HR Expert: Employment continuity and why it matters

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A client has approached me with a rather strange idea, and I wanted to check that they were not doing anything that was contrary to the law. They have a salesman, who has worked there for around 22 months. He however has made a lot of mistakes in this time and lost some key client deals as a result. My client is conscious that once the employee gets to two years service, it will be more complex to dismiss them. Is it possible for them to discuss the matter with the employee now, telling them that they will be dismissed but that new employment, with new service, would be available a few weeks later?

I would not suggest your client deals with the employee in the way that is outlined above. This is because it would not be a ‘genuine’ break in service, and on their return the employee’s start date is likely to be treated as when they first started with the business, almost two years ago. The recent case of Wade v Jansen dealt with a similar matter, and in it, it was made clear that such a resignation would be a “sham”.
Continuity of service is an important legal concept to bear in mind. Many employment law rights require an employee to have worked for their employer for a certain length of time. These include, for example:

  • Statutory guarantee pay – one months service is needed prior to being put on lay off to receive this payment from an employer.
  • Maternity. pay – 26 weeks service is needed on the 15th week before the expected week of childbirth to qualify for maternity pay. Many other family friendly statutory payments have a similar requirement.
  • Redundancy pay – two years service is needed.
  • The right to claim unfair dismissal – two years service is needed.

Employers have tried various ways to try and avoid continuity of service accruing over the years, largely unsuccessfully, unless they can provide evidence that there was a genuinely clean break in employment.
Your client therefore has two in this situation.

  1. Terminate the employee following their usual process before they reach two years service. The employment ends and the employee leaves the business. Should the individual then choose to come back and apply for another job with your client, through their own choice, they can be re-employed without service, as long as there is at least one full week ending on a Sunday between the end of the first period of employment and the start of the new one, and there was no agreement prior to termination that they would return.
  2. They could work with the employee to help them improve the quality of their work and avoid the need for dismissal entirely.
    Your client should carefully consider their next step in order to ensure they minimise any legal risks.

 

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