Department for Work and Pensions v Mughal

An Employment Tribunal must decide separately whether dismissal fell within the range of reasonable responses. A fair procedure and a reasonable finding of gross misconduct do not make dismissal inevitable. The Tribunal must assess the whole circumstances, including relevant mitigation, under section 98 of the Employment Rights Act 1996.

Where a Tribunal relies on material factual findings or considerations not advanced in evidence or submissions, fairness ordinarily requires it to give the parties an opportunity to address them. The resulting error vitiates the decision unless an appellate court can safely conclude that the outcome would inevitably have been the same. Reinstatement requires separate consideration of practicability and justice, and arrears under a reinstatement order cannot be reduced for contributory conduct.

The Claimant, a DWP employee with 15 years' unblemished service, accessed her tenant's benefit records without authority and made related communications to the local authority. She admitted serious misconduct. The Employment Tribunal held that dismissal was unfair because it lay outside the range of reasonable responses, assessed contributory fault at 75 per cent, and ordered reinstatement while reducing arrears of pay by 75 per cent.

DWP appealed against both liability and reinstatement. The Claimant cross-appealed against the reduction of reinstatement arrears. The central issues were whether the Tribunal had fairly and lawfully reached its conclusions on sanction and reinstatement, and the proper consequence of its errors.

1. Appeal allowed. The finding of unfair dismissal could not stand. The Tribunal had treated as very significant mitigation an immediate voluntary confession to a line manager, although there was no evidential basis for that finding and it was not a matter the parties had addressed. It had also relied on the absence of personal or financial gain without giving DWP's witnesses an opportunity to address that issue. Those matters were material to its conclusion that the decision-makers had adopted a rigid and inflexible approach.

2. The Tribunal also wrongly treated the conduct as non-dishonest. The Claimant had made false representations which she knew to be untrue. The finding was not a permissible conclusion on the evidence. The EAT could not safely conclude that, if the errors had been avoided, dismissal would inevitably still have been held outside the range of reasonable responses.

3. A reasonable finding of gross misconduct after a fair procedure does not end the statutory inquiry. Under section 98 of the Employment Rights Act 1996, the Tribunal must still decide whether dismissal was within the range of reasonable responses in the employee's particular circumstances. Mitigation and its effect on the sanction must ordinarily be considered.

4. The reinstatement order also fell away with the liability decision. Independently, an order under section 114(1) requires the employer to treat the employee as if not dismissed. Arrears of pay under such an order cannot be reduced for contributory conduct. The Tribunal's exercise of discretion under section 116 was further vitiated because it relied on a final written warning and on views about practicability which had not been put to the parties, and on its erroneous finding that the conduct was not dishonest.

5. The cross-appeal did not arise. The case was remitted to a differently constituted Tribunal for a rehearing. Although the Claimant admitted gross misconduct, fair dismissal was not the only possible outcome. Applying [2014] EWCA Civ 449, remission was required.

• Employment Appeal Tribunal: DWP's appeal against the finding of unfair dismissal and reinstatement order was allowed. The matter was remitted for a rehearing before a differently constituted Tribunal.
• Employment Tribunal: Employment Judge Spencer held the dismissal unfair, found 75 per cent contributory conduct, and ordered reinstatement with reduced arrears of pay. Reasons were sent to the parties on 21 August 2015.