McMillan v Airedale NHS Foundation Trust

An employee’s contractual right to appeal against a disciplinary warning or dismissal is ordinarily protective. Where the contractual procedure contains no express power to increase sanction, an appeal panel cannot impose a more severe sanction, including dismissal.

A re-hearing does not itself imply such a power. Nor can procedural understandings reached during the appeal amount to a binding contractual variation. The construction is reinforced where the procedure allows no further appeal and by the ACAS Guide’s indication that an appeal should not increase the penalty.

The effect of an employee’s purported withdrawal of an appeal was left undecided.

The respondent, a consultant obstetrician and gynaecologist, received a final written warning following internal disciplinary proceedings. She appealed under the Trust’s contractual disciplinary code. By agreement, the appeal panel conducted a re-hearing and upheld the misconduct findings. It then proposed to reconvene to decide sanction after receiving submissions which sought her dismissal.

The respondent withdrew her appeal and sought an injunction. HHJ Hegarty QC, sitting in the Queen’s Bench Division, held that the contractual appeal process did not permit an increased sanction and that the appeal could be withdrawn. He granted a permanent injunction restraining the Trust from reconvening the panel: [2013] EWHC 1504 QB.

The Trust appealed. The central question was whether its contractual disciplinary procedure permitted dismissal, or another increased sanction, for the first time on the employee’s appeal.

1. Appeal dismissed. The code gave the employee a right to appeal against a written warning or dismissal. Properly construed, that right was for the employee’s benefit and did not permit the appeal panel to increase the sanction. The appeal was not a continuation of the disciplinary process in which all disciplinary outcomes remained open.

2. The absence of a further right of appeal strongly supported that construction. It would be surprising if an employee could appeal a warning but, by exercising that right, become liable to dismissal without any appeal against that dismissal. Paragraph 4.23 referred to an appeal against a dismissal imposed under the earlier disciplinary provisions, not to a further appeal against dismissal first imposed by the appeal panel.

3. The ACAS Guide formed part of the admissible factual matrix. Although it was not incorporated into the contract, it was reasonably available through the code’s express reference to the ACAS Code of Practice. Its treatment of appeals reinforced the conclusion that a re-hearing could not increase the penalty.

4. Agreement that the appeal should be a re-hearing did not imply a power to increase sanction. Any procedural agreement was ineffective to vary the contract. Since the only practical purpose of the proposed reconvened hearing was to increase sanction, it would breach the contract and the injunction was justified.

5. The court did not decide the consequences of withdrawing an appeal, because its conclusion on sanction disposed of the appeal. Underhill LJ added that contractual procedures should ordinarily be followed, but a breach does not automatically establish an unfair dismissal or require injunctive relief; fairness under Employment Rights Act 1996 section 98 and the discretionary nature of injunctive relief may matter in an exceptional case.

• Court of Appeal (Civil Division): dismissed the Trust’s appeal and upheld the injunction: [2014] EWCA Civ 1031.
• High Court, Queen’s Bench Division: HHJ Hegarty QC held that the contractual appeal process did not allow an increased sanction and granted a permanent injunction restraining the Trust from reconvening the appeal panel: [2013] EWHC 1504 QB.