Can a dismissal be implied by an employer’s inactions?

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In order to bring a claim for unfair dismissal the employee must have been dismissed within the statutory definition of dismissal. If the issue is in doubt, the onus of proof is on the employee. The Employment Act 1996 section 95 explains that an employee is dismissed by his employer if:

  1. the contract under which he is employed is terminated by the employer (whether with or without notice),
  2. he is employed under a limited-term contract and that contract terminates by virtue of the limiting event without being renewed under the same contract, or
  3. the employee terminates the contract under which he is employed (with or without notice) in circumstances in which he is entitled to terminate it without notice by reason of the employer’s conduct.

In Sandle v Adecco [2016] the Claimant was employed by the Respondent as an agency worker but was assigned to another company, BASF, from November 2011 to November 2013 when her assignment was eventually terminated.

The Respondent made little attempt to contact the Claimant, or take positive steps to find her other work when her assignment had come to an end. Similarly, the Claimant also made no attempt to contact the agency. The agency, therefore, came to the assumption that the Claimant was no longer interested in further work from them.

On 28 February 2014 the Claimant brought a claim for unfair dismissal against the agency. The agency asserted that it had never dismissed her.

The Employment Tribunal held that the Claimant had not been dismissed. The ET explained that as the Respondent had not taken any steps to communicate a termination of the employment contract to the Claimant, the employment relationship was still ongoing when the claim for unfair dismissal was lodged.

The Claimant took her claim to the Employment Appeal Tribunal claiming that the ET took too restrictive an approach when considering whether she had been dismissed.

The EAT explained that a dismissal can be by “word or deed, and the words or deeds in question may not always be entirely unambiguous”. They also found that the Respondent’s payroll department had generated a P45 for its own records on 12 February 2014, however, the P45 was never sent to the Claimant. The EAT recognised that removing an employee from the payroll might imply termination of the employment contract by way of the employer’s conduct and therefore physical receipt of a P45 may not be the relevant act that determines the question of dismissal, if the dismissal is communicated by some other method at an earlier date. However, that did not help the Claimant as she was not aware that she had been removed from the payroll. A dismissal has to be communicated and although communication can be by conduct, it nonetheless, has to be something of which the employee was aware of.

The facts of this case are unusual, but all employers should be aware is that they may be found to have dismissed an employee without intending it and such a dismissal is likely to be unfair. To avoid these issues, clarity is key.

Dominic Bonham