FCA regulated firm entitled to rely on Employment Tribunal findings when determining fitness and propriety

The EAT has held that an FCA regulated firm was entitled to dismiss an approved person without further investigation by relying on the findings of an Employment Tribunal that he lacked credibility as a witness in separate proceedings.

The employee had previously brought an unsuccessful disability discrimination claim whilst employed.  In that claim, the Tribunal made adverse findings about his credibility and evasiveness as a witness and found that he had given misleading evidence.  However, the Tribunal’s findings did not go as far as saying that he had been dishonest. The employer subsequently relied upon the Tribunal’s findings to justify the employee’s dismissal on the basis that he was not ‘fit and proper’. Regulated firms in the financial services sector are obliged to ensure that regulated and certified staff are fit and proper to perform their roles.  No further investigation was carried out by the firm prior to dismissal, save for giving the employee an opportunity to comment on the Tribunal’s findings at the disciplinary hearing.  In concluding that the employee was not fit and proper, the firm took into account the FCA’s guidance that when assessing fitness and propriety all relevant matters should be considered, including whether a person had been criticised by a court or tribunal.

The employee brought an unfair dismissal claim which did not succeed. His appeal to the EAT failed.  The EAT confirmed that his dismissal was fair and that it had been reasonable for the firm to rely on the Tribunal’s findings as to his credibility, which were sufficiently damaging without the need to prove deliberate dishonesty. 

Why this matters

In this case, the firm relied on adverse credibility findings made by the Tribunal, but similar findings as part of an internal investigation would also be relevant when considering a person’s honesty and integrity.  Further, whilst in this case the lack of further investigation into the Tribunal’s findings was not fatal to the fairness of the dismissal, a disciplinary investigation would generally be regarded as best practice.

Radia v Jefferies International Limited

Court of Appeal overturns injunction to stop disciplinary proceedings

The Court of Appeal has overturned a High Court injunction which prevented an NHS Trust from continuing disciplinary proceedings against a doctor until the conclusion of a related police investigation into the doctor’s conduct.

The doctor in question was alleged to have hastened the deaths of a number of patients in his care.  Internal disciplinary proceedings were commenced and the NHS Trust notified the police who commenced a separate criminal investigation.  The doctor applied for and was granted an interim junction by the High Court which prevented the NHS Trust from continuing with its internal disciplinary process until the conclusion of the police investigation. 

The NHS Trust appealed and the Court of Appeal set the injunction aside.  In doing so, it held that in following its internal disciplinary process, the NHS Trust had not destroyed or seriously damaged the implied term of trust and confidence and that there was reasonable and proper cause for the Trust wanting to operate its contractual internal process. Moreover, there was no evidence that continuing with the internal process would risk any miscarriage of justice in the criminal proceedings.

The Court of Appeal did uphold the High Court’s findings that the NHS Trust had wrongly stopped the doctor’s pay whilst he was on suspension. There was no contractual right to do so and no basis to imply a term allowing for a deduction in circumstances where the doctor was ready, willing and able to work but was prevented from doing so because the GMC had suspended his registration to practice.

Why this matters

Employers are generally free to operate their disciplinary processes in accordance with their normal procedures and the courts will rarely intervene.  Further, employers should generally maintain an employee’s pay during any period of suspension where the employee is otherwise ready, willing and able to work. The exception to this is where there is clear contractual right that allows for pay to be withheld by the employer.

North West Anglia NHS Foundation Trust v Gregg

Head teacher was constructively dismissed as a result of a flawed disciplinary process which also amounted to sexual orientation discrimination

The EAT has confirmed that a gay head teacher was entitled to resign and claim constructive dismissal in response to fundamental flaws in a disciplinary process which considered allegations that his conduct (namely, his having sex with two 17 year old boys he met on the app Grindr) had brought the school into disrepute.

At first instance, the Tribunal found that school’s disciplinary and appeal process had been riddled with procedural errors and bias, including the withholding of relevant evidence and unsupportable conclusions being reached by the investigating officer who had significantly overstepped his remit as fact finder.  These findings were upheld by the EAT.  The EAT also upheld the Tribunal’s findings that the way the investigating officer had conducted himself during the disciplinary process amounted to an unconscious bias from which it was possible to infer sexual orientation discrimination.

Why this matters

The importance of running a fair and unbiased disciplinary process cannot be overstated and principles of natural justice should always be adhered to.  Unreasonable behaviour on the part of the employer risks not only an unfair dismissal finding but also opens up the potential for discrimination to be inferred on the facts of the case, where there is no persuasive non-discriminatory explanation for the behaviour in question.

The Governing Body of Tywyn Primary School v Aplin

Tribunal fails to properly consider the reasonableness of an adjustment made for a disabled employee

The EAT has found that an Employment Tribunal failed to properly consider the issue of reasonable adjustments when it determined that there had been no breach of duty by an employer that had ceased to provide a dedicated parking space to a disabled employee.

