The EAT has held that a clause which, on its face, permitted summary dismissal for any breach of a policy should be interpreted as only allowing summary dismissal for a breach which was serious and wilful or grossly negligent. It also observed that summary dismissal can only be permitted on the basis of an employee's conduct and not for other reasons.
Robert Bates Wrekin Landscapes Ltd v Knight
Mr. Knight was employed as a gardener. His contract of employment included a summary dismissal clause which provided that his employment could be terminated by his employer ("RBW") without notice or payment in lieu of notice in specified circumstances, which included gross misconduct and "if the Employee commits any breach of the Employer's or Customer's security rules". A large part of RBW's business was maintaining the gardens of a secure MOD site. The MOD's rule book stated that no MOD property should be removed from the site without permission.
A bag of bolts belonging to the MOD was found in Mr. Knight's van. Mr. Knight was summarily dismissed for theft and for removing goods from the MOD's site, contrary to protocol. Mr. Knight brought a claim for wrongful dismissal.
The Tribunal accepted Mr. Knight's explanation that he had simply forgotten to hand in the bolts and therefore held that he was not guilty of theft. The Tribunal accepted that he had breached his contract by breaching the MOD's security rules. However, as the Tribunal found that the breach was not deliberate, it held that Mr. Knight did not commit a fundamental breach of contract which entitled RBW to terminate Mr. Knight's employment summarily. RBW appealed.
The EAT dismissed the appeal. The central question for the EAT was whether the summary dismissal clause applied to any breach of security rules, however minor or inadvertent. The EAT held that it did not. It noted that as a general rule, an employee is entitled to notice of termination unless the employer can point to a repudiatory breach of contract i.e. gross misconduct or gross negligence. The summary dismissal clause should therefore be interpreted in this commercial context and only breaches of security rules which were serious and wilful or grossly negligent would justify summary dismissal.
This decision is a helpful reminder to employers that in the event of any ambiguity, a contractual clause will be construed in favour of the employee. Employers will often set out examples of circumstances under which it may be entitled to dismiss an employee without notice in a contract of employment or a disciplinary policy. If it is intended that a trivial breach of a policy should justify summary dismissal, this should be explicitly stated, otherwise a Tribunal is likely to take a more restrictive approach to the circumstances which would justify dismissal.
Although not necessary to decide the case, the EAT also observed that the right to statutory minimum notice can only be excluded where termination is by reason of the conduct of the employee. Therefore, a clause permitting summary dismissal on the basis of long term sickness absence or mental incapacity would not preclude an entitlement to statutory minimum notice.