O DAFIAGHOR-OLOMU v COMMUNITY INTEGRATED CARE

The Employment Appeal Tribunal interpreted section 124(5) of the Employment Rights Act 1996 to require that prior payments made by the respondent be deducted from the tribunal's assessment of the total compensatory award before the statutory cap is applied. The EAT therefore treated the earlier payment to account as reducing the amount to which the cap was applied.

The EAT also held that an application to reconsider under Schedule 1 paragraph 72 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 can properly be refused where there is no reasonable prospect of varying or revoking the original decision, including where fresh vacancy evidence would not alter the outcome unless the employee changed her position. The tribunal's refusal to reconsider re-engagement in those circumstances was not manifestly wrong.

Background and parties: The appellant, Mrs O Dafiaghor-Olomu, was held to have been unfairly dismissed by Community Integrated Care. She sought re-engagement and compensation. Following a first remedies hearing the tribunal awarded compensation and refused re-engagement. The appellant succeeded on appeal to the EAT and the matter was remitted to the Employment Tribunal for a second remedies hearing.

Procedural posture: At the second remedies hearing the ET increased the compensatory award to a total of £128,961.59 and again refused to order re-engagement. The respondent had already paid the earlier award of £46,153.55. The tribunal then considered whether the prior payment should be deducted before applying the statutory cap of £74,200. The appellant applied for reconsideration of the refusal to order re-engagement; two reconsideration applications were refused by the Employment Judge (decisions dated 17 and 18 September 2018).

Issues: (i) Whether, for the purposes of section 124(5) ERA 1996, payments already made by the respondent must be deducted from the tribunal's assessment of total compensation before applying the statutory cap; (ii) Whether the Employment Judge erred in refusing to allow reconsideration under Schedule 1 paragraph 72 of the 2013 Regulations on the basis that there was no reasonable prospect of varying the decision; and (iii) Whether the ET could revisit compensation when the case was remitted to consider re-engagement.

Court's reasoning and decision: The EAT concluded that the phrase "after taking into account any payment made by the respondent" in section 124(5) requires the tribunal to deduct payments to account from the figure it would otherwise award, and then to apply the statutory cap to that reduced figure. The EAT accepted that this may result in no practical benefit to an employer who complied with an earlier award but held the statutory wording mandated that approach. On reconsideration, the EAT endorsed the Employment Judge's application of Schedule 1 paragraph 72: the judge may refuse reconsideration where there is no reasonable prospect of varying the decision. In this case the tribunal was entitled to conclude that, because of the appellant's refusal to consider roles the tribunal and respondent judged suitable, fresh vacancy lists would not realistically alter the outcome unless the appellant changed her stance. Finally, the EAT held that the ET was entitled to revisit compensation when deciding not to re-engage, and the respondent's cross-appeal on competence to revisit compensation failed.

The appeal was allowed in part and otherwise dismissed. The EAT varied the ET's compensation order so that prior payments were deducted before applying the statutory cap, resulting in an award of £74,200 to the appellant. The EAT upheld the Employment Judge's refusal to reopen the re-engagement issue under Schedule 1 paragraph 72 because there was no reasonable prospect that fresh vacancy evidence would change the outcome absent a change in the appellant's position.

At first instance the Employment Tribunal found unfair dismissal, awarded compensation and refused re-engagement (First Remedies Hearing). The appellant appealed to the EAT; an earlier EAT decision concerning competency (UKEATS/0036/18/SS) resolved a challenge to the competency of the appeal. The EAT remitted the case for a Second Remedies Hearing. The ET issued its second remedies judgment on 28 August 2018; the appellant sought reconsideration (17 and 18 September 2018) which was refused. The present EAT judgment is [2022] EAT 84.