Internal Appeal Could Nullify Dismissal Even If Employee Does Not Want Job Back

In Phoenix Academy Trust v Kilroy, the Employment Appeal Tribunal (EAT) had to consider whether an employee who is dismissed, and then brings a successful internal appeal against that dismissal, should be treated as not having been dismissed, even if they made it clear when submitting their appeal that they have no intention of returning to work for the employer whatever the outcome of the appeal might be.

Phoenix Academy Trust v Kilroy

Case background

Where an employee appeals against an employer’s original decision to dismiss, and that appeal is successful, it has the effect of negating the decision to dismiss, reviving the contract of employment, which continues uninterrupted. This is sometimes referred to as a ‘vanishing dismissal’.

In these circumstances, there is no ‘dismissal’ for the purposes of section 95 of the Employment Rights Act 1996 (ERA) and, consequently, the employee cannot pursue an unfair dismissal claim on that basis.

Facts

Phoenix Academy Trust (PAT) dismissed Mr Kilroy summarily, just before it received his resignation letter alleging constructive dismissal. Shortly afterwards, Mr Kilroy invoked PAT’s internal, contractual appeal procedure. Before the appeal hearing, however, Mr Kilroy’s solicitors wrote to PAT saying, “irrespective of the result of the current appeal there is no question of our client returning to his former employment”. After that letter, but before the appeal hearing, Mr Kilroy brought an unfair dismissal claim against PAT based on the original summary dismissal.

PAT subsequently upheld Mr Kilroy’s appeal against dismissal, and reinstated him subject to a final written warning, requiring his return to work. However, Mr Kilroy then resigned by a further letter, alleging constructive dismissal.

As part of its defence to Mr Kilroy’s unfair dismissal claim, PAT argued that he had affirmed the employment contract by invoking the appeal procedure.

The ET upheld Mr Kilroy’s unfair dismissal claim. It found that he had not affirmed the employment contract relying, in particular, on his statement of intent not to return to work.

PAT appealed.

Decision

The EAT decided that Mr Kilroy had affirmed the employment contract by mounting an appeal and the effect of PAT’s decision to overturn the original decision to dismiss Mr Kilroy was to revive the employment contract (i.e. the dismissal ‘vanished’ and could not form the basis of an unfair dismissal claim).

However, the EAT also found that the ET had failed to consider properly whether Mr Kilroy had been constructively dismissed after the appeal outcome and, as such, remitted the case to the ET for reconsideration.

Comment

For there to be a valid unfair dismissal claim, there must be a ‘dismissal’ for the purposes of section 95 ERA. This requirement is easily satisfied where, for example, an employer expressly dismisses an employee or a fixed-term contract expires without renewal. In general, however, it is more difficult for an employee to satisfy the requirement in a constructive dismissal claim (as an employee must demonstrate that the employer acted in such a way as to repudiate the employment contract).

As we can see from this case, the situation may be complicated further where an employee, following dismissal, mounts an internal appeal with the employer. Following this case, it seems that a dismissed employee who brings an internal appeal is likely to be bound by the outcome of the appeal process (whatever their motivation in bringing the appeal), so if the result is the overturning of the dismissal they will lose the right to claim unfair dismissal on the basis of an original express dismissal.