insufficient investigation made dismissal unfair

Posted on February 27, 2013 by Martin Malone

Employers should take care to investigate allegations of dishonesty involving breach of trust particularly carefully, suggests the Employment Appeal Tribunal in Stuart v London City Airport.

Mr Stuart was one of 430 ground services employees at London City Airport who was dismissed for gross misconduct. It was alleged that he had gone to a duty free shop in the airport and taken goods without paying for them. His version of events was that a friend had beckoned him over for a chat while he was in the queue to pay for items, and he had not been aware of crossing the threshold of the shop, whereas one witness suggested that he had in fact tried to conceal the goods in his jacket. That witness was not present at any disciplinary hearing or appeal hearing, so her evidence could not be challenged, and the employer did not obtain evidence from other sources suggested by the other employee such as available CCTV, or likely witnesses including the friend or shop assistant manning the till, which could have confirmed or disproved the truth of the allegation of an attempt to hide items.

Since the conduct and scope of disciplinary proceedings is a common concern for many employers, it is worth spending a little time in considering the views of the EAT about what did happen and, more significantly, what should have happened. The facts are outlined in the decision as follows:

On the evening of 21 December 2009 the the Claimant entered Nuance, the duty free shop, to buy some Christmas presents. He chose some items which he stated that he held at all times in his hands; he accepted that he did not use a basket. He first went to pay for them at an un-manned till point, where he queued with another customer before a member of staff told him to go and pay at another till point because that one was closed. He moved over to a different till and began to queue again. During the whole of this period he stated that the items he had chosen were clearly visible in his hands.

What then happened was that he was beckoned over to a seating area immediately outside the shop by another Nuance staff member called Lynette, where she had a conversation with him about the snowy conditions at the airport that day. The Claimant then realised that he was due back from his break shortly and he moved to a refrigerated counter nearby to buy a drink. He still held in his hands the items for which he intended to pay. However, while he was selecting a drink, a police officer came to speak to him, on the basis that he was suspected of dishonestly removing goods from Nuance without paying for them.

The Respondents were informed and the Claimant was suspended on full pay, with effect from 21 December, pending an investigation into alleged gross misconduct involving breach of trust.

The matter was then investigated by the Respondents, as his employers. Statements were taken from Mr Gilani, the Nuance store manager, and from a Nuance staff member, Ms Adenike Adenekan. Strangely, in view of the significance of her evidence, which was very much in dispute, Ms Adenekan did not give evidence, either at the disciplinary hearing or before the Tribunal. Mr Gilani did, on both occasions, and the Tribunal also had his statement which had been made at the time. Mr Gilani’s evidence was that Ms Adenekan had reported concerns that an airport employee inside the shop, later accepted to be the Claimant, was secreting items from the purchasing section under his jacket. The Claimant vigorously denied that. As a result of Ms Adenekan’s report Mr Gilani went on to the shop floor, where he stayed for between 10 and 15 minutes. During that time he saw that there were no other customers in the shop and no queues. He stated that baskets were available for customers but that the Claimant was not carrying a basket.

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changing the effective date of termination of employment

Posted on July 26, 2012 by Martin Malone

It is a truth universally acknowledged that an employer and employee cannot agree between them to change the date on which employment is regarded as ending for the purposes of calculating time limits in tribunal cases. This is known as the “EDT” or effective date of termination and is imposed by statute. In cases of summary dismissal the EDT will nearly always be the date on which dismissal took place.

Hawes v Curtis is an example of the rare case when the EDT may not be the original date of dismissal. The circumstances were that two employees, who were both keyholders, were dismissed for misconduct after stock shortages were discovered, but their employer was not able to identify which individual employee was responsible. Continue reading →

just how far can the concept of philosophical beliefs extend?

Posted on October 26, 2011 by Martin Malone

As originally drafted, the Employment Equality (Religion or Belief) Regulations 2003 prohibited discrimination on grounds of religion or "similar" philosophical beliefs.

Then the Equality Act 2006 removed the requirement for such similarity, and extended the protection to any philosophical belief: the Equality Act 2010 s.10 continues with that wide definition.

