Commercial Motors (Wales) Ltd v Howley

A short period of subsequent work does not automatically end loss attributable to an unfair dismissal. Under section 123(1) of the Employment Rights Act 1996, the tribunal must decide on the facts whether the dismissal remained the cause of the ongoing loss and what award is just and equitable.

Contractual benefits lost during a notice period are compensable, but the award must reflect any period in which the employee received an equivalent benefit. An Employment Tribunal's reasons should be read fairly and are not subject to over-elaborate scrutiny. A perversity appeal succeeds only where the tribunal's conclusion was one no reasonable tribunal could reach.

The claimant was found to have been unfairly dismissed. In a remedies decision dated 4 November 2011, the Cardiff Employment Tribunal awarded £44,579.02, including losses relating to a company car, fuel allowance and mobile telephone, and a compensatory award.

The employer appealed the awards for contractual benefits, the application of section 123 of the Employment Rights Act 1996, and the assessment of earnings loss. The claimant cross-appealed in relation to training costs and the refusal to compensate the continuing loss of benefits after the notice period.

The central issue was whether the claimant's short-term work for another employer severed the causal connection between his unfair dismissal and later loss.

1. Appeal allowed in part. The Employment Appeal Tribunal reduced the notice-period awards for loss of the executive car and fuel allowance. The claimant had use of an Astra and fuel for about four-ninths of that period. He could not recover the value of the contractual benefits while receiving equivalent benefits. The awards were therefore reduced to £2,218.50 and £166.65 respectively.

2. The Tribunal was entitled to compensate the claimant for the loss of the company mobile telephone. Its reasons had to be read fairly and as a whole. It was implicit that it rejected the employer's case that a replacement phone had been offered. That conclusion was supported by evidence and did not meet the demanding threshold for perversity.

3. The Tribunal correctly applied section 123(1) of the Employment Rights Act 1996. A later job does not operate as an automatic cut-off for loss caused by an unfair dismissal. The question is whether the dismissal remained the cause of the loss, followed by an assessment of what is just and equitable. The claimant's work for W G Davies was a short-term consultancy, not permanent replacement employment. The Tribunal was entitled to find that the dismissal remained the primary cause of subsequent earnings loss, while crediting the consultancy income.

4. The remaining challenges to the earnings award and mitigation findings disclosed no error of law. The Tribunal was also entitled to reject the training-cost claim as too remote and the post-notice claims for benefits because there was insufficient evidence to quantify a just and equitable loss.

5. All other grounds of the employer's appeal and the claimant's cross-appeal were dismissed.

• Employment Appeal Tribunal — allowed the employer's appeal only to reduce the awards for the company car and fuel allowance during the period in which equivalent benefits were received; otherwise dismissed the appeal and cross-appeal.
• Employment Tribunal, Cardiff — by its remedies decision of 4 November 2011, awarded the claimant £44,579.02 following the finding of unfair dismissal.
• Employment Tribunal, Cardiff — by its liability decision of 25 May 2011, held that the claimant had been unfairly dismissed. A previous appeal by the employer against that decision was dismissed.