Veitch Penny LLP - Exeter | Crediton, Devon

Case

Harper v Virgin Net Ltd
Court of Appeal - (10 March 2004)

Issues

(1) Wrongful dismissal
(2) Unfair dismissal
(3) One year’s continuous employment

Facts

Sally Harper had been employed from 4th April 2000, initially on a temporary contract. As of 1st November 2000 she became a permanent employee. The terms of her contract of employment stated that she was entitled to three months notice of termination.

On 2nd March 2001 Harper was summarily dismissed 33 days short of her one year’s continuous employment. Had she reached the one year point, she would have been entitled to make a claim of unfair dismissal.

At first instance, the Employment Tribunal found that Harper had been wrongfully dismissed. She was awarded damages of £9,514.04 in respect of net notice pay. She was awarded a further sum in damages representing the full award she would have received had she been given the three months notice she was entitled to under her contract. The Tribunal reasoned that as a result of her wrongful dismissal, she had lost her right to claim unfair dismissal. Therefore she should be compensated for losing that right.

The Employment Appeal Tribunal (EAT) allowed the employers’ appeal against the award the original Tribunal had made for Harper’s loss of the chance to recover compensation for unfair dismissal. The EAT held that such an award was not available as a matter of law as it would be, in effect, an attempt to circumvent the statutory qualifying period. It was acknowledged that the effective date of termination may be extended in cases of summary dismissal by the length of statutory notice the employee was entitled to, but it was noted that legislation had not been drafted in such a way so as to extend the date to the contractual notice period in such circumstances where it is longer.

The EAT also found that Harper’s complaint only related to the decision to summarily dismiss her. Consequently it fell foul to the principle set down in Johnson –v- Unisys (which states that an applicant cannot recover their losses flowing from the dismissal itself, by way of damages for breach of contract).

Decision

The appeal was dismissed. The Court of Appeal confirmed that the Employment Tribunal had been incorrect to award damages for loss of statutory right. The EAT had been correct to allow the appeal on the basis that that type of award is not available in law. Parliament had deliberately drafted the legislation in such a way so as to allow for the postponing of the effective date of termination in respect of the contractual period of notice and had deliberately decided not to extend this to cover contractual notice periods.

In this case, Harper did not lose the right to claim compensation for unfair dismissal by being dismissed without her contractual notice, because she had never had such a right due to her falling short of the requirement of one year’s continuous service required by legislation.

Comments

The Court of Appeal has now authoritatively ruled that this type of claim cannot be brought because of the deliberate framing of the legislation. Consequently, an applicant cannot be compensated for a right that does not exist. The consequence for employers is that they will have the peace of mind knowing that they will not be liable for an unfair dismissal claim if they dismiss a new employee before the end of the 51st week of employment, as long as the dismissal is not based on a prohibited ground for which the year’s service qualification does not apply.