Bank contract broke continuity: support worker's unfair dismissal claim fails
A support worker who moved to a bank contract with no guaranteed hours lost the continuity needed to bring an unfair dismissal claim. The tribunal ruled it had no jurisdiction to hear the case.
2 min read · Last updated 18 May 2026
Case details
- #bank-contract
- #mutuality-of-obligation
- #continuity-of-employment
- #two-year-qualifying-period
Key facts
- The claimant started work as a support worker on 7 March 2018.
- She resigned between 29 January and 19 February 2019.
- She then entered a bank contract on 7 March 2019 with no obligation to accept or offer work.
- She recommenced employment with set hours on 18 March 2020.
- She was dismissed on or about 30 December 2021.
- The bank contract period broke continuity of employment.
Timeline
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Employment started
Claimant began work as a support worker.
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Resignation
Claimant resigned between 29 January and 19 February 2019.
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Bank contract signed
Claimant signed a bank contract with no mutuality of obligation.
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New employment started
Claimant recommenced employment with set hours of 42 per week.
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Dismissal
Claimant was dismissed on or about 30 December 2021.
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Preliminary hearing
Tribunal heard the jurisdictional issue.
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Judgment issued
Claim dismissed for lack of jurisdiction due to insufficient continuous employment.
The legal issue
The tribunal had to decide whether the claimant had two years' continuous employment ending with her dismissal, as required by section 108(1) of the Employment Rights Act 1996, to bring an unfair dismissal claim. The key question was whether the bank contract period counted towards continuity.
The outcome
The tribunal dismissed the claim for lack of jurisdiction. It found that the claimant did not have two years' continuous employment because the bank contract (7 March 2019 to 18 March 2020) did not count towards continuity.
- The bank contract had no mutuality of obligation: the employer was not obliged to offer work and the claimant was not obliged to accept it.
- Under the House of Lords decision in Carmichael v National Power plc, such a contract does not create an employment relationship for continuity purposes.
- As a result, the only continuous period was from 18 March 2020 to 30 December 2021 – less than two years.
- No compensation was awarded as the claim was dismissed at the jurisdictional stage.
Lessons & takeaways
- If you move from a regular contract to a 'bank' or zero-hours arrangement, your continuity of employment may be broken, affecting your right to claim unfair dismissal.
- To count towards the two-year qualifying period for unfair dismissal, each period of employment must be under a contract with mutual obligations – the employer must guarantee work and you must accept it.
- Even if you have worked for the same employer for several years overall, gaps or changes in contract type can reset the clock for unfair dismissal purposes.
- Check your employment contract carefully: if it says you are not obliged to accept work and the employer is not obliged to offer it, it likely breaks continuity.
- If you have a break in continuity, consider whether you have another type of claim (e.g., discrimination) that does not require two years' service.
A gap in continuity that cost a claim
This case shows how a seemingly minor change in working arrangements can have major legal consequences. The claimant had worked for Isand Limited as a support worker since March 2018. After resigning and returning under a bank contract in March 2019, she later resumed regular hours in March 2020. When she was dismissed in December 2021, she believed she had nearly four years of service – but the tribunal saw it differently.
The bank contract was the critical factor. It stated clearly that the employer was not obliged to offer work and the claimant was not obliged to accept it. Under employment law, that lack of 'mutuality of obligation' means the period does not count as continuous employment. The tribunal applied the well-known House of Lords case Carmichael v National Power plc, which established that a contract without mutual obligations is not a contract of employment for continuity purposes.
What the employer did right – and what the claimant could have done
The employer, Isand Limited, was represented by counsel and successfully argued that the bank contract broke continuity. The tribunal noted that the claimant herself had turned down work on one occasion, confirming she understood the contract's terms. For employers, this case reinforces the importance of clear written contracts and accurate records of hours worked.
For employees, the lesson is stark: accepting a zero-hours or bank contract can reset your continuity clock. Even if you later return to regular hours, the earlier service may not count. The claimant's unfair dismissal claim was dismissed without ever reaching the merits – not because she was fairly dismissed, but because she did not have the two years' continuous service required by law.
Why this matters for similar claims
This decision is a reminder that the two-year qualifying period for unfair dismissal is strictly applied. Employees who move between different types of contract with the same employer should be aware that continuity can be broken. Anyone considering an unfair dismissal claim should first check their continuous service dates – and if there is a bank contract period, seek advice on whether it counts.
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