If an employee is appealing against the decision to dismiss, and the appeal process is then delayed, what should you do about the employee’s payment of salary and date of termination? Esther Smith, partner at Thomas Eggar, and Martin Brewer, partner and employment law specialist at Mills & Reeve, advise.
The question:
An employee is appealing against the decision to dismiss. The appeal hearing has taken place, however due to necessary investigations and staff holiday, the process is taking a little longer than expected.
The employee was paid one month’s pay in lieu of notice on the date of termination. That was over one month ago. The chair of the appeal hearing has not reached a decision yet.
What would you usually do about the pay in this sort of situation? If the original decision is upheld I had planned on retaining the original termination date. However with the delays we now face, should we pay the employee for the extended duration of the appeal process? If so, how would that affect the date of termination?
Sarah Jennings
Legal advice:
Esther Smith, partner, Thomas Eggar
There is no obligation to continue payment of salary to an employee post termination. Their employment has as a matter of fact been terminated notwithstanding that they are appealing, so they are not entitled to salary over and above their payment in lieu of notice. If their appeal is successful they would be reinstated and you would need to pay them for the period between the dismissal and appeal that was not covered by the notice pay. However, if the original decision is upheld on appeal there is no need to do anything, as the original termination date will still stand.
Esther Smith is a partner in Thomas Eggar’s Employment Law Unit. For further information please visit Thomas Eggar
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Martin Brewer, partner and employment law specialist, Mills and Reeve
The dismissal takes place on the ‘effective date of termination’. From what you say, this is the date the employee left and was paid in lieu. Thus the notice pay is irrelevant. It’s simply the employee’s entitlement.
Thus if the employee is not reinstated you owe him nothing further. If he is reinstated he would be compensated for the period between one month after the termination date, and the date of reinstatement.
However, if you have an unusual contract under which, if the employee appeals they continue in employment, then clearly pay continues until the appeal is determined. This would be very unusual though.
Martin can be contacted at: martin.brewer@mills-reeve.com
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