The Effective Date of Termination (EDT) is not a particularly sexy employment law topic but establishing the actual date that an employee’s contract has come to an end can be very important. Usually, its greatest importance is in establishing the date by which an unhappy employee must start a claim for, for example, unfair dismissal. The law prescribes a strict limit of 3 months by which a claim must be lodged at the Tribunal office and this means that if the last day of work, the EDT, is 15th July the last day for lodging is 14th October. Some nasty rules apply if the EDT is 28th February – the last day is 27th May. Miss the date and an employee cannot usually proceed: since some claims may be worth thousands of pounds time, and its correct calculation, suddenly becomes really important.
Often the EDT is blindingly obvious but there is a significant percentage of cases in which it is not always so easy. A Mr Heaven fell into the minority group and it has taken the Employment Appeal Tribunal (EAT) to resolve the problem. The case is a reminder that establishing the EDT depends on what actually happened and not necessarily their wishes or any later agreement as to a different date are irrelevant.
On 29 August 2009, Mr Heaven delivered a "conditional resignation letter" stating that he would resign forthwith, provided two conditions were met: they were that he should receive one month's salary, that the employer should provide a "glowing" reference. His employers response on 30th August stated that a conditional resignation could not be accepted. They said that Mr Heaven would have to make it clear whether he was resigning or not. On 3 September, Mr Heaven said that he was definitely resigning but said that it should take effect from 29 August.
Later Mr Heaven lodged a Tribunal claim for unfair dismissal. Unhelpfully, the EAT judgment does not say on what date that was done but it must have been before 3rd December but after 28th November 2009. If the EDT was 29th August the Tribunal claim was too late (i.e more than three months after the EDT) and that is what the Tribunal judge decided.
On appeal, the EAT (Heaven v Whitbread) held that a contract can only be terminated unequivocally. So, a conditional letter of resignation does not bring an employment contract to an end. Therefore, Mr Heaven's first letter did not end the contract. His employment could not be ended until his unequivocal communication on 3 September. That termination date could not be backdated either by the employee or even by agreement with the employer. His claim was therefore in time.
Employers should be careful to seek clarification of any equivocal or conditional resignations. Conditional letters will not be sufficient to effectively terminate employment, at least not until the conditions have been met.
It should also be remembered that the EDT will occur only once the employee has confirmed unequivocally that he is resigning Remember the effect this will have on the time limits for starting tribunal claims.
