It is clear that for a termination of employment to be effective it must be communicated to the employee first. Case law makes it clear that if the employer sends the employee a letter advising them that they have been dismissed that the dismissal does not take effect until the employee actually opens/reads the letter.

However, a recent case illustrates that where an employee indicates that they are resigning with immediate effect (even if the employer suggests that the effective date of termination will be a later date) this does not alter the effective date of termination and the effective date is that on which the letter was opened by the employer and does not have to be read by the named addressee.

In this case the employee worked for a County Council, she had unsuccessfully appealed against a final written warning and demotion and decided to resign and claim constructive unfair dismissal. She sent her resignation letter by special delivery and it arrived at the Council’s office on 29 January 2010. It was opened by a member of the administrative staff and date stamped as received on 29 January 2010.

The Council wrote to the employee and said that it confirmed that it accepted her resignation and that her resignation would commence from the date of their letter, 2 February 2010. The Council’s pension section also wrote to her confirming that she had left employment on 2 February 2010.

She issued a claim form in the Tribunal dated 28 April 2010. It arrived by first class post at the Tribunal on 29 April 2010 and the Council argued that the claim had been brought out of time. It claimed that her effective date of termination was 29 January 2010, when the letter was opened and date stamped, so at the latest her ET1 claim should have arrived at the Tribunal was before midnight on 28 April 2010, within the three month time frame

Both the Tribunal Judge and the Employment Appeal Tribunal (EAT) agreed with the Council.

It was noticed that where an employer summarily dismisses an employee the employee is entitled to be informed or to have a reasonable chance of finding out that they have been dismissed before the time for bringing an unfair dismissal claim starts to run and this approach recognises that employees need to know they have been dismissed before they can be expected to take action within the time limits set by the legislation.

However, because employers do not have similar needs to employees, the courts have adopted a different approach when an employee communicates their decision to resign to their employer. The case of Edwards v Surrey Police illustrates that communication by words or by conduct such as to inform the employer that the contract is at an end will be sufficient.

The EAT held it was clear from her letter that her resignation was immediate and so it was effective as soon as that letter was opened and date stamped by the Council’s administrative staff. The EAT stated that the effective date of termination was not subsequently varied by the Council’s letter stating that her resignation was effective from 2 February.

The EAT said that the parties could not, retrospectively, alter the date of termination and so bypass the effects of the applicable legislation and a distinction had to be drawn between cases in which parties agreed an earlier termination date during the notice period and a situation where an employee effectively communicated their decision to resign with immediate effect. In those circumstances the effective date of termination was fixed and could not retrospectively be altered.

This issue would not have arisen of course if her solicitor had taken steps and issued the claim form a few days earlier.  The lesson to be learned from this case is that if there is any doubt whatsoever about the effective date of termination the ET1 should be issued in plenty of time so that it prevents the employer from raising a “limitation” argument. This case illustrates the risk of leaving it to the last moment before issuing an ET1, which is sometimes done to try and facilitate a negotiated settlement but has its risks.