Delayed dismissal resulted in claim of discrimination

Delayed dismissal resulted in claim of discrimination

Employers can often determine whether a new recruit is a good fit for their business within a few weeks.  A good fit does not necessarily always equate to a perfect fit.  Usually, with any new appointment comes an expectation that the individual should demonstrate a commitment to the business work ethic and values.  When it becomes evident that the employee’s work ethic is out of sync with the business, then a common response is to cut ties with the individual. However, as can be seen from the recently reported Employment Appeal Tribunal (EAT) case of Really Easy Car Credit v Thompson [2018] timing and an adequate paper trail demonstrating a fair reason to dismiss, is still key, even when making a decision to dismiss a short serving employee.

The background

The employer in this case operates a family owned second hand car sales business, which trades primarily online. In June 2016 it added Ms Thompson to its compliment of telesales staff, her main role being to make outbound phone calls. Her job offer was made subject to the usual three month probationary period, during which period it was terminable by either side with a weeks’ notice.

During the first few weeks of her employment Thompson failed to make a good impression with her new employer. It quickly became apparent from her conduct and performance that she had a poor work ethic and volatile temperament. As a result, after only a few weeks of her employment commencing, the employer felt it necessary to informally raise its concerns regarding her frequent cigarette breaks, failure to wear correct uniform and poor interactions with her colleagues. The employer also noted that her actual work performance was average in comparison to her colleagues but failed to directly raise this issue with her. 

In the last week of July 2016 Thompson discovered she was pregnant.  By the weekend of that same week she became ill and this situation continued until she was next expected back at work Tuesday, 2 August. However, instead of attending her GP practice or the hospital on Monday, 1 August or during the preceding weekend, Thompson chose to inform her employer by text, on Tuesday 2 August, that she had felt ill since Saturday (30 July) and was taking the day off as sick to go to the hospital. She did not mention at this stage that she was pregnant or that the purpose of her hospital visit was to have a scan to confirm all was well with her unborn child.

When did the employer make the decision to dismiss?

Thompson’s text caused some annoyance and debate between the owner-directors of the business.  One director felt Thompson’s text was “the last straw” in a series of unacceptable conduct and that she should be dismissed. However, the alternative view expressed by other directors was that she should be given the benefit of the doubt. The latter view prevailed and it was agreed to give her another chance and acknowledge her absence as authorised sickness.

When Thompson returned to work on Wednesday 3 August, she had an emotional outburst with a customer. This was brought to the attention of the director in charge of HR issues and he promptly spoke to her about the incident. Thompson became emotional and retired to the restroom for a short period. Later that morning she decided she could not stay at work and went home before her shift ended.

Why did the employer dismiss the employee?

As a result of the morning’s events, the owner-directors reviewed their earlier decision.  They decided that because of her “emotional volatility” and “failure to fit in with [its] work ethic”, she should be dismissed. A letter was drafted on 3 August to inform her of that decision but it was not posted that day. The directors considered it would be better to meet with her first and communicate the decision face to face. The following day, Thursday 4 August, a director telephoned Thompson to arrange a meeting to discuss the decision but during that call Thompson announced she was pregnant. After taking legal advice on the situation the directors decided to proceed with their earlier decision to dismiss the employee, on the basis that the reason for her dismissal was unconnected to her pregnancy and related only to the reasons identified before they became aware of her pregnancy.

What did the Employment Tribunal say?

On the date of dismissal Thompson had less than two years’ service. However, she was still entitled to bring a claim on grounds of automatic unfair dismissal arising from a dismissal connected to a pregnancy and pregnancy discrimination, as these claims required no qualifying period of service. At tribunal the judge held that it should have been obvious to the employer that Thompson’s emotional outburst of 3 August was connected to the hospital visit and her pregnancy. On this basis the employer’s decision to dismiss was therefore connected to her pregnancy.  As a consequence the dismissal was discriminatory on grounds of pregnancy and also automatically unfair.

The employer lodged an appeal against the Employment Tribunal’s (ET) judgement with the EAT on the following grounds:

  1. The ET failed to apply the correct legal test.

  2. The ET had misapplied the law.

  3. The ET has erred in its approach to the burden of proof and failed to make any findings on the explanations for its actions presented by the employer.

  4. The ET had erred by deciding the case on a claim which the employer had no notice of as it had not been presented in the claim put forward by Ms Thompson.

  5. The ET failed to adequately explain its reasoning or approach.

What did the EAT say?

The EAT found in favour of the employer on each of the grounds of appeal, stating that the tribunal had applied an incorrect legal test and in doing so misapplied the law. It also held that the tribunal had made its decision without establishing a number of facts to support its reasoning. “The only finding [the tribunal]… made was that a decision had been taken on 3 August, which was untainted by any knowledge of or belief in the Claimant’s pregnancy.” Notably, the EAT also remarked that once the decision to dismiss had been made on 3 August, there was no legal test requiring the employer to revisit that decision once it became aware of the pregnancy. The case was remitted back to a different tribunal for a rehearing of the facts and a determination of whether the employee’s pregnancy was the reason or primary reason for her dismissal on 5 August.

What can we take away from this case?

This was a successful outcome for the employer at appeal stage but we would recommend that when dismissing an employee with less than two years’ service (one year in Northern Ireland), care should still be taken.  Employers should ensure that their reason for dismissal is fair, reasonable and untainted by discrimination. Whilst it is not necessarily the case that the ACAS code needs to be followed in every instance of short service dismissal, it is good practice to adopt a procedure which is similar to the code. Doing so will undoubtedly create a clear paper trail supported by timely meetings, all of which can be helpful when defending unmeritorious claims. If you are thinking about dismissing an employee and are unsure about whether there are any risks, contact our offices to discuss how we can assist you.

As always, if you have a legal query please get in touch with the FSB Legal Helpline on 0345 0727727 and we'll be happy to assist you.