Withdrawing Dismissals – case authority

25th August 2010
Withdrawing Dismissals – case authority image

Withdrawing Dismissals – case authority

There are many instances of employers purporting to dismiss employees and then looking to withdraw or retract the dismissal. A recent case of Willoughby (W) –v- CF Capital Plc (CFC) provided some further legal guidance on this subject.

W was told by her manager that CFC was experiencing difficulties, and that one way to avoid redundancies was for staff to become self-employed on a retainer plus commission basis.  W expressed an interest in this option and requested more information.  After repeated requests for paperwork, W eventually received on 23rd December an agency agreement to effect the move to self-employed status. The agreement stated that her existing employment would end on 31st December.

W took legal advice and informed CFC that she declined the agency agreement.  On 5th January W’s manager rang her to say that there had been a misunderstanding and that if she did not want to become self-employed that she could continue in her employment.

W maintained that she had been dismissed and claimed wrongful and unfair dismissal.  CFC denied that there was a dismissal and claimed that W had resigned.

The Employment Tribunal (ET) found that the letter from CFC ‘without more’ amounted to a dismissal.  However the ET found ‘special circumstances’, as W’s manager had genuinely believed that W had agreed to become self-employed, and the dismissal was withdrawn as soon as practicable after W had alerted them to the mistake.  The ET held that W had resigned, having refused the explanation of the situation and offers to continue to employ her.  W appealed.

The Employment Appeal Tribunal (EAT) allowed her appeal!  They said the ET had failed to ask whether ‘in the special circumstances’, W was entitled to assume that the decision to dismiss her was a conscious, rational decision.  In other words, was there anything to indicate to W that the words of dismissal were not to be taken at face value?

The EAT noted that the main practical problem addressed by ‘special circumstances’ had been words spoken in the heat of the moment and then quickly retracted.

On the basis of the ET’s findings that the reference to termination in the letter was intentional, not an error, W was entitled to assume that this was a conscious rational decision and to consider that her employment had ended.  Further the EAT held the Tribunal was wrong to hold that the withdrawal of the dismissal was timeous.  For a clearly expressed dismissal to be retracted it must be done quickly, usually within a day or two.  In this case the period was much longer and the Christmas holiday period was no excuse.

Daven Naghen, head of our Employment Team commented as follows:-

“This ruling may have been harsh on the employer, but shows that the employer must take great care in these matters.  An employer is only likely to be able to retract a dismissal if it was say made in the heat of the moment and the retraction is made almost instantly within no more than a couple of days at most.  If an employer notifies an employee in writing of a dismissal it will have great difficulties in retracting the dismissal as a written letter could suggest that the employer has made a conscious and rational decision to dismiss.

Subsequently a dismissal which cannot be retracted may lead to a claim by the employee for wrongful dismissal and or unfair dismissal.”

If you need advice on this subject matter then please email daven.naghen@maplessolicitors.com or telephone Dav on 01775 722261.

Dementia Friends image

Dementia Friends

Maples Solicitors are proud to announce that they have now joined to become Dementia Friends which is an Alzheimer’s Society initiative.

The private client department of Maples Solicitors prepare Wills and Lasting Powers of Attorney on a regular basis and this often involves dealing with clients who are suffering from dementia. The private client team pride themselves on spending as much time as is necessary to assist all of their clients, but those suffering from dementia often require additional assistance and time to ensure that they have fully understood the legal documentation that they are creating. The private client department are regularly complimented on the way they deal with such clients, whether this be explaining things to them in a clear and uncomplicated manner, spending time with them or putting them at ease.

It is a misconception that anyone suffering from dementia cannot make a Will or Lasting Power of Attorney. Only if someone lacks sufficient mental capacity are they unable to make such a document. It is therefore vitally important upon any diagnosis of dementia that legal advice is taken as soon as possible to make sure that your affairs are in order so that it is easier for your family to deal with your affairs if you are unable to do so yourself.

To become Dementia Friends, Maples Solicitors have pledged to develop their understanding of dementia and continue assisting clients suffering from dementia with their legal affairs in a respectful, friendly and efficient way that is not daunting making the process as easy as possible.

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