Summary
Summary Wrongful Dismissal EMPWS2 Reading Notes
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- Institution
A thorough summary of the procedure and rules associated with wrongful dismissal and the termination of a contract.
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WRONGFUL DIMISSAL(DISMISSAL IN BREACH OF CONTRACT)
What is a - Employee (or worker) will have a claim for damages against his employer if been
dismissal? dismissed in breach of contract- the remedy is therefore damages for breach of
contract.
- If there is no dismissal, there cannot be a claim for wrongful dismissal. Instead, there
would be a general breach of contract claim.
For example:
(a) termination of the contract with no notice or short notice.
(b) where the employee/worker establishes he has been constructively dismissed.
(c) termination of the contract before the expiry of a limited term where there is no break
clause
Time Limits Claim can be pursued in the Civil Court or an Employment Tribunal
Note: London Borough of Enfield v Sivananda [2005] where a breach of contract claim is
struck out, by an employment tribunal, it is an abuse of process to re-issue it in the civil
courts.
Even if a claim is withdrawn, it may be an abuse of process to re-issue it if the claim in
the employment tribunal covered the same facts and was worth less than £25,000.
If a claim is withdrawn but it is intended to pursue the claim in the civil courts, the
claimant should tell the employment tribunal that that is the reason the claim is being
withdrawn
EMPLOYMENT TRIBUNAL CIVIL COURT
Must bring claim within 3 months BACK A Must be brought before the civil courts
DAY from the date of dismissal/ within 6 years of the dismissal (Limitation
termination Act 1980, s5).
Max claim: £ 25,000 Cap on Damages (
If the claim is worth less than £5,000 and is
The Court of Appeal, in Fraser v HLMAD pursued in the county court, it will automatically
[2006]: claimants wishing to bring high-value be referred to the small claims track.
breach of contract claims should do so in the
civil courts, unless they are willing to limit
No maximum payment
damages to £25,000.
More expensive to pursue
Unfair dismissal
Can only be bought by employees who satisfy the criteria.
Can only be bought before an employment tribunal.
The tribunal looks into whether or not there was a fair reason for dismissal and at the
reasonableness of the employer’s actions.
A successful applicant may receive a basic award of compensation within the set formula.
This compensatory award is subject to a maximum limit, which was £78,962 as at 6 April
2016.
Wrongful Dismissal
Preconditions under S3+8 ETA 1996 for bringing wrongful dismissal claim in employment
tribunal: Employment Tribunal’s Extension of Jurisdiction Order 1994):
(a) the claim must be for breach of a contract of employment or other contract connected
with employment and must arise or be outstanding on the termination of employment.
(b) the only remedy available is compensation;
(c) the employment tribunal will not be able to award more than £25,000 in respect of a
contract claim (1994 Order, art 10);
(d) the tribunal cannot hear all claims arising out of an alleged breach – for example
claims relating to contractual terms of confidentiality and restrictive covenants are
excluded (1994 Order, arts 3, 5);
(e) the employer will be able to raise a counterclaim (alleging that the employee has also
breached the contract of employment);
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, EMP2
(f) the claim will have to be brought within three months of termination.
Redundancy payment
The claimant must, again, be eligible and the claim is pursued (where necessary) in the
employment tribunal.
The payment is calculated in accordance with a set formula, which is the same as the basic
award formula for unfair dismissal
Note: NO CONTINUOUS EMPLOYMENT RESTRICTION. An employee is eligible to bring a
claim of Wrongful Dismissal from Day 1.
TERMINIATION OF CONTRACT
Termination by The parties may at any time agree to bring the contract to an end. Neither party will be in
agreement breach of contract and no claim for wrongful dismissal will arise.
Termination by WHERE A CONTRACT OF EMPLOYMENT CAN BE ENDED BY NOTICE:
notice
The applicable notice period will usually be expressly agreed in the contract, and if the
employer gives no notice or short notice he will be in breach.
If an expressly agreed notice period is shorter than the statutory minimum period
required by s 86 of the ERA 1996, then the longer statutory period of notice must be
given.
In the absence of an expressly agreed period of notice, there is an implied term that
the employee is entitled to ‘reasonable’ notice. E.g “reasonable” for a senior employee
will be a longer period of time, but it will still be subjected to the statutory minimum period.
employment up to a maximum of 12 weeks’ notice after 12 years’ continuous employment
DATE OF NOTICE
termination will only start to run from the date the employee received written notice of
their dismissal and has had a reasonable opportunity to read it.
This will be the default position unless there is an express contractual clause making
clear that, for example, notice is effective from the date of delivery.
This rule applies only to contracts for an indefinite term. In the absence of a ‘break’
clause, limited-term contracts cannot be terminated by notice.
EXPRESS TERM OF NOTICE
A party giving shorter notice will be in breach of the contract
If an expressly agreed period of notice is shorter than the statutory minimum period
required by ERA 1996, s 86 (see below), the longer statutory minimum period must be
given.
The parties should agree the period of notice when the contract is entered into.
IMPLIED TERM OF NOTICE
Employment that it can be terminated by reasonable notice given by either party. What
period is reasonable will depend on the facts of each case. The more senior the employee,
the longer the period of notice required.
The courts have held, for example, that three months was a reasonable period of notice for
a salesman and an airline pilot, but only one week was required in the case of a milk carrier.
THE STATUTORY MINIMUM PERIOD OF NOTICE: S86 ERA 1996
Period of continuous employment Notice
1 month to 2 years 1 week
2 years to 12 years 1 week for each year
12 years plus 12 weeks
And thereafter one additional week’s notice for each year of continuous employment S86(2)
The only statutory minimum notice required to be given by an employee is one week’s notice
after one month’s continuous employment (s 86(2)).
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