Historic Breaches of Contract

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Can you take employment action based on an historic incident? Find out in this recent case.

The Problem

You discover that one of your employees, whilst employed by you, had forwarded a pornographic email to a junior colleague and to two external contacts five years earlier. The question posed to you in the HR team is whether or not you can take action based on this historic incident (and despite the fact that the company is looking for a reason to justify immediate dismissal) .

The Principle

This was the case facing Leeds United Football Club (Williams v Leeds United Football Club). The Club summarily dismissed its Technical Director (despite the fact he was working out his 12 months’ notice period served on him by reason of redundancy). The High Court found that the Club’s findings were considered to be a legitimate reason to treat the contract as repudiated and thus justify immediate dismissal.

The Practice

It is not unusual for employers to question whether or not an employee can be summarily dismissed during a period of notice, especially where notice is lengthy. In this case, Mr Williams argued that the dismissal for this reason was a breach of contract. However, the High Court was satisfied that the conduct of the individual, viewed objectively, was sufficiently serious (despite how old it was) to warrant summary dismissal and that there was still a breach of the implied term of trust and confidence. The Club could not have accepted such a breach for the simple reason they had not been aware of it up until the last minute and when it became aware, it was entitled to take action.

Interestingly the High Court also said it was okay to dismiss despite the Club looking for ways to summarily dismiss the individual (thus saving money by not having to pay 12 months notice based on a salary of £200k p/a).

In practice, this case may suggest employers can be confident in dealing with historic issues which come to light and will be free to go on fishing trips to find wrongdoing. However, we suggest caution should still be exercised (not least because normal unfair dismissal tests will still apply). It appears that the facts that the employee held a very senior position and the employer was a football club, subject to public and media attention, could have been key to this decision. It is also considered surprising that the Club came under no criticism for trying to find a reason to dismiss.

If you have any queries on what the changes will mean in practice for your club, please call our dedicated County FA Helpline on 08448 240 432 or email [email protected].