Unfair dismissal claims can proceed despite a finding of misconduct

A recent tribunal ruling highlights why employers should always follow a fair process before deciding whether to dismiss an employee, says Rebecca Jorgensen

Unfair dismissal claims can proceed despite a finding of misconduct

An unfair dismissal claim should not be struck out even though there is no prospect of a monetary award, the Employment Appeal Tribunal (EAT) has ruled in the case of Evans vs London Borough of Brent.

Although reinstatement and re-engagement are both possible awards, a successful unfair dismissal claim usually results in an employee only receiving financial compensation for loss of earnings. This case is a stark warning to employers of the importance of ticking all the procedural boxes, even where they have a slam dunk gross misconduct case. Otherwise, they could find themselves in the galling position of expending legal fees and losing an unfair dismissal claim.

Background

Dr Evans was a deputy head teacher at a school in the London Borough of Brent for 12 years. Another teacher alleged misconduct and financial mismanagement by members of the senior management team, including Evans. He was suspended and a formal investigation commenced. 

Evans was invited to a disciplinary hearing. He was given almost three weeks' notice along with an investigation report that ran to more than 800 pages. He asked to postpone the disciplinary hearing to give him more time to prepare and to enable his sister to accompany him. 

The school refused and held the hearing in Evans' absence. At the hearing, it was concluded that Evans received unauthorised overpayments from the school and that he enabled unauthorised overpayments to be made to another member of staff. Evans was dismissed for gross misconduct. 

Evans brought a claim in the employment tribunal against the London Borough of Brent for unfair dismissal. The claim was stayed pending a separate High Court action. The Borough of Brent issued court proceedings against Evans and five others for repayment of sums. The council won and the High Court ordered Evans to repay more than £46,000 to the school.

The tribunal believed there was no prospect of Evans being awarded any compensation because of the High Court's findings. However, it acknowledged that, procedurally, there was a question as to fairness owing to the school's refusal to postpone the disciplinary hearing. 

Despite accepting that it could not be said that Evans's claim of unfair dismissal had no reasonable prospect of success, the tribunal struck out the claim on the basis that no financial award would be made. Dr Evans appealed to the EAT. 

The EAT’s decision

The EAT upheld Evans’s appeal after considering two questions:

  1. Was there value in a finding of unfair dismissal, even without a financial award? Yes. It is in the interests of justice to hold an employer to account for procedural unfairness, even if there is no financial award.
  2. Was such a claim an abuse of process? No. There had been, for example, no express finding of bad faith. 

So, even when misconduct is clear, employees cannot be penalised for pursuing a claim purely on a point of principle despite there being no real prospect of financial compensation. 

Consideration for employers 

This case is a reminder that employers should not cut any corners in making sure the correct procedural steps are adhered to – even in clear-cut cases of gross misconduct. 

Employers should review their workplace policies to ensure they are able to follow a fair and reasonable process before deciding whether to dismiss an employee. Employees should be given an opportunity to state their case at a disciplinary hearing and have the right to attend with a trade union representative or a fellow employee. 

Unfair dismissal claims can be an expensive exercise, both in terms of costs and time. In most scenarios, three weeks' notice of a disciplinary hearing would be considered generous. However, given the volume of material in the investigation report here and Evans's request to delay the hearing to further prepare for it, the school should perhaps have granted him a little more time. In doing so, it might have avoided the considerable expense of defending an unfair dismissal claim. 

Rebecca Jorgensen is a senior associate at Dentons