Employment lawBy Martin Edwards, Mace & Jones, LiverpoolSettling claimsSutherland v Network Appliance Ltd and another (2001) IRLR 12Mr Sutherlands employment was terminated on agreed terms, including payment of a sum of money in full and final settlement of any claims you may have against the company arising out of your employment or its termination.

Subsequently, he presented a complaint to the tribunal claiming a breach of statutory rights, including unfair dismissal, and damages for breach of contract.

The employers alleged that any claims for damages for breach of contract had been compromised by the agreement.At a preliminary hearing, the tribunal held that it had no jurisdiction to consider the claims for damages for breach of contract, because of the agreement.

Mr Sutherland appealed on the basis that since the agreement referred to all claims without distinguishing between statutory and contractual claims, section 203 of the Employment Rights Act 1996 rendered the agreement void in its entirety.

The Employment Appeal Tribunal (EAT) upheld the tribunals decision.

Since claims for breach of contract arise under section 3 Employment Tribunals Act 1996, they are not caught by the restriction on contracting out in section 203(1) Employment Rights Act in respect of proceedings under that Act, even though any valid statutory claims could not have been excluded.Where a compromise agreement which is expressed as being in full and final settlement fails to comply with section 203, the agreement is void only in respect of statutory claims.

It remains enforceable to the extent to which it contains a compromise of contractual claims.Gloystarne & Co Ltd v Martin (2001) IRLR 15This case provides a cautionary tale for those dealing with others purporting to represent parties to tribunal proceedings.

Mr Martin brought an unfair dismissal claim, in which he did not identify a representative acting for him.

Two days before the hearing, a trade union official phoned the tribunal to say that the parties had reached an agreement and confirmed the position by fax.

The Advisory, Conciliation and Arbitration Service (ACAS) informed the tribunal that a COT3 form was being prepared.The tribunal subsequently made an order staying the application.

The union official then wrote to the tribunal saying that Mr Martin had decided not to complete the COT3 and wished his case to be re-listed.

At the hearing, it became clear that any terms of settlement which had been discussed and purportedly agreed between the trade union organiser, the employers and ACAS were done without Mr Martins knowledge and consent.

The tribunal accepted Mr Martins evidence that he went absolutely ballistic when he found ACAS had been told the case was settled.

The tribunal ordered that the case be re-listed for hearing.

The EAT upheld that decision.Ostensible authority arises by the party himself holding out that a person was authorised to act on his behalf, not by a holding out by counsel, a solicitor, a Citizens Advice Bureau adviser or other representative.

B does not becomes As agent in dealings with C, nor does B acquire authority from A to act on As behalf in relation to C, by way only of what B says to C.

If that was the case, the EAT pointed out, principals could have agents completely unknown to them and over whom they had no control.

B becomes As agent in dealings with C by reason, in general, of what A says to C on that point or whether A conducts himself in some way that reflects on the possibility of Bs agency.

This decision may appear harsh, but the reasoning seems to be correct.