Unfair Dismissal

Question 1

Stages in UD Claim

Answer 1

1) Is individual an employee?
2) Does the employee meet qualifying period of continuous service?
3) Was the employee dismissed?
4) When was the effective date of termination?
5) What was the reason for the dismissal?
6) Was the dismissal fair, both substantively and procedurally?
7) Remedies.

Question 2

s 94(1) ERA 1996

Answer 2

Employee has the right not to be unfairly dismissed. Therefore, there must be a contract of employment per s 230(1) ERA 1996.

Question 3

s 108(1) ERA 1996

Answer 3

2 years of continuous employment are required for the employee to qualify for unfair dismissal.

Note that there are exceptions to the 2 year qualifying period under s 108(3). These are automatically unfair reasons for dismissal - e.g. dismissal for membership of a trade union under s 152 TULRCA 1992.

Question 4

s 212(1) ERA 1996

Answer 4

Any week during which an employee’s relations with his employer are governed by a contract of employment count towards the period of qualifying service.

Question 5

s 212(3)

Answer 5

If employee is absent from work due to sickness or injury, or temporary cessation of work etc., this still counts towards the period of continuous service.

Question 6

s 95(1) ERA 1996

Answer 6

s 95(1) sets out three forms of ‘dismissal’:

a) termination by employer
b) expiration of a fixed-term contract
c) constructive dismissal

A fixed-term contract is one not intended to be permanent and the contract terminates upon the expiration of a period of time, or a particular condition being met.

Question 7

Constructive Dismissal

Answer 7

Constructive dismissal = employee terminates the contract in response to breach of contract by the employer. Note Geys v Societe Generale has confirmed the elective theory applies to breach of contract - so contract only terminates if employee elects to end it.

Question 8

Western Excavating Ltd v Sharp

Answer 8

CA held that an employee is only entitled to resign in response to employer’s conduct if the employer has committed a fundamental breach of contract.

S was denied financial help from the company’s welfare officer, so resigned in response and claimed constructive dismissal = not a fundamental breach of contract.

Question 9

Chesham Shipping v Rowe

Answer 9

Tribunal must ensure that what has really taken place is dismissal of the employee, rather than just words of abuse by the employer.

Question 10

Notcutt v Universal Equipment Co

Answer 10

Frustration (where the contract becomes impossible to perform due to an intervening event) does not constitute dismissal for the purposes of UD.

Question 11

s 97(1) ERA 1996

Answer 11

s 97(1) defines the effective date of termination. EDT depends on how the termination was carried out by employer:

(a) by notice - EDT = date the notice expires;
(b) without notice - EDT = date the termination takes effect;
(c) limited-term contract - EDT = when the contract is terminated by the limiting event without being renewed under the same contract.

Question 12

Gisada Cyf v Barrett

Answer 12

EDT cannot be earlier than the date when the employee knows (or at least had a reasonable chance to discover) that they have been dismissed.

Employee was away from home and therefore was unaware that she was issued a letter of summary dismissal for alleged misconduct.

Question 13

Dedman v British Building & Engineering Appliances Ltd

Answer 13

For summary dismissal, EDT is the date that the summary dismissal was made, regardless of whether it was justified.

Question 14

Kirklees MBC v Radecki

Answer 14

Summary dismissal may be effected implicitly by employer conduct in fundamental breach of contract, e.g. refusal to pay wages.

Question 15

s 111(2) ERA 1996

Answer 15

Three month limitation period from the EDT in which C must bring their unfair dismissal claim.

This is one reason why the EDT is so important - must be within 3 months of the EDT. Second reason = 2 year period of qualifying service ends upon the EDT.

Question 16

s 98(1) ERA 1996

Answer 16

For UD, it is for the employer to show:

a) the reason for the dismissal; AND
b) that the reason falls within s 98(2) OR there is some other substantial reason for dismissal which justifies dismissal from the particular post the employee held.

Question 17

s 98(2) ERA 1996

Answer 17

Valid reasons for dismissal:

(a) capability/qualifications of employee;
(b) conduct of employee;
(c) employee was made redundant.

Note that an employer may show that there was SOSR outside of these three reasons for the dismissal. However, this is still subject to the same fairness test under s 98(4).

Question 18

W Devis & Sons v Atkins

Answer 18

Reason for dismissal must be one that the employer relied upon at the time of dismissal, and CANNOT be based on facts discovered after the dismissal.