Removal of just one word dramatically increased the potential for seeking protection from discrimination on a whole range of lifestyles, ideas and practices. As we’ve reported on many occasions it is fair to say that, over recent years, claimants have put forward quite an esoteric mix of possible candidates, and establishing whether these actually amount to a protected philosophical belief is becoming a standard pre-hearing review issue for employment tribunals. Continue reading →

“factually” incorrect but still discrimination

Posted on September 26, 2011 by Martin Malone

A Leeds employment tribunal has ruled that a Polish worker who was routinely called Borat by a work colleague over a four week period was subjected to race discrimination.

Adrian Ruda joined TEi in Wakefield as a quality assurance engineer. In 2010 he brought a number of claims against his employer, alleging race and sexual orientation discrimination. Most were dismissed by the tribunal which found Mr Ruda’s evidence to be “less than persuasive and less than honest”. However, the complaint that he was called Borat was upheld. This meant that he was subjected to a humiliating and degrading working environment and he was also a victim of direct race discrimination. Continue reading →

400,000 pounds award for disability discrimination

Posted on July 25, 2011 by Martin Malone

Jonathan Jones was dismissed by his employer, Jewson, five months after he suffered a stroke. He was the branch manager of their Cardigan branch and had worked for the company for 22 years. His employer relied on incapacity as a potentially fair reason for dismissal. Unfair dismissal law provides that employment may be terminated on the ground of ill-health incapacity if it becomes clear that the employee is unlikely to be able to return to work in the reasonably foreseable future. Continue reading →

It turns on the words – “theft of money” or “loss of money”

Posted on January 25, 2011 by Martin Malone

Celebi -v- Scolarest Compass Group UK & Ireland Limited is a decision of the Employment Appeal Tribunal which emphasises the importance for employers of ensuring that they use the right terminology when taking disciplinary action against employees. The case is also a good example of how an apparently straightforward dismissal can keep an employer occupied for years because the relevant events took place in November 2006 and Mrs Celebi was dismissed in May 2007. The case went to the Employment Appeal Tribunal in 2008 when the issues mainly concerned technical matters relating to the procedures in the Employment Act 2002 (which no longer apply) and a rehearing was ordered. That took place and the resulting decision led to the appeal which took place last year. I’m commenting on it now, first because the case demonstrates how employment cases can become very protracted and expensive and, second, because of the warning that it provides to employers who think they have acted correctly but who happen to use the wrong words at the wrong time can undermine what was otherwise an apparently fair process.

Mrs Celebi was a chef manager at a college. On 14 November 2006 she collected £3,400 in cash. She completed paperwork confirming this when the money was sent to the bank but only £400 was received. As a result of this she was suspended.

She was sent a letter which identified the basis of the investigation as “serious allegations: Loss of £3,000 cash banking/inaccuracy in banking”. She was called to a hearing to consider allegations of incorrect reporting of stock figures, failing to follow financial procedures and discrepancies in banking. Her dismissal in May 2007 cited the same reasons.

Her initial claim for unfair dismissal was dismissed but her appeal succeeded in 2008 so that the case was remitted to a new tribunal hearing. The “second tribunal” again found that the dismissal was fair, not least because Scolarest had found, after a reasonable investigation, that she had been responsible for the loss of the £3,000. The person who dismissed her said in her evidence (on more than one occasion) that she believed that Mrs Celebi had stolen the money.

So how did Mrs Celebi succeed on her appeal? Judge McMullen considered numerous cases including the well known decision in British Home Stores -v- Burchell (was there a genuine belief, on reasonable grounds and after a reasonable investigation, of the guilt of the employee concerned) and Strouthos -v- London Underground (a charge against an employee facing dismissal must be “precisely framed”). He also considered Spink -v- Express Foods in which it was held that it is “a fundamental part of a fair disciplinary procedure” that an employee can only be disciplined in respect of a charge that has been put to them. Although it might readily be implied that the employer’s position was that the money had been stolen, on the evidence, that was never directly put to Mrs Celebi. The tribunal was wrong because it concluded that the dismissal was attributable to theft. The letter requiring Mrs Celebi to attend a disciplinary hearing did not expressly state this and it was held that she might have responded differently to an allegation of negligence rather than theft.

The result is that the dismissal was unfair and another tribunal was required to consider the question of remedy. However, Judge McMullen pointed out that the tribunal might wish to consider the effect of Polkey -v- A E Dayton Services (reduction or elimination of a compensatory award on the basis that, had correct procedures been followed, the employee would have been fairly dismissed). That is unlikely to provide any comfort to the employer given the history of the matter and their employment of solicitors and leading barrister Daniel Barnett to represent them for the second appeal.

