McCreadie v Thomson & MacIntyre (Patternmakers) Ltd

For the purposes of section 2(4) of the Redundancy Payments Act 1965, an employer may make an offer in writing through a notice addressed collectively to employees. Individual delivery is unnecessary where the written offer is brought to the employee’s notice, is capable of being understood, and is actually read.

If the renewed or new contract differs from the former contract, the offer need specify only the terms and conditions that differ. It need not restate unchanged terms or affirm their continued similarity.

The appellant was employed as a pattern maker. When the respondents moved their premises from Glasgow to Clydebank, the resulting change constituted a dismissal which would ordinarily have entitled him to a redundancy payment. Before the relevant date, the respondents posted a notice directing all employees to report for work at the new premises.

The industrial tribunal held that the notice was not an offer in writing within section 2(4) of the Redundancy Payments Act 1965 and awarded a redundancy payment. The First Division of the Court of Session unanimously reversed that decision and remitted the matter to the tribunal. The employee appealed to the House of Lords.

The issues were whether a collectively addressed notice could amount to an offer in writing to the employee and whether the offer had to specify both changed and unchanged terms of employment.

1. Appeal dismissed unanimously. Lord Guest delivered the substantive speech. Lord Reid, Lord Morris of Borth-y-Gest, Lord Wilberforce and Lord Simon of Glaisdale each agreed with his reasons.

2. Per Lord Guest, section 2(4) of the Redundancy Payments Act 1965 should receive its ordinary and practical meaning in the industrial setting in which employers and employees must operate it. It should not be construed with a degree of technical strictness that defeats the Act’s purpose.

3. Per Lord Guest, the notice posted on the employer’s notice board was an offer in writing to the appellant. Section 2(4) did not require an individually delivered document which the employee could take away and study. Compliance was established because the offer was written, brought to the employee’s notice, capable of being understood by him, and actually read by him. His written refusal demonstrated that he had read and understood it.

4. Per Lord Guest, the notice was also capable of contractual acceptance. An employee who reported at the new premises at the stated time would have bound the respondents to employ him in his former job at his former pay.

5. Per Lord Guest, where a renewed or new contract differs from the former contract, section 2(4) requires the offer to specify the terms and conditions that differ, including any difference in capacity or place of employment. It does not require the offer also to identify every unchanged term or expressly affirm the similarity of those terms. Here the only difference was the new place of work, which the notice specified clearly.

6. The appeal was dismissed with costs.

1. House of Lords: Dismissed the employee’s appeal unanimously and upheld the First Division’s decision.

2. First Division of the Court of Session: Unanimously allowed the employer’s appeal, reversed the industrial tribunal’s decision and remitted the matter to the tribunal.

3. Industrial tribunal: Held that the notice was not an offer in writing within section 2(4) of the Redundancy Payments Act 1965 and that the employee was entitled to a redundancy payment.