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Russell Cooke Solicitors - Employment Law Update

June 2010


Welcome to the latest edition of the Employment Law Update brought to you by the employment team at Russell-Cooke. The aim of this service is to keep you informed of recent developments in this fast moving field of law so that you are better prepared to deal with issues as they arise in your workplace and recognise when professional advice might be required.

Contact details for members of the team are provided at the end of the Update. If you have a query about the issues covered or about any employment law related matter please do not hesitate to get in touch.

In this update:

  • Salford Royal NHS Foundation Trust v Roldan [2010] EWCA Civ 522 – dismissal for gross misconduct held to be unfair as the employer failed to properly test the evidence against the employee
  • Ward Hadaway Solicitors v Capsticks Solicitors LLP UKEAT/0471/09/SM – TUPE held not to apply when an organisation removed one firm of solicitors from its panel and introduced a new firm
  • Edwards v Chesterfield Royal Hospital NHS Foundation Trust [2010] EWCA Civ 571 - Failure to follow a contractual disciplinary procedure is a breach of contract that can give rise to a claim for uncapped damages in the County Court
  • New Government halts the Vetting and Barring Scheme
  • Lawless v Print Plus UKEAT/0333/09/JOJ – the EAT discusses the factors that may be relevant when awarding uplifts on compensation


Salford Royal NHS Foundation Trust v Roldan

Dismissal for gross misconduct unfair due to a failure to carry out a fair investigation and test the evidence of the witness against the Claimant. In cases where the consequences of dismissal are particularly serious, such as a possible reference to the Independent Safeguarding Authority or to the police, a particularly careful and thorough investigation is required.

Ms Roldan was a Registered Nurse who was dismissed after four years of service, following a complaint that she had mistreated a patient. The employer, having suspended her and investigated the matter, relied on the evidence of another employee who had recently joined the Trust. The Claimant accepted that two of the allegations were in part true but raised points in mitigation, namely that one incident: throwing wipes which had landed on the patient’s face, had been accidental and that a gesture she had made to the patient had been intended to mollify the patient and had been misinterpreted as offensive by the witness. However the Claimant denied other allegations, including the claim that she had slapped the patient’s hand and tapped the patient’s foot with increasing force. She also denied looking around to check if she was being observed, which was relied on as evidence of malice or intent. The employer’s investigating officer noted that it was not in fact possible for other people to see into the room where the alleged incidents took place. However, this possible inconsistency between the witness’ claim that the Claimant did check whether she was being observed and the evidence that she would not have been seen in any event was not considered further by the employer.

The Court of Appeal held that the Tribunal was entitled to conclude that, in the light of the fact that this particular case turned on a conflict of evidence between the Claimant and the witness, the employer should have tested the evidence of the witness where it was possible to do so. This would have included further enquiry into whether it was likely that the Claimant would have been visible from outside the room and whether this would have been apparent to the Claimant. If evidence indicated it was not possible to see into the room, this would cast a significant doubt on the witness’s evidence. This point was particularly significant because of the allegation that the Claimant had been acting in a way that was deliberate and malicious. If it had been found that her actions were not premeditated a reasonable employer may well have taken the view that in light of her years of good service and clean record, one incident of poor conduct in the heat of the moment did not merit such a severe sanction. Equally, if the investigating officer was wrong and people could see into the room, the employer had failed to discover whether or not there were any other witness'.

It was also noted by the Court of Appeal that in a situation where there is a conflict of evidence between employees, with little or no other evidence to corroborate either version of events, an employer is not obliged to believe one employee and disbelieve another. In some cases it may be acceptable for employers to find that the case against an employee is not proved, without saying that they disbelieve witnesses. In particular, this may be appropriate where the employer tends to believe that the complaining witness is giving accurate evidence but the allegations are out of character for an employee who has many years of good service; in such cases it will be perfectly proper for the employer to give the alleged wrongdoer the benefit of the doubt.

