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Norton Tool and Constructive Dismissal

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Since 1976, tribunals have applied the controversial rule in Norton Tool v Tewson, which is authority for the proposition that employees are entitled to compensation for unfair dismissal for all of their contractual notice period, even if they found another job during that period or failed to mitigate their losses. This means that employees can benefit from double recovery, particularly when they have long notice periods.

In Stuart Peters v Bell, the EAT held that the same principle applies to constructive dismissals (as well as 'normal' dismissals). Although an appeal is unlikely in this case because of the small amounts involved, and because it would need the House of Lords to overturn Norton Tool, HHJ Burke concluded his judgment by expressing a hope that this principle might be reconsidered by the House of Lords when the opportunity arises.