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Giving Credit for Notice Monies

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The EAT has handed down its decision in Voith Turbo v Stowe, dealing with the issue of whether an unfairly dismissed employee needs to give credit for earnings achieved in new employment during a period when the former employer was paying notice pay.

The Employment Appeal Tribunal (HHJ McMullen presiding) held that credit need NOT be given, i.e. that the employee effectively has a windfall of the additional monies.

This decision appears to conflict with last month's decision in Morgans v Alpha Plus Security Ltd. (see bulletin 24/1/05), holding that when assessing the 'just and equitable' losses, credit should be given for ALL income.

Thus it seems we are back to having a conflict of authority on this point again. The matter seems appropriate for the Court of Appeal - particularly as the same firm of solicitors (ASB Law) acted for the employer in both cases.

Voith Turbo Ltd v Stowe

Morgans v Alpha Plus Security