Labour supervision 4 (lecture notes)
‘Good reason’ + ‘fair process’
Until 1971, provided the employee was given his contractual period of notice, the employer was
entitled to end their employment for any reason
The US continues to adopt the ‘employment at will’ model; no good cause needs to be shown
A cap on compensation applies; the incentive is therefore to frame your claim as a discrimination
claim under the EA
The regime is said to incentivise the parties to try to negotiate/mediate a settlement; the threat of
litigation (Unison v Lord Chancellor)
An employee
s.94(1) ERA
Limb (b) workers not covered
Qualifying period of 2 years
Challenged in Seymour-Smith; it was argued that the requirement amounts to discrimination against
women since they are much more likely to have an uneven pattern of employment
The HOL held that the rule is justified
A balance must be struck between the interests of employers and employees
EXCEPTIONS:
● Automatic unfair dismissal (s.108(3) ERA)
● If the employee has been dismissed for a reason which is or relates to his political opinions or
affiliation (see the ECHR case of Redfearn v UK) (s.108(4) ERA)
● Where the dismissal is connected with the employee’s membership of the Reserve Forces
(s.48 Defence Reform Act)
Any agreement to give up a right to pursue an unfair dismissal claim in an employment tribunal
(thereafter ET) is void (s.203 ERA)
Void insofar as it has the effect of limiting/excluding the employee’s statutory rights (Igbo v Johnson
Matthey Chemicals)
BUT there is an exception when the employee enters into a valid settlement agreement pursuant to
s.203(3) ERA
This is supplemented by the right to have ‘protected conversations’ before litigation (s.111A)
Introduced by the Coalition government
The employer can make an offer where he is unhappy with the employee’s performance
This is hugely important in practice
,Coalition government (further reforms):
(i) increase in the qualifying period
(ii) cap on the compensatory award for unfair dismissal
(iii) fees for bringing tribunal claims
Note that this was struck down in Unison
(iv) the claimant must notify ACAS before lodging a tribunal claim; encouraging early conciliation
The meaning of dismissal
Covered by s.95(1) ERA: three categories of dismissal
The burden falls on the employee to establish that a dismissal has taken place
(a) Dismissal by employer
Generally refers to the typical ‘you’re sacked’ situation
The dismissal may occur with or without notice (if the latter, a wrongful dismissal claim may also be
available)
Situations where the employer unilaterally imposes radically different terms of employment:
s.95(1)(a) or (c)?
Hogg v Dover College: the EAT held that the teacher was essentially told that his former contract was
terminated- the changes amounted to a dismissal
In Alcan Extrusions v Yates, it was suggested that ‘the departure may, in a given case, be so substantial
as to amount to the withdrawal of the whole contract’ (i.e., s.95(1)(a))
Alternative scenario: fire and rehire
The employer dismisses the worker and rehires him on new, less favourable terms and conditions
See the P&O Ferries case study
A new statutory code of practice is likely to come into force in this area
Legal effect in the sense that the tribunals will have to take it into account
BUT see USDAW v Tesco Stores
The Court of Appeal overturned an injunction that had prevented Tesco from using dismissal and
re-engagement to withdraw a collectively agreed contractual benefit that it had previously described
as ‘permanent’ and ‘guaranteed for life’
, (b) Expiry of a limited term contract (thereafter LTC)
Covers fixed term contracts; completion of a performance of a specific task; occurrence of a specific
event
When such a contract is not renewed, it amounts to a dismissal in law: it must be handled properly by
the employer
An LTC is deemed to be permanent on the first renewal if the employee has four years’ continuity and
there is no objective reason for not granting permanent status (the Fixed Term Work (Prevention of
Less Favourable Treatment) Regulations 2002
Prevents repeated renewals of fixed term contracts
Derived from EU law
(c) Constructive dismissal
The employer commits a repudiatory breach of contract (a contractual test therefore applies- see
Western Excavating v Sharp)
Refer back to the bilateral theory (Geys)
The courts are generally reluctant to find constructive dismissals
Harvey on Industrial Relations (cited with approval in Brown v Merchant Ferries) suggests four
requirements:
● A breach of contract
● Sufficiently important/serious
● The employee must leave in response to the breach
● The employee must not delay too long (Western Excavating v Sharp)
Though note that trying to find alternative employment before resignation may be permitted (Waltons
& Morse v Dorrington)
Regard must be had to factors such as (i) length of service, (ii) the need to support family members
The employee must also not have waived the breach by affirming the contract
The so-called ‘last straw’ cases may apply here; though such a claim was rejected in Kaur v Leeds
Teaching Hospitals
In contract law, the employer is entitled to damages for the loss flowing from the breach of contract
Limited to compensation for the loss of pay + benefits for the period of notice the employer would
have been obliged to provide
The Johnson exclusion zone applies- essentially a wrongful dismissal claim
‘Good reason’ + ‘fair process’
Until 1971, provided the employee was given his contractual period of notice, the employer was
entitled to end their employment for any reason
The US continues to adopt the ‘employment at will’ model; no good cause needs to be shown
A cap on compensation applies; the incentive is therefore to frame your claim as a discrimination
claim under the EA
The regime is said to incentivise the parties to try to negotiate/mediate a settlement; the threat of
litigation (Unison v Lord Chancellor)
An employee
s.94(1) ERA
Limb (b) workers not covered
Qualifying period of 2 years
Challenged in Seymour-Smith; it was argued that the requirement amounts to discrimination against
women since they are much more likely to have an uneven pattern of employment
The HOL held that the rule is justified
A balance must be struck between the interests of employers and employees
EXCEPTIONS:
● Automatic unfair dismissal (s.108(3) ERA)
● If the employee has been dismissed for a reason which is or relates to his political opinions or
affiliation (see the ECHR case of Redfearn v UK) (s.108(4) ERA)
● Where the dismissal is connected with the employee’s membership of the Reserve Forces
(s.48 Defence Reform Act)
Any agreement to give up a right to pursue an unfair dismissal claim in an employment tribunal
(thereafter ET) is void (s.203 ERA)
Void insofar as it has the effect of limiting/excluding the employee’s statutory rights (Igbo v Johnson
Matthey Chemicals)
BUT there is an exception when the employee enters into a valid settlement agreement pursuant to
s.203(3) ERA
This is supplemented by the right to have ‘protected conversations’ before litigation (s.111A)
Introduced by the Coalition government
The employer can make an offer where he is unhappy with the employee’s performance
This is hugely important in practice
,Coalition government (further reforms):
(i) increase in the qualifying period
(ii) cap on the compensatory award for unfair dismissal
(iii) fees for bringing tribunal claims
Note that this was struck down in Unison
(iv) the claimant must notify ACAS before lodging a tribunal claim; encouraging early conciliation
The meaning of dismissal
Covered by s.95(1) ERA: three categories of dismissal
The burden falls on the employee to establish that a dismissal has taken place
(a) Dismissal by employer
Generally refers to the typical ‘you’re sacked’ situation
The dismissal may occur with or without notice (if the latter, a wrongful dismissal claim may also be
available)
Situations where the employer unilaterally imposes radically different terms of employment:
s.95(1)(a) or (c)?
Hogg v Dover College: the EAT held that the teacher was essentially told that his former contract was
terminated- the changes amounted to a dismissal
In Alcan Extrusions v Yates, it was suggested that ‘the departure may, in a given case, be so substantial
as to amount to the withdrawal of the whole contract’ (i.e., s.95(1)(a))
Alternative scenario: fire and rehire
The employer dismisses the worker and rehires him on new, less favourable terms and conditions
See the P&O Ferries case study
A new statutory code of practice is likely to come into force in this area
Legal effect in the sense that the tribunals will have to take it into account
BUT see USDAW v Tesco Stores
The Court of Appeal overturned an injunction that had prevented Tesco from using dismissal and
re-engagement to withdraw a collectively agreed contractual benefit that it had previously described
as ‘permanent’ and ‘guaranteed for life’
, (b) Expiry of a limited term contract (thereafter LTC)
Covers fixed term contracts; completion of a performance of a specific task; occurrence of a specific
event
When such a contract is not renewed, it amounts to a dismissal in law: it must be handled properly by
the employer
An LTC is deemed to be permanent on the first renewal if the employee has four years’ continuity and
there is no objective reason for not granting permanent status (the Fixed Term Work (Prevention of
Less Favourable Treatment) Regulations 2002
Prevents repeated renewals of fixed term contracts
Derived from EU law
(c) Constructive dismissal
The employer commits a repudiatory breach of contract (a contractual test therefore applies- see
Western Excavating v Sharp)
Refer back to the bilateral theory (Geys)
The courts are generally reluctant to find constructive dismissals
Harvey on Industrial Relations (cited with approval in Brown v Merchant Ferries) suggests four
requirements:
● A breach of contract
● Sufficiently important/serious
● The employee must leave in response to the breach
● The employee must not delay too long (Western Excavating v Sharp)
Though note that trying to find alternative employment before resignation may be permitted (Waltons
& Morse v Dorrington)
Regard must be had to factors such as (i) length of service, (ii) the need to support family members
The employee must also not have waived the breach by affirming the contract
The so-called ‘last straw’ cases may apply here; though such a claim was rejected in Kaur v Leeds
Teaching Hospitals
In contract law, the employer is entitled to damages for the loss flowing from the breach of contract
Limited to compensation for the loss of pay + benefits for the period of notice the employer would
have been obliged to provide
The Johnson exclusion zone applies- essentially a wrongful dismissal claim
