Post Office (Consignia Plc) v Burkett

In an unfair-dismissal case, an employment tribunal must apply the British Home Stores v Burchell inquiry: whether the employer genuinely believed in the employee’s misconduct, had reasonable grounds for that belief, and carried out as much investigation as was reasonable. The tribunal must assess reasonableness against the material available to the employer. It may make its own factual findings only to test whether the employer’s differing conclusions were tenable. It must not substitute its own view of culpability. Where the appellate court lacks the complete evidence needed to decide fairness, remission to a new tribunal is appropriate. [1980] ICR 303

The Post Office dismissed Kenneth James Burkett for allegedly deliberately overfilling a vehicle with oil to put it out of service. The Employment Tribunal found unfair dismissal, assessed contribution at 30%, and awarded £3,111.50. The Employment Appeal Tribunal dismissed the Post Office’s appeal.

On further appeal, the Court of Appeal considered whether the Employment Tribunal had properly applied section 98(4) of the Employment Rights Act 1996, or had substituted its own view that the overfilling was accidental. The court also considered whether it could determine the fairness issue itself or should remit it.

Appeal allowed unanimously. The matter was remitted de novo to a different Employment Tribunal.

1. Applicable test. Section 98(4) of the Employment Rights Act 1996 required the tribunal to decide whether the dismissal was reasonable in all the circumstances. The British Home Stores v Burchell test required consideration of the employer’s genuine belief, reasonable grounds for that belief, and the reasonableness of the investigation. The investigation issue should be considered before the reasonable-grounds issue. The first and third elements were satisfied here; the reasonable-grounds issue remained decisive. [1980] ICR 303
2. Error by the Employment Tribunal. The tribunal treated its own conclusion that the overfilling was accidental, and its statement that there was no evidence of deliberateness, as determinative. It failed to assess the material before the employer, including the quantity of oil added, the dipstick reading, the words used before the incident, and the fact that the vehicle was driven with knowledge that it had been overfilled. A tribunal may make its own findings only to test whether the employer’s differing findings were tenable. It must not substitute its own view of the employee’s culpability. The distinction between the employer’s evidential grounds and the adequacy of its investigation remained material. [1980] ICR 303
3. Further reasoning. Lord Justice Sedley emphasised that the assessment had to comply with section 98(4)(b), including equity and the substantial merits of the case. The guidance in Iceland Frozen Foods v Jones, as discussed with Foley v Post Office, left open the possibility that the employer’s conclusion was unreasonable or unfair. Lord Justice Rix agreed with both judgments and stressed that unfair dismissal concerned fair process, assessed through the employer’s investigation and honestly held belief. [1983] ICR 17 [2000] ICR 1283
4. Remission. The Court of Appeal declined to determine whether the dismissal was fair because it had not been provided with all the evidence arising from the employer’s investigation. The case was therefore remitted for a fresh hearing before a different Employment Tribunal. The respondent was ordered to pay £5,000 costs inclusive of VAT, and permission to appeal to the House of Lords was refused.

• Court of Appeal (Civil Division). On 14 May 2003, the appeal was allowed. The case was remitted de novo to a different Employment Tribunal, with costs of £5,000 inclusive of VAT; permission to appeal to the House of Lords was refused. [2003] EWCA Civ 748
• Employment Appeal Tribunal. On 12 July 2002, the Post Office’s appeal against the Employment Tribunal’s decision was dismissed.
• Employment Tribunal. On 23 January 2002, the tribunal found unfair dismissal, reduced compensation by 30% for the employee’s contribution, and ordered payment of £3,111.50.