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Zulhayir v J J Food Service Ltd UKEAT/0593/10/SM

Keywords • effective date of terminationtime limitsunfair dismissal

Appeal against the ET decision to strike out claims of unfair dismissal, disability discrimination and breach of contract. Appeal allowed and remitted to a fresh Tribunal for a full hearing.

The claimant, a delivery driver, suffered an accident at work in 2005 and as a result was unfit to carry out his job. Statutory sick pay was paid to the claimant for 6 months, after which payments stopped because he did not provide any further medical certificates.18 months later the respondent wrote to him, at the address they had on their records, saying that they had had no correspondence from him for the last 6 months regarding his return to work, and that unless he contacted them within a few days, they would assume he no longer wished to work for the respondent. Unfortunately, the claimant had moved house, and had not informed the respondent of his new address, and so did not receive this letter. The respondent did not make any further effort to send or deliver the letter, despite knowing that the claimant had not received it because it had been sent by recorded delivery and returned by the Post Office to the respondent. The letter, and the news that he had left his job, which was only formally terminated in 2006, only came to the claimant's attention in July 2009 whilst pursuing a personal injury claim against the respondent. The claimant lodged his ET1, complaining of unfair dismissal, disability discrimination and breach of contract, in July 2009. The Judge struck out his claims on the basis that the failure to inform the respondent of his change of address, or provide for his post to be re-directed, amounted to an implied termination by him of his contract of employment. He had resigned in 2006, and so his claim was out of time. The claimant appealed.

The EAT found that the EJ was wrong to follow the case of Harrison v George Wimpey & Co Ltd which raised the concept of implied termination of the contract of employment by the employee, sometimes described as self-dismissal. In the case of London Transport Executive v Clarke, the Court expressly disapproved 3 cases of self-dismissal, holding that a repudiation by the employee must be accepted by the employer whereupon the contract is terminated by the employer in circumstances amounting to dismissal by him

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Appeal No. UKEAT/0593/10/SM

EMPLOYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 26 July 2011

Before

HIS HONOUR JUDGE PETER CLARK, MR T MOTTURE, MR M CLANCY

MR Z M ZULHAYIR (APPELLANT)

J J FOOD SERVICE LTD (RESPONDENT)

Transcript of Proceedings

JUDGMENT

APPEARANCES

For the Appellant
MR D STILITZ (One of Her Majesty's Counsel)

Bar Pro Bono Unit

For the Respondent
MR T GRADY (Representative)

SUMMARY

UNFAIR DISMISSAL – Dismissal/ambiguous resignation

STATUTORY DISCIPLINE AND GRIEVANCE PROCEDURES – Whether applicable

JURISDICTIONAL POINTS – Claim in time and effective date of termination

EDT; whether self-dismissal by Claimant; acceptance of repudiation by Respondent amounting to dismissal. Communicating dismissal.

Held: Claim in time; SGP not applicable: complaint of continuing breach of DDA and right to holiday pay continuing after repeal of DRR, see para 3 2008 Order.

HIS HONOUR JUDGE PETER CLARK

Introduction

1. This matter is proceeding in the Watford Employment Tribunal. The parties are Mr Zulhayir, Claimant, and J J Food Service Limited, Respondent. This is an appeal by the Claimant; with the permission of HHJ Richardson, against the reserved Judgment of Employment Judge Mahoney, sitting alone at a Pre-Hearing Review (PHR) held on 6 September 2010, striking out his claim against the Respondent. That Judgment with Reasons was promulgated on 23 September.

The facts

2. The facts are important in this case and are not materially in dispute. They are very helpfully set out by the Employment Judge at paragraph 3 of this Reasons and we should recite them.

"3.1 From evidence before it, the tribunal makes the following findings of fact.

3.2 The claimant was employed by the respondent on 1 November 2001 as a delivery driver.

3.3. On 7 January 2005 the claimant was involved in an accident at work which involves serious injuries to his spine as a result of which he became unfit to carry out his job. At the date of the Pre-Hearing Review, the claimant was still unfit to carry out his former job as a delivery driver.

