Nelson v Clapham & Anor (t/a Claphams Solicitors)

Reductions of compensation for contributory conduct under sections 122(2) and 123(6) of the Employment Rights Act 1996 are principally factual questions. The tribunal must identify the employee’s conduct, assess whether it was culpable or blameworthy, and determine whether it caused or contributed to the dismissal. Conduct during a disciplinary process may be relevant, including dishonesty or unfounded allegations against the employer. An appeal on perversity grounds succeeds only where no reasonable tribunal, properly appreciating the evidence and law, could have reached the decision.

An Employment Tribunal found that the claimant had been unfairly dismissed, partly because the dismissal procedure was defective. It nevertheless reduced both her basic and compensatory awards by 80 per cent, finding that her dishonest explanation concerning an email, failure to clarify her position, and failure to explain statements about harming the respondents’ reputation had contributed significantly to her dismissal.

The claimant appealed, arguing that the tribunal had relied impermissibly on conduct during the disciplinary meeting and had reached a perverse conclusion. The central issues were whether such conduct could be considered under sections 122(2) and 123(6) of the Employment Rights Act 1996, and whether the 80 per cent reduction was legally sustainable.

1. Appeal dismissed. The Employment Tribunal’s judgment was upheld, including the 80 per cent reductions in the basic and compensatory awards.
2. The application of sections 122(2) and 123(6) of the Employment Rights Act 1996 is substantially a question of fact. The tribunal must identify the conduct in question, determine its nature, assess whether the claimant was culpable or blameworthy, and decide whether it caused or contributed to the dismissal. It must then determine the appropriate reduction as just and equitable.
3. Culpability is not confined to breach of contract or tort. It includes conduct which is foolish, perverse or otherwise blameworthy. Dishonest conduct, or conduct misleading an employer, is plainly capable of amounting to relevant contributory conduct where it is causative of dismissal.
4. Conduct during a disciplinary process, including at a disciplinary hearing, may be taken into account. The statutory references to “any conduct” and “any action” are sufficiently broad. The distinction is between culpable conduct which contributes to dismissal and a mere failure by an employee to assist in establishing a defence.
5. The tribunal was entitled to regard the claimant’s allegation that the respondents had taken the email from her handbag as an accusation of almost criminal conduct. It was also entitled to rely on her failure to retract or clarify the email’s contents and her failure to explain the reference to harming the respondents’ business. Those findings supported the conclusions that the conduct was culpable and causative.
6. The challenge was principally an attempt to reargue the evidence. On perversity principles, the decision could be disturbed only if no reasonable tribunal, properly appreciating the evidence and law, could have reached it. That threshold was not met.

• Employment Appeal Tribunal: Appeal dismissed and the Employment Tribunal’s judgment upheld.
• Employment Tribunal: The claimant was found to have been unfairly dismissed, but the basic and compensatory awards were reduced by 80 per cent for contributory conduct. The tribunal’s judgment was registered on 12 May 2011.