WM Morrisons Supermarket Plc v Kessab

In a misconduct dismissal, the employer must have a genuine belief in guilt, reasonable grounds for that belief, and an investigation that is reasonable in the circumstances. The range of reasonable responses applies both to the decision to dismiss and to the procedure adopted. An appellate court should not interfere with an Employment Tribunal’s properly directed factual assessment absent perversity.

A Polkey reduction may nevertheless be required where dismissal was substantively as well as procedurally unfair. The tribunal must assess the chance that a fair process would have resulted in dismissal.

The Employment Tribunal upheld the claimant’s claims for unfair and wrongful dismissal, while dismissing his race discrimination and harassment claims. It found that the employer had inadequately investigated an allegation that the claimant had acted aggressively and used abusive language towards his manager. It also found procedural unfairness in the short time allowed for preparation and in the non-disclosure of further witness evidence obtained on appeal.

The employer appealed against the findings of unfair dismissal and against the refusal to make a Polkey deduction from compensation. The central issues were whether the Tribunal had substituted its own view for that of the employer, and whether substantive unfairness prevented a Polkey assessment.

1. Appeal allowed in part. The appeal against the finding of unfair dismissal was dismissed. The appeal concerning the refusal to consider a Polkey deduction was allowed.

2. The Employment Tribunal had applied the three-stage approach in British Home Stores v Burchell [1978] ICR 303. It was entitled to find that the employer lacked reasonable grounds for its belief in misconduct because its investigation of the material witness evidence was inadequate. The evidence had been obtained perfunctorily and had not been reasonably tested against the claimant’s consistent account.

3. The Tribunal was also entitled to regard the limited time given to prepare for the disciplinary hearing, and the failure to disclose the further appeal-stage witness account, as procedurally unfair. Its observations about the speed of the process did not show that it had substituted its own view for the employer’s. It had correctly directed itself to the range of reasonable responses.

4. The Employment Appeal Tribunal would not revisit those factual findings. There was substantial evidential support for them and the case was nowhere near the high threshold for perversity.

5. The Tribunal erred in treating substantive unfairness, combined with procedural unfairness, as excluding a Polkey deduction. It should instead consider whether, and to what extent, a fair procedure might have led to dismissal.

6. The question of the deduction was remitted to the same Employment Tribunal. In the interests of proportionality, it should consider determining it on written submissions unless either party objected.

• Employment Appeal Tribunal: allowed the employer’s appeal only on the Polkey issue and remitted that issue to the same Employment Tribunal.
• Employment Tribunal, London (South): upheld unfair dismissal and wrongful dismissal claims, dismissed discrimination and harassment claims, and awarded compensation without a Polkey deduction.