Case for dismissal

In this case Sarah was dismissed prior the transfer. She was found guilty of theft, and theft is commonly considered to be an act capable of gross misconduct, and as such would be considered a fair reason for dismissal. Sarah’s dismissal was therefore not connected to the transfer and any claim she may have will be considered within the standard rules of dismissal and the fact that the company has gone through the transfer will be irrelevant. She is therefore incorrect to bring a claim against Alpha Industries, and should bring her claim against Bartonshire General Hospital.

In determining whether Sarah’s claim may succeed, it is necessary to consider the way in which she was dismissed and any potential claim she may be entitled to. As mentioned above, her claim should be brought against Bartonshire General Hospital. In order to establish whether she could bring a claim in either wrongful or unfair dismissal, it is necessary to consider the requirements under each dismissal. One of the requirements under wrongful dismissal is that the employee had not committed a gross misconduct. As theft is considered to be gross misconduct, she would not be entitled to bring a claim of wrongful dismissal.

In order to bring a claim of unfair dismissal the claimant is required to have been in continuous employment of at least 12 months, must have been an employee, must have been dismissed, and must not be within an excluded class. One of the reasons when dismissal could potentially be fair includes employee’s conduct. Conduct will normally relate to misconduct within employment. The employer has an obligation to ensure that a correct procedure is followed prior to dismissal. This in turn will be adequate evidence when deciding whether employer’s actions were fair.

The employer needs to show that they have carried out an investigation, which should be done as soon as possible in order to avoid or limit any suspension period. The employee should be notified in writing of any investigation being carried into the alleged misconduct. This should then be followed by a meeting in order to give the employee a chance to defend himself. Furthermore, after the meeting, the employee should be notified of his right to appeal a decision involving disciplinary action. However, in cases of gross misconduct, the employer has the right to dismiss the employee without warning.

Even where the employer has shown that the dismissal was due to employee’s conduct, therefore making it a fair dismissal, tribunals will need to be satisfied that the employer had been reasonable in its approach.

Section 98(4) of Employment Rights Act 1996 states that when deciding the fairness of the dismissal, tribunals must consider “the reason shown by the employer, and whether, in the circumstances the employer acted reasonably or unreasonably in treating that reason as a sufficient reason for dismissing the employee".

Reliance on this section had brought into question the correct approach tribunals should take when determining whether the employer had acted reasonably in dismissing the employee. This was considered in Iceland Frozen Foods v Jones [1982] IRLR 439, where it was held that the tribunals should, in deciding reasonability of the employer, take into consideration facts of each case as well as any circumstances particular to the employer, such as the nature and size of employer’s business.

The importance of investigations being carried out by the employer was emphasised in Sainsbury’s Supermarkets v Hitt [2003] IRLR 23. Here the tribunal wrongly based their decision on their own view of what the employer should have done, instead of considering whether actions carried out by the employer in these specific circumstances were reasonable. The Court of Appeal overturned the tribunal’s decision and emphasised the importance of considering whether the employer’s actions were reasonable in those particular circumstances.

In the present case, it appears that the hospital carried out sufficient investigation into Sarah’s misconduct. Although the employer has the right when dealing with gross misconduct cases to dismiss the employee without any notice, the hospital decided to follow the correct procedure and to allow Sarah to appeal against their decision.

Sarah could claim that although the hospital carried out the investigation, the CCTV images were of such a poor quality that they could not positively confirm that she was on those images. In cases of suspected conduct, tribunals will need to be satisfied that the employer had a reasonable suspicion which amounted to an actual belief that the employee was guilty. Furthermore, such belief would need to be based on reasonable grounds, and finally the employer will need to show that he carried out an investigation. Tribunals will consider the investigation and the results of such investigation in order to establish whether the dismissal was fair.

In this case, there is no evidence that the employer failed to follow proper procedure and conduct an appropriate investigation. It is not clear to what extent the employer took the investigation and whether any witnesses had been interviewed. However, it would appear that Sarah had been given an opportunity to dispute the decision on her appeal, and was unsuccessful. It is unlikely that Sarah would be successful in bringing her claim of unfair dismissal against the hospital.

c)

The Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE") regulate business transfer in that it entitles all employees to transfer from one owner to another and retain their existing terms and conditions. This is set out in Regulation 4(1) of TUPE 2006.

