The Price Tag of Continuous Service

You are sitting with colleagues about to offer a job to an interviewee.  The latter has been advised well as he asks you directly, ” I would like to be assured that you will recognise my previous continuous service in the offer for this role?”  The candidate is very experienced for the role and you are keen to seal the offer.  So you answer, “Yes, once it has been verified”.  What have you recognised and at what cost?

Statutory Continuous Service

Such service builds an individual’s entitlement to rights such as notice periods, eligibility to claim unfair dismissal, redundancy pay.  When you agree to recognise continuous service, you may inherit a long period of unbroken service which could, for example, result in up to 20 years of service being taken into account for redundancy pay.  Thus it pays to be aware of what costs you may inherit.

As it is a statutory principle, most employers have to recognise such service. However, some organisations go further and recognise a wider definition of previous service that will count for benefits etc.

Strict Reckoning of What Service Counts

Statutory continuous service is based on a strict principle. To be reckonable, service must be unbroken. A gap of just one week will break the service record. A week is measured from a Sunday but will count even if less than an hour of work was performed or if no work was performed in a week if the following applies:

  • A contract was in existence even if no work was carried out that week
  • The week by arrangement or custom is deemed to be a period of employment such as a term time worker who is not required to work during the school holidays or a woman on ordinary maternity leave.

Other situations can also arise leading to the recognition of continuous service if an individual is:

  • Incapable of carrying out his work due to sickness or injury for up to 26 weeks and is then re-employed – those weeks will be treated as continuous service.
  • Absent from work due to a temporary cessation of work even if the contract does not continue.

A Break in Service

If none of the above apply and an individual has a ‘gap’ of one week in his employment, he will be treated as having broken his statutory continuous service.

In most cases that means the service before the break will not be reckoned as statutory continuous service. However, there are some situations in which the service will not be broken but certain weeks will not be counted e.g. strikes – those weeks will not count but do not break continuous service.

In many cases, continuous service only with the current employer will count. For example, schools are not regarded as associated organisations and service with another school even within the same LA is not regarded as statutory continuous service but note the points below.

The Hidden Cost

[Author’s update] If the employer is the local authority, then any continuous service with that authority will count which will include working at other schools of the same authority whether in support and/or teaching roles.

An expensive mistake can be made if you contract to recognise service that is not continuous as you will be liable under the contract to recognise such service. Verbal or written offers of employment should make it clear that recognition of service is subject to verification of reckonable statutory continuous service and relevant previous service for particular rights and benefits.

Before answering the interviewee’s question, you should consider the real cost as you may inherit longer service because of an industry wide agreement. For example, if the interviewee has been working for a local authority type of employer, his service may count under what is known as the Modification Order.  The service must be continuous but may have been built up across several employers.  The last employer will inherit the liability for the whole continuous service of the individual

As individuals move between maintained schools and academies, you will need to have a policy on whether or not you will recognise their previous service.  Service with an academy counts for redundancy purposes but it does not have to be counted for some benefits.  In deciding your policy, you may need to take account of the thoughts below.

A Beneficial Price Tag

Some managers will be tempted to engineer a break in service to keep costs down or delay an individual accruing the right to claim unfair dismissal.  A more effective mindset is to consider the value of the experience and transferable skills that an individual will bring to the school.  Yes, that will have a price tag if things go wrong but as managers we have to nurture a culture that makes expectations explicit and provides a work environment for individuals to apply their skills to the benefit of the school as well as their own development and satisfaction from the exercise of their skills.

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