Cumbria County Council & Anor v Bates

When assessing compensation for unfair dismissal, a tribunal must predict the loss flowing from the dismissal. It must consider reliable evidence that employment might later have ended, even where that evidence concerns post-dismissal events. A later criminal conviction may therefore reduce a pension-loss award if it could have curtailed the claimant’s employment. The rule against reducing compensation directly for post-dismissal misconduct under Employment Rights Act 1996 section 123(1) does not prevent that predictive assessment.

A tribunal must also permit a party to rely on relevant written witness evidence, subject to the weight properly attributable to it. Refusing to consider it merely because the witness is absent may be procedurally unfair.

The claimant, a teacher, succeeded in his unfair-dismissal claim. At remedy, the Employment Tribunal awarded compensation including pension loss to age 65.

After dismissal, the claimant was convicted of common assault on a former pupil and received a six-week prison sentence. The respondents contended that this event could have ended, or reduced the duration of, his teaching employment and therefore reduced pension loss. The Tribunal held that it was bound by Soros v Davison to disregard the conviction, and reinstated its original remedy award after a review.

The respondents appealed. The central issues were whether the conviction could be considered in the future-loss assessment and whether the Tribunal had fairly dealt with evidence bearing on the probable effect of the conviction.

1. Appeal allowed. The issue of pension loss alone was remitted to a newly constituted Employment Tribunal.

2. The Tribunal misapplied Soros v Davison. The respondents did not seek a direct reduction in compensation merely because of post-dismissal misconduct. They relied on the conviction and prison sentence as evidence relevant to the prediction of how long the claimant would probably have remained employed. That was a materially different question.

3. Under the approach in Software 2000 Ltd v Andrews and Scope v Thornett, future-loss assessment necessarily involves prediction and uncertainty. A tribunal must take account of evidence on which it can properly rely, including evidence which may show that employment would have ended after dismissal for reasons unrelated to the original dismissal. The claimant’s conviction could substantially reduce pension loss and was evidence the Tribunal was entitled, and in this case required, to consider.

4. The Tribunal also acted unfairly by refusing to consider the respondents’ relevant witness statement merely because its maker was not available for cross-examination. Absence could affect weight, but did not justify preventing counsel from referring to the statement. Its conclusion that there was no evidence supporting the respondents’ case was unsustainable, particularly given both that statement and the claimant’s own evidence.

5. The Tribunal correctly identified that the respondents bore the burden of showing that employment would have ended before age 65. On reconsideration, however, the new Tribunal must evaluate the evidence, including whether a percentage reduction is appropriate and whether the conviction affected causation of the claimed pension loss.

6. The apparent-bias complaint failed. A stated preliminary view did not demonstrate predetermination. The Tribunal’s failure to address accelerated receipt caused no practical consequence.

• Employment Appeal Tribunal: Allowed the respondents’ appeal and remitted pension loss to a newly constituted Employment Tribunal.
• Employment Tribunal: Following a remedy hearing and review, reinstated its original award, including pension loss to age 65. The decision was sent to the parties on 4 October 2012.
• Employment Tribunal: Found the claimant unfairly dismissed and reduced compensation by 15% for contributory fault. Written reasons were sent on 13 December 2010.