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Continuity of Employment

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The Court of Appeal has overturned the EAT's decision in Curr v Marks & Spencers plc (see bulletin dated 9th April 2002 for the EAT decision).

An employee had a four year break in her employment, pursuant to the Marks & Spencers' Child Break scheme. Whilst it was clear that there was no governing contract of employment during those four years (so as to enable continuity of employment to continue accruing), the majority of the EAT held that she was "absent from work in circumstances such that...[she] is regarded as continuing in the employment of her employer for any reason" under ERA 1996, s212. Accordingly her continuity of employment remained unbroken during the four year gap and she was entitled to a redundancy payment based on her accrued continuity of employment dating back to 1973.

The Court of Appeal has overturned that decision, holding (reluctantly) that continuity of employment was broken during the four year Child Break gap. Because the M&S Child Break scheme involved a resignation from work (albeit with a guarantee of re-employment at the end of four years), there was no way in which Ms Curr could be regarded as "continuing in the employment of her employer". The very fact she resigned showed she was not continuing in employment. The position might have been different if there had been an agreement or custom that she remained regarded as employed for the purpose of, for example, pension arrangements - but this was not the case. Therefore she lost the benefit of 17 of her 25 years' service for the purpose of calculating her redundancy payment.