Case of the week: Sodexho Defence Services v Steele

Sodexho Defence Services Ltd v Steele


Mrs S L Steele was employed as a manager of a convenience store. The system that the store had for cashing up was that the money was counted and bagged in an office in which there was CCTV. Approximately £10,000 had gone missing over four dates between April and July. On these four occasions, Steele was responsible for counting and bagging the money and she had signed all of the entries relating to the bagging up process.

Following an investigation, the respondent concluded that Steele had turned off the CCTV tape while she carrying out the bagging process with a colleague, Mrs Saunders, during the instance when money went missing in July. Steele was seen on the tape approaching the camera and turning it off. She admitted that the money bags could not be opened once they were sealed and that she should have kept the tape running when it went off. The respondent also concluded that the money could not have gone missing after the bagging up process. The respondent dismissed Steele on the basis that she was guilty of theft. Saunders left the respondent’s employment, for an unconnected reason, before the disciplinary procedure was commenced.

The employment tribunal found that the dismissal was unfair and criticised the respondent for not commencing disciplinary action against Saunders despite her having left the respondent’s employment by the time the disciplinary procedure was conducted. The tribunal concluded that the difference in treatment between Steele and Saunders was “wholly irrational and wholly undermines the third limb of Birchall” (which requires an employer to show that at the time it formed the belief that the employee was guilty of misconduct it had carried our as much investigation as was reasonable in the circumstances). The tribunal therefore held that the respondent had not carried out a proper investigation. The respondent, Sodexho Defence Services, appealed against the tribunal’s decision on the basis that it was perverse.


The Employment Appeal Tribunal (EAT) agreed, overturned the decision, and made a finding of fair dismissal. The EAT found that the tribunal had not sought to judge the reasonableness of the respondent’s conclusions but had rather substituted its own views. The EAT commented that “any employer was entitled to take the view that the claimant was guilty and the investigation that was conducted.was entirely adequate. There was clearly an act of serious misconduct, there was no legitimate reason for turning off the CCTV tape.”

In relation to tribunals’ finding of disparity of treatment, the EAT held there could not be any disparity of treatment as Saunders was not employed by the respondent by the time the disciplinary procedure was conducted. This in itself undermined the tribunal’s decision.


This case serves as a useful reminder that, when considering the fairness of a dismissal, the tribunal must not put themselves in the position of employers and consider what they themselves would have done in the circumstances. What a tribunal must decide is not what it would have done if it had been management, but whether the employer acted reasonably. Here, the facts of the case were such that on any commonsense view, the respondent had conducted a reasonable investigation and was entitled to conclude that Steele was guilty of theft. The tribunal had erred by substituting its view as to the adequacy of the investigation.

Rita Mehta, solicitor, Thomas Eggar

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