Prospect v Hajee

In a misconduct dismissal, procedural fairness is assessed under the range of reasonable responses and by examining the disciplinary process as a whole. An employer’s failure to follow its disciplinary policy does not itself make a dismissal unfair. It may nevertheless be decisive where the omitted investigation could have clarified disputed facts material to the charge and neither the dismissing nor appeal officer considered the case with a sufficiently open mind.

A full and fair internal appeal can cure even serious defects at the earlier stage. The question is whether the overall process was fair, not whether the appeal is labelled a rehearing or review. Under section 13(6) of the Employment Rights Act 1996, an agreement made after the event giving rise to a disciplinary repayment obligation cannot authorise wage deductions on account of that event.

The Claimant, an experienced union officer, was dismissed for alleged insubordination after failing to provide written confirmations concerning a transfer and a branch meeting. He had a live final written warning. The London South Employment Tribunal held that the employer genuinely believed the misconduct and had reasonable grounds for that belief, but that the dismissal was procedurally unfair. It found that no required preliminary investigation had occurred and that the dismissing manager lacked impartiality. It also held that a £750 deduction from wages under a training-cost repayment agreement was unlawful.

The employer appealed. It challenged the construction and significance of its disciplinary policy, the finding that the internal appeal did not cure earlier defects, and the deduction finding. The central questions were whether the tribunal had erred in its assessment of procedural fairness and whether the repayment agreement validly authorised the deduction.

1. Appeal dismissed. The Employment Tribunal was entitled to find that the dismissal was procedurally unfair. Its findings that a preliminary investigation was required under the employer’s serious-misconduct procedure, that disputed matters could have been clarified by such an investigation, and that the dismissing officer was not impartial were open to it.

2. The policy drew a deliberate contrast between ordinary misconduct, for which an investigation could be unnecessary where facts were undisputed, and serious or gross misconduct, for which an investigating manager will be appointed and must report. On the facts, the Claimant’s motivation and attitude, and what occurred at the branch meeting, were materially disputed. A fair early investigation could have affected the interpretation of the conduct relied on as insubordination.

3. The tribunal correctly applied the misconduct-dismissal approach and the range of reasonable responses under section 98(4) of the Employment Rights Act 1996. It did not substitute its own view merely by deciding that the absence of an investigation, in the particular factual setting, fell outside that range.

4. The tribunal erred in treating the loss of a two-stage process as a defect that could never be cured on appeal. As explained in Taylor v OCS Group Ltd, [2006] ICR 1602, even serious procedural defects may be cured by a full and fair appeal. The correct inquiry is the fairness of the process overall, including the seriousness of the alleged misconduct, the effect of earlier defects, and the thoroughness and open-mindedness of the appeal.

   The error was immaterial. The tribunal’s separate finding that the appeal officer lacked complete impartiality was not perverse. It was based on his untenable treatment of the dismissing officer’s prior involvement, his extensive prior knowledge of the Claimant, and his criticism of the Claimant’s past performance. The appeal therefore did not cure the earlier unfairness.

5. The deduction finding was upheld on a new pure point of law. The repayment agreement followed the disciplinary sanction requiring a contribution to training costs and was consequent on that event. It was therefore ineffective under section 13(6) of the Employment Rights Act 1996 to authorise deductions on account of the earlier event. Exceptional circumstances justified allowing the point because it required no further factual inquiry, caused no prejudice, and supported the existing judgment in the Claimant’s favour.

1. Employment Appeal Tribunal — dismissed the employer’s appeal and upheld the findings of procedurally unfair dismissal and unlawful deduction from wages.

2. London South Employment Tribunal — judgment promulgated on 7 September 2016. It held that the Claimant had been unfairly dismissed for misconduct on procedural grounds and had suffered an unlawful deduction of £750.