London Sovereign Ltd v Gallon

Under section 98(4) of the Employment Rights Act 1996, the tribunal must review the employer’s investigation, disciplinary process, factual conclusions and reasons for dismissal. It must assess whether those matters fell within the range of reasonable responses. It must not decide the misconduct allegation for itself and then judge the employer by that conclusion.

A tribunal may make its own factual findings where another issue, such as wrongful dismissal, requires it. Separating those exercises is good discipline, although failure to adopt a particular structure is not itself an error of law. A Polkey assessment is predictive: it asks whether the actual employer might fairly have dismissed and the chances that it would have done so.

Mr Stephen Gallon, a bus driver with 23 years’ service, was summarily dismissed for allegedly using a mobile phone while driving. He denied using it and brought claims for unfair and wrongful dismissal.

The Employment Tribunal upheld both claims. It found that the employer had not reasonably investigated matters including telephone records, the claimant’s need for reading glasses and the witness’s observations. It also found that the claimant had not used the phone. The employer appealed, alleging substitution, perversity and failure to apply the Polkey principle.

The central issues were whether the tribunal had applied the correct review under section 98(4) and whether its findings on wrongful dismissal and any reduction for the chance of a fair dismissal could stand.

1. The appeal was allowed in relation to unfair dismissal. The tribunal had stated the correct law but had fallen into the error of substitution. Under section 98(4) of the Employment Rights Act 1996, it had to identify the employer’s reasoning and assess whether the investigation, disciplinary process, conclusions and sanction fell within the range of reasonable responses.

2. The tribunal was not required, for the unfair dismissal issue, to decide whether the claimant had in fact committed the alleged misconduct. Its own findings were relevant to wrongful dismissal, where it had to determine the facts for itself, but could not replace the employer’s decision-making process in the section 98(4) analysis.

3. The tribunal had failed to engage adequately with the employer’s reasoning. It did not properly consider the significance of the witness’s observation of distraction over approximately ten seconds, or the employer’s reasons for not awaiting telephone records and not investigating the eyesight issue. Those matters had to be identified and assessed against the reasonable-employer standard.

4. The separate perversity grounds failed. It was open to the tribunal to conclude that the telephone records and the claimant’s need for reading glasses should have been investigated. For wrongful dismissal, the tribunal was entitled to reach its own factual conclusion that the claimant had not used the phone. That conclusion was not perverse. The appeal therefore did not disturb the wrongful dismissal finding.

5. The tribunal’s brief treatment of Polkey was inadequately reasoned. The assessment is predictive and concerns the actual employer, assuming it had acted fairly. The tribunal must ask whether a fair dismissal could have occurred and what chance there was that this employer would have dismissed. The unfair dismissal matter was remitted as a whole to a freshly constituted tribunal.

• Employment Appeal Tribunal: allowed the appeal on unfair dismissal, upheld the wrongful dismissal decision, and remitted the unfair dismissal matter to a freshly constituted Employment Tribunal.
• Watford Employment Tribunal: upheld the claims for unfair and wrongful dismissal; written reasons were sent on 20 July 2015.