KUKD.COM Ltd v Farooq

Where an employee resigns on contractual notice and remains ready, willing and able to work, the contract continues until that notice expires. An employer may waive the employee’s obligation to work during that period, but that waiver alone does not end the contract early or remove the employee’s entitlement to salary.

Fresh evidence will not be admitted on appeal unless, among other requirements, it could not with reasonable diligence have been obtained for use at the tribunal hearing. A party advancing a new factual defence must prepare and produce the material needed to support it.

The employee resigned from his employment as a business development manager, giving four weeks’ notice. The employer immediately accepted the resignation, said that he needed give only one week’s notice, and told him that he would be paid only to that date.

The Employment Tribunal found that an oral agreement had preserved the employee’s four-week notice period. It awarded four weeks’ salary, commission and consequential bonus. The employer appealed, contending that it had waived the notice requirement and thereby ended the contract, and challenging the Tribunal’s construction of the commission provision requiring signup forms and “images”. It also sought to introduce emails as fresh evidence.

1. Appeal dismissed. The Tribunal was entitled to find that, although the employer had initially exercised its contractual power to vary the notice the employee had to give, a later meeting resulted in an agreement that the required notice remained four weeks. That finding of fact was unimpeachable.

2. The employee’s resignation gave valid four-week notice. He made clear that he was ready, willing and able to work during it, so the contract continued and salary remained payable until the period expired. The employer’s reply merely waived his obligation to work or be available for work. It did not bring the contract to an earlier end or remove the entitlement to salary. Trotter v Forth Ports Authority [1991] IRLR 419 did not support the employer’s contrary submission.

3. The Tribunal’s finding that “images” in the commission agreement did not mean restaurant menus was not perverse. It had heard the witnesses and considered the documents. It was entitled to take account of the absence of menu allegations in key witness statements and of commission payments made during the relevant period.

4. The employer’s proposed emails were not admissible as fresh evidence. It failed the first requirement in Ladd v Marshall [1954] EWCA Civ 1: the material could, with reasonable diligence, have been obtained for the Tribunal hearing. The employer had raised the menu case late and could not assume that the meaning of “images” would be uncontroversial. It had not sought further evidence at the hearing or promptly afterwards. It was therefore unnecessary to consider the remaining requirements.

5. The remaining commission and bonus grounds depended on the unsuccessful menu argument and consequently failed.

• Employment Appeal Tribunal: dismissed the employer’s appeal from the Employment Tribunal’s judgment sent to the parties on 28 November 2016.
• Employment Tribunal: awarded the employee four weeks’ notice pay, commission and bonus.