3.4 Initially, the claimant supplied medical certificates which were delivered to the respondent by his son in law. The medical certificates stated he was unfit to work and were dated 11 and 20 January, 7 February, 7 March and 20 June 2005. During this period the claimant received statutory sick pay by direct payments into his bank account.

3.5 After 25 June 2008 no further medical certificates were provided by the claimant to the respondent and statutory sick pay ceased to be paid from about mid July.

3.6 The respondent's records recorded the claimant as living at 7 Clydach Road, Enfield, Middlesex EN1 3XL.

3.7 Shortly after 27 September 2005 Jobcentre Plus sent the respondent a statutory sick pay and benefit form about the claimant, recording the above address as the claimant's address and requesting information in relation to the payment of statutory sick pay.

3.8 Part of the employee handbook of the respondent, which the claimant accepted he had received, stated that an employee must notify the respondent of any change of address and telephone number, so they could maintain accurate information on their records and make contact in the case of emergencies.

3.9 In January 2006 the claimant was evicted from 7 Clydach Road, Enfield because he had been unable to pay the rent and moved to accommodation at 176A Baker Street, Enfield EN1 3JS. The tribunal is satisfied that he did not notify the respondent of that change of address at any time thereafter.

3.10 On 28 June 2006, Mr Camkiran sent a letter by recorded delivery to the claimant at the 7 Clydach Road, Enfield address which stated as follows:-

'It has come to my attention that you left you job as a driver on 22 July 2005 and since then we did not receive any correspondence regarding your return to work despite the efforts we made to contact you.

Am I to assume that you no longer wish to work for J J Foods Service Limited? If so, please confirm in (sic) your resignation in writing. Please note that if you do not contact me by 5 July 2006 then we would conclude that you no longer wish to work for us and that you terminated your employment by your own volition.

If not, please contact me immediately upon receipt of this letter in order that we may arrange a meeting to discuss the situation.'

That letter was duly returned by the Post Office to the respondent on 6 July 2006 marking that it had not been called for. The respondent made no further efforts to send that letter or deliver that letter to the claimant.

3.11 On 5 October 2007 a firm called Hamilton Insurance, which is a member of the HSBC Group, wrote to the respondent requesting details of the claimant's alleged disability as they were dealing with an insurance claim for the claimant. The claimant's address on the application form was noted as 7 Clydach Road, Enfield.

3.12 On 18 July 2005 a report from Ms Szasz an occupational therapy injury management consultant had been produced at the request of the respondent through a company called Corpore Limited. This report set out the problems that had arisen for the claimant as a result of the accident. The report stated that it seemed unlikely the claimant would be able to continue working as a driver but that a role working in the transport management area of the company might be a possibility. Ms Collison, another injury management consultant, produced a further report for Corpore Limited on 26 January 2006.

3.13 In June 2005 the claimant had instructed solicitors, Parker Bird, to act on his behalf in a personal injury claim against the respondent company for the injury received in the accident which had taken place at work. In the course of that personal injury case the claimant was examined by a consultant nominated by the respondent in 2009. The respondent's insurers had instructed solicitors, Kennedys, to act on their behalf in this claim.

3.14 The letter dated 28 June 2006 referred to in paragraph 3.10 above, first came to the attention of the claimant when he received a letter dated 20 May 2009 from Kennedys."

3. That letter stated, among other things:

"The Defendant ceased to pay you with effect from 22 July 2005 when you left your job with them as a driver, although as we understand it, your employment was not formally terminated until 5 July 2006. We attach a copy of our client's letter to you dated 28 June 2006."

4. That letter was sent by Kennedys to the Claimant at his 176A Baker Street, Enfield address, he having recently parted company with his solicitors, Parker Bird, instructed in the personal injury claim.

