Summary

In exceptional circumstances, an employer’s failure to follow proper procedural steps prior to dismissal will not render that dismissal an unfair one.

The Law

Section 98 of the Employment Rights Act 1996 deals with unfair dismissal. It provides a list of the reasons under which a dismissal would be considered fair and puts the requirement on employers to be reasonable when dismissing employees.

It goes on to direct employment tribunals that to answer the question of whether the dismissal is fair or unfair (having regard to the reason shown by the employer), it depends on whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonably in treating the reason as a sufficient reason for dismissing the employee.

Iceland Frozen Foods Ltd v Jones [1982]

This case held that when assessing reasonableness, the employment tribunal must focus on whether the employer’s decision was within the range of reasonable responses for a reasonable employer in all the circumstances. It must not substitute its own view instead.

Polkey v AE Dayton Services Ltd [1988]

This case addressed the fairness of a dismissal where the employer has failed to follow proper procedural steps. In it, it was held that there are exceptional circumstances where an employer’s failure to follow procedure may not amount to an unfair dismissal if it can be shown that the procedural steps would have made no difference to the outcome.

Turner v Vestric Ltd [1980]

In this case, there was no attempt at all to solve the problem before dismissal. It was held that “where a dismissal was due to a breakdown in a working relationship it was necessary, before deciding whether or not the dismissal was fair, to ascertain whether the employers had taken reasonable steps to try to improve the relationship; that to establish that the dismissal was not unfair, the employers had to show not only that there had been a breakdown but that the breakdown was irremediable”.

The Facts

The claimant worked for the respondent in a senior position on projects relating to 5G technology, until they contracted Covid-19 and took time off sick as they struggled with its long-term effect. Whilst the claimant was absent on sick leave, the respondent decided to no longer pursue those projects, which prompted a redundancy consultation which included the claimant’s role.

The claimant refused to participate in the consultation, due to their ongoing ill health. They did however raise a grievance against it, which was partially upheld. The element that was upheld was that the claimant’s line manager had put undue weight on the claimant’s 5G experience when putting their role at risk, and that the claimant’s other skills, experience and delivery had not been adequately considered. Following the outcome of the grievance, the claimant behaved in a “confrontational manner”, accusing their manager of being incompetent and making things up. They also declared their intention to raise further grievances and take the matter to an employment tribunal. Following this, further attempts to restart the redundancy were made but abandoned, and the claimant commenced a phased return to work.

Once the claimant was back working, two options were put to them: continue reporting to the manager in the same team or find an equivalent role elsewhere in the business. Neither option however was acceptable to the claimant who attempted to put a number of conditions on the agreement, which the respondent refused to allow. The claimant then rejected both an offer of coaching to try and repair their relationship with their manager and a newly created alternative role under a different manager. To the claimant, the new role was a demotion and would amount to constructive dismissal. This prompted the respondent to decide the employment relationship had irretrievably broken down and for this reason it terminated the claimant’s employment. This was without any formal warnings or right of appeal but did come with payment in lieu of notice.

The claimant brought various claims including automatically unfair dismissal for making a protected disclosure, ordinary unfair dismissal and failure to make reasonable adjustments.

Decision: Employment Tribunal (ET)

It was held by the ET that the respondent had made genuine attempts to resolve the situation with the claimant, but to no avail. Faced with dismissal as the only option, when deciding to dismiss the claimant the respondent was found to have formed a reasonable belief that the relationship of trust and confidence between the parties had broken down irretrievably. On this basis, the ET rejected the victimisation and automatic unfair dismissal claim, because there was nothing to suggest these were considerations for the respondent when making the decision to dismiss.

The ET concluded that this case was one of those rare occasions when a dismissal that does not follow a written warning, nor offers the claimant the chance to appeal, still falls within the range of reasonable responses that a reasonable employer would have. As such, the unfair dismissal claim was also dismissed.

The claimant appealed.

Decision: Employment Appeal Tribunal (EAT)

Before the EAT, it was argued that the ET had wrongly decided that the dismissal was fair, despite the fact it failed to follow the usual recognised process. Applying Polkey, the EAT highlighted the efforts the respondent had made to accommodate the claimant’s requests, and to rebuild the relationship between them. The fact these were continually rejected, and the claimant’s refusal of any of the solutions put to them, including the alternative role, meant that this situation fell within the exception in Polkey and that any other procedural steps would not have made any difference to the situation they found themselves in.

The EAT also applied the principle from Turner that whilst employers do not have to take “all reasonable steps” before dismissing due to the breakdown of the employment relationship, genuine efforts should still be made. It also held that the responsibility for repairing the relationship was borne by the employer where it was to blame for the relationship breaking down. In this case, the EAT held, the only blame that could be attributed to the respondent was failing to consider the claimant’s experience in skills in the redundancy process, which was upheld in the grievance.

Takeaway Points

This case very much turned on its own facts, which are unlikely to arise in many other cases. However, it does provide a useful reminder that there can be times when a dismissal is carried out without proper process but is not an unfair dismissal. For that to be the case, the employer must have a genuine belief that further attempts at reconciliation are futile and that dismissal is in reality the only viable option. It must also have made reasonable attempts to fix the relationship that the employee is unwilling to accept.

What is clear is that dismissals without process are not to be taken lightly, and only in exceptional cases will a decision such as the one in this case be found not to be unfair dismissal. This case does not remove the need for an employer to act reasonably, but instead reinforces the point that significant attempts must be made to repair the relationship before concluding that it is unfixable.