Question 19

s 98(4) ERA 1996

Answer 19

Fairness test for dismissal. Fairness depends on whether the employer acted reasonably in treating it as a sufficient reason for dismissal, and shall be determined in accordance with equity and the substantial merits of the case.

Question 20

Iceland Frozen Foods v Jones

Answer 20

Browne-Wilkinson J said that the test for substantive fairness under s 98(4) is whether the employer’s response fell within the band of reasonable responses (BoRR). Tribunal should not substitute its own judgement as to what the employer should have done - instead, if the dismissal fell within the wide margin of BoRR, dismissal = fair.

Question 21

British Leyland v Swift

Answer 21

Employee dismissed after 18 years’ outstanding service because employer found a tax disk that belonged to them in his car. CA overruled ET and held that ET had substituted its own views as to what the appropriate response was, rather than applying the correct test of whether it fell within the BoRR.

Wrongfully using the employer’s tax disk in his car did fall within the BoRR. Irrelevant that the ET thought that dismissal was disproportionate.

Question 22

Bowater v Northwest London Hospitals Trust

Answer 22

C was dismissed for making a joke about sex after having to restrain a patient by sitting on him. CA held that dismissal for the comment was unfair since it was outside of the BoRR - C was trying to extricate herself from an embarrassing situation.

Question 23

HSBC v Madden

Answer 23

CA robustly affirmed BoRR as current law. Mummery LJ said Parliament had many opportunities to reformulate the test but had not done so. CA overturned the EAT’s decision because although the bank could have made a more thorough investigation, it had made some reasonable enquiries and so dismissal fell within the BoRR. EAT substituted its own judgement for how the employer should have responded = erred in law, since EAT applied wrong test.

Question 24

BHS v Burchell

Answer 24

Procedural fairness - for allegations of misconduct, the employer must carry out as much investigation as was reasonable in the circumstances.

Question 25

ACAS Code of Practice

Answer 25

Sets out a list of factors for employer’s BEST PRACTICE in relation to procedural fairness complying with s 98(4). This includes, inter alia:

• An investigation to establish facts of the case;
• Written notice to employee of the allegation;
• A meeting/hearing between employer and employee;
• Warnings and final warnings issued;
• Opportunities to appeal.

These factors are used to inform tribunal’s decision of whether the dismissal was procedurally fair. Note that it is a guide for best practice, NOT a list of legal requirements.

Question 26

Remedies for UD

Answer 26

Two possible remedies:

1) Reinstatement or re-engagement - ss 113-116 ERA 1996
2) Damages - ss 118-124 –> damages = basic award + compensatory award

Question 27

s 114 ERA 1996

Answer 27

Order for reinstatement may be made by a tribunal. Reinstatement requires the employer to take back the employee in his previous job with full back pay and employment under the same conditions as he was prior to the dismissal.

Question 28

s 115 ERA 1996

Answer 28

Re-engagement under s 115 ERA 1996 is an order for the employee to be re-employed on such terms as the tribunal may decide in employment comparable to that from which the employee was dismissed, or other suitable employment.

Question 29

s 116 ERA 1996

Answer 29

Tribunal must consider whether it is ‘practicable’ for the employer to comply with a reinstatement/re-engagement order, and whether it would be just to make an order if the employee also contributed to the dismissal.

Question 30

s 119 ERA 1996

Answer 30

Basic award for damages.

Appropriate amount for basic award = weekly pay x years of service (up to max of 20 years’ service) for ages 22-40.

Ages 41+ = 1.5x weekly pay x years of service (up to 20 years max).

Below 22 = 0.5x weekly pay x years of service (up to 20 years max).

Question 31

s 227 ERA 1996

Answer 31

Upper limit on one week’s pay = £430/week.

Question 32

s 123 ERA 1996

Answer 32

Deals with compensatory award for UD.

s 123(1) - amount of compensatory award is what the tribunal considers just and equitable in the circumstances.

Question 33

Norton Tool Co v Tewson

Answer 33

Compensatory award should be calculated according to identifiable items of economic loss, e.g. wages, compensation for period of likely unemployment, rather than general award.

Question 34

Dench v Flynn and Partners

Answer 34

If the employee finds a new, better-paying job, then the compensatory award should be restricted accordingly.

Question 35

Wardle v Credit Agricole Corporate and Investment Bank

Answer 35

Stigma damages may be awarded as part of the compensatory award. If employee’s future job prospects are likely to be substantially worse off/less well remunerated, this can be reflected in compensatory award.

