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Issue 12 (July 1997)

Contents

Sacked before she started
Electricity pensions hopes dashed
One law for the rich?
Maternity: ill health and return to work following maternity leave
Part-time workers' rights
Fixed-term contracts - waiver clauses  

Sacked Before She Started

Sarker v. South Tees Hospitals Trust NHS

An employee whose contract is ended before starting work can bring a claim for breach of contract the Employment Appeal tribunal has ruled. The offer of the job and its acceptance amounts to a contract of employment between the two parties although the employee may start work at a future date.

Once those terms were agreed, no further contract was required by the parties to confirm the employment relationship. The EAT reasoned that someone engaged under a
contract of employment to start work at a future date could claim unfair dismissal if the contract was terminated by the employer for an unfair reason such as pregnancy or
trade union activities. It was no different for claims relating to breach of contract.

The decision clarifies the scope of Industrial Tribunal jurisdiction to hear breach of contract claims, which before 1994 could only be brought in the High or County Court. The Industrial Tribunal Extension of Jurisdiction Order 1994 allows Tribunals to hear money claims up to a maximum of £25,000 if they are outstanding or arise under the employment contract when employment ends.

But what does employment mean in this context? The EAT said an Industrial Tribunal would have jurisdiction to hear a breach of contract claim, although the employee had not actually worked a single day for the employers.

In this case Ms Sarker obtained employment as an ultra sound manager with an NHS Trust. On the 25 August 1995 she was sent a letter of appointment and a formal document setting out particulars of employment. Both documents required two months notice from Ms Sarker to terminate her employment. She accepted these terms. However, before she started work, the Trust sought to increase her commitment to work for them to six months. Following a telephone call between the parties, the offer of employment was withdrawn by the Trust and Ms Sarker commenced a claim for breach of contract for the notice she was due under the contract.

The IT had ruled that it couldnot hear the claim because at the date of the alleged breach, there was no termination of employment because she had not actually started
work. The Industrial Tribunal therefore rejected her claim on those grounds.

Overturning this decision, the EAT said the claim did arise or was outstanding on the termination of employment. There was a contract, one that would start at a later date, and that contract had been broken the EAT ruled.

If you accept a job offer but the employer reneges before work begins, this decision opens the door for breach of contract or unfair dismissal claims. A breach of contract claim would be for the period of notice to which the employee was entitled. Unfair dismissal claims could face the hurdle of the 2 year qualifying period unless they were for an automatically unfair reason such as pregnancy or trade union activities.