We are pleased to provide you with the Herrington Carmichael LLP employment law update for September 2018.
This is a key note summary of some of the main developments in employment law in the last month.
1. Resigning in response to a repudiatory breach
In the recent case of Brown & Anor v Neon Management Ltd & Anor, the High Court held that where an employee resigns on notice, as a result of an alleged breach of contract, they effectively affirmed the contract. This means that they accepted that the breach was not serious enough to immediately bring an end to the contract, and they will continue to be bound by its terms.
This case dealt with an employee’s notice of six and twelve months and the judge noted that it would be unconscionable to reserve an employee’s rights for that period of time, while notice is served. If the employee does serve notice, and affirms the contract, these facts may still be taken into account if any other breaches occur to evidence the repudiatory nature of the new breach.
Each case must, of course, be considered on its merits. However, we can see this case being used as an authority to argue that contracts have been affirmed and, where an employee wishes to resign and not affirm the contract, they will need to be bolder. The employee may need to be prepared to put an immediate end to their employment, and ultimately their salary.
2. Time limits expiring on a weekend
For most employment related claims, the time limit for submitting the claim is three months from the act complained of. In the case of Miah v Axis Security Services Ltd, the three months expired on a Sunday. The claim form was posted to the Employment Tribunal on the Friday before the expiry of the time limit and only received by the Employment Tribunal on the Monday, the day after the time limit expired.
The Claimant argued that the time limit was automatically extended where the limitation period expires on a non-working day. The Employment Appeal Tribunal rejected this argument, thereby confirming that the claim was out of time.
This case serves as an important reminder that limitation periods imposed are very important. Employees should deal with any complaints they have against their employer, or previous employer, promptly. Likewise, employers should deal with any claim received in plenty of time before the deadline to ensure they are permitted to defend the claim.
3. Respondent should still be permitted to take part in remedy hearing
Employers should always aim to file a Response Form to an Employment Tribunal claim before the deadline, if they are intending to defend a claim. However, in the event that this does get missed, the Employment Tribunal Rules of Procedure provide that a Judge shall decide the claim based on the material available (namely the evidence provided in the claim form).
If this does happen, and the Employment Tribunal finds in favour of the Claimant, the Respondent will be liable for the claim, despite having presented no evidence as to its position. In the recent case of Office Equipment Systems Ltd v Hughes, the Court of Appeal held that where this happens, the Respondent should still be entitled to be involved in the remedies hearing, in circumstances where the matter would have had separate liability and remedies hearings.
This will give employers the chance to mitigate their liability in circumstances where they have, for whatever reason, missed the deadline for responding to a claim. Although this is far from perfect, it at least provides some comfort to employers.
4. The need for a signed contract when enforcing post termination restrictions
In the recent case of Tenon FM Ltd v Cawley, an employer attempted to enforce a non-solicitation of employees clause against a formeremployee by applying for interim injunctive relief. Ms Cawley had worked for Tenon for around 10 years, during which time she had been provided with two different contracts, each imposing restrictive covenants. Tenon failed to produce a signed copy of either contract and Ms Cawley confirmed that this was because she had never signed them.
The Judge refused to grant the interim injunction for a number of reasons, and emphasised the importance of receiving affirmative agreement to covenants in order for them to be enforceable.
This case acts as a reminder to employers to ensure that signed contracts are always obtained from employees, particularly where these contain restrictive covenants which may need to be enforced.