Regulations 4(4) and 4(5) of TUPE 2006 further state that any changes that the new employer wishes to implement into the existing employment contract of transferred employees will only be allowed if these changes are not related to the transfer. If the employer is attempting to change the employment contract, he needs to show that the reason for such change is not transfer related, but is an “economic, technical or organisational" reason. This would include change in the workforce or redundancy.

In Wilson v St Helens BC [1998] IRLR 706 it was established that transfer related amendments to the existing employment contract would be considered void, even if the employee had agreed to such changes.

New employer may wish to standardise employment contracts across the board, however, following Delabole Slate Co Ltd v Berriman [1985] IRLR 305, this would not be considered an adequate reason as it is transfer related and therefore any dismissal occurring as a consequence of such change would automatically be deemed unfair dismissal. This is also supported by regulation 7(2) of TUPE 2006, which states that any dismissal occurring as a consequence of the transfer will be automatically unfair, unless the employer can show that the reason for dismissal is economic, technical or organisational one.

TUPE Regulations 2006, therefore, aim to protect employees that are being transferred by ensuring that their employment contracts are not capable of transfer related amendments that will leave the employee worse off. Furthermore, this protection will remain in place even if the employer attempts to change terms and conditions several years later. The employer would again need to demonstrate that any amendments, regardless of when they occur, are not in any way related to the transfer.

In the present case, Alpha is not entitled to standardise and amend terms and condition as such amendment would mean that Hassan Iqbal would receive lesser wage. Any changes Alpha attempted would be considered transfer related, as it is clear that Alpha wished to reduce Hassan’s salary by removing his award on the basis that such award is not available to Alpha’s own employees. It is clear that amending Hassan’s contract of employment does not fall under the economic, technical or organisational reason. Therefore, Alpha will not be entitled to make any changes.

Regulation 7(2) of TUPE 2006 states that any dismissal occurring as a result of the transfer, will automatically be unfair, unless the employer can show that the reason is either economic, technical or organisational. As mentioned above, the reason behind Hassan’s dismissal is neither economic, technical nor organisational. Therefore, Hassan’s dismissal will automatically be classified as unfair dismissal. Hassan’s claim will be against Alpha, who as a transferee company, undertake all liability relating to employment issues arising out of the transfer.

Hassan may be able to bring claims of both wrongful and unfair dismissal. Hassan’s employer at Alpha summarily dismissed Hassan for “refusing to cooperate". This could arguably be inadequate reason to summarily dismiss an employee. An employee will tend to be summarily dismissed for greater misconduct, such as theft. Since Hassan had not committed a gross misconduct allowing the employer to summarily dismiss him, he may be entitled to bring a claim of wrongful dismissal. Damages for wrongful dismissal are wages for the notice period. It would appear that Hassan had already been paid all outstanding notices and holidays. However, it is unclear whether his payout was at his existing salary of £245 per week gross, or, since the award had been withdrawn with immediate effect, at a reduced salary.

Since his dismissal is transfer related, it is automatically unfair, and therefore entitling Hassan to bring a claim of unfair dismissal. Under unfair dismissal, the employee is entitled to claim damages, such as, reinstatement into their old position at the company; re-engagement into a similar position with the employer; or monetary compensation. Financial compensation is the most common damage to be awarded to the employee and it consists of basic and compensatory award. The calculation for basic award takes into account employee’s age, salary and length of service. In this case, Hassan has been in employment for 10 years, and has worked since the age of 42. Therefore, the calculation for his basic award would be as follows:

10 (years) x £245 (gross salary) x 1.5 (weeks – 1.5 week’s salary for each completed year at the age of 41 or over) = £3,675.

Compensatory award is defined in section 123(1) of Employment Rights Act 1996 as an award intended to financially compensate the employee for any loss occurring as a result of dismissal. In determining the extent of an award, the tribunal will consider various factors, such as loss of wages, future loss of wages as well as the manner in which the dismissal occurred. The maximum award available for unfair dismissal is £65,300.

In conclusion, Alpha may potentially face a claim of wrongful and / or unfair dismissal. Since the dismissal is a direct result of the transfer, TUPE Regulations 2006 will apply, and Hassan may be entitled to both basic and compensatory award.

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