Z v A (Unfair Dismissal : Reason for dismissal including substantial other reason)

An allegation of historic child abuse may constitute a potentially fair some other substantial reason for dismissal, but it does not make dismissal inevitably fair. Under section 98 of the Employment Rights Act 1996, the employer must establish a reason of a kind justifying dismissal. The tribunal must then assess fairness on all the circumstances of the individual case.

An employer may not treat an unendorsed allegation as conclusive. A fair procedure normally requires the employee to have a reasonable opportunity to answer material relied upon. On compensation, loss from mental illness is recoverable only where sufficient evidence proves that it resulted from the dismissal; the statutory award does not compensate non-economic loss or loss caused by separate pre-dismissal conduct.

A school caretaker was suspended and later dismissed after police reported an allegation of historic sexual abuse. By the dismissal date, the police had not endorsed the allegation as credible, relevant supporting witnesses had not supported it, and the investigation was close to an outcome. The school nevertheless decided that the allegation alone had irreparably damaged trust and confidence and posed safeguarding and reputational risks.

The Employment Tribunal held the dismissal substantively and procedurally unfair. It awarded compensation but found that the claimant had not proved that post-dismissal depression, which prevented him from working, had been caused by the dismissal. The employer appealed the liability decision. The claimant cross-appealed on remedy. The central issues were whether the dismissal was fair for SOSR under section 98 and whether the claimed loss from depression was caused by the dismissal.

1. Both appeals were dismissed. The Employment Tribunal was entitled to find that the employer had not established a substantial reason of a kind justifying dismissal and, alternatively, had acted unreasonably in treating the reason as sufficient.

2. The approach in A v B and Leach v Office of Communications governed the case. Whether an allegation of abuse supplies SOSR, and whether dismissal for that reason is fair under section 98 of the Employment Rights Act 1996, are matters for assessment on all the facts. There is no presumption that dismissal following an allegation, even one authoritatively supported, is fair. An employer must not accept disclosed information uncritically.

3. The Tribunal had not adopted an impermissible taxonomy of allegations or required the school to determine guilt. It had made a permissible factual assessment that the school dismissed because an allegation had been made, irrespective of its credibility or outcome. The police had not endorsed the allegation at the material time. That conclusion was not perverse.

4. The Tribunal was also entitled to take account of the school’s relevant procedures and the procedure as a whole. The claimant had not been given a proper prior opportunity to address strategy-meeting material relied upon at the hearing. A fair procedure requires a reasonable opportunity to answer matters held against the employee. The tribunal properly treated the interests of children as paramount but not exclusive.

5. Under section 123, compensation must be for economic loss sustained in consequence of dismissal and attributable to the employer’s action. Mental illness which follows dismissal may in principle establish that causal link, but the claimant bears the burden of proving it with sufficient evidence. The Tribunal permissibly found that the medical and other evidence attributed the depression to the allegation or suspension, rather than to dismissal.

6. The Tribunal was also entitled to find that the events in May 2011 were not part of the dismissal process. Any loss caused by separate pre-dismissal conduct was outside the statutory compensatory award and could only be pursued, if otherwise available, in a separate common-law claim.

• Employment Appeal Tribunal: The employer’s appeal against the finding of unfair dismissal and the claimant’s cross-appeal on compensation were dismissed: [2013] UKEAT 0203_13_0912.
• Employment Tribunal: Employment Judge Pettigrew held on 15 October 2012 that the claimant had been unfairly dismissed. In a separate decision dated 16 January 2013, the Tribunal awarded £5,155.52 compensation.