The EAT has held that an unfair dismissal claim should proceed where there were arguments of procedural unfairness, even though there was no real chance that the claimant would be awarded any damages.
The facts
Dr Evans was Deputy Head Teacher of the Copland Community School. Allegations were made that members of the senior management team, including Dr Evans, had been guilty of misconduct and financial mismanagement. Having suspended Dr Evans and conducted an investigation, the school invited Dr Evans to a disciplinary hearing. About two weeks before the hearing, he was sent a copy of the investigation report, which was about 800 pages long. He applied for a postponement of the hearing on the grounds that he needed longer to consider the paperwork and that he wanted his sister (who was abroad and had accompanied him to a previous meeting) to accompany him at the disciplinary hearing. The request was refused, and Dr Evans was dismissed for (among other things) receiving unlawful bonuses and receiving payments that should not have been made or accepted for work on a construction project.
Dr Evans lodged an unfair dismissal claim which was stayed pending criminal proceedings and a subsequent High Court claim against Dr Evans and others. The High Court found that the allegations made against Dr Evans in the disciplinary proceedings had been proven. It concluded that Dr Evans had received £250,000 in overpayments that he should not have received.
However, for procedural reasons, Dr Evans only had to repay a fraction of this amount.
After the High Court claim the stay on the employment tribunal proceedings was lifted. The employment tribunal struck out Dr Evans’ claim on the basis that there was no reasonable prospect of a finding that either the employer did not have a reasonable belief in Dr Evans’ misconduct or the dismissal was outside the range of reasonable responses. The employment tribunal acknowledged that there was a question of procedural fairness in relation to the decision not to postpone the disciplinary hearing. However, the employment tribunal struck this ground out on the basis that any compensation would inevitably be reduced to zero as a result of Dr Evans’ conduct. Finally, in light of the High Court judgment and the fact that around £200,000 of overpayments to Dr Evans was irrecoverable, the employment tribunal considered that it would not have been just and equitable to make any payment of compensation to Dr Evans.
Dr Evans appealed to the EAT. The EAT commented that, at the heart of the appeal, was the question, “what is the value of a finding of unfair dismissal absent any financial award or other remedy?”. Allowing Dr Evans’ appeal, the EAT held that the employment tribunal had been wrong to decide that a finding of unfair dismissal, without financial compensation, would have no value. It could not be said that a mere finding of unfair dismissal would be of no value, or that it is not in the interests of justice to hold an employer to account for procedural unfairness in deciding to dismiss a long-serving employee, even if that cannot lead to any financial award. The unfair dismissal claim was therefore allowed to proceed.
What does this mean for employers?
This was an extreme case of gross misconduct, for very serious offences, in circumstances under which Dr Evans had wrongfully received a significant amount of money, most of which the employer could not recover. In spite of this, Dr Evans’ employer had to suffer the time and costs in defending a claim, and potentially a finding of unfair dismissal. Taking the procedural step of a short delay may well have been a better option in this case.
This case makes it clear to employers that unless they are prepared to admit liability on procedural grounds, they should act reasonably by following all procedural steps, even in clear cut cases of gross misconduct. In doing so they may be able to avoid the time and costs in defending an unfair dismissal claim.
