Why it is important to word dismissal letters carefully
In this case an employee was dismissed for redundancy with 4 days notice. Her contract of employment in fact entitled her to 3 months notice of dismissal. The letter of dismissal stated that payment would be made of statutory redundancy pay, holiday pay, and an ‘ex gratia’ payment of a sum equivalent to 3 months’ gross salary.
The employee brought a claim for damages for dismissal without notice. The employer argued that the ‘ex gratia’ payment, which had been paid, was meant to be a payment for the notice period. The EAT disagreed and upheld the Tribunal’s earlier judgment.
The reasoning behind the EAT’s decision was that an ‘ex gratia’ payment is ordinarily understood to mean a gift or payment made by favour as opposed to a payment made on account of any legal obligation. There was nothing in the dismissal letter which cast doubt on this interpretation – the letter could have explained that the ‘ex gratia’ payment was actually her notice payment but it did not.
Case reference: Publicis Consultants UK Ltd v Ms F O’Farrell.
The employer in this case clearly did not understand the meaning of the term ‘ex gratia’ and, therefore, the case serves as a cautionary reminder not to use Latin unless you know exactly what it means!
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