One of the main benefits of CLB Employment Solutions is that we advise our subscribers about these issues before they end up in an employment tribunal. If you are not yet a subscriber please call free on 08000 320 974.

Associative discrimination – when a “gay pub” becomes a “gastropub”

Posted on January 23, 2011 by Martin Malone

In Lisboa -v- Realpubs Limited and others the Employment Appeal Tribunal was asked to consider whether the employer’s policy of encouraging a wider clientele at what was previously recognised as a gay pub led to less favourable treatment of gay customers which in turn caused Mr Lisboa to resign in circumstances amounting to discriminatory constructive and wrongful dismissal. Although the case was decided on the basis of the legislation which applied prior to the implementation of the Equality Act 2010 the principles remain relevant.

The Coleherne pub in Earls Court was known as London’s first “gay pub”. However, by 2008 the pub was in decline and it was bought out by Realpubs Limited which had a reputation for reinventing failing pubs as gastropubs, offering high quality food and drink to all sections of the community. It was renamed as the Pembroke Arms. Mr Lisboa, an openly gay Brazilian man was recruited as assistant manager of the new Pembroke Arms. His employment lasted for 42 days (from 1/12/08 to 11/1/09). In his second week of employment he was instructed to put up a board outside the pub saying “this is not a gay pub”. He refused and instead put up a notice saying “under new management – friendly staff”. In an email sent on 8 December a director said that they were making sure that people knew that it was no longer an exclusively gay pub and that they were barring “over the top” old customers but this needed “to be done right!!”. Staff were encouraged to seat customers who did not appear to be gay in prominent places so they could be seen from outside the pub. The employer also took steps to achieve its policy of having an even balance between the sexes in the staff working at the pub.

The repositioning policy apparently failed since the tribunal found that the clientele both before and after the re-launch remained at 90% gay.

The pub manager resigned on 30 December and Mr Lisboa decided to resign on the same day. A director tried to persuade him to stay and said that if he was resigning because of the “gay issue” he was sorry if he had not expressed himself properly on that issue. Mr Lisboa confirmed his resignation on 11 January. He brought claims of common law constructive dismissal and discrimination under the Sexual Orientation Regulations, alleging comments directed at him concerning his sexual orientation and a course of conduct by the employer under which he was put under pressure to work in a way which made the pub less welcoming to gay customers than to straight customers.

The tribunal found that there were examples of direct discrimination but rejected the claim based on the trading policy on the basis that Realpubs were operating on the basis of a legitimate commercial objective. It found that nothing was done to make the pub unwelcoming to gay customers in general or less welcoming to gay customers than other patrons.

The EAT identified the key issue in this regard as whether the repositioning of the pub went too far in embracing a policy of putting pressure on gay customers or taking negative steps which made the pub less welcoming to gay customers. The tribunal focused on the commercial objective of Realpubs but the EAT took the view it should have made a judgment about whether the wider factual matrix resulted in the old gay clientele being treated less favourable than the desired straight/family customer base on the grounds of their sexual orientation. Based on the facts that was “plainly and unarguably” the case. It followed that Realpubs was operating a policy which discriminated against gay customers so that Mr Lisboa’s reason for resigning was prompted by unlawful discrimination against customers. This was sufficient to constitute a repudiatory breach of the contract of employment on which to base the claim for constructive dismissal. The result is that the EAT reversed the decisions concerning associative discrimination and constructive dismissal and remitted the case to another employment tribunal to determine the amount of compensation payable to Mr Lisboa.

In response to the decision Realpubs said it respects all members of its team and welcomes all customers. It is considering an appeal. Although the law concerning discrimination based on working conditions and environment is fairly well established the case provides an interesting demonstration of how an ostensibly well-intentioned employer can nonetheless fall foul of laws designed to protect against discrimination in circumstances in which its general policies and practice can lead to claims by individual employees.

newsletter – tribunal decisions are final unless there is a point of law

Posted on December 20, 2010 by Martin Malone

The loser in a case before an employment tribunal is often very tempted to appeal simply because they lost. A recent case is a salutary reminder of the important point that that is generally not enough – an appeal can only be made on a point of law.

