Compass Services (UK) Ltd v Offord [1997] UKEAT 140_97_0402

EAT
Compass Services (UK) Ltd v Offord
[1997] UKEAT 140_97_0402 · 1997-02-04

JUDGE PETER CLARK :

The question before the Industrial Tribunal, and in this appeal, is whether the Applicant, Mrs Offord, can count as continuous service with the Respondent employer, the period from 24 February 1986 until her eventual dismissal on 1 March 1996 for the purposes of founding a complaint of unfair dismissal, a claim for a redundancy payment and her claim for damages for wrongful dismissal.This preliminary issue came before a Chairman (Mr John Warren) sitting alone at the London (South) Industrial Tribunal on 7 January 1997. He held that her employment was continuous, notwithstanding a break in service between 7 January and 13 February 1995. That period, he concluded, amounted to absence from work on account of temporary cessation of work, and could be counted under Section 212(3)(b) of The Employment Rights Act 1996 , formerly paragraph 9(1)(b) of Schedule 13 to The Employment Protection (Consolidation) Act 1978 . Against that decision, for which Extended Reasons were given on 17 January 1997, the Respondent employer now appeals.

The Facts

The Chairman made the following material findings of fact. The Applicant commenced employment with the Respondent on 24 February 1986. On 20 October 1994 she was given written notice of dismissal by reason of redundancy to expire on 7 January 1995. In the letter the Respondent assured the Applicant that every effort would be made to find her suitable alternative employment. The letter also set out her redundancy pay entitlement should no alternative position be found.In November 1994 the Applicant attended an interview with the Respondent for the post of Catering Manager at Lanesborough Preparatory School to cover a maternity leave absence. Her employer was to be an associated employer within the Compass Group, Chartwells.By letter dated 23 December 1994, which did not arrive until 3 January 1995, the Respondent, following earlier telephone conversations, wrote to confirm that her notice of redundancy had been withdrawn as she would be carrying out project work from 7 January until her transfer to Chartwells in February. It is common ground that in fact no formal offer of employment with Chartwells was made until the Respondent's letter dated 24 January 1995. In the course of his reasons the Chairman found that the project work was not suitable alternative employment.On 3 January 1995, before receiving the Respondent's letter dated 23 December by post and fax that day, she wrote to the employer in these terms:
"As I have not received written confirmation of my redundancy notice being withdrawn, as discussed with Graham, I have to assume that it is still effective.
Wages inform me that I have 20 days holiday entitlements so far, and as I have only taken 16 so far I would like to leave with immediate effect, today being my last working day. This leaves one day owing to me."She had been concerned that her position with the Respondent was uncertain; she had a mortgage to pay and she needed a job. She arranged to commence work with Old Barn Nurseries, an unconnected employer, and did start that job in early January 1995 following her last day of work with the Respondent on 3 January.On 24 January the Respondent wrote to the Applicant offering her a temporary contract as Catering Manageress to cover maternity leave at Lanesborough School. That letter continued by setting out her salary. The employment was to commence on 13 February 1995 and the letter states:
"This appointment to Chartwells is made on the basis that your service with Compass Services finished on 6th January 1995 by your own request.
I can confirm that I would be very happy to consider you for the permanent position of Catering Services Manager, which would commence in April 1995.This appointment would be subject to the School's approval and satisfactory progress during your time at Lanesborough School. In the event that you are successful in obtaining the substantive job, I would be happy to back date your service to commencement in February1986.

If you have any queries please do not hesitate to contact me."

The Applicant took up that employment on 13 February 1995. Her predecessor, due to return from maternity leave in July 1995, was in fact made redundant, and the Applicant continued in post until she became ill in January 1996, and was dismissed on grounds of capability on 1 March 1996. The Respondent never acknowledged that her service should run from February 1986. It is apparently the Respondent's case that she was never appointed to the substantive job at Lanesborough School, although she worked in that capacity for just under a year, apart from school holidays.Further, the Industrial Chairman, in paragraph 17 of his Reasons said this:
"17 ... I am concerned, and I accept the Applicant's evidence that she was told that if she pursued a claim for redundancy against Compass at the time in respect of termination of her employment as at 7 January 1995, then the offer of the post at Lanesborough School would be withdrawn. That to me is quite scandalous conduct on the part of the Respondents. I have no evidence to rebut that allegation and I accept the evidence given by the Applicant that that is what occurred."
Whatever the merits of the Respondent's behaviour, the issue before us, as it was before the Industrial Tribunal Chairman, is whether under the statute the Applicant is entitled to count as continuous her service since 1986.