Question 36

Polkey v AE Dayton Services Ltd

Answer 36

Polkey deduction may apply to compensatory award. Where the tribunal finds that the dismissal was substantively fair, but did not comply with procedural fairness requirements, it may be appropriate to reduce the compensatory award to reflect this - even reduce it to zero on grounds of contributory fault.

Procedural Fairness - if reason for dismissal is related to:

a) capacity - employer should give employee opportunity to show they can do the job;
b) conduct - employer should conduct investigation and allow employee to defend themselves.

Question 37

s 124(1) ERA 1996

Answer 37

Sets out upper limit of compensatory award. Amount of compensatory award cannot exceed £78,962 or 52 x weekly pay of employee - whichever of these two is lower.

Question 38

Redfearn v UK

Answer 38

R was dismissed due to being elected as a BNP councillor.

If an employee is dismissed for reasons that may violate their ECHR rights, national law must provide some form of redress for this.

R should not have been totally barred from his UD claim due to his failure to meet the 1 year qualifying period of continuous service, since the dismissal involved violation of his ECHR rights.

Question 39

s 13 Enterprise and Regulatory Reform Act 2013

Answer 39

Following Redfearn, there is now an amendment to s 108 ERA 1998 providing that the 2 year qualifying period does NOT apply to dismissals for political affiliation or opinion.

Question 40

Pay v Lancashire Probation Service

Answer 40

P performed in hedonist and fetish shows in his leisure time, and sold S&M equipment online. Employer dismissed him for this on grounds that it was incompatible with his role as a youth probation worker, even though it did not affect the quality of his work.

EAT accepted that s 6 HRA imposes a duty on public authority employers to act in a way that is compatible with the ECHR. However, this merely forms part of the BoRR test - EAT rejected the notion of a proportionality test where the dismissal interferes with ECHR rights. Employer had not acted unreasonably since dismissal fell within BoRR.

EAT reasoning for why it fell within the BoRR: 1) criminal activity (BDSM in public); 2) in a public place, so Art 8 not engaged.

Question 41

Pay v UK

Answer 41

ECtHR did not apply BoRR test for fairness of dismissal - applied proportionality test instead. Art 8 rights engaged even though in public space, since this constituted an aspect of his private life. Nevertheless, ECtHR found that the interference with P’s Art 8 rights was proportionate since he failed to curb the online aspects of his activity, which could come to public knowledge.

Question 42

Turner v East Midland Trains

Answer 42

C dismissed for selling fake tickets and profiting privately, although employer did not have direct evidence to prove this.

Elias LJ stated that applying a proportionality test would lead to the same out come as the BoRR test. ECtHR has not given a higher level of protection of Art 8 rights where they have been engaged by the dismissal. Thus, BoRR complies with Art 8 ECHR rights because the impact on those rights is taken into account in the BoRR test.

So, BoRR allows a heightened standard to be adopted by the tribunal where human rights are concerned.

Question 43

Mathewson v RB Wilson Dental

Answer 43

Employee was found by the police to be in possession of a small quantity of cannabis during his lunch break - possession is unlawful, but there was no evidence that he had used it whilst working or that it affected his quality of work in any way.

Employer dismissed him due to this cannabis possession. EAT majority held that this fell within the BoRR and thus was a fair reason for dismissal, even though it was a harsh response due to the fact M was not given the chance to defend himself and no evidence it affected his work.

Question 44

Barbalescu v Romania

Answer 44

Employer found employee using work email for private purposes and dismissed him. ECtHR held that Art 8 was engaged but not violated as employer’s monitoring of computer was limited in scope and proportionate - therefore dismissal on grounds of using his yahoo account for private purposes was fair.

Question 45

Collins and Mantouvalou

Answer 45

‘X’ - argue that English law should adopt a proportionality test (rather than BoRR for dismissal where employee’s ECHR rights are concerned) in order to harmonise the law with the decision in Pay v UK. Note that although ECtHR also found dismissal was fair under proportionality test, the claim progressed much further than the domestic courts so there is a difference between applying the two tests.

Question 46

s 152 TULRCA

Answer 46

Dismissal on grounds of trade union activity is an automatically unfair reason for dismissal under s 108(3) ERA 1996.

Question 47

Automatically unfair reasons for dismissal

Answer 47

For auto unfair reasons which do not require the 2 year qualifying period of continuous service under s 108(3) - see ss 99-104 ERA 1996.