Donald v AVC Media Enterprises Ltd

In assessing compensation for unfair dismissal, the employer bears the burden of proving that the claimant acted unreasonably in mitigating loss. A tribunal must not treat the burden as neutral, require the claimant to prove reasonable steps, or base its conclusion on speculation.

When deciding whether it is just and equitable to extend time for a pregnancy-discrimination claim, a tribunal must consider all significant circumstances. This includes the balance of prejudice and, where relevant, the merits. Failure to address prejudice is an error of law, particularly where refusing an extension deprives the claimant of a potentially strong claim.

The claimant succeeded before the Employment Tribunal in a claim of constructive unfair dismissal. The Tribunal awarded past loss but refused future wage loss. It also dismissed, as out of time, her claim that she had been denied an opportunity for promotion because of pregnancy and maternity leave.

The claimant appealed the future-loss and time-extension decisions. The respondent cross-appealed the quantum of the past-loss award, relying on a shoulder injury which had not been the subject of evidence before the Tribunal.

The central issues were whether the Tribunal had correctly approached mitigation of loss, and whether it had lawfully refused to extend time for the pregnancy-related discrimination claim under Equality Act 2010.

1. Appeal allowed; cross-appeal dismissed. The refusal of future wage loss and the refusal to extend time for the pregnancy-related discrimination claim could not stand. Both issues were remitted to a freshly constituted Employment Tribunal.

2. Under section 123 of the Employment Rights Act 1996, the claimant must mitigate loss, but the respondent bears the evidential burden of proving unreasonable conduct. The Tribunal neither acknowledged that burden nor assessed whether the respondent had proved unreasonableness. It instead appeared to require the claimant to justify her job search and made unsupported assumptions that pregnancy and limited opportunities had led her to choose not to work. That approach was inconsistent with Wilding and Cooper Contracting. The Tribunal had also failed to reconcile its finding that the claimant would have received maternity pay with its refusal of all future loss.

3. For a just-and-equitable extension of time, the Tribunal had to consider all significant circumstances, including prejudice. Its focus on the claimant's informed earlier decision not to sue did not discharge that task. It did not address the prejudice caused by depriving her of the claim, the absence of real prejudice to the respondent, or the apparent strength of the merits.

4. The findings were sufficient to show a strong case that the claimant had been passed over for promotion because of pregnancy and maternity leave. The Tribunal should therefore have permitted the section 18 claim to proceed. However, the EAT did not determine its merits, so that both parties retained ordinary first-instance and appeal rights.

5. The reconsideration decision on victimisation under section 27 of the Equality Act 2010 could not be read across to determine the separate section 18 claim. The allegations concerned different acts and different times. The respondent's quantum challenge raised a matter not put before the Tribunal and was dismissed.

• Employment Appeal Tribunal: Allowed the claimant's appeal, dismissed the respondent's cross-appeal, and remitted the future-loss and pregnancy-discrimination issues to a freshly constituted Employment Tribunal.
• Employment Tribunal: By judgment dated 3 April 2014, unanimously upheld constructive unfair dismissal, awarded past loss, refused future loss, and dismissed the pregnancy-related discrimination claim as out of time. A reconsideration judgment dated 10 December 2014 rejected a victimisation claim.