Policy News Journal - 2012-13

“I was dismissed on the grounds of gross misconduct. I was accused of stealing food. The matter was trivial, in that I provided a fellow employee, who was purchasing a dessert, a generous sprinkling of chocolate pieces.

“There is no standard for such measures - they are always imprecise and will vary among customers.

“My colleague had asked me: ‘Make it a nice one’.

“So the measure I gave erred on the side of more than, rather than less.” The application for unfair dismissal against franchise company Lonetree, who run a string of McDonald’s restaurants was initially made, however both sides reached an out-of-court settlement after the Advisory Conciliation and Arbitration Service was called in.

A spokesman for the McDonalds franchise, said:

“This matter has now been resolved to the satisfaction of both parties. “The Employment Tribunal case has been withdrawn. No admission of liability was made.”

WRONGFUL REPUDIATION AND EFFECTIVE TERMINATION

3 January 2013

If an employment contract is wrongfully repudiated, does the termination take effect automatically - the 'automatic theory' - or when the other party accepts the repudiation - the 'elective theory'?

When the repudiation is accepted, says the Supreme Court, in Geys v Societe Generale London Branch .

Daniel Barnett’s Employment Law Bulletin reports:

The Claimant was told at a meeting in November 2007 that his employment was to end, with a payment-in-lieu of notice (PILON) being made in December 2007 for his 3 months' notice. The Claimant reserved his rights and only in January 2008 did he receive a payslip for the PILON. A key question was when the dismissal took effect, as, under the contract, proper notice had to be given to terminate it, and a more generous termination payment was due if termination had taken effect in 2008 rather than 2007. The Supreme Court decided (4-1, Lord Sumption dissenting) that the elective theory was to be preferred, and termination only took effect in January 2008. Automatic termination would permit a wrongdoer to choose a termination date potentially to the detriment of the wronged party. Under the terms of the contract, the employer had not given proper notice of termination until January 2008, when the payslip was provided, despite the Claimant clearing his desk and receiving a PILON in December. Therefore, the Claimant qualified for a higher termination payment. Lady Hale's speech at paras. 57-61 comments on the importance of notice of termination being given in 'clear and unambiguous terms'. The fact that a PILON went into the employee's bank account was not sufficient notice to make termination effective: an employee '...should not be required to check his bank account regularly in order to discover whether he is still employed. If he does learn of a payment, he should not be left to guess what it is for and what it is meant to do...'.

Practitioners may wish to note the consequences of the judgment when termination dates and the validity of a termination may affect contractual entitlements. The judgment resolves a

CIPP Policy News Journal

12/04/2013, Page 74 of 362

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