This case is particularly significant for organisations working in the health and social care sectors, as the court was heavily influenced by the serious consequences of being dismissed for misconduct in this area. The Claimant was facing deportation and was in fact prosecuted (and acquitted) in relation to the incidents which hadled to her dismissal. While Tribunals are not entitled to put themselves in the shoes of the employer and rehear the case against the employee, this case highlights the importance of carrying out an enquiry which focuses equally on the allegations and on all evidence that may exculpate the employee.


Ward Hadaway Solicitors v Capsticks Solicitors LLP

A TUPE service provision does not occur where a contract for the provision of services is transferred from one provider to another, but matters which are still ongoing remain with the original provider.

This case arose from an unfair dismissal claim but the appeal was concerned with the applicability of TUPE to the provision of on-going legal services. Ward Hadaway (the Appellant) was one of a panel of solicitors’ firms who provided legal services for the Nursing and Midwifery Council (NMC). In 2007, following a tender process, the NMC selected Capsticks (the Respondent) as the sole provider of its legal services and took in-house significant elements of the services which had previously been undertaken by the Appellant.

The Tribunal had to consider whether the NMC’s decision to re-tender its legal services amounted to a ‘service provision change’ under the TUPE Regulations. The Tribunal accepted that there was an organised grouping of employees who had a principal purpose of carrying out activities for the NMC. The Tribunal viewed the “activities” as being split into two elements: work in progress and the expectation of future work. It held that only the work in progress was an activity under TUPE as the expectation of future work could not sensibly be viewed as an “activity” due to the lack of guarantees as to the amount and nature of the work that might be received in the future.

After 1 October 2007 the NMC gave new instructions to the Respondents, but the Appellants continued to work on the significant number of ongoing matters referred to them before this date. In light of this the Tribunal found that the work in progress did not transfer to the Respondent and no activity ceased to be carried out. Therefore TUPE did not apply. In the alternative the Tribunal also found that even if both work in progress and the expectation of work were “activities” for the purposes of TUPE, there would still be no service provision change, as the scope of the work before and after the change in supplier was reduced. The decision to take elements of the work in house was sufficient to change the nature of the activities that moved to Capsticks.

Ward Hadaway appealed on the basis that the Tribunal had incorrectly narrowed its focus in treating as activities work in progress, but not the expectation of work. In addition, the Appellant argued that the Tribunal had incorrectly depicted the differences in the work undertaken before and after the change in suppliers. However, the EAT upheld the original decision, finding that it was open to the Tribunal to define “activities” narrowly in this case.

This decision will be of interest to employers who obtain work through outsourcing and tendering processes, particularly where it is possible or desirable to provide the service in an innovative way. However, it is unlikely that this case will create a clear rule in this area as the applicability of TUPE will continue to depend on the individual facts of each case.


Edwards v Chesterfield Royal Hospital NHS Foundation Trust

Failure to follow a contractual disciplinary procedure is a breach of contract that can give rise to a claim for uncapped damages in the County Court. The employee will be able to claim damages for full loss of earnings and is not restricted to claiming their notice pay.

Mr Edwards was employed by the Trust as a consultant trauma and orthopaedic surgeon and was dismissed following allegations of serious personal and professional misconduct. Following his dismissal he was able to find work as a locum but argued that he would not be able to find another permanent position because of the way in which the Trust had dismissed him, and that,a as result, his career had suffered life-long damage. He issued a claim for breach of contract in the County Court, seeking damages in the region of £4 million.

Mr Edwards relied on the fact that the Trust’s disciplinary procedure was a contractual procedure and provided that the disciplinary panel should include a clinician of the same discipline and a legally qualified chairman. These requirements had not been followed and Mr Edwards argued that the outcome of the disciplinary procedure would have been different if they had been.

