Robert Bates Wrekin Landscapes Ltd v Knight

An express contractual term permitting summary dismissal for breach of security rules must be construed in its commercial and contractual context. It will not ordinarily authorise dismissal without notice for every minor or inadvertent breach. In the employment context, summary dismissal generally requires a repudiatory breach: wilful and deliberate contravention of an essential term, or gross negligence.

For unfair-dismissal compensation, Employment Rights Act 1996 requires reductions for contributory conduct to be assessed on a just and equitable basis. A contractual term cannot dictate a 100% reduction.

The employee, a gardener working on a secure Ministry of Defence site, was summarily dismissed after leaving the site with a bag of bolts in his van. The Employment Tribunal accepted that he had forgotten to hand the bolts in. It held that he had not committed theft or a repudiatory breach, and that he was both wrongfully and procedurally unfairly dismissed.

The employer appealed. It relied on a contractual clause permitting termination without notice for any breach of the employer’s or customer’s security rules. It also contended that the employee’s contributory conduct should have produced a 100% reduction in unfair-dismissal compensation. The central issue was whether the clause covered a minor and inadvertent breach.

1. Appeal dismissed. The Employment Judge’s conclusion that the employee had not committed a repudiatory breach of contract was open to him.

2. Clause 14.10 had to be interpreted in its commercial setting and against clause 14 as a whole. The ordinary understanding of an employment contract is that notice is payable unless there is gross misconduct or gross negligence. A printed clause should not lightly be read as extending an employer’s right to dismiss without notice contrary to that understanding.

3. The clause did not apply to every breach of security rules. Its literal application to a trivial, forgetful act would be absurd. Properly construed, it applied only to a breach which was serious and wilful, or grossly negligent, under normal employment-law principles. The employee’s inadvertent failure to return the bolts was therefore outside the clause and was not repudiatory.

4. The argument on unfair-dismissal compensation also failed. Even if clause 14.10 had covered minor inadvertent breaches, sections 122(2) and 123(6) of the Employment Rights Act 1996 required the Tribunal to decide what reduction for contributory conduct was just and equitable. The contractual clause could not compel a 100% reduction.

• Employment Appeal Tribunal: dismissed the employer’s appeal and upheld the finding of wrongful dismissal and the relevant compensation findings.

• Employment Tribunal: Birmingham Employment Tribunal, Employment Judge Alliott, judgment dated 5 July 2012, held that the employee had been unfairly and wrongfully dismissed.