The Employment Tribunal proceedings

5. The Claimant lodged his form ET1 on 28 July 2009, complaining of unfair dismissal, Disability Discrimination Act discrimination, including a failure to make reasonable adjustments, breach of contract - that is non payment of notice pay - and unpaid holiday pay. By their form ET3, lodged on 28 August 2009, the Respondent contended that the Claimant's employment ended by dismissal, effective on 5 July 2006. They disputed his various claims on the merits and, in addition, took a limitation point.

6. A Case Management Discussion (CMD) was held before Employment Judge Pettigrew on 2 June 2010. By his Order, which appears to be dated 5 June, that Judge identified the substantive issues in the various claims and also directed that the matter go for a PHR in relation to four issues which are listed by Judge Mahoney at paragraph 1 of his PHR Judgment Reasons:

"1.1 Was the claimant dismissed or did he resign?

1.2 What was the effective date of termination of his employment?

1.3 What therefore was the time limit for bringing any claim and what were the issues then identified in relation to all the claims?

1.4 Has the respondent complied with the statutory grievance procedures [SGP] in relation to the claimant's complaints of unpaid holiday pay and disability discrimination by failure to make reasonable adjustments?"

The PHR Judgment

7. Having identified those issues and set out his findings of fact, Judge Mahoney directed himself to three authorities, two of which he drew to the attention of the parties, the Claimant then appearing in person and the Respondent being represented by Mr Howard. Those cases were Harrison v George Wimpey & Co Ltd [1972] ITR 188 (NIRC) and GF Sharpe & Co Ltd v McMillan [1998] IRLR 682 (EAT). The third case was Gisda Cyf v Barrett, then in the Court of Appeal, whose Judgment was later affirmed by the Supreme Court, [2010] ICR 1475.

8. Barrett is concerned with the effective date of termination as defined by s.97 of the Employment Rights Act 1996 (ERA). Harrison raises the concept of implied termination of the contract of employment by the employee; sometimes described as self-dismissal. Sharpe is a case on frustration of contract due to medical incapacity for work. Pausing there, no plea of frustration was raised in the ET3 response, nor in the list of either substantive or PHR issues at the CMD held on 2 June 2010. Although the Employment Judge referred the parties to Sharpe he did not base his determination on the doctrine of frustration, but solely on the principle of implied termination formulated by Sir John Donaldson (President) giving the Judgment of the NIRC in Harrison.

9. At paragraph 6 Judge Mahoney expressed his conclusion in this way:

"The tribunal concludes on the authority Harrison v George Wimpey & Co Limited that the failure of the claimant in January 2006 either to inform the respondent of his change of address or to provide for post sent to 7 Clydach Road, Enfield to be forwarded to his new address by the Post Office, amounted to an implied termination by him of his contract of employment. The claimant, therefore, had resigned by 31 January 2006 and his claim is struck out."

10. In this appeal, by way of a skeleton argument lodged late in the day, Mr Grady, who represented the Respondent at the PHR as he does before us, seeks to raise a new point, namely that the contract of employment in this case was terminated by operation of law, namely frustration. Mr Daniel Stilitz QC, now appearing on behalf of the Claimant under the ELAAS pro bono scheme, objected to the new point being taken for the first time on appeal, relying on the Kumchyk line of authority. Having heard argument we upheld that objection. It would not be right to allow the Respondent to advance a wholly different argument from the basis on which the PHR proceeded. In arriving at that conclusion we follow the approach which another division, on which I sat, took in Hassan v Odeon Cinemas Ltd [1998] ICR 127 130C.

The appeal

11. The first question to be addressed is whether the Employment Judge was correct in law in following the implied termination approach advanced in Harrison. That case dates back to the early days of this jurisdiction. It has not been subsequently referred to in any later case, according to the researchers of counsel. I have never come across it before and it is not referred to in the index to the current edition of Harvey on Industrial Relations and Employment Law. That may be because it is reported only in the Industrial Tribunal Reports, which from memory were discontinued in about 1976. Nevertheless, it is a mark of this Employment Judge's depth of learning that he was aware of the case and, as a decision of the NIRC, it is binding on the Employment Tribunal, although not this EAT, unless it is inconsistent with subsequent higher authority.

