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Must a final warning be given in good faith to have any effect?

Yes, advises Employment Partner, Paula Stuart, following the recent Court of Appeal decision in  Way v Spectrum Property Care Limited.

The Court of Appeal has ruled that final warnings given in bad faith should not be relied upon when assessing whether or not there was sufficient reason for dismissing an employee.

Paula Stuart says that ‘This case highlights the importance of following a fair disciplinary procedure and ensuring that warnings are properly issued.  A failure to do so could result in an unfair dismissal claim even when the allegations of misconduct have been proven’.

The facts of the case are that Mr Way worked for property service company Spectrum Property Care Limited as an electrical contracts manager. In December 2010 he had been given a final warning in respect of alleged breaches of the company’s recruitment policy. He was said to have assisted his ex-partner’s son to obtain a position with the company. The letter confirming the outcome of the disciplinary hearing stated that the conduct improvement expected of him was to ensure that he was fully familiar with the group’s policies and procedures as detailed in the staff handbook. That warning was still on his file when he was later found to have used his work computer to send inappropriate emails. A subsequent disciplinary hearing found that he had sent offensive emails in breach of the company’s computer usage policy and, in the light of the ‘live’ final written warning, the decision was taken in December 2011 to dismiss him for gross misconduct.

Mr Way brought a claim for unfair dismissal. In rejecting his claim, the Employment Tribunal (ET) found that the disciplinary procedure followed was fair and reasonable and that dismissal was within the band of reasonable responses available to Spectrum in the circumstances. The ET did not address Mr Way’s claim that the final warning given to him in 2010 had been given in bad faith. His contention was that the disciplinary proceedings had been initiated to cover up a more senior employee’s part in the matter and that he was told not to appeal against the warning and ‘it would pay him to forget about the whole thing and move on’.  An employer would not be acting reasonably in taking into account such a warning when deciding whether the employee’s conduct was sufficient reason for dismissing him;

The ET’s ruling was subsequently upheld by the Employment Appeal Tribunal (EAT). Although the EAT acknowledged that the ET had failed to address Mr Way’s allegation that the final written warning had been given in bad faith, it concluded that the failure to address the issue had not affected the outcome of the case. In its view, the warning meant that dismissal was almost inevitable and its fairness could not be doubted.

The Court of Appeal held that a final warning given in bad faith could not be relied upon for the purpose of determining whether there was a good enough reason to justify dismissal and Mr Way’s case was sent back to a freshly constituted ET for reconsideration.

If you require any advice on any disciplinary or dismissal matter, or any other employment matter, please contact Paula Stuart at pstuart@geoffreyleaver.com or on 01908 689345.