Curr v Marks & Spencer plc [2002]
We previously reported the case of Curr v Marks & Spencer in the Employment Appeal Tribunal (June 2002, LELR 71), a case concerning the status of an employee during a career break. The EAT had concluded that during a four year career break, although there was no contract of employment, there was continuity of employment. The period of absence from the workplace was a continuing arrangement preserving continuity. The main practical importance was that employment rights dependent on a period of service would not be lost during a career break, such as unfair dismissal protection and redundancy entitlement.
The Court of Appeal disagrees and has overturned the EAT's judgment.
Under the career break scheme for managers at Marks & Spencer, Ms Curr resigned and received her P45 and commenced a four year break. She was guaranteed a management position on her return. During the four years she had to keep in touch with Marks & Spencer, not take up any other paid employment without their consent, and to work for a minimum of two weeks each year.
Four years after her return to work Ms Curr was made redundant and received a redundancy payment based on four years service, not her whole service with the store of 25 years.
The Court of Appeal examined the position from two angles: whether Ms Curr's employment contract subsisted during her four year break, and whether the break was 'an arrangement' that would span the gap, as held by the EAT.
There was mutuality of obligation during the career break, the Court of Appeal held, and it was a contract, but it did not constitute a contract of employment.
In order to be an arrangement sufficient to preserve continuity (section 212(30(c) Employment Rights Act 1996) it is necessary to look at all the circumstances and in particular the terms of the arrangement. There must be mutual recognition that the ex-employee, although absent from work, is to be regarded as continuing in the employment of the employer. Ms Curr was not regarded as continuing in employment during the break. The scheme conferred the option to be re-employed in a management position on her return.
This case is disappointing and misses the point of career breaks which is to enable women to pick up where they have left off, status and rights in tact, after a period with their children. The protection of accrued employment rights during the break is important and enables the schemes to be used with confidence by women with small children. This ruling may reduce the attractiveness of the career break schemes, leaving women to struggle on in their infants' early years, or change career.
The ruling highlights the importance of the contractual terms of career break schemes. Continuity of employment is a legal term that cannot be redefined by the parties, but the contractual terms in any particular scheme can be whatever the parties decide. A clear contractual right to return, contractual redundancy provisions incorporating pre- and post- break service can be included in the scheme itself.