The Trust argued that, even if Mr Edwards’ claim was successful, damages should be limited to his earnings for his notice period and the additional time it would have taken to follow the correct procedure. It relied on the established principle in Johnson v Unisys that individuals could not argue that an unfair dismissal amounted to a breach of contract (in particular a breach of the implied term of trust and confidence) to try and claim damages in the County Court. Parliament had set down a specific regime for unfair dismissals, with a cap on the level of compensation that can be awarded, and this could not be circumvented. The Trust succeeded in the High Court and the employee appealed.

The Court of Appeal upheld the appeal. In this case, both parties had agreed to contractual disciplinary procedures. Employers are not obliged to include or agree to such a term in a contract but where such a term is present it will be binding. As a result, the prohibition on individuals claiming (uncapped) damages in the county court for the way in which they were dismissed was not relevant. Other breaches of contract gave rise to breach of contract claims and, in these circumstances, it was open to the employee to seek to recover all the losses that arose from that breach.

This case underlines the potentially serious consequences for employers who choose to make workplace policies contractual and highlights the need for organisations to review their contracts and take advice on the status of their policies where necessary.


New Government halts the Vetting and Barring Scheme

The original Vetting and Barring Scheme was due to extend the scope of compulsory checks on staff and volunteers who have contact with children and vulnerable adults, with voluntary registration due to commence on 26 July. However, the coalition government has suspended this, taking the view that the scheme is disproportionate, overly burdensome and an undue infringement on civil liberties. The planned changes to the scheme have not yet been announced.

The Independent Safeguarding Authority will continue to make barring decisions, following its existing procedures. Employers are still required to refer information to the ISA if they have moved or dismissed an individual because of a risk of harm to a child or vulnerable adult and should ensure that they continue to comply with this requirement.


Lawless v Print Plus

The extent of a failure to follow procedures, the employer’s intentions, the language used and the size and history of an organisation, may all be relevant when a Tribunal considers a request for an uplift on compensation payable by the employer.

Mr Lawless was employed by a small family run printing business and was dismissed in February 2008. At that time the statutory dispute resolution procedures were still in force (they were subsequently abolished with effect from April 2009) and his dismissal was automatically unfair, due to a failure to follow the statutory procedure. The Employment Tribunal awarded a 10% uplift on compensation but also held that the Claimant’s compensation should be calculated on the basis that, even if the employer had followed a fair procedure, the Claimant would have been dismissed in any event. The Claimant appealed.

The Employment Appeal Tribunal noted that, when considering the appropriate level of the uplift, relevant factors include whether the procedures were ignored completely or applied to a certain extent; whether the failures were deliberate or inadvertent and whether there were any mitigating factors in the employer’s favour. The size and resources of the employer may also be relevant. However, it was not to be assumed that failures by small organisations would not merit a higher uplift. In this particular case, a higher uplift was appropriate, due to the complete failure to follow any procedures and the offensive language used in the employer’s final letter to the employee, refusing to hold an appeal. While the organisation was small, it was well established and had 8 employees, as well as recent experience of employment law requirements, having dismissed staff in the past. While the manager may have been under financial pressure when making the decision to dismiss the Claimant, he maintained his inflexible attitude when he received letters from the Claimant some weeks after the dismissal. The EAT therefore held that the employee was entitled to a 40% uplift on compensation.

In addition, it was held that the employee’s compensation should not be limited to a month’s additional earnings. While the redundancy situation was genuine, there was a chance that the employee would have been able to retain his job if a fair selection process had been carried out.

While the statutory dispute resolution procedures are now behind us, unreasonable failures to comply with the ACAS Code that has replaced them by either employer or employee can still lead to uplifts or reductions in compensation of up to 25% and it is likely that Tribunals will take the same factors into account when excising their discretion in relation to uplifts under the new regime.


Contact us:

The Employment Team
Russell-Cooke Solicitors,
2 Putney Hill,
SW15 6AB

Tel: 020 8789 9111


This material does not give a full statement of the law. It is intended for guidance only, and is not a substitute for professional advice. No responsibility for loss occasioned as a result of any person acting or refraining from acting can be accepted by Russell-Cooke.

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The Employment Team at Russell-Cooke
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