Employment Contracts and the Implication of Terms by Custom and Practice

Workers wishing to discern the extent of their entitlements need usually do no more than read their employment contracts. As one case showed, the occasions when further rights are to be implied into a contract, having been established by custom and practice, are few and far between.

The…

Oct 14, 2021

The case concerned a claim by 27 ex-employees of a food company to enhanced redundancy payments. Their contracts did not expressly give them a right to such payments, but they argued that the company and others in the same group had an established track record of making redundancy payments well in excess of the statutory minimum. On that basis, they asserted that a custom and practice had developed, giving rise to legitimate expectations, and that an entitlement to enhanced payments should be implied into their contracts.

Rejecting their claims, however, an Employment Tribunal (ET) ruled that consistent past payment of enhanced redundancy by an employer over a period of time does not, in and of itself, suggest that there is a legal obligation to do the same in the future. It noted that, for a variety of reasons, some employers choose to benefit their staff over and above their statutory entitlements. Such discretionary benevolence may be driven by, amongst other things, a desire to foster a happy, more productive workforce or to encourage customer confidence or better industrial relations.

Rejecting the employees’ challenge to that outcome, the Employment Appeal Tribunal found that they had failed to prove the existence of an established custom and practice. The occasions on which the company or others in its group had paid enhanced redundancy were few in number and some years in the past. There was also a lack of consistency in the formulae used to calculate such payments. The ET’s conclusions on the evidence were plainly right.

Employment Dispute Settlement Precludes Subsequent Victimisation Claim

The vast majority of employment cases end in compromise, thus doing away with the need for a public hearing. As a Court of Appeal ruling made plain, however, great professional care is required in drafting settlement agreements in order to ensure that they do not themselves become the focus of further dispute. The case concerned a man whose race discrimination complaint against a company for which he worked for about a month was compromised on confidential terms. He accepted a sum of money in…

Use of Discriminatory Words in the Workplace – Context Always Matters

Employers are entitled to enforce zero-tolerance policies in respect of discriminatory remarks in the workplace. As an Employment Tribunal (ET) ruling showed, however, a thorough investigation is always required prior to a dismissal, not least because words that may be utterly unacceptable in one context may not be in another. A sales manager with an otherwise blemish-free disciplinary record was summarily dismissed on grounds of gross misconduct on the basis that he had used the discriminatory…

Landlord of Converted Office Block Pays Price for Breaching Fire Safety Rules

To what extent should landlords who have breached fire safety rules be entitled to recover the costs of remedying such breaches from tenants by way of service charges? The Upper Tribunal (UT) considered that important issue in a case concerning a former office building that had been converted into 96 flats. The building came to the attention of the local fire and rescue service when its fire alarm was disabled by a leak. A fire officer attended and found evidence that fire compartmentation and…