Misconduct Uncovered Post-Dismissal

In shedding light on the correct approach to cases where evidence of misconduct is uncovered subsequent to dismissal, the Employment Appeal Tribunal (EAT) has ruled that it was open to an employment tribunal (ET) to find that a fair dismissal was likely to have taken place at a later date and to reduce compensation accordingly.

A hotel engineer had been dismissed on purported lack of capability grounds after he presented expert medical evidence that working night shifts was likely to harm his mental health. His claims of unfair dismissal and disability discrimination were upheld by the ET. However his compensation was reduced by 65% after the employer presented evidence which it had discovered after the man’s dismissal that he had worked on his own account whilst on sick leave.

In dismissing the employee’s appeal, the EAT rejected his plea that the ET had misdirected itself in law when it ruled that, in reaching its conclusion, it had been unnecessary to make a firm finding as to whether there had in fact been gross misconduct on his part. On the basis that the employer had reasonable grounds for believing him guilty of such misconduct, the ET had been entitled to find that the likelihood was that he would have been fairly dismissed. Arguments that the ET’s decision was perverse or inadequately reasoned were also rejected.

The employer had cross-appealed on the basis that the employee should have been awarded nothing for his future loss from the date on which, according to the ET’s findings of fact, he would probably have been fairly dismissed. Rejecting that argument, the EAT found that there was nothing to preclude the ET from making an award on a percentage basis if satisfied that it was more likely than not that the employee would have been fairly dismissed at some point in the future.