What is the effective date on which an employee is dismissed?

In most circumstances the date on which an Employee is dismissed is clear, but this is not always the case, and it is sometimes important to know when this happened.   

Why is the Effective Date of Termination (“EDT”)important?

The EDT is important for 3 main reasons:

1. to calculate whether or not an employee has sufficient continuity of employment  to qualify for a particular statutory right;
2. to comply with time limits to bring Tribunal or court claims if the employee has  the necessary qualifying period of employment (where this is necessary);
3. to calculate a “week’s pay” given for every year of employment for the purpose of  various  compensation awards e.g. redundancy and unfair dismissal basic award.

When is the Effective Date of Termination?

The EDT is the date on which:

1. notice of termination expires;
2. where no notice is served, the date on which termination takes effect or
3. the date of expiry of a fixed term contract.

Dismissal with Notice

If either the employer gives notice to terminate employment, then the EDT is the date on which the notice period expires, not the date on which it is given.  This is the case whether or not the employee actually works the notice period.

What if the Notice is not clear?

Where the Employer gives notice to dismiss, but it is not clear when the notice period is intended to expire, the Tribunal will look at what a reasonable employee would understand it to mean, in the light of the facts known to him at the time.  Any ambiguity will be interpreted in favour of the Employee.

Dismissal without Notice

If no notice is given, termination will normally take place immediately it is communicated e.g. when the employer tells the employee that he is dismissed “with immediate effect”.   

If summary dismissal is communicated by letter then the EDT will normally be the day on which the employee reads the letter.   The Tribunal will normally take into account evidence of when letters normally arrive in the post and that most letters are read promptly.  However, if there is a delay (e.g. if the employee is on holiday or in hospital) the EDT will be when the letter is actually read, unless the Employee has deliberately avoided reading the letter.

As will be seen below, the general rule is that the EDT cannot be changed.   However, in a relatively rare case involving summary dismissal (without notice) the EAT said in the case of Hawes & Curtis v Arfan & Mirza  that the employer intended to change and did change the EDT.  Here both employees were summarily dismissed on 5th October 2010 but appealed the decision under the employer’s appeals procedure.  The appeal was not successful, but the employer wrote to them saying that their EDT would be the date of the appeal decision (4th November 2010) and they were paid up to that date.   The Tribunal held that this was the EDT and this was upheld on appeal to the EAT.

Despite this decision, the starting point in a case of dismissal without notice is the “date on which the termination took effect”.  However, internal appeals are integral to the protection of employment rights and can be considered if relevant to proceedings.

Payment in Lieu of Notice

This is treated as if no notice was given, unless it can be shown that the intention was to dismiss with notice but release the employee from his obligation to work out the notice (i.e. paid or garden leave situations).

Waiving or changing the Notice Period

The parties can agree to waive a notice period, or to bring it forward or extend it, and thereby change the EDT.  However, they cannot agree a different EDT so as to extend time for making an Employment Tribunal claim, as those time limits are strict and only the Tribunal can extend them.   

Simply allowing the employee to stay away from work on gardening leave does not bring forward the EDT (whereas a genuine payment in lieu of notice will do).

Constructive Dismissal Cases

Where the employee resigns without notice, the EDT is normally the date on which the employee accepts the employer’s breach of the contract of employment, as terminating the employment (not the date of the breach itself, if this is different).  

Acceptance of the breach must be communicated by word or conduct.   If this is communication is by letter, the EDT is the date on which it is read, but a faxed resignation takes effect as soon as it is sent, even if it is sent after office hours and not read until the next working day [Potter and others v RJ Temple Plc (In Liquidation) 2003]

If you wish to discuss any aspect of employment law, please contact Janet Long in our employment team by email at j.long@pj-h.co.uk

The contents of this article are intended for general information only.  It is not a substitute for legal advice, and shall not be deemed to be or constitute legal advice.  We therefore cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.  

We will, however, be pleased to advise you on the specific facts of your case.