Kelly v PGA European Tour

When assessing re-engagement after unfair dismissal, the tribunal must consider whether suitable employment is available at the remedies hearing. It generally need not consider vacancies that arose but were filled before that hearing, although the statutory treatment of a replacement for the dismissed employee remains distinct. Practicability is assessed by reference to whether the particular employer genuinely and rationally believes that the employee cannot perform the role or cannot be trusted to work successfully. A tribunal must not substitute its own view. Re-engagement is ordinarily impracticable where the employee plainly lacks a genuinely essential requirement of the role. The assessment is prospective and may be revisited when compensation is determined. The tribunal must also assess, on the available evidence, the chance of a fair dismissal occurring in any event.

Scott Kelly had been unfairly dismissed by the PGA European Tour. The employment tribunal ordered his re-engagement as Commercial Director, China, but found that he had not been dismissed because of age. The Employment Appeal Tribunal set aside the re-engagement order, held that the role required Mandarin, and found that the tribunal had applied the wrong approach to the employer’s views about capability and trust. It remitted the question of a possible compensation reduction for a later fair dismissal and rejected an argument concerning vacancies already filled before the remedies hearing. The claimant appealed on the interpretation of section 116 of the Employment Rights Act 1996, practicability, appellate intervention, remittal and compensation.

1. Appeal dismissed. Lewis LJ, with Elisabeth Laing LJ agreeing, upheld the EAT’s decision to set aside the re-engagement order and to remit the question of a possible compensation reduction.
2. Under sections 115 and 116 of the Employment Rights Act 1996, practicability is assessed by reference to the position at the remedies hearing and the date for compliance. Section 116(5) requires disregard of the appointment of a permanent replacement for the dismissed claimant. It does not require disregard of other posts which became vacant but were filled before the remedies hearing.
3. Where the employer relies on conduct said to have destroyed trust and confidence, the tribunal must test whether this employer genuinely holds that belief and whether it has a rational basis. Similar principles apply where the employer believes that the claimant cannot perform the required role. Mere assertion is insufficient, but a genuine and rational belief will usually be highly significant.
4. The tribunal had to take account of its liability-stage findings that Mr Pelley genuinely believed that the claimant lacked the capability required for the new senior role, and that this belief was rationally based. It could not substitute its own assessment. The claimant also lacked the essential ability to speak, write and read Mandarin for the China role. Re-engagement in that role was therefore impracticable. The EAT was entitled to decline remittal because no lawful re-engagement order was available.
5. The assessment at the order stage is prospective and provisional in the sense explained in McBride v Scottish Police Authority [2016] I.C.R. 788; it is not a conclusive determination at the later compensation stage. The court rejected the separate submission that the order necessarily required creation of a new job.
6. The tribunal had to consider the evidence bearing on whether a fair dismissal would have occurred in any event. Its failure to do so justified remittal. Underhill LJ added that tribunals should avoid excessive glosses on practicability, and should assess each case on its facts.

• Court of Appeal (Civil Division): dismissed the claimant’s appeal and upheld the EAT’s treatment of re-engagement, filled vacancies and the need to assess a possible compensation reduction.
• Employment Appeal Tribunal: allowed the respondent’s appeal against re-engagement, set aside that order, remitted the compensation issue, and dismissed the claimant’s challenge concerning filled vacancies and reconsideration.
• Employment Tribunal: upheld the unfair dismissal complaint, rejected age discrimination, refused reinstatement, but ordered re-engagement as Commercial Director, China and made no Polkey reduction.