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Misunderstandings and mistaken intentions

17 October 2011

When issuing a notice of termination of employment the general rule is that a clear and unambiguous notice is to be taken at face value and an employer has no right to withdraw it. However, there are certain situations (e.g. where notice is given in the heat of the moment) where this does not apply. These are known as the “special circumstances” exceptions.

What about when an employer intends to terminate the employment but on the basis of a misunderstanding? The Court of Appeal has held in CF Capital v Willoughby that an employer’s mistake in issuing notice of termination before agreement with the employee had been reached was not a special circumstance. The employer had intended to terminate her contract therefore it could not be unilaterally withdrawn.

If there is any scope for misunderstanding in a dismissal scenario employers are advised to send a note of the proposal and seek agreement from the employee before issuing the notice of termination.

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