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When does a resignation take effect?

Giving an employee a cooling off period does not change the effective date of termination.

What is the effect of a letter of resignation and of any subsequent correspondence?

In Secretary of State v Hibbert,[2013] UKEAT 0289_13_3007, the EAT considered this question in the context of whether the claim was lodged out of time.

The claim related to constructive dismissal, which occurs if an employee terminates his employment contract (with or without notice) in circumstances in which he is entitled to terminate it without notice by reason of the employer’s conduct

Facts

H had worked for R since 2008. When her grievance appeal was rejected, she hand-delivered a letter to R, drafted by her solicitors, which was received and read by R on that day. The letter stated: “I am of the view that there has been a fundamental breach of my employment contract by my employer and I have no alternative but to resign my position.”
R replied, giving H five days to review her decision. H’s solicitors replied to confirm that H’s decision to resign was based on her view that there had been a significant breach of trust and confidence entitling her to resign.
A further letter from R purported to accept H’s resignation and required her to give four weeks’ notice, confirming that she would be paid to the end of that period.

ET

An employment tribunal will consider a complaint of unfair dismissal only if it is lodged within three months of the “effective date of termination”. This is the date on which the notice expires, if an employee’s contract is terminated by notice, or the date termination takes effect, if no notice is given. In this case, the sole issue for the tribunal to determine was whether the claim was lodged out of time, which in turn depended on the effect of the letter of resignation.
R argued that H’s letter was “unambiguous as to resignation”, and therefore that the dismissal was with immediate effect. Events post-dating that letter, R submitted, were irrelevant. H submitted that R did not accept her resignation but instead made it clear that her contract continued until the end of her notice period.
The tribunal held that it had jurisdiction to hear the claim as the dismissal took effect at the end of the notice period, and that H had lodged it in time.

EAT

The EAT held that the letter from H was a letter of immediate resignation. Its concluding words, “I have no alternative but to resign my position”, were unambiguous. There was no question of H taking a decision in the heat of the moment. The resignation letter was drafted by her solicitor or, at the very least, she wrote it having taken legal advice.
Further, this was not a case of R refusing to accept H’s decision to resign. As a constructive dismissal case, no question of the employer accepting or refusing to accept the employee’s resignation arises, the resignation being an acceptance of R’s fundamental breach of contract.
The resignation was unaffected by R giving H a “cooling off period”. Neither subsequent correspondence nor the fact that R required H to give four weeks’ notice and paid her for that period had any legal effect. As a matter of law, H resigned on the date R received her resignation letter, which was also the effective date of termination. Accordingly, the unfair dismissal claim was lodged out of time and the employment tribunal had no jurisdiction to hear it.

Comment

How to react to a letter of resignation is a question that can vex employers. It is a well-established principle that a party who has properly given notice of termination has no right to unilaterally withdraw it. However, the EAT refers in its judgment to decisions taken in the heat of the moment, and case law shows that employers can be required to allow an employee who resigns in this way to retract a resignation. However, it may not always be easy to tell whether a resignation falls within this category.

Although the employer succeeded in this appeal, the outcome could have been very different had H sought to persuade the tribunal that it was not reasonably practicable to lodge the claim in time.

For further advice and assistance, contact Adrian on 0161-371 0011 adrian@claim.co.uk

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