We take a look at three cases that highlight different aspects of employment law – Unfair Dismissal after a breakdown in working relationship, the Material Factor Defence in an equal pay case, and Remedies and Re-Engagement in an age discrimination case.
Unfair Dismissal: Can you fairly dismiss an employee after a breakdown in a working relationship without any procedure (including an appeal)?
The short answer is yes, in certain and unusual circumstances. In the case of Gallacher v Abellio Scotrail, the Claimant was a senior manager in the Respondent’s business. The relationship with her manager deteriorated at a critical point for the business and the manager was forced to act. After consulting with HR, the manager decided to dismiss her at an appraisal meeting with no procedure, forewarning, or right of appeal.
The Employment Appeals Tribunal (EAT) ruled that the dismissal was fair, and the decision to dismiss without any procedure was reasonable given the circumstances, even going as far as to determine that going through a procedure would have made the situation worse as the relationship had broken down on both sides.
This case shows that there will be times when procedures can be dispensed with because the circumstances are seen to be futile, although it is a rare occurrence. There is no rule of law that the absence of any procedure renders a dismissal unfair, all the circumstances of the case have to be considered. However, the EAT noted that dismissals without following any procedures will always be subject to extra caution before a decision is taken on whether it was a reasonable response.
Material factor defence: In a case on equal pay filed against the Co-operative Group, Ltd., the Respondents’ initially successful claim of the material factor defence against the Claimant’s accusation on equal pay (among numerous other claims) was later rejected by the tribunal. The tribunal found that the material factor defence applied at the point when the Claimant was appointed, but this explanation was rejected by the tribunal as being ‘historical’ a year later.
The question is: was it right for a tribunal to find that a successful material factor defence explaining the difference in pay between two employees had ceased to operate at a later point in time?
Not on the facts of the case, held the Court of Appeal in Walker v Co-operative Group Limited.
The Court of Appeal agreed and held that to dismiss this explanation as ‘historical’ missed the point. What mattered is that it was, indeed, the explanation for the pay difference. Moreover, the tribunal’s analysis had overlooked the fact that, even a year later, in respect of the comparators, there was at least one material factor, which remained causative of (or which explained) the differential in pay.
Remedies and re-engagement: In a case claiming unfair dismissal by reason of age discrimination, can an employment tribunal order re-engagement where the employer believes that trust and confidence have broken down?
No, not if the belief is rationally held, held the EAT in Kelly v PGA European Tour.
The Claimant was dismissed for poor performance but, before he was dismissed, he covertly recorded two meetings in which the employer tried to resolve the matter informally. The tribunal refused to order reinstatement but instead ordered re-engagement to a different role.
The EAT held that there does not have to be conduct contributing to the dismissal to affect the question of re-engagement, and all of the evidence available at the time of the remedy hearing is to be considered. Events of which the employer was not aware at the time of the dismissal can be considered, and there is no reason in principle why a belief about capability or performance cannot be relied upon as causing trust and confidence to break down. The EAT allowed the appeal and substituted an order refusing re-engagement.
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John Nimmo, Founding Partner
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Dawn Robertson, Partner
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