Chivas Brothers Ltd v Robertson

In a misconduct dismissal, the employer’s belief, reasonable grounds and investigation must be assessed by applying the objective standards of the reasonable employer. The tribunal must not substitute its own view of what investigation it would have undertaken. It must explain why omitted inquiries mattered and why no reasonable employer could have omitted them.

Compliance with the statutory dismissal procedure is assessed at the relevant procedural stage. Step 1 is judged when the written statement and invitation are sent. Step 2 requires a reasonable opportunity to consider and answer the stated information, but a finding of non-compliance requires an evidential basis.

Where an employment tribunal’s findings contain material contradictions, errors and procedural irregularities, the appellate tribunal may set aside the decision and remit the case for rehearing.

Mrs Robertson, an engineering administrator, was dismissed for serious misconduct relating to excessive purchasing of consumables using an employer-issued purchasing card. An Employment Tribunal found the dismissal unfair, awarded compensation, and also found automatic unfairness arising from non-compliance with the statutory dismissal procedures.

The Tribunal accepted that the employer had a genuine belief and reasonable grounds for its belief, but concluded that the investigation was unreasonable. It also identified procedural failures and considered that the statutory procedure had not been followed. The employer appealed, and the employee brought a cross-appeal concerning the statutory procedure and the conclusion that dismissal would have been a reasonable sanction.

The central issues were whether the Tribunal had properly applied the misconduct-dismissal test, whether its findings were supported by evidence, and whether the statutory procedure had been breached.

1. Appeal allowed; cross-appeal dismissed. The Employment Tribunal’s judgment contained contradictions, patent errors and findings unsupported by evidence. Its procedure was also flawed because the Employment Judge invited and relied on further written submissions about material that had not been explored in evidence, apparently without involving the lay members. The case was therefore remitted to a freshly constituted Employment Tribunal for rehearing.

2. Under British Home Stores Ltd v Burchell [1978] IRLR 379, the employer must establish a genuine belief in the employee’s misconduct, reasonable grounds for that belief, and an investigation reasonable in all the circumstances. Applying Sainsbury’s Supermarkets Ltd v Hitt [2003] IRLR 23, the investigation question is governed by the objective standards of the reasonable employer and the range of reasonable responses. The Tribunal had instead adopted a substitution mindset by identifying further inquiries which might have been made without explaining why no reasonable employer would have omitted them.

3. The Tribunal’s findings that the employer had reasonable grounds and had failed to carry out a reasonable investigation were inadequately explained and appeared contradictory. Its criticisms of the investigation lacked an evidential basis or failed to show how the proposed inquiries could have affected the central concerns about excessive purchasing, lack of records and failure to check deliveries.

4. The letter inviting the employee to the disciplinary hearing complied with step 1 of the statutory procedure. Compliance was to be assessed when the letter was sent, not by comparing it retrospectively with every finding made after the hearing. There was also no evidential basis for finding that step 2 had not afforded a reasonable opportunity to respond.

5. The Tribunal had not determined whether its alleged procedural failures independently made the dismissal unfair. If procedural unfairness were established, the potential application of Polkey principles should have been addressed, as noted in Red Bank Manufacturing Ltd v Meadows [1992] ICR 204 and Salford Royal NHS Foundation Trust v Roldan [2010] EWCA Civ 522.

6. The Tribunal was entitled in principle to conclude that the employee’s serious negligence could justify dismissal. Its conclusion that the expenditure was not significant merely because the employer had a global turnover of about £2 billion had no proper evidential basis.

• Employment Appeal Tribunal: allowed the employer’s appeal, dismissed the employee’s cross-appeal, and remitted the case to a freshly constituted Employment Tribunal for rehearing.
• Employment Tribunal: found the employee unfairly dismissed and awarded compensation. The judgment was registered on 15 September 2010.