McCann v. Clydebank College

An employee’s entitlement to sick pay does not create an absolute rule that remunerative work during sickness absence can never justify dismissal. Where the employee undertakes other paid work during hours for which sick pay is claimed, without the employer’s knowledge or consent, the conduct may constitute serious misconduct. The assessment is fact-sensitive. Relevant considerations include the contractual allocation of working time, whether the employee obtained a financial benefit, the risk to recovery, the basis of the sick-pay scheme, the employee’s good faith and any ambiguity or innocent misunderstanding. In a clear case, an employer may reasonably regard the conduct as exploiting illness or receiving payment twice for the same period. The Employment Appeal Tribunal will not interfere with factual findings unless they are perverse.

The appellant was a part-time college lecturer who was absent through work-related stress and received sick pay. During the absence he attended and worked at a garage business which he owned. The college investigated the matter using covert surveillance, dismissed him for gross misconduct and rejected his appeal.

An Employment Tribunal dismissed his unfair-dismissal claim. It found that he had worked at the garage during relevant periods, had acted in bad faith, and that dismissal fell within the band of reasonable responses. The appeal challenged the contractual working hours, the treatment of remunerative work during sickness absence, the use of surveillance under article 8, and reliance on section 1(4)(c) of the Employment Rights Act 1996.

1. Appeal dismissed. The Employment Tribunal was entitled to find that the appellant had worked at the garage on the relevant days, that he had not genuinely observed the distinction later advanced between different parts of the week, and that he had acted in bad faith. Those were essentially factual findings and disclosed no perversity.

2. The proposition that an employee’s dismissal for undertaking remunerative work during sickness absence is necessarily unfair in the absence of an express policy was rejected. Each case depends on its facts. In the typical case, an employee contractually required to work during a particular period is required to do so exclusively. That default position is not necessarily altered by sickness absence.

3. An employer paying sick pay has a legitimate interest in restricting other remunerative work during the relevant period. The work may hinder recovery, and sick pay is ordinarily based on the employee having lost the opportunity to earn. In a clear case, undertaking paid work without consent may amount to serious misconduct. Where ambiguity or innocent misunderstanding exists, dismissal may nevertheless fall outside the range of reasonable responses.

4. The surveillance issue was governed by proportionality under article 8 of the European Convention on Human Rights. The Tribunal was entitled to conclude that the surveillance was proportionate and that the DVD evidence was admissible.

5. The reference to section 1(4)(c) of the Employment Rights Act 1996 was irrelevant to the fairness issue and had not been raised before the Tribunal. The appeal was dismissed.

• Employment Tribunal, Glasgow — The appellant’s unfair-dismissal claim was dismissed. The decision and written Reasons were sent to the parties on 27 August 2009.
• Employment Appeal Tribunal — The appeal was dismissed.