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Employer could not rely on an express clause entitling it to summarily dismiss an employee, when the employee’s breach was considered minor

In Robert Bates Wrekin Landscapes Ltd v Knight, an employer was not permitted to rely on an express clause entitling it to dismiss an employee without notice for breach of security rules, when such a breach was minor or inadvertent.

Background

Mr Knight was a gardener for RBW.

Mr Knight’s contract provided a list of circumstances where his employment might be terminated without notice. These included “theft of the employer’s or customer’s property” and “breach of the employer’s or customer’s security rules”. RBW relied on these to summarily dismiss Mr Knight, after a bag of bolts from a MOD site was found in Mr Knight’s van.

Tribunal

Mr Knight brought an unfair dismissal claim and a wrongful dismissal claim. The Tribunal found that Mr Knight had been procedurally unfairly dismissed, although deductions were made to his award for Polkey and contributory fault.

Mr Knight’s contractual claim for notice pay was therefore the focus of this case. The Tribunal found that Mr Knight’s had simply forgotten to hand the bolts in and had intended to do so when next at work. He was therefore not guilty of theft. It also found that although he was guilty of failing to obtain the MOD’s permission before taking the bolts off-site, this was not deliberate.

EAT

RBW appealed to the EAT. It argued that Mr Knight’s contract had an express clause entitling it to summarily dismiss him for a breach of security rules. Further, Mr Knight’s actions jeopardised its relationship with the MOD, a key customer.

The appeal was not upheld. The EAT highlighted that as a general rule, an employee is entitled to receive notice unless an employer can point to a repudiatory breach of contract. A repudiatory breach usually entails either deliberate contravention of an essential contractual term, or gross negligence, whereas Mr Knight’s breach was minor or inadvertent.

Comments

Although the wording of the contract, on the face of it, permitted RBW to summarily dismiss Mr Knight, this was unlawful.

Essentially, this case boiled down to contractual interpretation. The EAT pointed out that Mr Knight could have breached RBW’s security rules and his contract, for example, by leaving the MOD site with a broken cup. However, it would be absurd if this resulted in his summary dismissal.

Employers should ensure that contractual termination provisions are clearly drafted. Such provisions will be interpreted according to the general contractual principles governing repudiatory breach. There needs to be a deliberate and serious wrongdoing element to justify summary dismissal.

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