When an employee leaves without giving notice
What recompense is an employer entitled to when an employee leaves without giving proper notice? This issue was considered by the Employment Appeals Tribunal (EAT) in the recent case of Davis v. Pyrz
, concerning a nanny and her former employer. The same principles would apply to any other employment situation.
Miss Pyrz, a nanny, left her employment without giving notice and brought claims alleging she had not been paid the national minimum wage (NMW) or holiday pay. She also claimed that her employer, Miss Davis, had made an unlawful deduction from her wages by taking four instalments of £50 as a deposit. Miss Davis counterclaimed that, by failing to give one month's notice, Miss Pyrz was in breach of contract. She also made a number of other counterclaims, alleging that Miss Pyrz had broken her computer, stolen a CD and skirt, left an unpaid telephone bill and owed money for a travel ticket.
The Employment Tribunal upheld Miss Pyrz's claims and also Miss Davis' counterclaim for breach of contract for leaving without giving notice. However, in the absence of any express notice period the Tribunal decided the appropriate notice period was the statutory one week's notice, and awarded Miss Davis one week's pay in damages. It decided it did not have jurisdiction to hear Miss Davis' other counterclaims.
On appeal, the EAT overturned the decision on unlawful deductions and confirmed that there is nothing to prevent deductions being made in circumstances where the deduction is authorised under a provision of the contract, as it was here.
In relation to the counterclaim, the EAT upheld the Tribunal's decision that where there is no express notice period the appropriate notice period to apply is the statutory one week's notice. However, in calculating damages the correct measure should have been the difference between the sums Miss Davis had incurred as a result of the Miss Pyrz's breach (i.e. to pay a replacement nanny) and the wages that would have been paid to her (in accordance with the NMW) had she worked her notice. The difference amounted to just £13.85.
The EAT agreed that the counterclaim relating to the computer repair could not be dealt with by the Tribunal as it did not relate to the employment contract. However, it held that the Tribunal was wrong in finding that the counterclaims relating to the CD, dress, unpaid telephone bill and travel expenses could not be heard. The EAT was satisfied that there is implied duty of fidelity in any employment contract, which would apply to the CD and dress. In relation to the telephone bill and travel expenses, these could be legitimately claimed as they arose properly under a contract ancillary to the employment contract.
Whilst the EAT commented that the issues in this appeal "concerned a variety of small issues none of any general interest", it provides a useful reminder of the manner in which damages are calculated when an employer claims for an employee's breach of contract for failing to give proper notice. In practice, it is only likely to be worthwhile for an employer to pursue such a claim if the financial consequences have been substantial. The employer is under a duty to mitigate his losses, perhaps by reallocating work to existing employees temporarily. Any loss to the employer is also offset (as it was in this case) to allow for the fact no notice paid is payable to the employee. In addition, the costs of recruiting a replacement are generally not recoverable, as the employer would have incurred these costs even if the employee has given full notice.
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