Lawless v. Print Plus (Debarred)

Under section 31(3) of the Employment Act 2002, a 10 per cent uplift is mandatory where the statutory procedure was not completed because of the employer’s failure. A tribunal may award more, up to 50 per cent, where that is just and equitable, and must give reasons for its decision.

The relevant circumstances must relate to the procedural default. They include the extent of non-compliance, whether it was deliberate, and matters mitigating culpability or seriousness. The employer’s size and resources may be relevant but do not automatically reduce the uplift.

In assessing compensation after a Polkey reduction, a tribunal must compensate for a sufficiently substantial chance of continued employment. A balance-of-probabilities approach is wrong.

The appellant was dismissed for redundancy by a small printing partnership. The Employment Tribunal found the dismissal automatically unfair under section 98A(1) of the Employment Rights Act 1996, awarded compensation on a Polkey basis, and applied a 10 per cent uplift under section 31(3) of the Employment Act 2002.

The appellant appealed on two issues: whether the uplift should exceed 10 per cent, given the employer’s wholesale failure to follow the statutory procedures, and whether future loss had been assessed incorrectly by asking whether dismissal was more likely than not by a particular date.

1. Uplift. Section 31(3) imposes a mandatory 10 per cent uplift. The tribunal then has a discretion to award a further uplift, up to a total of 50 per cent, if it is just and equitable in all the circumstances. Reasons are required both when awarding more than 10 per cent and when rejecting a properly advanced case for a higher uplift.
2. The relevant circumstances must be connected with the failure to comply with the statutory procedures. They include whether the procedures were ignored altogether or partly applied, whether the failure was deliberate or inadvertent, and any circumstances mitigating culpability or seriousness. The employer’s size and resources can be relevant where they aggravate or mitigate culpability, but small businesses are not automatically entitled to lesser uplifts.
3. The dismissal involved a wholesale failure to apply proper procedures, followed by an offensively worded refusal to conduct an appeal. The tribunal’s identified mitigating factors did not justify limiting the uplift to 10 per cent. The EAT substituted a 40 per cent uplift under section 35 of the Employment Tribunals Act 1996.
4. Future loss. The tribunal was wrong to conclude that compensation ended when dismissal by the end of March 2008 was more likely than not. Where there is a sufficiently substantial chance that employment would have continued, the claimant must be compensated for that chance. The assessment requires an evaluative consideration of relevant contingencies, including the chance of fair dismissal later, the financial condition of the business, and the possible reduction in earnings.
5. The EAT awarded a further six months’ loss, producing a total award of £14,583.21, and substituted that figure for the tribunal’s award.

• Employment Tribunal, Hereford: found the dismissal automatically unfair under section 98A(1) of the Employment Rights Act 1996, awarded £9,101.60, and applied a 10 per cent uplift.
• Employment Appeal Tribunal: allowed the appeal on the uplift and future-loss issues, substituted a 40 per cent uplift and awarded a total of £14,583.21.