HOMEBASE LTD v MR D B WESTOBY [2001] UKEAT 855_00_2003

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2001] UKEAT 855_00_2003Case No Appeal No. EAT/855/00Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
HOMEBASE LTDAPPELLANTMR D B WESTOBYRESPONDENT
Before
Mr Recorder LangstaffLord Gladwin of CleeDate 20 March 2001
[1]APPEARANCES For the Appellant MR JASON GALBRAITH-MARTEN (Of Counsel) Instructed by: Messrs Eversheds Solicitors Fitzalan House Fitzalan Road Cardiff CF24 OEE For the Respondent MR WESTOBY IN PERSON MR RECORDER LANGSTAFF QC The employer Appellant appeals from a decision of the Employment Tribunal sitting at London (South) which was promulgated on 20 June 2000. At issue, was what was the effective date of termination of the employment of Mr Westoby. He had lodged an application before the Industrial Tribunal on 9 March 2000.[2]Accordingly, if the date of termination pursuant to section 111(2)(a) of the Employment Rights Act 1996 was 10 December 1999 or later he would have submitted his originating application within 3 months. Otherwise he would have to come within the exception that it was not reasonably practicable for him to have submitted an originating application sooner. The Employment Tribunal did not consider the exception because they found that the effective date of termination was 25 December 1999.[3]Section 97 of the Employment Rights Act 1996 defines the effective date of termination. It provides:
"(1) Subject to the following provisions of this section, in this Part "the effective date of termination" – (a) in relation to an employee whose contract of employment is terminated by notice, whether given by his employer or by the employee, means the date on which the notice expires, (b) in relation to an employee whose contract of employment is terminated without notice, means the date on which the termination takes effect, (a third possible meaning (c) is not material)"
[4]The Employment Tribunal found that the Respondent had received a letter dated 15 September 1999. It took the view that this letter was not intended to dismiss without notice or with insufficient notice. Instead it constituted dismissal with notice. They say:
"This was in effect a payment in lieu of working out that notice hence the date at which notice expired was 25 December 1999."
[5]The letter to which they had regard is central to this case. The material parts read as follows:
"Following the job match exercise I am sorry to inform you that we are unable to offer you a position in the new structure. Therefore the outcome is that your contract with Homebase will terminate on Saturday 2 nd October 1999, by reason of job redundancy. This letter is formal notice of termination of your contract of employment."
[6]If matters had rested there, there could have been no possible doubt as to the meaning of the letter. It would have provided for termination on notice albeit a very considerably shorter period of notice than that to which the Respondent was properly entitled. However, the letter continued, advising of a right of appeal which had to be exercised, if at all, by the day after the letter was dated at the "very latest" (a provision which led to a certain amount of critical comment from the lay members of this Tribunal) and a further appeal up to 22 September. It then dealt under the heading of "severance" with the calculation of a severance payment. That provision reads as follows:
"Your severance payment is calculated on the 12 weeks prior to Saturday 2 nd October 1999. A payment in lieu of notice, according to your length of service, will also be paid to you. This payment in lieu of notice will be payment for the weeks commencing from Monday 4 th October until the end of your notice entitlement period."
The letter proceeds in italic with what appear to be 2 alternative versions, one of which should, it appears, have been scored through, but was not, as to the date upon which the severance payment and payment in lieu would be lodged with the Respondent's bank. It went on to say:
"Details of your severance calculation are attached."
It turns out that they were not but came a few days later in a document dated 25 September.[7]On the second page, or it may be the reverse of the letter, was set out the eligibility of Mr Westoby for a profit share the calculation of which appears to have depended upon his continuing eligibility, for it provided an entitlement to continue to use his staff discount card "until the end of your contractual notice period" and provided also that he could retain his allocated car "until the end of your contractual notice period or when you start a new job whichever is sooner."[8]The expression "contractual notice period" was intended to be a reference to the period to which under his contract of employment unless otherwise determined Mr Westoby would have been entitled. That understanding is confirmed by the severance pay calculation when finally it was received dated 25 September. On the face of that document there were a number of dates. Termination date was set at 2 October 1999 and the end of contractual notice period at 25 December 1999. The notice period in weeks was said to be 12 and the notice period to be worked in weeks, 0.[9]The Employment Tribunal said of this letter at paragraph 4 in giving the reasons for their decision that:
"The letter of 15 September 1999 was not intended to dismiss without notice or with insufficient notice because as a matter of fact there was work done after the termination period expressed therein. Further the Applicant not only received payment for work done beyond 2 October 1999. He also received most – if not all – of his work related benefits up to the date his notice period expired i.e. up to 25 December 1999."