12. The concept of self-dismissal produced a respectable line of authority in the EAT during the 1970s; see for example, Gannon v J C Firth Ltd [1976] IRLR 415, Kallinos v London Electric Wire [1980] IRLR 11, and Smith v Avana Bakeries Ltd [1979] IRLR 423; all cases where it was held that repudiatory conduct by the employee terminated the contract of employment of itself; there was no dismissal by the employer under what is now s.95(1)(a) ERA.

13. On the other hand, in cases such as Simmons v Hoover Ltd [1977] ICR 61 it was held that a repudiation by the employee must be accepted by the employer whereupon the contract is terminated by the employer in circumstances amounting to a dismissal by him. A similar result was reached by Sir Robert Megarry, Vice Chancellor, in the civil case of Marshall (Thomas) (Exports) Ltd v Guinle [1978] ICR 905. That divergence of authority was considered by the Court of Appeal in London Transport Executive v Clarke [1981] ICR 355. By a majority - Denning MR dissenting - the Court adopted the Marshall approach. Dunn LJ expressly disapproving the three earlier self-dismissal cases which I have mentioned (see 372D).

14. We note that Dunn LJ went on to disapprove reliance by Sir John Donaldson (President) in the NIRC case of Sanders v Neale [1974] ICR 565 of the principle in MacKay v Dick [1881] 6 App Cas 251, that repudiation of a contract by one party terminates a contract without acceptance by the other party. We venture to suggest that had Harrison been cited to the court in Clarke, it would have been similarly disapproved by the majority.

15. In these circumstances we uphold Mr Stilitz's first submission, that the Employment Judge was wrong to follow Harrison in the light of subsequent Court of Appeal authority in Clarke.

16. The question then is where that leaves this appeal. Plainly the contract here was not impliedly terminated by the Claimant by resignation by 31 January 2006. Mr Grady contends in the alternative, that it ended on 5 July 2006 when the Claimant, having failed to notify the Respondent of his change of address as he was obliged to do under the terms of the Respondent's handbook, was removed from the Respondent's record. The claims are therefore hopelessly out of time. We prefer Mr Stilitz's analysis.

17. Having sent the letter of 28 June 2006 by recorded delivery, and that letter having been returned by the Post Office on 6 July, the Respondent then took no further action to communicate its contents to the Claimant. The particular feature of this case is that, at that time, the Claimant was off sick, he was not entitled to sick pay but he was pursuing a personal injury claim against this Respondent through solicitors, as the Respondent was aware. No attempt was made by the Respondent to communicate with him through those solicitors. In any event, the letter of 28 June 2006 did not amount to the Respondent's acceptance of repudiation or indeed resignation by the Claimant, see Hassan 130F.

18. The result, in our judgment, is that no effective steps were taken by either party to terminate the contract of employment until the letter from Kennedys, the Respondent's solicitors in the personal injury proceedings dated 20 May 2009, enclosing the Respondent's earlier letter of 28 June 2006, reached the Claimant stating that his employment had been formally terminated on 5 July 2006. That was the first opportunity which the Claimant had to know that the Respondent no longer wished to be bound by the contract. He accepted that state of affairs by commencing these Tribunal proceedings on 28 July 2009, see Gunton v Richmond upon Thames BC [1980] ICR 755.

19. It follows in our judgment that the complaints of unfair dismissal and breach of contract were brought in time. Further, since the complaints under the Disability Discrimination Act and in respect of outstanding holiday pay from and since 2005 did not wholly arise before 6 April 2009 (they were continuing claims), the transitional provisions at paragraph 3 of the Employment Act 2008 (Commencement No.1 Transitional Provisions and Savings) Order 2008 revoking statutory grievance procedures and dismissal and disciplinary proceedings do not apply, and all claims may now proceed to a full merits hearing before the Employment Tribunal.

Disposal

20. The appeal is allowed, the strike out order is set aside. The matter will now proceed before a differently constituted Employment Tribunal at a full merits hearing held to determine the issues identified by Employment Judge Pettigrew at the CMD held on 2 June 2010.