Jersey: When Does The Termination Of A Contract Amount To A Wrongful Dismissal?

Last Updated: 7 June 2012
Article by Colette Hunt

It is perhaps not surprising, in the current economic times, that wrongful dismissal has been an issue considered by the Jersey Employment Tribunal on several occasions recently.

Wrongful dismissal claims are not new in Jersey. Prior to the introduction of the Employment (Jersey) Law 2003 these were brought before either the Royal Court or the Petty Debts Court, depending on the sum in dispute. Since the Tribunal has existed, it has had the power to deal with such a claim and since its remit is limited to a claim of less than £10,000, it means these are no longer pursued in the Petty Debts Court.

So, provided an employee is claiming £10,000 or less for sums due under the contract, they can lodge a JET1 with the Tribunal that includes a claim for wrongful dismissal either as a stand-alone claim, or as well as alleging unfair dismissal.

Two recent decisions are worthy of comment as they demonstrate the range of issues that can arise or be in dispute in wrongful dismissal cases. The first may be of interest to any employee who has an enhanced redundancy package and the second has a wider application as it provides guidance on how the damages will be valued or calculated in such a case.

The first involved a senior employee at the States of Jersey. He had worked there for many years and was happy to continue but in 2006, was offered a secondment to another position on certain terms. He was never issued with another contract and when the seconded post was subsequently discontinued, he was redeployed but, ultimately, made compulsorily redundant from that redeployed role.

He had accepted the secondment based on terms set out in a letter which included the assurance that "on completion of this period of secondment, a permanent position, which will reflect your skills and competencies, will be made available to you within the States with remuneration no less than your current grade". This wording proved crucial in his case. The employee had certainly relied on it and the Tribunal found that his contract of employment was in fact amended by way of agreement of the terms set out in that letter.

The employee submitted claims for both unfair and wrongful dismissal. There were two separate contested hearings before two differently constituted Tribunal panels (presumably to ensure fairness). The first in July 2011 found that he was unfairly dismissed and awarded him the maximum 26 weeks' pay, but this was reduced by 100% because he had already received a redundancy payment in excess of this award.

As the employee was entitled to a generously enhanced redundancy payment, the set-off applied by the Tribunal meant it was, in effect, pointless for him to bring his claim for unfair dismissal, but understandable why he did. In many instances, the employee would not be entitled to such a large redundancy payment.

At the start of its judgment on wrongful dismissal, the Tribunal emphasised the difference between claims for unfair and wrongful dismissal. The former came into existence under the law and is defined by that law, and the latter is in breach of the terms of the contract between the employer and the employee. The breach can be express or implied, or both.

The Tribunal also emphasised that an unfair dismissal may not be a wrongful dismissal and vice versa. Thus the fact that an employee is found to have been unfairly dismissed does not affect whether they were also wrongfully dismissed, as proved to be the case on the facts of this employee's termination.

Both types of claim can arise following an actual dismissal or a constructive dismissal.

This employee's claim for wrongful dismissal failed because his redundancy, described as a compulsory redundancy, was with his consent. It was financially advantageous for him to agree to this rather than accept voluntarily redundancy. This proved to be a significant point.

In July 2011, the first Tribunal panel had found unequivocally that he had wished to take the compulsory redundancy package. He had understood the amount being offered to him and decided to accept this. He had been advised that he could appeal against being made compulsorily redundant, but did not.

The second judgment involved a Facilities and HR officer at a financial services company. He resigned with immediate effect after he did not consider he had been sufficiently supported in a number of matters. He lodged a complaint for constructive unfair dismissal and claimed other sums including notice pay equal to his three months' contractual notice payable under the contract and in respect of holiday pay during the notice period.

Interestingly, the employer denied that he was constructively unfairly dismissed but made a commercial decision by admitting that he was unfairly dismissed to avoid the cost of a lengthy contested hearing.

Following the admission, the parties agreed that the compensation award amounted to £5,692.40 but as the employer sought a reduction of this award on the basis that because the employee had got another job immediately after resigning, he had suffered no, or little, loss. A second Tribunal had to consider whether this should be "just and equitable" to take into account.

The second Tribunal panel confirmed that the purpose of an "award" for unfair dismissal was to compensate the employee rather than penalise the employer.

As the Tribunal did not have the opportunity to hear about the employee's time with the firm because the employer had admitted liability, it did not know the facts of the case to be able to apply them. It concluded that on the face of the firm's admission it appeared that he had been entirely justified to resign because of the employer's failure to abide by the terms of his contract.

Faced with the prospect of being unemployed, the Tribunal found it was entirely reasonable for him to look for and secure alternative work as soon as he could. It concluded that if it were to reduce his unfair dismissal award for doing so, this would in effect be punishing him for being focused and organised, and in turn would be unduly rewarding the employer. Thus the employer's application to reduce the award on the basis that the employee's actual financial loss was minimal, was dismissed.

In respect of the claim for wrongful dismissal, the Tribunal gave a lengthy decision but the following are the key points:

  • the company should have given the employee the 3 months' notice in accordance with the terms of the contract;
  • it was not possible in this case for the employee to work his notice period as he had resigned;
  • as the contract contained a "payment in lieu of notice" clause, it was possible for the employer to make him a financial payment in lieu of notice, but it chose not to;
  • losses incurred by the employee in such cases are deemed to be damages (as opposed to compensation) and as such, the usual rules and principles of common law apply. The Tribunal considered various wrongful dismissal decisions of the Royal Court in Jersey both prior to and since the law took effect; in particular on the issue of the duty of the employee to mitigate its loss;
  • as the employee had secured suitable alternative employment within a few weeks of resigning, he had satisfied his obligation in respect of his duty to mitigate;
  • as there is no rule of law which limits damages in such cases to loss of pay and benefits resulting from not being provided with notice, all other entitlements can be claimed by the employee for the duration of the notice period, a monetary value given to each and then this will be taken into account when assessing the amount of damages. In his JET1, the employee had claimed for loss of private health insurance, permanent health insurance, travel insurance and life insurance although the monetary value had not been calculated (it would be advisable to quantify all such amounts in advance of any contested hearing and try to agree these with the other party);
  • accordingly, the actual amount that the employee earned with the new employer was set off against the value of the pay and benefits that he would have received if he worked out his notice with the employer or had been paid in lieu of the notice period;

Finally, the employee claimed a modest amount for the holiday pay that would accrue during the contractual notice period. This was because he had resigned. The Tribunal found that after the date of his resignation, he was not obliged to provide any services for the firm and so it could not be said that he had "earned" the right to accrue annual leave.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions