The Acas Code of Practice states that employees should not normally be dismissed for their first misconduct offence, and should be given a chance to improve, using a written warning. Acas advises that a warning should last for a set period, after which it should be disregarded for disciplinary purposes.
The Court of Appeal in this case considered whether an employer is entitled to have regard to an expired warning – or rather the conduct that led to that warning – when considering disciplinary action.
In July 2004, Webb, an aircraft fitter employed by Airbus, was given a 12-month final written warning for misuse of Airbus premises and equipment and the fraudulent misuse of company time, which expired in August 2005. Shortly afterwards, Webb and four colleagues were found watching television in the locker room when they were supposed to be working. Airbus regarded this as gross misconduct. Webb was dismissed his colleagues, who had good disciplinary records, were given final written warnings and taken off the night shift.
Webb brought an unfair dismissal claim, and argued that Airbus should not have relied on the expired warning to dismiss him. The employment tribunal and Employment Appeal Tribunal (EAT) both said that an expired final warning should be disregarded for all purposes, relying on the Court of Session’s decision in Diosynth Limited v Thomson. In Diosynth, the employer had relied on an expired warning to tip the balance in favour of dismissal and, without it, the other factors would not have justified dismissal. The decision there was that an employer cannot rely on an expired warning as the determining factor in deciding whether to dismiss an employee.
The Court of Appeal disagreed with both the tribunal and the EAT, overturned the unfair dismissal finding, and said that it was not necessarily unreasonable to take a spent warning into account. The court said that the facts in Diosynth were different because the employee would not have been dismissed had the expired warning not been considered. In this case, Webb had committed an act of gross misconduct for which dismissal was within the range of reasonable responses – regardless of the warning.
The Court of Appeal has examined the question of the employment status (or otherwise) of an individual supplied to work for a client by an agency. A key problem underlying this type of case is that, while the worker is engaged and paid by the agency, for all intents and purposes, they are part of the client’s (end-user’s) team working alongside the end-user’s employees, sometimes for many months or even years on end.
The debate set in with the case of Dacas v Brook Street Bureau in 2004, which said that there could be an implied contract of employment between the client or end-user and the worker, particularly where the individual had worked for the end-user over a course of a number of years. The Greenwich decision, to some extent, moves away from Dacas in that it says that the mere passage of time does not mean that the worker will automatically be an employee of the end-user. Instead, the Court of Appeal has said that, in the absence of an express written contract with the end-user, a contract of employment should not be implied unless it is necessary to do so.
Instead, you have to look at how the arrangements work in practice, who controls the worker, who disciplines the worker, who pays the worker, and the history of the relationship. Was the worker directly employed by the end-user before moving across to the agency? All of these are relevant factors. The end result which was recognised by the Court of Appeal is that there is a lack of certainty in these cases, and that can be a headache for companies engaging agency workers.
The court chose not to make new law, and instead said that this would be a matter of economic and social policy for parliament.
It is important to separate the penalty from the misconduct. While a penalty can be time-limited, the misconduct cannot be. After a warning has expired, it cannot can be relied upon as a reason for dismissal in its own right. But that does not necessarily mean the underlying misconduct should no longer be relevant to the reasonableness of the employer’s reaction to any later misconduct.
What you should do
- Do not rely on an expired warning as a reason for dismissal. However, if you have a reason to dismiss, you may take account of past misconduct to determine the appropriate sanction.
- Take care when making dismissal decisions and drafting letters to avoid any suggestion that an expired warning formed any part of the reason for dismissal. Only refer to an expired warning in terms of mitigation.