Shrestha v Genesis Housing Association Ltd

The Court of Appeal dismissed the appellant's appeal against findings that he had fraudulently over-claimed mileage and was fairly dismissed for gross misconduct. The court applied the tripartite Burchell test for misconduct dismissals and section 98(4) of the Employment Rights Act 1996, holding that the Employment Tribunal had correctly assessed whether the employer had a genuine belief based on reasonable grounds and had carried out as much investigation as was reasonable in all the circumstances.

Key legal principles:

• The Burchell tripartite test: employer belief, reasonable grounds for that belief, and reasonable investigation into the matter.
• The objective "range of reasonable responses" standard applies to the reasonableness of an employer's investigation as well as to the decision to dismiss.

The court rejected the submission that each line of defence raised by the employee had to be separately investigated unless manifestly false; the tribunal was entitled to assess the investigation as a whole and to conclude that further inquiries were unnecessary. The tribunal's finding of dishonesty (gross misconduct) was sufficient to dismiss the wrongful dismissal claim and to refuse the claimed allowances.

The appellant, employed as a floating support worker, claimed mileage and an essential car user allowance. An audit of his claims for May to July 2011 showed claimed mileages generally about twice the distances suggested by AA and RAC route-finders. An internal investigation and disciplinary process followed. The employer's investigation compared claimed mileages with AA/RAC figures and with the appellant's own earlier claims; the appellant explained discrepancies by reference to parking difficulties, road works, one-way systems and diversions. The employer concluded the appellant had over-claimed mileage fraudulently and dismissed him for gross misconduct. The internal appeal upheld dismissal.

The appellant's Employment Tribunal claim for unfair and wrongful dismissal was dismissed on 5 April 2013. His appeal to the Employment Appeal Tribunal was dismissed under the rule 3(10) procedure on 18 October 2013 (UKEATPA/0759/13/SM). Permission to appeal to the Court of Appeal was granted by Rimer LJ (oral renewal) and an amendment of grounds by Elias LJ was permitted.

Nature of the claim: claims for unfair dismissal, wrongful dismissal, and payment of essential car user allowance and outstanding mileage for August to October 2011.

Issues before the Court of Appeal:

• Whether the Employment Tribunal and Employment Appeal Tribunal applied correctly the Burchell test and whether the employer had carried out a reasonable investigation into the appellant's responses to the disciplinary allegations.
• Whether the tribunal's findings supported a conclusion of gross misconduct and thus the rejection of the wrongful dismissal claim.
• Whether the tribunal failed to deal with the entitlement to the allowance and outstanding mileage.

Court's reasoning: The court reiterated that the Burchell test requires: an employer belief in the employee's guilt, reasonable grounds for that belief, and that the employer carried out as much investigation as was reasonable in all the circumstances. The court rejected the appellant's contention that every line of defence raised had to be separately investigated unless manifestly false, holding that the investigation must be assessed as a whole. Given the comparative analyses carried out, the opportunities given to the appellant to explain discrepancies, and the conclusions of decision-makers, the tribunal's finding that a reasonable investigation had been undertaken was open to it. The court also accepted that the tribunal had, expressly or implicitly, found dishonesty and was entitled to refuse the claimed payments. The appeal was dismissed.

The appeal was dismissed. The Court of Appeal held that the Employment Tribunal had correctly applied the Burchell tripartite test and section 98(4) of the Employment Rights Act 1996, and that the employer had carried out as much investigation as was reasonable in all the circumstances. The tribunal's finding of dishonesty was properly made and justified dismissal for gross misconduct, supporting the rejection of the wrongful dismissal and payment claims.

Employment Tribunal (Employment Judge McLaren) dismissed unfair dismissal and wrongful dismissal claims on 5 April 2013; Employment Appeal Tribunal (His Honour Judge Peter Clark) dismissed the appeal under rule 3(10) on 18 October 2013 (UKEATPA/0759/13/SM). Permission to appeal to the Court of Appeal was granted by Rimer LJ (oral renewal) and Elias LJ permitted amendment of grounds.