Leicester City Council v A Chapman

The Employment Appeal Tribunal allowed the employer's appeal against an Employment Tribunal decision that had upheld claims of unfair and wrongful dismissal. The key legal issue was whether the ET had impermissibly substituted its own view for that of the disciplinary decision‑maker when assessing the reasonableness of the belief that the claimant had sexually harassed a colleague, contrary to the standard in section 98(4) Employment Rights Act 1996 and the Burchell principles. The EAT held the ET had failed to engage with the evidence and the reasoning of the dismissing officer and had adopted a substitution mindset, rendering its unfair dismissal conclusion unsafe. On wrongful dismissal, the EAT found the ET was wrong to say the respondent had not called any relevant evidence: documentary and indirect evidence from the internal investigation and disciplinary process were before the ET and could not be dismissed without consideration. The matter was remitted to the Employment Tribunal for further determination.

Background and procedure:

The claimant, employed as a leisure centre attendant, was dismissed after internal investigation and a disciplinary hearing following allegations by a colleague (AG) about incidents on 13 April 2018 captured partly on CCTV. The Employment Tribunal (sitting at Leicester and Nottingham) upheld the claimant’s claims of unfair dismissal and wrongful dismissal in a reserved judgment sent on 8 December 2020. The employer appealed to the Employment Appeal Tribunal.

Nature of the claims and relief sought:

• The claimant sought remedies for unfair dismissal under section 98(4) Employment Rights Act 1996 and for wrongful dismissal (summary dismissal in breach of contract).

Issues framed by the EAT:

• whether the ET fell into a substitution mindset or reached a perverse conclusion in assessing the fairness of the conduct dismissal, particularly as to whether the decision‑maker had reasonable grounds to believe the claimant had made a sexually suggestive remark while holding AG’s head;
• whether the ET erred in its approach to the evidence on wrongful dismissal by effectively disregarding documentary and indirect evidence from the employer’s internal process.

Court’s reasoning and conclusions:

• The EAT reviewed the applicable legal principles (including Burchell, the band of reasonable responses test, and the need to guard against substitution described in London Ambulance Service v Small and related authorities). It concluded the ET, when characterising the critical factual dispute, did not properly engage with the evidence available to the dismissing officer (Mr Beddow) and substituted its own view for his. In particular, the ET adopted an incorrect basis for inferring that the decision‑maker rejected the claimant’s account for reasons not given by him, and treated the matter as a conflict of accounts when, as presented to the decision‑maker, AG said the remark had been made and the claimant could not recall the words but regarded the interaction as banter. That made the ET’s conclusion on unfair dismissal unsafe.
• On wrongful dismissal, the EAT found it was an error of law for the ET to say the respondent had not called any relevant evidence other than CCTV. The employer had relied on written statements, investigation notes, the investigation report and evidence from investigating and dismissing officers. While the ET could have rejected that material, it was wrong simply to ignore it without explanation.
• Because the EAT considered the ET’s reasoning on both issues unsafe but that more than one outcome remained possible, the appeal was allowed and the case remitted to the Employment Tribunal for further consideration; the parties were invited to make brief written representations about the terms of the remission.

Appeal allowed. The EAT concluded that the Employment Tribunal had fallen into a substitution mindset and failed to engage adequately with the evidence and the dismissing officer’s reasons when finding the dismissal unfair under section 98(4) Employment Rights Act 1996; and had erred in law in its treatment of the evidence for the wrongful dismissal claim by effectively disregarding documentary and indirect evidence adduced by the respondent. The matter was remitted to the Employment Tribunal for further proceedings.

Appeal from the Employment Tribunal (Leicester and Nottingham) arising from a reserved judgment sent 8 December 2020; decision on appeal by the Employment Appeal Tribunal in Leicester, Neutral Citation [2022] EAT 178 (this judgment).