No Six Year Limit for Contractual Claims in Tribunal

Tribunal concludes that the six year limitation period for breach of contract claims did not apply to a breach of contract claim brought in the employment tribunal.

A Claimant in an employment tribunal has three months less a day (subject to the “stop the clock” provisions associated with Early Conciliation) to present their claim to the Employment Tribunal. This deadline provides two main benefits; firstly, it means that any problems can be addressed quickly and contemporaneously between parties, and secondly, it gives an employer some certainty that once three months have passed, a claim will not be brought against them.

Claims for breach of contract, however, are a little different. Unlike unfair dismissal claims, once a Claimant has left employment, they have a choice of presenting their claim in the Employment Tribunal or the County or High Court. If the Claimant chooses the County or High Court) the deadline to present that claim is six years. The implication being that employers would have to wait far longer to know they are free of any risk of litigation.

The Central London Employment Tribunal has now added a further twist to this situation by concluding that the six year time limit for breach of contract claims does not apply to breach of contract claims brought in the Employment Tribunals. Instead, nothing should prevent a Claimant from presenting a claim that is more than six years old, provided that it is presented within 3 months of the end of the employee’s employment.

In this particular case (Grisanti v NBC News) Ms Grisanti presented a number of claims, including breach of contract, having found that her former employer had failed to make any National Insurance contributions on her behalf in a period between 1996 and 2003. Under the Civil Court rules for breach of contract claims the deadline to present her claim would have been in 2009 and so NBC argued that her claim was out of time. However, Ms Grisanti argued that as she was not entitled to present a claim to the Employment Tribunal for breach of contract whilst she was still an employee, she could only do so within the three months after her employment had finished, and so the six year rule should not apply to her.

Ultimately, the Employment Tribunal favoured Ms Grisanti’s argument and decided that the six year rule that applies to contractual claims in the civil courts should not apply to tribunals. It agreed with Ms Grisanti that employees would be dissuaded from bringing contractual claims against their employer whilst the employment relationship continued, and unless they could still make an historical claim once the relationship had ended their rights would have been unfairly limited.

Whilst the ruling does present the possibility of employees bringing up alleged breaches of their contracts from years ago, it is worth bearing in mind that this is an Employment Tribunal decision only. As such it does not set a precedent that is binding on other judges in future tribunal proceedings. This would only happen if NBC decide to the appeal the decision to the Employment Appeal Tribunal.  

https://ids.thomsonreuters.com/download/file/fid/55271