[10]The first sentence of that paragraph contains a non sequitur. Behaviour after a notice has been given cannot determine the intention with which the notice was given. That intention was the intention and could only be the intention with which the original notice was delivered. For that, we think, there is no alternative but to focus upon the words of the letter itself and we accept Mr Galbraith-Marten's submission that the letter construed sensibly bearing in mind the individual to whom it was addressed and the nature of the letter was to make it plain that work under the contract was to cease on 2 October. A distinction appears to be made between the notice given and what is described as contractual notice period, a reference, we think, to the period to which Mr Westoby would have been entitled lawfully if his contract had not been determined by short notice at an earlier date.[11]In summary, therefore, we think the letter was intended to bring employment (in the sense of working at the place of work) to an end on 2 October 1999 and to make provision financially for the benefits that Mr Westoby would have been entitled to had that contract continued. So far as two at least of those benefits are concerned we, with some hesitation, think that Mr Galbraith-Marten may be right in suggesting that the offer or permission to use a staff discount card and to continue to use a car until the end of what would have otherwise been a notice period under the contract are practical means of avoiding what would otherwise be a difficult time wasting and expensive calculation, namely the putting of a value upon those benefits with which to compensate Mr Westoby for what was on any showing a breach of contract by Homebase in determining his contract earlier than they were lawfully entitled to do.[12]Since it was plain that the Employment Tribunal considered that although no work was actually done after 23 October 1999 some benefits under the contract remained in receipt by Mr Westoby, the question arises whether the continuation of a contract of employment, in a sense that there has been a breach by the employer which has not been accepted as repudiatory by the employee, affects what would otherwise be the date of termination. The answer appears to be given by a decision of this Tribunal in Robert Cort & Son v Charman [1981] IRLR 437. There, this Tribunal presided over by Browne-Wilkinson J, as he was, discussed the meaning of the fore-runner provision to section 97(1)(a) and (b) of the Employment Rights Act. They considered that they were bound by the Court of Appeal in Dedman v British Building and Engineering Appliances [1973] IRLR 379. That decision compelled the view that the effective date of termination was fixed at what most employees would understand to be the date of termination: that is, the date on which the employee ceased to attend his place of employment. The fact that, his so ceasing, might have been in breach of contract, might have been a consequence of the provision of short notice, or might have been (as the facts of Stapp v The Shaftesbury Society [1982] IRLR 326 were later to demonstrate) because a notice given lawfully was thereafter shortened so as to amount to summary dismissal, made no difference to the principle that in interpreting section 97(1) the effective date of termination was the date upon which the employee ceased to work at the place of work where he had been employed.[13]The only exception to this would be where there was notice, whether given for the statutory period or some shorter period, as Cort v Charman itself makes clear, which provided for a specific date. What we say therefore has no relationship to any case in which it appears that garden leave has been granted. We are dealing rather with a case in which there has been no agreement found by the Employment Tribunal to be a garden leave arrangement and therefore no understanding backed by documentation that there had been notice set to expire at a particular date to which section 97(1)(a) might relate.[14]If, as a first reading of the letter of 15 September 1999 might suggest, the employment here came to an end on 2 October 1999 irrespective of the fact that the contractual notice period would have expired on 25 December 1999, the effective date of termination would be 2 October. Here however, this case differs from others that we have been aware of. It appears that the employer and employee by some arrangement secured that Mr Westoby worked on until 23 October 1999. This is described in parenthesis in paragraph 5 of the Tribunal's decision as being by mutual agreement. We were concerned at one stage during the course of the hearing whether the Employment Tribunal, having come to the view they did that the letter upon a true construction of it provided for a notice period expiring on 25 December, had not considered what effect, if any, the continued work by Mr Westoby until 23 October might have had upon the effectiveness or continuing validity of any of the documentation given to him in September. Indeed, whether the notice that had been given to him was still effective to any extent.[15]He has indicated to us (in terms which make it clear to us that though unrepresented he has given the matter proper consideration) that he would not wish us to remit the case to the Employment Tribunal for further consideration of the effect of this period of 3 weeks working which otherwise we might have been inclined to do.[16]He has invited us, having listened to that which Mr Galbraith-Marten has said, to accede to the Appeal by allowing it and thus inevitably remitting the entire case from now on to the Employment Tribunal upon the footing that the application to that Tribunal was out of time having been submitted some months late.[17]We are prepared for the reasons which we have given to accede to that invitation. Essentially we have considered that the reasoning of the Tribunal in construing the letter of 15 September was flawed as being a non sequitur. We do not see within it the ambiguity which the Tribunal did, and we think that had the Tribunal had the advantage of being referred to the cases that we have seen they would not have concluded as they did. They may have been moved by the circumstances in which notice was given to a distinguished servant of the Respondent, at a time when it was likely to cause him some emotion and dislocation of his normal life we have no hesitation in accepting what he says on this. Whether that is relevant at all to any question of extension of the time limits is a matter which an Employment Tribunal has yet to determine.[18]Accordingly we allow the Appeal. We remit the case to the Employment Tribunal for further consideration upon the footing that the effective date of termination was 23 October 1999. Although we have been invited by Mr Galbraith-Marten to consider that we should direct that a fresh Tribunal hear the case we think that there may be much advantage if it is still possible to convene the Tribunal which heard the case from which this Appeal has come. That would give rise certainly to economy of time, but if that is not possible plainly it will have to be a fresh Tribunal. And finally we would like to thank Mr Galbraith-Marten for his clear and effective submissions and Mr Westoby for his frank approach to us.