EAT Contract of Employment : Implied Term or Variation or Construction of Term – C (a project engineer) was subject to a contract which provided that if she did not work her notice, then to the extent that there was shortfall her employer would deduct a sum equal to the salary to be paid during the shortfall from her. The ET found she did not work her notice. The employer deducted a full month’s salary from money otherwise due to her, in the reckoning of which he did not include the notice pay that would have been due had she worked. C accepted this was the effect of the clause and argued that it thus operated as a penalty. An ET found it was not, but was, rather, a genuine pre-estimate of the losses that might be incurred if at short notice a senior professional such as a project engineer had to be recruited to fill an important gap. Her appeal against this decision failed, as did a related appeal against the ET’s refusal to consider documents tendered to it by the employer after the evidence had concluded but before submissions, which might have shown that the employer in this case had begun to recruit a replacement before C resigned.
Observations made about the proper construction of a clause such as an issue here in future cases: the EAT was not itself satisfied such a clause would usually be intended to operate as both parties here accepted it did in the present case, and did not wish this case to set an unfortunate precedent for later ones.
Langstaff P J
[2014] UKEAT 0045 – 13 – 0403
Bailii
England and Wales
Employment
Updated: 04 December 2021; Ref: scu.526521