Edwards v Chesterfield Royal Hospital NHS Foundation Trust

Damages for wrongful dismissal caused by breach of a contractual disciplinary procedure are ordinarily limited to the earnings that would have been received during the contractual notice period. The court does not assess the likelihood that a properly conducted disciplinary process would have ended in continued employment. Where the procedure had to be completed before notice could lawfully be given, damages may also include earnings during a reasonable period for completing that procedure. The employee must give credit for sums received from the employer and earnings obtained in mitigation.

The claimant, a consultant surgeon, appealed against a District Judge’s decision limiting his potential wrongful-dismissal damages to three months’ notice pay. He alleged that the defendant NHS Trust had dismissed him using the wrong contractual disciplinary procedure for professional misconduct. For the purposes of the application, the court assumed that allegation could be established.

The appeal concerned whether the claimant could recover losses extending beyond the contractual notice period, including the period required to complete the proper disciplinary procedure, and whether the court should assess the prospects of a favourable disciplinary outcome.

1. The appeal succeeded to a limited extent. The claimant had no realistic prospect of recovering damages calculated by reference to the possibility that a properly conducted disciplinary hearing would have resulted in his retaining employment. The ordinary common-law measure, reflected in Laverack v Woods of Colchester Ltd [1967] 1 QB 278, required the court to ask what the claimant would have gained if the contract had been performed.

2. Following Gunton v Richmond-upon-Thames LBC [1980] ICR 755, a contractual disciplinary procedure could operate as a brake on the employer’s power to give notice. The employer could not give notice until the procedure had been completed, but could then terminate on contractual notice. The court therefore did not inquire whether the claimant would ultimately have been dismissed.

3. The three-month notice provision was relevant even though the Trust had not actually relied on it. Damages involved a hypothetical assessment of what the employer could have done to minimise its liability. The reasoning in Focsa Services (UK) Ltd v Birkett [1996] IRLR 325 and Janciuk v Winerite Ltd [1998] IRLR 63 was respectfully adopted.

4. The observations of Lord Hoffmann in Johnson v Unisys Ltd [2003] 1 AC 518 concerning disciplinary procedures did not preclude recovery of the additional procedural period. Those observations were unnecessary to the decision in that case, and the loss there claimed was different. The particular contractual and institutional background of professional disciplinary procedures for NHS doctors, emphasised in Skidmore v Dartford and Gravesham NHS Trust [2003] ICR 721, also mattered.

5. The maximum recoverable damages were therefore the claimant’s earnings during the reasonable period required to complete the applicable procedure, if begun on 10 February 2006, plus three months’ notice pay, less income received from the Trust and earnings in mitigation. The precise duration of the procedural period was left for determination at trial. The parties were invited to make submissions on the order and costs.

1. High Court (Queen’s Bench Division): allowed the appeal to the limited extent that the potential damages could include the reasonable period required to complete the contractual disciplinary procedure, in addition to three months’ notice pay.

2. District Judge Jones: limited the claimant’s potential wrongful-dismissal damages to three months’ income and granted permission to appeal.