Davies v Sandwell Metropolitan Borough Council

An employment tribunal may look behind a final warning only in exceptional circumstances. The warning may be treated as valid where it was issued in good faith, supported by prima facie grounds, and was not given for an oblique motive or manifestly inappropriately. A failure to appeal does not itself validate a warning or prevent scrutiny where the employee’s decision not to appeal involved no admission of the allegations. The tribunal must assess the warning under the more exacting Stein test, then decide whether dismissal for subsequent misconduct fell within the range of reasonable responses.

The claimant, a teacher, was dismissed after five allegations of misconduct were upheld. The employer relied on a previous final written warning, although the Employment Tribunal considered that the warning hearing had involved serious procedural defects, including refusal to consider potentially important evidence.

The Tribunal nevertheless held that the warning could not be challenged because the claimant had not pursued an appeal by way of rehearing, and dismissed the unfair-dismissal claim. The claimant appealed on the basis that the Tribunal had wrongly treated the absence of an appeal as decisive. The Employment Appeal Tribunal considered the extent to which the validity of a final warning could be examined when assessing a later dismissal.

1. Appeal allowed in part and case remitted. The Employment Tribunal had misdirected itself by treating the claimant’s failure to appeal the final warning as a reason why its validity could no longer be questioned.
2. The applicable threshold for looking behind a final warning is more exacting than the ordinary unfair-dismissal test. Consistently with Stein v Associated Dairies Ltd and Tower Hamlets Health Authority v Anthony, a tribunal may generally treat a warning as valid if it was issued in good faith, there were prima facie grounds for it, and it was not issued for an oblique motive or manifestly inappropriately.
3. An appeal which has been launched but remains unresolved is a relevant circumstance for both the employer and tribunal. However, the absence of an appeal is not conclusive. Where the employee did not appeal because of advice about the risks of a rehearing, and that decision involved no express or implied admission that the allegations were true, it could not cure a warning which might otherwise be a nullity.
4. The Employment Tribunal had itself identified potentially fundamental defects in the warning hearing. It was therefore required to reconsider fairness by applying the Stein and Tower Hamlets principles, disregarding the absence of an appeal. The EAT could not determine whether the dismissal was fair or unfair on the existing findings.
5. The matter was remitted to the same Tribunal for further legal submissions and determination without further evidence. If dismissal was found unfair, the Tribunal was to consider remedy, including contribution and the prospect of a fair dismissal under Polkey v A E Dayton Services Ltd.

• Employment Appeal Tribunal: Allowed the appeal to the limited extent identified and remitted the fairness issue to the same Employment Tribunal.
• Employment Tribunal at Birmingham: Dismissed the unfair-dismissal claim on 23 March 2009.
• EAT rule 3(10) stage: HHJ McMullen QC dismissed the appeal as disclosing no arguable ground.
• Court of Appeal permission stage: Sir Richard Buxton allowed the claimant’s appeal against the rule 3(10) decision and granted permission on a limited issue.