ACCT2041 PBL - Lecture 10

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ACCT2041: Principles

of Business Law

Week 10
Employment law: dismissal;
redundancy.

Dr Gavin D’Northwood
Content – Lecture 10
• Distinguish wrongful dismissal
from unfair dismissal and
constructive dismissal.
• Explain the circumstances which
give rise to each type of
dismissal.
• Cover the reasons given for ‘fair’
dismissal.
• Explain when a claim for
redundancy may exist.
Wrongful dismissal

• Wrongful dismissal = breach of contract by employer

• Summary dismissal (no notice); gross misconduct?

• Minimum notice periods (per s86 ERA 1996)

• Remedies, e.g. loss of earnings for the notice period


Unfair dismissal
• Eligibility to claim:

1) Continuous employment
▪ 5 years for part-time staff! (up to 1994)
▪ 2 years (1994 – 1999)
▪ 1 year (1999 – 2012)
▪ 2 years! (from April 2012)
2) Employee must prove that they have been dismissed
▪ Actual – you’re sacked!
▪ Constructive – you resign because of a repudiatory breach by your
employer.
▪ Deemed – employee on maternity leave is refused return to work.

• Compliance with ACAS grievance procedures?


(unreasonable failure could increase damages by up to 25%!)
Unfair dismissal
• Eligibility to claim:

3) The employer must prove the dismissal was fair


▪ Justifiable grounds for dismissal? (s98 ERA 1996)
➢ Lack of qualification or capability? (Litster v Thom & Sons Ltd
(1975); Davison v Kent Meters (1975))
➢ Gross negligence (Taylor v Alidair (1978))
➢ Long-term illness
➢ Misconduct (Thomson v Alloa Motor Co. (1983); Moore v C & A
Modes (1981); Whitlow v Alkanet Construction (1987); Teggart v
Teletech UK Ltd (2012))
➢ Statutory restriction (Mathieson v Noble (1972))
Unfair dismissal
• Eligibility to claim:

3) The employer must prove the dismissal was fair


➢ Other substantial reasons, (e.g. resolve personality clash, see
Gorfin v Distressed Gentlefolks’ Aid Association (1973) or
employee has moved too far away from workplace e.g. Farr v
Hoveringham Gravels Ltd (1972) or economic reasons e.g. St John
of God (Care Services) Ltd v Brooks (1992, EAT)
• Note: appropriate procedures must be followed to prove ‘fairness’

• Automatically unfair circumstances?

• Remedies?
▪ Reinstatement: ERA 1996, s.113
▪ Re-engagement: ERA 1996, s.114
▪ Compensation: ERA 1996, S.119
Redundancy
• Redundancy = an employee’s job ceases to exist
due to restructure / change of business practice /
location closed / business ceased
▪ Redundancy payment = compensation for lost
job. Eligibility?
1) Continuous service
2) Relevant employee status
3) Dismissal caused by redundancy
▪ Change of workplace location – is this
constructive dismissal?
➢ O’Brien v Associated Fire Alarms (1969)
➢ Managers (Holborn) Ltd v Hohne (1977)
▪ Offers of suitable alternative employment?
(Can’t claim redundancy if ‘dismissed’)
▪ Unfair dismissal arising from redundancy?
(Selection criteria? Bias?)
And now…
• From the module Learn Ultra site you can
access and watch a short video on
‘restraint of trade’ clauses in employment
contracts.
Employment law:
protection against
discrimination.

Next
week…

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