The claimant suffered from ulcerative colitis which meant that she often needed to go to the toilet urgently. Historically, she had been provided with a dedicated parking space near to the building to allow her easy access to the toilets but this arrangement ceased when she began working at another site.  From then on she was expected to find an appropriate space on a first come first served basis. If she could not then she was permitted to park in an essential user parking bay or otherwise park temporarily in an unauthorised zone. The employer regarded these arrangements as equivalent to giving her a dedicated parking space.

The employee disagreed and brought proceedings.  At first instance, the Tribunal found there had been no breach since the new arrangement was a reasonable adjustment. However, on appeal the EAT found that the Tribunal had not properly approached the question of reasonableness.  Not only had the Tribunal failed to consider the employer’s own policy (which stated that priority for dedicated parking spaces would be given to staff requiring them as a reasonable adjustments) but it had also failed to properly consider the particular disadvantage suffered by the employee which was stress caused by having to find a suitable parking space.  Had the Tribunal done so, then it was unlikely to have concluded that the alternative arrangements were sufficient to discharge the duty.

Why this matters

When considering the reasonableness of an adjustment for a disabled employee, the focus should be on the particular disadvantage caused by the PCP and whether the adjustment in question alleviates the disadvantage to the employee. The case is also a reminder that employers will be expected to follow their own policies on adjustments (where these exist) and only depart from policy where there is a cogent justification for doing so.

Linsley v Commissioners for Her Majesty’s Revenue and Customs

Employer not vicariously responsible for incident at Christmas party

The High Court has held that an employer was not liable for injuries suffered by its employee at a work Christmas party and neither was it vicariously liable for the actions of the individual who caused the injuries.

Cancer Research arranged a Christmas party for staff at its Cambridge research institute.  A risk assessment was undertaken and two additional security staff engaged for the event. On the dance floor, one of the institute’s visiting scientists attempted to pick up a colleague and employee of Cancer Research, but lost his balance and dropped her, which unfortunately caused her a serious back injury. She duly sued Cancer Research for negligence but her claim was rejected by the county court.  She then appealed to the High Court.

The High Court considered the risk assessment that had been undertaken by Cancer Research prior to the event and concluded that it was sufficient.  The court did not accept that it was necessary for the risk assessment to go as far as considering which might happen if someone under the influence of alcohol served at the event did something untoward on the dance floor.  The High Court also held that whilst Cancer Research could in principle be vicariously liable for the acts of the visiting scientist, on the facts there was insufficient connection between the incident and the nature of his work and therefore vicarious liability could not be established.

Why this matters

These types of cases turn on their facts but this case is a helpful reminder that for an employer to be vicariously liable for the acts of its staff, there must be a sufficient connection between the position in which the individual was employed and the unlawful conduct, so as to make it just and reasonable to hold the company legally responsible for the consequences of that conduct.   

Shelbourne v Cancer Research UK

Round up of other developments

Increases to various statutory payments

April 2019 saw an increase to various statutory payments and caps. Highlights include:   

• A rise in the National Living Wage which applies to workers aged 25+ from £7.83 to £8.21 per hour.
• An increase in Statutory Sick Pay (SSP) from £92.05 to £94.25 per week.
• An increase in Statutory Maternity/Paternity/Adoption/Shared Parental Pay and Maternity Allowance from £145.18 to £148.68 per week.
• An increase to the statutory limit on a week’s gross pay from £508 to £525.
• An increase in the maximum compensatory award that can be made in unfair dismissal cases from £83,682 to £86,444.

Increase to Vento bands in discrimination claims

The Vento bands for claims presented on or after 6 April 2019 are as follows:

• Lower band - £900 to £8,800;
• Middle band - £8,800 to £26,300; and
• Upper band - £26,300 - £44,000.

Guidance for employers on women’s progression in the workplace

The Government Equalities Office has published guidance for employers on women’s progression in the workplace and the evidence based actions they can take to support women to progress, help close the gender pay gap and increase gender equality in the workplace.

Good Work Plan changes to employment law

The Employment Rights (Miscellaneous Amendments) Regulations 2019 bring into force various proposals under the government’s policy paper the Good Work Plan, including increasing the financial penalties which can be made against employers who breach worker’s rights (from £5,000 to £20,000, effective 6 April 2019). From 6 April 2020, both workers and employees will be entitled to a statement of employment particulars from the start of their employment.

Plans to modernise the Employment Tribunal Service

The Modernisation of Tribunals: Innovation Plan for 2019/2020 has been published, which sets out various aims and objectives to reform the UK Tribunals system (including the Employment Tribunal Service).  This includes the planned introduction of a digital case management platform so that cases can be managed online and a move towards digital evidence presentation and live video evidence.  It is also intended that hearings will be recorded so as to bring the Tribunals into line with other courts and facilitate open justice.

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