House Of Fraser v Christofidou

In a conduct dismissal, an Employment Tribunal must apply the band of reasonable responses to both the employer’s decision and its investigation. It must not substitute its own preferred investigative course for that of the employer.

A finding that an employer failed to seek material evidence is perverse where the employer sought the witness’s contact details and the employee, who could provide them or call the witness, declined to do so. Where the only basis for unfairness is such a perverse finding, the dismissal may be found fair.

Conduct consisting of unhelpful, inconsistent and suspicious answers in circumstances giving rise to a justified loss of trust and confidence may amount to a fundamental breach entitling summary dismissal.

The employer appealed against the decision of the London (Central) Employment Tribunal, which had upheld the claimant’s claims for unfair and wrongful dismissal.

The claimant had been dismissed after an investigation into goods sold through an eBay account registered at her address. The Tribunal found that the employer reasonably concluded that her inconsistent and suspicious answers caused a breakdown of trust and confidence. It nevertheless found the dismissal unfair because the employer had failed to seek evidence from the claimant’s former husband, who was connected with the account.

The Tribunal made a 25% Polkey reduction and a 50% reduction for contributory conduct. The central issues were whether the Tribunal had substituted its own view for that of the employer, reached perverse conclusions, and whether substitution rather than remission was appropriate.

1. Appeal allowed. The unfair dismissal finding could not stand. The Tribunal’s decisive finding that the employer had failed to seek evidence from the claimant’s former husband was perverse. Its own findings showed that the investigator had sought his contact details in order to speak to him, while the claimant, who had the details and was in contact with him, declined to provide them or call him as a witness.

2. Under section 98 of the Employment Rights Act 1996, a conduct dismissal must be assessed by the band of reasonable responses. That standard applies to the investigation as well as to the decision to dismiss. The Tribunal instead assessed what it thought the employer should have done, including its own view of the former husband’s centrality and of what further enquiries might have established. This was an impermissible substitution of its view for that of the employer.

3. Once the perverse finding was removed, the Tribunal’s own findings supplied no basis for unfairness. The EAT therefore substituted a finding that the dismissal was fair, rather than remitting the matter.

4. The Tribunal’s findings on the Polkey reduction and contributory conduct were, if necessary, also perverse. It was unsustainable to find a 75% prospect that the former husband would have supplied exonerating evidence, or equal responsibility between the parties, where the employer sought to contact him and the claimant could herself have produced his evidence. It was also perverse to treat the appeal as failing to cure defects when the claimant did not attend or provide material and the employer reasonably proceeded in her absence.

5. The wrongful dismissal conclusion was unsafe because it was affected by the erroneous attribution of culpability to the employer. The claimant’s unhelpful, inconsistent and suspicious conduct justified a conclusion that trust and confidence had broken down. Since that obligation goes to the heart of the employment relationship, the conduct was a fundamental breach entitling the employer to terminate summarily. Findings were substituted dismissing both claims.

6. The employer’s application for appeal fees under Rule 34A(2)(a) of the Employment Appeal Tribunal Rules 1993 was refused. Costs did not automatically follow the event, and the claimant’s means justified declining an award.

• Employment Appeal Tribunal: allowed the employer’s appeal and substituted findings that both claims failed.
• London (Central) Employment Tribunal: held that the claimant had been unfairly and wrongfully dismissed, subject to a 25% Polkey reduction and a 50% reduction for contributory conduct.