Employment Law Cases
Resignation in the heat of the moment
The EAT re-examines the current legal position surrounding the retraction of a resignation made in the heat of the moment. Subjective intention is irrelevant and a reasonable bystander test applies.
Mr Omar resigned from his employment ‘in the heat of the moment’ during an altercation with his line manager. He maintained that in a further meeting that day the CEO had recognised that he did not want to resign and asked him to consider the offer of an alternative role. During another meeting two days later, the CEO told Mr Omar that his line manager had in fact decided that she no longer wanted to work with him and was going to treat his resignation as standing. Mr Omar was asked to confirm his resignation in writing which he said he would do. However, he did not withdraw his resignation but in fact sought to retract it. The employer refused the retraction and treated his employment as terminating with one month’s notice. Before the tribunal Mr Omar argued that he had not resigned. He said that his case fell within the ‘special circumstances exception’ namely that an employer is normally entitled to rely on words of resignation in accordance with their normal meaning unless there are ‘special circumstances’ that would indicate they should deviate from the general rule. For example, did the employer notice that the employee was behaving unusually? His unfair dismissal claim was dismissed by the tribunal and he appealed.
The appeal was allowed.
The reason for this was that the tribunal had erred in law by failing to make adequate findings of fact and failing to direct itself properly in accordance with the applicable legal principles, which the EAT decided - after a full review of earlier case law - are, in summary, as follows:
- There is no such thing as the ‘special circumstances exception’; the same rules apply in all cases where notice resignation (or dismissal) is given in the employment context.
- A notice of resignation (or dismissal) once given cannot unilaterally be retracted. The giver of the notice cannot change their mind unless the other party agrees.
- Words of resignation (or dismissal), or words that potentially constitute words of resignation (or dismissal), must be construed objectively in all the circumstances of the case in accordance with normal rules of contractual interpretation. The subjective uncommunicated intention of the speaking party is irrelevant; the subjective understanding of the recipient is relevant but not determinative.
- What must be apparent to the reasonable bystander in the position of the recipient of the words is that:
- the speaker used words that constitute words of immediate resignation or dismissal (if the dismissal or resignation is ‘summary’) or immediate notice of resignation or dismissal (if the dismissal or resignation is ‘on notice’) – it is not sufficient if the party merely expresses an intention to dismiss or resign in future; and,
- the resignation (or dismissal) was ‘seriously meant’, or ‘really intended’ or ‘conscious and rational’. The alternative formulations are equally valid. What they are all getting at is whether the speaker of the words appeared genuinely to intend to resign/dismiss and also to be ‘in their right mind’ when doing so
- In the vast majority of cases where words are used that objectively constitute words of resignation (or dismissal) there will be no doubt that they were ‘really intended’ and the analysis will stop there. A tribunal will not err if it only considers the objective meaning of the words and does not go on to consider whether they were ‘really intended’ unless one of the parties has expressly raised a case to that effect to the tribunal or the circumstances of the case are such that fairness requires the tribunal to raise the issue of its own motion.
- The point in time at which the objective assessment must be carried out is the time at which the words are uttered. The question is whether the words reasonably appear to have been ‘really intended’ at the time they are said.
- However, evidence as to what happened afterwards is admissible insofar as it is relevant and casts light, objectively, on whether the resignation/dismissal was ‘really intended’ at the time.
- The difference between a case where resignation/dismissal was not ‘really intended’ at the time and one where there has been an impermissible change of mind is likely to be a fine one. It is a question of fact for the tribunal in each case which side of the line the case falls.
- The same rules apply to written words of resignation / dismissal as to spoken words.
This will no doubt become required reading in such cases. But there is an argument that the EAT may have overreached itself as it declares various Court of Appeal judgments wrong!