The Law

Section 212 provides so far as is material:
"(3) Subject to subsection (4), any week (not within subsection (1)) during the whole or part of which an employee is - (b) absent from work on account of a temporary cessation of work,

counts in computing the employee's period of employment."

The provision breaks down into these questions:(1) Was the employee absent from work?(2) Was there a cessation of work?(3) Was the cessation temporary?(4) Was there a causal connection between the absence and the temporary cessation? Bentley Engineering Co Ltd v Crown [1976] ICR 225 .

The Appeal

The Applicant does not appear and is not represented before us, but we have taken into account the written submissions lodged on her behalf by her representative, Mrs Jill Armstead. In support of the appeal Mr Crighton makes the following submissions.First, he contends that the Chairman's finding in paragraph 17 of the Reasons that the project work, offered and rejected by the Applicant, was not suitable alternative employment, was a perverse finding. It is unnecessary for us to rule on that submission. The question of suitable alternative employment is relevant only to a claim for a redundancy payment arising out of termination of the contract on 7 January 1995. No such claim is made in this case. It is not relevant to the continuity point which is before us.Secondly, he submits that the Chairman's finding that the Applicant did not resign voluntarily is perverse. However, the critical point is that the notice of dismissal given on 20 October was never consensually withdrawn. It therefore operated to terminate the contract of employment on 7 January 1995, for the reason originally given, that is, redundancy. We shall return to this point later in our judgment.Thirdly he relies upon the House of Lords decision in Secretary of State for Employment v Globe Elastic Thread Co Ltd [1979] ICR 706. He cites that case as authority for the proposition that this Applicant cannot succeed in showing continuity because she had a period of employment with an unconnected employer, Old Barn Nurseries. As we shall shortly show, that employment is quite irrelevant to the issue in this case.Globe Elastic is nothing to the point. There the employee worked for Company A from 1948 to 1970. In 1970 he accepted employment with a related Company B, on the understanding that his employment with A would be treated as continuous. Upon his dismissal by B in 1975 on grounds of redundancy, he claimed a redundancy payment on the basis of continuous service since 1948.The House of Lords held that he could only count service with B from 1970 for the purposes of his redundancy entitlement. The reason was that under the statute A and B were not associated employers. Accordingly there was no continuity of service following the change of employer.In this case, the Applicant does not rely on service with Old Barn Nurseries, she relies upon two periods of employment with the Respondent, bridged by the temporary cessation provision in Section 212(3)(b).

Conclusion

We return to the four questions posed by Phillips J in Bentley v Crown .(1) Was the Applicant absent from work during the relevant period?Yes. The Applicant was not at work for this employer during the period. She fulfils the criterion of having two successive contracts with the Respondent, separated by an interval of time during which she had no contract with the Respondent. It is immaterial that she was, during the period, employed by a different employer under a contract with that unconnected employer.(2) Was there a cessation of work?There was here a period during which the Respondent had no need of the Applicant's services. It is enough that there has been a cessation so far as the Applicant is concerned, even if other parts of the Respondent's business are proceeding normally. Fitzgerald v Hall, Russell & Co Ltd [1970] AC 984 . It is akin to a lay-off.(3) Was the cessation temporary?In answering this question it is necessary to look back, not forward. The intentions of the parties prior to the cessation that work will resume shortly is not conclusive. It is necessary to look back after the return to work to see whether the cessation was 'temporary'. Here, the break was for five weeks. We are satisfied that the Chairman was entitled to conclude that such a break was temporary.(4) Was there a causal connection between the Applicant's absence and the temporary cessation of work?Where an employee is dismissed by reason of misconduct, but later re-employed, he cannot claim a temporary cessation of work. Clark v Blairs Ltd [1966] 1 ITR 545. Similarly, where the employee voluntarily resigns and is then later re-employed. Roach v CSB Moulds Ltd [1991] IRLR 200. However, those are not the facts in this case. The Chairman found that the terminating event was the Respondent's original notice of dismissal by reason of redundancy, which could not be unilaterally withdrawn by the employer and in circumstances where there was no consensual withdrawal of that notice. See Harris & Russell Ltd v Slingsby [1973] ICR 454. That was the terminating event, not the Applicant's letter dated 3 January 1995.Having answered the individual questions raised in Bentley v Crown we also bear in mind Phillips J's further dictum in that case upon which the Applicant relies. He said:
" ... it is proper to dissect the phrase in that way, but having done so, you should stand back, as it were, and take an overall view and consider the question 'in the round' whether it is fair to say that the employee was absent from work on account of a temporary cessation of work'."
Having done so, we conclude that the Applicant was absent from work on account of a temporary cessation, as the Chairman found.Accordingly this appeal is dismissed.