London Borough Of Brent v Finch

In a misconduct dismissal, an employment tribunal must determine the employer’s actual reason by reference to the case advanced and the evidence. It should not substitute an unpleaded allegation of dishonesty based on innuendo where the employee has not raised that case. Applying the Burchell principles, the tribunal must address the employer’s genuine belief, reasonable grounds and investigation in relation to the allegations actually made. It must match its findings to those allegations, take account of material admissions, and then decide whether dismissal fell within the range of reasonable responses. The employer is entitled to set reasonable rules, procedures and standards for employees with financial responsibilities. The appeal was allowed and the case was remitted to a differently constituted tribunal.

The Claimant, a school employee with financial responsibilities, was summarily dismissed following allegations concerning unauthorised correspondence, inadequate records of donations and vouchers, and failures in school dinner-money procedures. The Respondent’s written case relied on misconduct and did not allege dishonesty.

The Employment Tribunal found procedural unfairness because it considered that the real reason for dismissal was an uninvestigated allegation of dishonesty. Alternatively, it found the dismissal substantively unfair. The Respondent appealed against liability and the refusal to make reductions for contribution or under Polkey. The central issues were whether the tribunal had identified the employer’s reason correctly and whether it had applied the misconduct dismissal principles to the allegations actually advanced.

1. Appeal allowed; remittal. The Employment Tribunal’s judgment could not stand and the case was remitted to a differently constituted tribunal. The issues of contribution and remedy therefore required no determination.
2. For a misconduct dismissal, the tribunal must apply the Burchell test. The employer must establish the reason for dismissal and must genuinely believe in the matters relied on. The tribunal must also consider whether there were reasonable grounds and whether a reasonable investigation was carried out. Each stage is judged by the standard of a reasonable employer.
3. An alternative reason for dismissal, such as dishonesty or pretext, requires some evidential foundation. The employee bears only an evidential burden, but something must be raised. The tribunal erred in treating dishonesty as the real reason where the written reasons were not challenged and the issue was not shown to have been live.
4. The tribunal also failed to explain why it rejected the reasons stated in the dismissal letter. Its findings did not correspond properly with the three allegations. It addressed matters not alleged, failed to deal with material admissions, and did not determine whether the employer genuinely believed each allegation or had reasonable grounds for that belief.
5. The tribunal then could not properly assess the range of reasonable responses. It was for the school to determine appropriate financial procedures, protocols and standards. A finding that the employee was honest did not resolve whether she had been responsible for poor administration or breaches of those procedures.
6. Where dishonesty is genuinely relied on, it must be properly put to the employee and investigated: Strouthos v London Underground Ltd [2004] IRLR 636. The tribunal was directed to reconsider the allegations and the employer’s reason on remission.

• Employment Appeal Tribunal: Allowed the Respondent’s appeal from the Employment Tribunal sitting at Watford. The decision was set aside and remitted to a differently constituted Employment Tribunal.
• Employment Tribunal: Upheld the unfair-dismissal claim, awarded £18,163.40, and declined reductions for contribution or under Polkey.