City Hospitals Sunderland NHS Foundation Trust v Iwuchukwu & Anor

In deciding whether a dismissal for capability is fair under section 98(4), the tribunal must assess the reasonableness of the decision to dismiss in the circumstances existing when it was made. Earlier unreasonable conduct or procedural breaches do not, without more, taint the dismissal.

The tribunal must engage with the employer's actual reasons for rejecting alternatives such as remediation, redeployment or retraining. A breach of an internal appeal timetable does not itself establish unfair dismissal where there is a plausible explanation for delay and the employee retains an opportunity to appeal.

An inference of race discrimination or victimisation cannot stand where the tribunal's own findings disclose a complete explanation for the treatment that is unrelated to race or protected acts.

The claimant, a consultant surgeon and the Trust's only black African consultant, was restricted to non-clinical duties after concerns about his practice. Following a Royal College of Surgeons review and a capability hearing, the Trust dismissed him for capability reasons.

The Employment Tribunal upheld claims arising from the Trust's failure to investigate his discrimination grievances under its formal procedure. It also found the dismissal unfair under section 98(4) of the Employment Rights Act 1996. The Trust appealed.

The central issues were whether the grievance treatment supported findings of race discrimination and victimisation, whether time had properly been extended, and whether earlier procedural failings and delay in arranging an appeal made the capability dismissal unfair.

1. Appeal allowed. The findings of race discrimination and victimisation could not stand. The Employment Tribunal had treated the unsustainable assertion that the grievances were out of time as sufficient to infer discrimination. Its own findings showed that the Trust regarded the grievances as attempts to delay or derail the capability process. That was a complete explanation unrelated to race. The hypothetical comparator was also defective because it omitted that material characteristic.

2. The victimisation reasoning was equally unsustainable. The Employment Tribunal had not adequately explained why the content of the grievances materially influenced the decision, rather than the Trust's view of their procedural effect. The successful discrimination and victimisation claims were therefore dismissed.

3. The extension-of-time issue was consequently immaterial. The EAT nevertheless noted that Abertawe Bro Morgannwg University Local Health Board v Morgan [2018] EWCA Civ 640 establishes that a claimant's failure to give direct evidence explaining delay does not oblige a tribunal to infer that there was no acceptable reason, nor does an absence of acceptable reason inevitably prevent a just-and-equitable extension.

4. The unfair-dismissal finding involved errors of law. Applying McAdie v Royal Bank of Scotland [2007] EWCA Civ 806, the statutory question under section 98(4) of the Employment Rights Act 1996 was whether dismissal was reasonable in the circumstances at the date of dismissal. Earlier unreasonable conduct could be relevant, but could not by itself render the panel's decision unfair.

5. The Employment Tribunal also failed to engage with the capability panel's detailed reasons for rejecting in-Trust remediation, third-party remediation and redeployment. Its conclusion about the delayed appeal was perverse: the policy timetable was short, there was a plausible explanation for the delay, and the claimant could still have pursued the listed appeal.

6. The ordinary unfair-dismissal claim was remitted to a new Employment Tribunal. The prior Tribunal's primary findings of fact were preserved, subject to any further order.

• Employment Appeal Tribunal: Allowed the Trust's appeal in [2018] UKEAT 0164_17_2604. It dismissed the successful race discrimination and victimisation claims and remitted the ordinary unfair-dismissal claim to a new Employment Tribunal.
• Employment Tribunal, North Shields: In a judgment sent to the parties on 2 November 2016, upheld one race discrimination and victimisation claim concerning the grievances and found the capability dismissal unfair under section 98(4) of the Employment Rights Act 1996. It dismissed the remaining claims.