This is the first post in the “popular law” series I promised a long time ago. It is a post that I have been meaning to write for quite some time, and frankly could have written many months ago. I have been prompted to get my act together by reading a recent Employment Appeal tribunal decision.
Often I find myself explaining that the “unfair” in unfair dismissal relates above all else to the employer’s processes leading to the decision to terminate an employee’s employment. The question is whether the employer’s procedures leading to the dismissal were fair. The question is NOT whether the employer was correct in determining that the employee was likely to have committed the alleged misconduct.
Understanding this enables employers to take steps which can reduce the chances of a successful claim. Understanding this enables employees’ advisers to determine the chances of successfully bringing a Tribunal claim for unfair dismissal.
Last week I read a recent Employment Appeal Tribunal decision, Ministry of Justice v Parry UKEAT/0068/12/ZT http://www.bailii.org/uk/cases/UKEAT/2012/0068_12_1411.html. My eye was caught by paragraph 10, in which Mr Justice Langstaff, President of the Employment Appeal Tribunal, succinctly reminds us of the analysis that and Employment Tribunal should carry out in determining whether an employee has been unfairly dismissed for misconduct:
Surprisingly for a conduct dismissal, the analysis by the Tribunal did not address in turn the issues to which case law has established a Tribunal should pay regard: whether the employer had a genuine belief that the employee was guilty of the misconduct alleged; whether that was based on reasonable grounds; after a reasonable investigation; and whether the decision to dismiss was within the range of reasonable responses open to an employer in respect of the misconduct.
That paragraph contains the legal analysis in a nutshell, certainly when dealing with a claim for unfair dismissal following the termination of employment for gross misconduct.
It is a common misconception that an Employment Tribunal looks at whether the employer “got it right” in terms of whether the employee did or did not do whatever it was that he was dismissed for. That is not what the Tribunal does. Only in the most exceptional cases will a Tribunal go behind the employer’s decision in that respect.
What a Tribunal wants to see is whether the employer followed reasonable and fair investigation and disciplinary processes. If at all possible (and this may be difficult for the smaller employers) the investigation should be carried out by someone other than the person making the decision at the disciplinary meeting. The investigation should be as thorough as is necessary in the circumstances. The person conducting the investigation should do so with an open mind: it is possible that when the evidence has been gathered he may conclude that proceeding to a disciplinary meeting is not appropriate or justified.
If it is decided that there should be a disciplinary meeting, then the employee must be given advance notice of the meeting and the material gathered in the investigation should be disclosed to him. These may be documents that have been gathered, statements of people involved, etc. The purpose of disclosing relevant material to the employee is to give him an opportunity to consider it.
The purpose of the disciplinary meeting is to enable the decision maker and the employee to hear the evidence against the employee. The employee should then have the opportunity to ask questions, if need be to call his own witnesses who may contradict facts or show them in a different light, and to put forward an explanation.
The manner in which the decision maker goes about things may help show whether he has approached the meeting with an open mind. Has he allowed the employee to speak, and listened? Has he interrupted? Has he given a decision instantly, almost without pause to think? Or has he taken some time to consider, even if it is a case of asking the employee to wait for a few minutes while he thinks about what he has heard and makes his decision?
If an employer is able to show that he has conducted fair investigation and disciplinary processes, then he is well on the way to successfully defending the unfair dismissal claim. Going back to what Mr Justice Langstaff said, the question then becomes whether the employer had a genuine belief that the employee was guilty of the misconduct alleged. If the decision maker can demonstrate that he came to the disciplinary meeting with an open mind and that he reached his decision after considering the evidence at the disciplinary hearing and the employee’s response, then he will be likely to be able to satisfy the Tribunal in this regard. It is only in the most exceptional cases that the Employment Tribunal will go behind the question of the decision maker’s belief in the employee’s guilt. The Tribunal will only do this in cases where, having regard to the evidence, the decision that the employee was guilty of the misconduct staggers belief. The word that is used is that the decision was “perverse”.
Finally, there is the question whether the decision to dismiss was within the range of reasonable responses. Obviously the answer to this question will depend on the circumstances, not least the seriousness of the misconduct and the previous employment history of this employee. A note of caution: if the employer is relying on the fact that the employee has had previous warnings, when dismissing for what might otherwise be a relatively minor infraction, then it is important that the decision maker at the disciplinary hearing is aware of the history of warnings and has that history in mind.
Therefore if an employer is able to show that:
- he followed fair investigation and disciplinary processes;
- leading to a decision taken on the evidence and with an open mind that the employee was guilty of the misconduct alleged; and
- with an appropriate outcome;
then he is likely to be able to defeat an unfair dismissal claim, even if the employee can now cast some doubt on the question of his guilt of the alleged misconduct.
On the other hand, if the employee can show that the employer failed in one or more of those points, then he is on the way to establishing unfair dismissal.
As I said at the beginning, the word “unfair” in unfair dismissal relates to the procedures operated by the employer leading to the decision to dismiss.
These are the questions that those advising employees ask and go through. If, as an employer, you operate procedures which will satisfy these tests, then it is likely that an employee’s advisers will warn that the chances of success are not high. This can be important if the ex-employee has legal expenses insurance or is trying to persuade a lawyer to represent him on the basis of sharing a percentage of the winnings. In either case, the insurer or the lawyer will only take on the case if the chances of winning it are good enough.
There is one further point claimants must be aware of. This is the possibility of a Polkey deduction. In the 1987 case of Polkey v AE Dayton Services http://www.bailii.org/uk/cases/UKHL/1987/8.html the House of Lords ruled that even if a dismissal was procedurally unfair, nevertheless a Tribunal can reduce the compensation awarded if it considers that a fair procedure would have led to dismissal.
The Polkey deduction can be as much as 100%. I have acted for an employer who sacked two employees on the spot for fighting, right in front of the MD. One of the employees brought a Tribunal claim. We had to concede that the dismissal was procedurally unfair, but successfully argued for a Polkey deduction, the Tribunal reducing compensation by 75%.
This blog post necessarily contains a brief summary of the legal principles and should not be treated as legal advice in any specific case. Please contact me if you wish to discuss any specific situation.
The ACAS Code of practice – Disciplinary and grievance procedures: http://www.acas.org.uk/index.aspx?articleid=2174