No extension of the effective date of termination where an employee is dismissed for gross misconduct

No extension of the effective date of termination where an employee is dismissed for gross misconduct

To qualify for the right to claim unfair dismissal, employees must generally show that they have been continuously employed for at least two years. When an employer gives no notice or less than the minimum statutory notice, the effective date of termination is artificially postponed to the date on which the proper statutory notice would have expired, for the purposes of this two year qualification.

In the recent case of Lancaster & Duke Limited v Wileman, the Employment Appeal Tribunal has confirmed that if an employee is dismissed without notice for gross misconduct, then their effective date of termination will not be extended by the statutory minimum notice period.

The Claimant, Ms Wileman, was summarily dismissed by Lancaster & Duke Limited (“Lancaster”) for gross misconduct just two days before she was due to have completed two years’ service. On the face of it she therefore did not have the right to bring a claim for unfair dismissal.

However Ms Wileman successfully argued before the Employment Tribunal that her effective date of termination (“EDT”) was extended by her statutory minimum notice. As Ms Wileman’s statutory minimum notice period was one week, this was sufficient to give her the right to bring a claim.  

Lancaster appealed to the Employment Appeal Tribunal (“EAT”) on the basis that as Ms Wileman had committed gross misconduct, they were entitled to terminate her contract without notice and her EDT was not deemed to be extended in these circumstances. Accordingly she had less than two years’ service as at her EDT and so did not have the right to bring a claim for unfair dismissal.

The EAT agreed and upheld Lancaster’s appeal. It then remitted the claim back to the Employment Tribunal to decide if Ms Wileman had, in fact, committed gross misconduct.

Comment

While this case appears to be helpful to employers, its outcome illustrates that in cases of gross misconduct dismissals where the operation of the artificial extension of the EDT would have given an employee 2 years’ qualifying service, any claim may still need to be heard at tribunal to determine whether it was in fact gross misconduct or not. Accordingly, even if the employer is ultimately successful, they may still have to go to the trouble and expense of defending the claim.

In the event that an employer is considering dismissing an employee who is about to achieve two years’ service we recommend that the dismissal takes effect no later than 10 days prior to the anniversary of their start date to avoid this issue arising.  

Employers should note, though, that even if an employee has less than two years’ service, they can still bring certain claims, for example for discrimination or under the legislation protecting whistle blowers, which have no qualifying length of service.

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