In Gallagher v Eircom the employee in question had been sentenced to a prison term of 8 years.
Under normal circumstances a long prison sentence would be sufficient grounds for frustration of contract.
In this case, however, the employee argued that he had in fact been dismissed as his employer had waited until one week before his sentence was due to end to inform him that his employment was being terminated.
The employer argued that the reason for the delay was that as a former semi-state body it had detailed disciplinary procedures and while it had gone through these procedures the contact had in fact terminated due to frustration when the employee was given the prison sentence.
The EAT agreed with the employer and held that termination due to frustration occurs due to circumstances which are outside the control of the parties and held that the contract had terminated automatically once the employee had received the prison sentence.
As a result, the employer had not been obliged to go through the normal disciplinary procedures involved in dismissing an employee.
Case: Gallagher v Eircom, Employment Appeals Tribunal
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