Unfair dismissal claim struck out: less than two years' service and no garden leave
A technical development manager who believed he was on garden leave had his unfair dismissal claim struck out because he had less than two years' service and the effective date of termination was clear.
1 min read · Last updated 18 May 2026
Case details
- #strike-out
- #effective-date-of-termination
- #payment-in-lieu-of-notice
- #garden-leave
- #qualifying-period
Key facts
- The claimant started employment on 3 January 2021.
- The claimant was dismissed on 21 November 2022 with immediate effect and received a payment in lieu of notice.
- The claimant had less than 2 years' continuous service at the effective date of termination.
- The claimant believed he was on garden leave during the notice period, but the contract did not contain a garden leave clause.
- The termination letter and consultation meeting clearly stated the termination date as 21 November 2022.
Timeline
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Employment started
Claimant commenced employment with Belfield Furnishings Ltd.
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Contract signed
Claimant signed a contract of employment which included a payment in lieu of notice clause but no garden leave provision.
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Dismissal
At a final consultation meeting, the claimant was told his employment was terminated with immediate effect due to redundancy. He received a termination letter confirming the date.
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Payment in lieu of notice
Claimant received a payslip showing a payment in lieu of notice of £10,140.
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Claim issued
Claimant issued a claim for unfair dismissal and age discrimination.
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Strike-out application
Respondent applied to strike out the unfair dismissal claim for lack of jurisdiction.
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Preliminary hearing
Employment Judge Broughton heard the strike-out application.
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Judgment
The unfair dismissal claim was struck out as it had no reasonable prospect of success due to insufficient service.
The legal issue
Whether the claimant had the required two years' continuous service to bring an ordinary unfair dismissal claim, and whether the effective date of termination was 21 November 2022 or a later date due to a mistaken belief about garden leave.
The outcome
The tribunal struck out the unfair dismissal claim as it had no reasonable prospect of success.
The key reason was that the claimant had less than two years' continuous service at the effective date of termination (21 November 2022). The claimant's argument that he was on garden leave, which would have extended his employment, was rejected because:
- His contract did not contain a garden leave clause.
- The termination letter and meeting clearly stated immediate termination with payment in lieu of notice.
- The payslip and P45 both showed the leaving date as 21 November 2022.
No compensation was awarded as the claim was struck out.
Lessons & takeaways
- Employees with less than two years' service generally cannot claim ordinary unfair dismissal, unless the dismissal is for an automatically unfair reason.
- A payment in lieu of notice ends the employment on the date of termination, not at the end of the notice period.
- Believing you are on garden leave is not enough — check your contract for a garden leave clause and confirm with your employer.
- Always read your employment contract carefully, especially clauses about notice, payment in lieu, and garden leave.
This case shows how important it is to understand the legal effect of a payment in lieu of notice (PILON). The claimant, a technical development manager with less than two years' service, was dismissed with immediate effect and received a PILON. He believed he was on garden leave during the notice period, which would have extended his employment and given him the qualifying service to bring an unfair dismissal claim. However, his contract did not contain a garden leave clause, and the termination letter and meeting clearly stated the date of termination as 21 November 2022.
What the employer did right
Belfield Furnishings Ltd had a clear termination letter, a signed contract with a PILON clause, and consistent documentation (payslip, P45) all showing the same leaving date. This made it difficult for the claimant to argue that the effective date of termination was later. The employer also applied promptly to strike out the claim, saving time and costs.
What the claimant could have done differently
The claimant admitted he had not read his contract. If he had, he would have seen there was no garden leave clause. He also did not ask anyone to clarify his status. Checking the contract and asking questions at the time could have avoided the misunderstanding. Additionally, employees with less than two years' service should be aware that they have limited protection against unfair dismissal, unless the reason is automatically unfair (e.g., whistleblowing, discrimination).
Why this matters
The case is a reminder that the effective date of termination is a critical legal concept. A mistaken belief about garden leave does not change the legal position. For employees, it underscores the need to understand your contract and the implications of a PILON. For employers, it shows the importance of clear documentation and consistent communication to avoid disputes about the termination date.
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