Spur Way Foods Ltd v Zafar & Ors

In a misconduct dismissal case, the tribunal must assess the employer’s decision under Employment Rights Act 1996, section 98. It must not decide for itself what actually happened and then treat the employer’s different conclusion as unfair. The material questions are the employer’s reason, its genuine belief, the reasonable grounds for that belief, the reasonableness of its investigation, and whether dismissal fell within the range of reasonable responses.

Actual facts remain relevant to contractual notice pay and contributory conduct. Those objectively determined issues must be kept distinct from the statutory unfair-dismissal inquiry. Each employee’s case requires individual consideration.

The employer summarily dismissed three employees following a workplace fracas involving a fourth employee. Two other employees who were present were not dismissed. The claimants brought claims for unfair dismissal and notice pay.

An Employment Judge at Watford found the dismissals unfair. The employer appealed, principally contending that the Judge had substituted his own factual view of the incident for the statutory assessment of the employer’s decision. The appeal also raised the proper separation of the notice-pay and contributory-conduct issues, and the appropriate remittal.

1. Appeal allowed. The Employment Tribunal’s decision could not stand and the whole case was remitted for rehearing before a fresh Tribunal.

2. Under section 98 of the Employment Rights Act 1996, the employer bears the burden of showing the reason, or principal reason, for dismissal. There is no formal burden of proof on the section 98(4) assessment of reasonableness. That assessment concerns the employer’s actions and decision at the time, not the Tribunal’s own conclusion about what actually occurred.

3. In a conduct case, the Tribunal must address the employer’s belief, whether it had reasonable grounds for that belief after a reasonable investigation, and whether dismissal was within the range of reasonable responses. The Tribunal below instead made extensive findings about the incident itself, scarcely addressed the evidence of the employer’s decision-makers, and then treated the employer as at fault for not reaching the Judge’s conclusion. That was an impermissible substitution of the Tribunal’s view.

4. The Tribunal also had to distinguish that statutory inquiry from objectively determined issues. An employee’s repudiatory breach, relevant to entitlement to notice pay, and the employee’s contributory conduct, relevant to remedy, require findings of actual fact. They do not turn on the employer’s state of mind.

5. Each claimant required separate consideration. On rehearing the Tribunal should consider why each claimant was dismissed, whether the employer reasonably regarded the two retained employees as materially different, and, if necessary, articulate separately its conclusions on notice pay and contribution.

6. A fresh Tribunal was required. The original Judge had expressed a sufficiently clear view that it would be unfair for the matter to return to the same Judge.

• Employment Appeal Tribunal: Allowed the employer’s appeal and remitted the claims for a complete rehearing before a fresh Tribunal: [2014] UKEAT 0318_14_0710.
• Employment Tribunal (Watford): Found that the three claimants had been unfairly dismissed. Its decision was set aside.