Continuity of employment

Many statutory employment rights depend on the employee being in employment for a minimum period of time before they can claim the right - for example there is a minimum period of 2 years continuous service to qualify for a redundancy payment or unfair dismissal where employment started after 6 April 2012.


Section 212 Employment Rights Act 1996 sets out specific provisions as to how weeks that count towards continuous service may be calculated.

 

The basic rule is that all weeks during which there is a contract of employment in existence count toward continuous service. There is no minimum period specified so the hours of work in any week could be quite small.

 

The rules also provide that in certain circumstances a week when no work is carried out can still count toward continuity of employment.

Temporary cessation of work

Section 212(3)(b) ERA 1996 allows weeks when there is a 'temporary cessation of work' to be counted toward continuity.

 

The use of this continuity provision enabled a teacher who accepted a succession of short term (term time and home based) teaching assignments over a period of many years to establish continuity of service. The gaps between her teaching assignments were disregarded because the employer had so regularly re-employed her: Cornwall County Council v Prater [2006] EWCA  Civ 102.

Arrangement or custom

Section 212(3)(c) allows weeks when no contract exists by arrangement or custom to count toward continuity. This allows and employees to argue that the break in employment is due to arrangement or custom whereby the employee is regarded as an employee notwithstanding his or her absence and despite the fact that he or she has no contract of employment with the employer during the period of absence.

 

In Curr v Marks & Spencer [2002] EWCA Civ 1852 the Court of Appeal set out some rules for how this type of continuity should work:

(i)   the arrangement must be understood by both parties to have the 'requisite effect';

(ii)  the 'requisite effect' is that the employee is regarded as continuing in the employment of the employer; and

(iii)  it is sufficient if he or she is so regarded for any purpose, not necessarily for all purposes (the example given being of the employee being treated as such for the purpose of accruing pensionable service, as in Wishart v NCB [1974] ICR 460).

 

In addition, in order for there to be an ‘arrangement’ there must have been a discussion or agreement to the effect that the parties viewed the employment relationship as continuing despite the termination of the contract of employment before the break.

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