I have recently experienced a spate of cases where employer clients have been seeking advice on how to handle employee resignations. Perhaps this is a consequence of new year, new job syndrome. What has been refreshing is the awareness from our clients about the need to proceed with caution in certain circumstances. It is well established law that an employer should be slow to accept a resignation where there are “special circumstances”. For example, where the words of resignation are ambiguous or uttered in the hear of the moment: “shove your job, I’m done here” (the language is often more colourful). Acceptance of a resignation in such circumstances can convert the resignation into a dismissal, which will of course be an unfair dismissal (because there will have been no proper procedure followed). The correct approach in such cases is to allow the employee time to cool down, and an opportunity to reconsider whether it was really their true intention to resign.
I had another scenario recently where an employee who had been AWOL for a period of time ultimately resigned, but where the resignation was nothing more than a statement of intent. In order to be a valid resignation, it must specify a date on which it is to take effect (or at least a means of inferring what that date will be). A resignation with “immediate effect” does exactly as it says on the tin.
Are there any other prickly issues when it comes to resignations? What about an employee who resigns with notice, and then half way through the notice period the employer wants to call it a day and make them leave immediately? A notice period cannot be varied unless both parties agree. An employer who unilaterally shortens a notice period may find that this amounts to a dismissal in law, and thus could result in a claim (in the same manner as hastily accepting a heat of the moment resignation).
But what if there is a contractual ability for the employer to curtail the notice period with a payment in lieu of notice?
In Fentem v Outform EMEA Ltd the employee was contracted to a 9 month notice period when he resigned. Having served approximately 8 months of his notice, and with just one month left to go, the employer decided that it wanted to bring forward his termination date and pay the employee in lieu of the remaining one month’s notice. The employee raised a claim for unfair dismissal, arguing that the employer’s actions converted his resignation into a dismissal. The employment tribunal disagreed with the employee and relied on the fact that his employment contract allowed the employer, in circumstances where the employee resigned with notice, to end the employment at any time during the notice period and to make a payment in lieu of notice. It was found that there was no dismissal. Mr Fentem appealed this to the EAT. Despite much analysis and discussion about whether previous case law was correctly decided, or manifestly wrong, the EAT upheld the finding of no dismissal.
Had there been no such clause in the employment contract, the outcome would have been different.
This case acts as a reminder to employers of the need to have carefully drafted notice clauses, particularly if there is ever going to be a desire to cut short a notice period.
For any help or advice, please contact the Blackadders Employment Team operating across Aberdeen, Dundee, Edinburgh, Glasgow and Perth.
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