Enable Care & Home Support Ltd v Pearson

In a conduct dismissal, once the employer has shown a genuine belief in misconduct, reasonable grounds and a reasonable investigation, the tribunal must consider whether dismissal for the employer’s actual reason fell within the range of reasonable responses. The tribunal must not dilute that reason by reassessing the seriousness of individual allegations and then substitute its own view of the appropriate sanction. Dismissal is fair if it falls within the range, even though some reasonable employers might have imposed a lesser sanction. Wrongful dismissal involves a different question: whether the employee’s conduct was sufficiently serious to amount to a repudiatory breach of contract.

Mrs Pearson, an HR adviser, was summarily dismissed after four allegations of misconduct were upheld, involving holiday records, disclosure of confidential information and attendance at a training event while suspended. The Employment Tribunal found that the employer had a genuine belief in the misconduct, reasonable grounds and had conducted a reasonable investigation, but held that dismissal was outside the range of reasonable responses. It also found that the misconduct was insufficiently serious to justify summary dismissal at common law.

Enable Care appealed against findings of unfair and wrongful dismissal. The appeal raised whether the tribunal had substituted its own view of the appropriate sanction and whether its conclusion on gross misconduct was perverse.

1. Unfair dismissal. By a majority, the appeal was allowed on this issue. Under Employment Rights Act 1996, section 98(4), the tribunal had to assess whether dismissal for the employer’s actual reason was within the range of reasonable responses. The employer’s reason comprised the set of facts known to it or beliefs held by it which caused the dismissal.
2. The tribunal accepted that the employer genuinely believed the allegations, had reasonable grounds for that belief and had carried out a reasonable investigation. It nevertheless reassessed the seriousness of the individual charges, treated them as relatively minor and substituted a diluted version of the employer’s reason. That was the wrong question. The relevant issue was whether the employer’s actual reason, viewed as a whole, was sufficient to justify dismissal. On the tribunal’s findings, dismissal fell within the range of reasonable responses.
3. The majority distinguished the issue from the further fact-finding required in LAS v Small. No remission was necessary, and the finding of unfair dismissal was set aside.
4. Minority view. Mr Smith considered that section 98(4)(b), requiring consideration of equity and the substantial merits of the case, had independent significance. He regarded the tribunal’s references to what a reasonable employer would have done and to mitigating factors as a permissible assessment under section 98(4), rather than demonstrable substitution. He would have dismissed the unfair-dismissal appeal.
5. Wrongful dismissal. This concerned the factual question whether the conduct amounted to a repudiatory breach entitling the employer to terminate without notice. The tribunal’s conclusion that the misconduct was not gross misconduct was not perverse. This part of the appeal therefore failed unanimously.
6. The finding of unfair dismissal was set aside and that claim dismissed. The finding of wrongful dismissal stood.

• Employment Appeal Tribunal: allowed the appeal on unfair dismissal and dismissed that claim; dismissed the appeal on wrongful dismissal.
• Employment Tribunal: upheld claims of unfair and wrongful dismissal and found 50 per cent contribution to the unfair dismissal.