intimating resignation
other than on that day. Equally, it was not suggested that the EDT was 28
January; allowance was evidently made for a period for delivery to elapse after
posting before the claimant could be held to an EDT.
20.
I note that in Horwood, Slade J observed that the
concerns expressed in the authorities (including Gisda Cyf) about
protecting employees’ rights do not arise when the decision to leave is that of
the employee (paragraph 42) but would respectfully differ. The generality of
the statutory purpose of protection of employee’s rights applies, in my view,
just as much when determining the EDT in a constructive dismissal case.
Fairness dictates that employees should not be held to an EDT which they could not reasonably have thought was the EDT, EDT being a term of art and a date
to be ascertained on an objective view of all relevant facts and circumstances.
21.
Finally, some assistance is also provided by what was said by
Sedley LJ in the case of Fitzgerald v University of Kent at Canterbury [2004] ICR 737 at paragraph 20:
“….the effective date of termination is a statutory construct
which depends on what has happened between the parties over time and not on
what they may agree to treat as having happened.”
22.
Three points arise from that observation. First, the EDT is to be found
by considering objectively what parties did and said over whatever, in an
individual case, is the relevant period. Secondly, parties cannot undo what
has happened even by agreement. Thirdly, as was recognised by Judge Hague QC sitting in this Tribunal in the case of Newman v Polytechnic of Wales Students Union [1995] IRLR 72 at page 74 (and relied on by HHJ Richardson in Potter)
ascertaining the EDT is:
“…..essentially a matter of fact to be decided in a practical
and commonsense way….”
The Appeal
Submissions for the Respondents
23.
Before me today, Mr Lindhorst submitted that the EDT was the date
when the Claimant intimated her resignation to the Respondents; that was
21 November. It would, he said, be an artificial construct to hold that
where there was no agreement about a notice period to be worked, an employee
could intimate termination on one day whilst still choosing a later date on
which that termination was to come into effect. The time limit was a statutory
construct and neither employer or employee could contract out of it.
24.
He did not demur from the proposition that the employee’s own actings
were relevant: Gisda Cyf at paragraph 29. He stressed, however,
that parties could not escape the statutory construct and referred to Fitzgerald
in support of that submission. He submitted that it was not what was in the Claimant’s
head that mattered; it was a question of what she did. Her letter was received
on Sunday 21 November. There was no discussion between parties at that
time. The letter of 22 November, accepting the Claimant’s resignation,
was irrelevant. It was not “significant” that the letter referred to a
resignation date that was later than the date of delivery. He did, however,
accept – under reference to the case of Potter – that it was
relevant to ask whether the employee’s communication was clear and what it was
that was being communicated. The nub remained, however, in his submission,
that she could not give notification of resignation on 21 November whilst
at the same time unilaterally saying that it was not to take effect until the
following day.
25.
Mr Lindhorst referred to the case of Horwood and the
authorities referred to within it. Whilst recognising that they were not directly
in point, he generally prayed them in aid of his submissions, particularly for
the proposition that employers – or parties – cannot agree the EDT, its
ascertainment being a matter of applying the statutory provisions.
Submissions for Claimant
26.
Mr Ross submitted that the appeal was ill founded. The authorities
demonstrated the following general principles: that the principles of the law
of contract are of limited relevance when determining the EDT, that a practical
and commonsense approach was to be adopted: Newman, that parties’
intentions were relevant: Potter at paragraphs 9 and 40, and
construction of section 97 ought to be guided by the underlying purpose of
the statute, which was protection of employee’s rights: Gysda.
27.
The Employment Judge had, he submitted, reached the correct conclusion
in its succinctly expressed decision. It was consistent with the above
principles. It was clear that both parties understood that the Claimant’s
employment came to an end on 22 November 2010; that emanated from the date
on her letter and the terms of the Respondent’s letter of 22 November.
This was not a case of an employer seeking to impose a different date; those
letters simply demonstrated the parties’ mutual understanding of what the
position always was. Practical commonsense dictated that 22 November was the
EDT. Further, that was what the Claimant intended. That was clear from what
she had written and done. Regarding 22 November as the EDT was consistent
with the statutory purpose. To approve an interpretation which allowed an
employer to write to an employee stating expressly that her last date of
employment was 22 November but to then maintain before the Employment Tribunal
that the EDT was in fact a day earlier would not be consistent with the protection
of an employees’ rights.
