Montracon Ltd v Hardcastle

In deciding whether to reduce a basic award for contributory conduct under Employment Rights Act 1996, section 122(2), a tribunal may reach a percentage different from that applied to the compensatory award under section 123(6). The inquiry remains directed to the employee’s conduct and what is just and equitable between the parties.

Long and unblemished service may be considered as part of the employee’s overall conduct. The employer’s unfair conduct is not relevant to the assessment. Where serious culpable conduct has been found, however, a tribunal must give it weight. A nil reduction may be perverse if it fails to do so.

The claimant, an experienced HGV driver with a long unblemished record, collided with a low bridge after forgetting the height of his unusually high trailer. He was summarily dismissed for gross misconduct.

The Hull Employment Tribunal held by a majority that the dismissal was unfair. It reduced the compensatory award by 60% for the claimant’s contributory conduct under section 123(6) of the Employment Rights Act 1996, but made no reduction to the basic award under section 122(2). The employer appealed only that nil deduction.

The central issue was whether the tribunal had erred in treating the claimant’s long service as justifying no reduction to the basic award despite its findings of serious culpability.

1. Appeal allowed in part. The Employment Appeal Tribunal set aside the nil reduction of the basic award and substituted a 30% reduction.

2. Sections 122(2) and 123(6) of the Employment Rights Act 1996 permit different assessments of contributory conduct for the basic and compensatory awards. The question under each provision is whether, and to what extent, a reduction should be made because of the claimant’s conduct.

3. The assessment must concern the claimant’s conduct. It must not take account of the employer’s conduct in unfairly dismissing the claimant, nor the conduct of other employees. The tribunal was nevertheless entitled to consider the claimant’s long unblemished service when assessing his overall conduct and deciding what was just and equitable under section 122(2).

4. The majority tribunal erred by attaching no weight to conduct it had found clearly and seriously culpable. Given those findings, no reasonable tribunal properly directing itself could conclude that a nil deduction was just and equitable.

5. All necessary primary findings had been made. Balancing the claimant’s culpable driving against his long unblemished service, the EAT substituted a 30% reduction to the basic award. This properly reflected the distinction from the unchallenged 60% compensatory-award reduction.

• Employment Appeal Tribunal: Allowed the employer’s appeal to the limited extent of setting aside the nil reduction to the basic award and substituting a 30% reduction.
• Hull Employment Tribunal: Judgment dated 8 February 2012, with written reasons provided on 12 March 2012. By a majority, it found the dismissal unfair, reduced the compensatory award by 60%, and made no reduction to the basic award.