Claimant v Escendant Limited
Outcome
Individual claims
The tribunal found that a collateral contract existed whereby the respondent promised to transfer 2% share equity to the claimant in return for him commencing employment. The email of 28 March 2022 constituted a clear offer of share ownership to take effect post-investment, and the claimant accepted by signing the employment contract. The entire agreement clause in the employment contract did not apply to this separate share agreement, which pre-dated and was expressly acknowledged to fall outside the employment contract. The respondent breached this collateral contract by failing to transfer the shares.
Facts
The claimant was a senior deep learning engineer employed by a technology start-up from June 2022 to February 2024 on a salary of £130,000. During pre-employment negotiations in March 2022, the respondent's director promised the claimant 2% share ownership in the company in return for joining, to be transferred shortly after a £1 million investment. The claimant signed an employment contract on this basis, though the contract contained an entire agreement clause and no mention of shares. The promised shares were never transferred, and the claimant was dismissed in February 2024.
Decision
The tribunal found that a collateral contract existed alongside the employment contract, whereby the respondent promised to transfer 2% share equity to the claimant. The email of 28 March 2022 constituted a clear and unambiguous offer of share ownership which the claimant accepted. The entire agreement clause did not apply because the share agreement was expressly understood to fall outside the employment contract, and the parties' clear intention was that the share promise would be binding. The respondent breached this collateral contract. A remedy hearing will follow.
Practical note
An entire agreement clause in an employment contract may not exclude a collateral contract where pre-contractual correspondence makes clear that certain promises fall outside the written contract and parties expressly intend those promises to be binding.
Legal authorities cited
Case details
- Case number
- 3302963/2024
- Decision date
- 14 November 2025
- Hearing type
- full merits
- Hearing days
- 2
- Classification
- contested
Respondent
- Sector
- technology
- Represented
- Yes
- Rep type
- lay rep
Employment details
- Role
- Senior Deep Learning Engineer
- Salary band
- £100,000+
- Service
- 2 years
Claimant representation
- Represented
- No