The Employment Appeal Tribunal (EAT) has, in the case of Heaven v Whitbread Group plc, provided guidance on how the effective date of termination (EDT) of employment should be determined. The judgment serves as a reminder that the determination of the EDT depends on what actually happened between the parties. Their wishes or any subsequent agreement as to a different date are irrelevant.
On 29 August 2009, Mr Heaven submitted a "conditional resignation letter", which stated that he would resign forthwith, provided two conditions were met: that he received one month's salary, and that he was provided with a "glowing" reference. His employers responded to him the next day stating that they couldn't accept a conditional resignation. Mr Heaven would have to make it absolutely clear whether he was resigning or not. Mr Heaven confirmed, on 3 September, that he was definitely resigning but said that his resignation should take effect from 29 August.
Mr Heaven subsequently raised a claim for unfair dismissal. The question of whether the EDT was 29 August or 3 September was important, as this would determine whether or not Mr Heaven's claim was in time. The EAT held that a contract can only be terminated unequivocally and a conditional letter of resignation will not bring an employment contract to an end. Therefore, despite Mr Heaven's statement that his resignation should take effect from the date of his first letter, his employment was not in fact terminated until his unequivocal communication on 3 September. This date could not be backdated either by the employee or by agreement with the employer. His claim was therefore in time.
Impact on employers
- Employers should treat any equivocal or conditional resignations with care and seek clarification from the employee if there is any room for doubt. Conditional letters will not be sufficient to effectively terminate employment, even if the conditions are met.
- Employers should bear in mind that the EDT will occur only once the employee has confirmed unequivocally that they are resigning and be aware of the effect this will have on the time limits for bringing tribunal claims.