SPI Spirits (UK) Limited & Anor v Vladislav Zabelin

A contractual term cannot be used, through the tribunal’s just and equitable discretion, to achieve a fixed cap on statutory compensation which would be void under section 203 of the Employment Rights Act 1996. Compensation should ordinarily reflect the underlying loss, subject to the statutory scheme.

The grievance provisions of the ACAS Code require a written grievance. A further written grievance is not required merely because closely related concerns are developed at a grievance meeting. Whether the disciplinary provisions apply depends on the employer’s contemporaneous allegation of culpable conduct, not on the tribunal’s later finding that the conduct was a protected disclosure. An uplift may extend to an individual agent responsible for the employer’s procedural failure.

The claimant, an employee of the first respondent, raised written concerns about proposed pay and bonus reductions. At a subsequent meeting and telephone call he made protected disclosures. The Employment Tribunal found that the second respondent, acting as the employer’s agent, subjected him to detriment and dismissed him because of those disclosures. It made compensation awards, including a 20% ACAS Code uplift.

The respondents appealed the remedy decision. They contended that contractual termination provisions limited compensation to £270,000 net, that the grievance procedure was not engaged, and that an uplift could not be made against the individual agent. The central issues concerned the effect of section 203 of the Employment Rights Act 1996 and the application of the ACAS Code under section 207A of the Trade Union and Labour Relations (Consolidation) Act 1992.

1. Appeal dismissed. The tribunal had considered the respondents’ argument that the contractual provisions and their negotiation made it just and equitable to limit compensation. It was entitled to reject it.

2. Properly construed, the clauses guaranteed a contractual payment of £270,000 net and contemplated credit or set-off for other termination entitlements. They did not cap an Employment Tribunal award. In any event, using them to limit the awards to that figure would in substance impose an unenforceable contractual cap. That would contradict section 203 of the Employment Rights Act 1996 and Parliament’s decision not to cap compensation for dismissal for protected disclosure. The same conclusion applied to detriment compensation under section 49(2), whose relevant language was materially the same as section 123(1).

3. The grievance part of the ACAS Code was engaged only when a grievance was put in writing. The EAT followed Cadogan Hotel Partners Ltd v Ozog. The claimant’s email of 4 June was a written grievance. The related concerns developed at the 5 June meeting did not materially change its underlying subject matter or the redress sought. The tribunal was entitled to find that no further written grievance was required.

4. Independently, the disciplinary part of the Code was applicable. Its application turns on the employer’s contemporaneous reaction to conduct it regards as, or potentially as, culpable. It does not turn on the tribunal’s later conclusion that the conduct was a protected disclosure. The second respondent dismissed the claimant in reaction to his stance and no fair procedure was followed. The tribunal’s alternative conclusion that a 20% uplift was justified under the disciplinary provisions therefore supported the result.

5. Section 207A permits an uplift of an award against an individual agent where that person was responsible for the employer’s failure to follow the Code. The second respondent was responsible for the procedural failure. The tribunal could therefore uplift the award against him as well as the employer.

• Employment Appeal Tribunal: appeal dismissed: [2023] EAT 147.
• Employment Tribunal, London Central: found protected-disclosure detriment and automatic unfair dismissal, then awarded compensation with a 20% ACAS Code uplift. No citation was stated.