28.
Regarding the authorities referred to by Mr Lindhorst, Mr Ross
submitted that none of them were on all fours with the present case; all of
them concerned different circumstances. Fitzgerald, however,
showed that a sensible objective assessment was to be applied to the
ascertainment of the EDT. Potter emphasised the relevance of the
employees’ intention. Edwards, referred to in Horrocks,
which dealt with the need to actually communicate the termination of the
contract, did not assist. Horwood was not in point.
29.
Finally, Mr Ross submitted that determining that the EDT was
22 November 2010 was a permissible option: Melon v Hector Powe
[1980] SC 188.
Cross-Appeal
30.
The issues in the cross appeal arise only in the event that the appeal
is not dismissed.
31.
First, Mr Ross submitted, as above noted, that there was no basis for
the Employment Tribunal’s findings at paragraph 23. I have already dealt
with that matter. He was, I consider, well founded in his criticisms but that
finding is not material to the outcome of the case as a whole.
32.
Secondly, Mr Ross submitted that the Respondents were personally barred
from contending that the EDT was 21 November since they had never stated that
that was their position until after these proceedings were raised. They had,
conversely, stated to the Claimant that her employment ended on 22 November.
33.
Mr Ross referred to Rankine: Personal Bar p.6; Secretary
of State for Employment v Globe Elastic Thread Co Ltd [1980] AC 506,
and the Stair Memorial Encyclopedia 1601-1609. The Respondents had
represented to the Claimant that their position was that 22 November was
the termination of the Claimant’s employment, it was in reliance on that belief
that the Claimant had, through her solicitors, presented her application when
she did, and it was self evident that was to her prejudice. The Respondents
were accordingly personally barred. Insofar as it might be suggested that
personal bar did not apply because this was a matter of statutory rights, that
proceeded only on the wide, general comment in Rankine and was not supported by
the Globe Elastic case.
34.
Mr Lindhorst submitted that personal bar could not apply because this
was matter of statutory rights. If the Respondents’ application of section 97
of the 1996 Act was correct then the jurisdiction of the Employment Tribunal
was excluded by section 111. Parties could not confer jurisdiction by
agreement.
Discussion and Decision
35.
I cannot find fault with the reasoning of the Employment Judge and am
persuaded that Mr Ross’ submissions on the EDT are well founded. Even
allowing for the letter having been delivered to the Swallow Hotel on 21
November, what it communicated was that the Claimant was intimating that she
was resigning not that day but the following day. The letter could not
be read as communicating a contemporaneous resignation on 21 November or
that the Claimant intended to do other than resign on 22 November. Further, on
the findings in fact, the Claimant had no reason to think that her resignation
would be communicated to either Respondent earlier than Monday 22 November
2010. She left the hotel thinking that the message of her resignation would not
be communicated to anyone from the Respondents on the Sunday. Whilst she
emailed it to Tessa Budd, there are no findings in fact to show that she had
any reason to think that an employee who worked Monday to Friday would read and
act on that email on the Sunday. That was what “happened between parties” to
use the terminology of Sedley LJ in Fitzgerald and there was
no basis for the Claimant sensibly to understand that her resignation date
would be other than 22 November.
36.
Regarding the issue of personal bar, I do not, in these circumstances,
require to determine it. Had I had to do so, however, I can see that there may
be an argument to the effect that personal bar applies where an employer has
led an employee to believe that they accept that termination of employment
occurred on one date and do not suggest otherwise until a date when it is too
late for the employee to present a timeous claim if the employer’s revised
assertion is correct – that is because the EDT is essentially a question of
fact. However, there would have been a problem for the Claimant because (a)
the point was not argued before the Employment Tribunal and (b) there are no
findings in fact to the effect that the employers’ representation that they
accepted that termination occurred on 22 November was in fact relied on in the
matter of presenting the ET1 when it was presented.
Disposal
37.
In these circumstances, I will pronounce an order dismissing the appeal.
