Newbound v Thames Water Utilities Ltd

The Court of Appeal allowed the claimant's appeal against the Employment Appeal Tribunal and restored the Employment Tribunal's decision that the claimant's dismissal for conduct was unfair. The court accepted the ET's primary findings that the SHE4 method statement was recently introduced, that the claimant had not been trained in its significance, that there had been prior condonation of similar behaviour, and that the employer's investigation was reasonable. Applying section 98 of the Employment Rights Act 1996, the court held that dismissal was outside the band of reasonable responses in all the circumstances, including the claimant's 34 years' service and the disparate treatment between the claimant and the CP2 in charge, Mr Andrews. The ET's assessment of 40% contributory fault was left undisturbed.

This is an appeal from an EAT decision which set aside an Employment Tribunal (ET) finding of unfair dismissal. The claimant, a penstock co-ordinator with 34 years' service, was dismissed after entering a C-class sewer twice without breathing apparatus contrary to a SHE4 method statement and a C permit. The employer conducted a fact-finding investigation, held disciplinary and appeal hearings and summarily dismissed the claimant for gross misconduct on 15 September 2011. The ET (Employment Judge Bedeau) found the reason for dismissal was conduct and that the employer's investigation was reasonable, but concluded dismissal was unfair because no reasonable employer would have dismissed in the circumstances and, alternatively, because of unjustified disparate treatment compared with the CP2 in charge, Mr Andrews. The ET also assessed contributory fault at 40%.

Procedural history: ET decision (reserved) 17 September 2012 finding unfair dismissal; employer appealed to the EAT which allowed the appeal and dismissed the claim (judgment 9 April 2014); Court of Appeal allowed claimant's appeal and restored the ET decision ([2015] EWCA Civ 677).

Nature of the claim: unfair dismissal (conduct).

Issues before the court:

• Whether the ET properly applied the statutory test in section 98 of the Employment Rights Act 1996 and whether dismissal fell within the band of reasonable responses;
• whether the ET impermissibly substituted its own view for that of the employer;
• whether disparate treatment of the claimant and Mr Andrews rendered dismissal unfair;
• the appropriate reduction for contributory fault.

Court’s reasoning: The Court of Appeal emphasised the distinction between questions of fact for the ET and questions of law for appellate bodies. It accepted the ET's primary findings (recent introduction of SHE4, lack of training, prior condonation) as open to the ET on the evidence. The court held those findings material to reasonableness: in particular, lack of training and historical condonation meant management had not made it clear that future non‑compliance would justify dismissal. The EAT erred by treating the matter solely through a wide margin of appreciation on health and safety and by substituting its own view of culpability. The court therefore restored the ET’s conclusion that the dismissal was unfair but left the ET’s 40% contributory deduction intact.

Appeal allowed. The Court of Appeal restored the Employment Tribunal’s finding that dismissal was unfair because dismissal was outside the range of reasonable responses in all the circumstances. The EAT had erred by substituting its own assessment of blameworthiness and failing to respect the ET’s permissible findings of primary fact (recent introduction of the SHE4, lack of training, prior condonation and disparate treatment). The ET’s 40% contributory conduct deduction was left undisturbed.

Employment Tribunal (Watford, Employment Judge Bedeau) reserved decision 17 September 2012: claimant unfairly dismissed (remedies later assessed). Employer appealed to the Employment Appeal Tribunal (UKEAT/0011/13/SM); EAT allowed the employer's appeal and dismissed the claim in a reserved judgment handed down 9 April 2014. With permission from Elias LJ the claimant appealed to the Court of Appeal which allowed the appeal on 3 July 2015 and restored the ET decision.