How long has an employee worked for you? It seems a straightforward question, and in many cases the answer will be obvious, but there are some situations where the position becomes more complicated.
- Why does it matter?
Continuous employment becomes an issue where an employee needs a particular period of service in order to qualify for something. This might be a statutory claim such as unfair dismissal, or it might be something like a redundancy payment, where the amount payable depends on length of service (as well as age and pay). An employer might offer certain service-related benefits, such as additional holiday or sick pay after the employee reaches a particular period of employment with the organisation, so it will be important to work out when that point is reached.
- How does continuity of employment get broken?
Generally speaking, continuous employment will begin on the first day that the employee works for the employer and it will continue until the contract is terminated. If there is a gap of more than a complete week then continuity may be broken. However, the legislation states that a gap must be a “complete week, ending in a Saturday.” The effect of this is that if (for example) an employee stops work on a Monday and starts work 8 days later, continuity will not be broken because the gap has not been a week ending on a Saturday. In practice it is often easiest to assume that a gap needs to be at least 2 weeks.
- What sort of situations might preserve continuity of employment?
The most problematic area for employers is where it appears that there might be a gap in service (because the gap is more than a complete week) but in law the employment is continuous. The main areas where continuity can be preserved are:
This is where the employee may not necessarily work very often, but there is an overarching contract that governs the work that they do for the employer. This can sometimes be the case with bank staff. For example, in the case of Cornwall County Council v Prater (2006), a home tutor on various temporary assignments was considered to be an employee during breaks in between, where there was no work available for her.
Where the Transfer of Undertakings (Protection of Employment) Regulations 2006 apply, an employee’s continuity of employment will be preserved even when they move from one employer to another.
Local Authority or NHS employers
Special rules apply to certain public sector employers so that even if an employee moves between different organisations, their continuity of employment is preserved.
Absence by ‘arrangement or custom’
This applies where the employee has a reason for being away from work – a sabbatical or career break can be an example of this, so it is a good idea for employers to be very clear in any sabbatical agreement what the intention is. Our recent article on sabbaticals and career breaks can be seen here.
Temporary cessation of work
This is one of the most contentious areas, as there is no maximum in what will count as ‘temporary’ for this purpose.
The leading case in this area is that of Hussain v Acorn Independent College (2010) where the Employment Appeal Tribunal found that the correct approach is to look at why the contract has come to an end. In that case, the employee’s contract had ended due to the summer break, and had started again because of the new academic year. Therefore, although the gap was several weeks, the employee’s employment was deemed to be continuous. In sectors such as education, where it is common for there to be gaps due to the school holidays, employers need to be particularly wary of assuming that continuity is broken, particularly where staff are engaged on fixed term contracts which are then renewed.
A temporary cessation of work can also apply where there is an agreement in place to re-employ the employee – and the agreement does not have to be in writing for this purpose. This can ‘bridge the gap’ and ensure that when the employee rejoins, their continuous employment is preserved.
Are you dealing with an issue involving continuous employment? We can guide you through the issues. Please contact any member of the Pure Employment Law team on 01243 836840 or [email protected].