As most employment tribunal cases turn on questions of fact and as the decision of the tribunal is final on matters of fact (save in those few cases where the decision was “perverse” or was so defective that justice requires the matter to be remitted back for rehearing), it follows that in most cases there is no point in appealing against an employment tribunal’s decision. Of course, if pressed to do so, those acting for the losing party will try to find a point of law on which to hang an appeal. Advisers are generally well aware that a “perversity” argument is unlikely to succeed (except in the most extreme cases) so they may attempt a more sophisticated approach – for example in discrimination cases it is not uncommon for an appeal to be presented on the basis that the employment tribunal wrongly applied the rules relating to the burden of proof as this can sometimes be a way of getting around the difficulty. In general if arguments of this sort are really no more than dressing up a point of fact as a point of law the appeal will be dismissed without a full hearing – it will get no further than the preliminary “sift” stage at the appeal tribunal.

Nevertheless some litigants persist. It has to be said that the appeal tribunal generally leans over backwards to give them a fair hearing but at the end of the day it must apply the law. And that says the Employment Appeal Tribunal has jurisdiction to hear appeals only on points of law (Employment Tribunals Act 1996 s.21).

In the recent case noted above an agency worker, Ms Arrowsmith, was interviewed for a post at Nottingham Trent University, where she worked. She did not get the job. She brought a sex discrimination claim against the University saying she was rejected because two members of the panel which interviewed her knew that she was pregnant. The critical question in the case was whether those two members of the panel (or either of them) knew that the she was pregnant at that time. Clearly this was a question of fact. After a four-day hearing, the Nottingham Employment Tribunal, faced with a straight conflict of evidence between the the two sides (claiming and denying knowledge of her pregnancy on the panel members’ part) found in the University’s favour.

Ms Arrowsmith went on to use all avenues available to her to contest that decision. Including the original hearing her case eventually had no less than seven judicial hearings, five of them at the Employment Appeal Tribunal. However no point of law was involved. The question of whether any of the interview panel members knew that the she was pregnant was simply a matter of fact for decision by the original tribunal. The EAT judge concluded by adopting words used by a judge in the Court of Appeal in a different case, saying “I feel that like many highly intelligent non-lawyers, the applicant puts a great deal of faith in detail and in complexity. This is actually a quite simple case.”

While only indirectly relevant, given that an appeal can only be on a point of law, it is worth noting the slight oddity that the Employment Appeal Tribunal normally consists of two non-lawyer members as well as a legally qualified judge. Indeed, perhaps even odder, it is theoretically possible for the two lay members to overrule the judge - indeed this actually happened in a case called Moores v Bude-Stratton Town Council EAT [2001] ICR 271.

The moral is clear: employees who are dissatisfied with the judgment of an employment tribunal, even those who have so far dispensed with the services of a professional advocate, should be careful to take and heed proper legal advice before deciding to mount an appeal. Otherwise they may face an expensive, time consuming and stressful experience which turns out to be completely pointless.

Coincidentally, shortly after the note above was written, a new Court of Appeal judgment became available on line, stressing the point that an appeal from an employment tribunal cannot be made against a finding of fact (Clarke v Zurich UK General Services Ltd [2010] EWCA Civ 1333 on 26th November 2010).

now that’s an expensive comment to have made

Posted on May 28, 2010 by Martin Malone

[picappgallerysingle id="1633994" align="left"] In our June 2009 newsletter we reported the case of Linda Sturdy, a senior NHS manager who was passed over for promotion because of her age. Unfortunately, when told that she was 57 a manager commented “I didn’t realise you were so old”. The upshot was that she received an award for injury to feelings which, including interest, came to £33,500 and is believed to be the highest of its kind.

She was also awarded £5700 plus interest for aggravated damages (reflecting the way in which the NHS Trust employer dealt with the matter) and an uplift of 25% to the award to recognise the Trust’s failure to follow the correct procedures.

Ms Sturdy has now recovered a further £147,000 for lost salary and pension rights, making the overall award just short of £187,000.

Now that’s an expensive comment to have made! According to the Yorkshire Post the case has cost the Leeds Teaching Hospitals NHS Trust over £500,000. This is at a time when it is under pressure to make cuts to services running into millions of pounds.