Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+

Employment lawCase lawUnfair dismissal

Calculating compensation for unfair dismissal: Software 2000 Limited v Andrews and others (EAT/0533/06)

by Personnel Today 27 Feb 2007
by Personnel Today 27 Feb 2007

Four employees brought unfair dismissal claims in respect of their redundancies. Their complaints mainly related to defects in the selection process, including incorrectly identified selection pools and unduly subjective selection criteria, inconsistently applied.


While the tribunal agreed that the pooling and selection criteria were imperfect, it found that these defects did not themselves make the dismissals unfair. However, it was highly critical of the employer’s failure to provide appropriate guidance to the assessing managers as to how to score employees against the criteria. This, combined with subjective criteria, meant that the dismissals were unfair.


The employer argued that the same individuals would have been selected for redundancy even if a more correct process had been applied.


If that were the case, it argued, provided that the three-stage statutory procedure had been followed, the finding of unfairness should be reversed, since the dismissal of these employees was inevitable.


The tribunal was not persuaded. The selection process was fundamentally flawed so as to make it impossible to predict who would have been selected under a fair process. The tribunal fixed the compensatory award on that basis. The employer appealed against the measure of compensation.



Decision


The Employment Appeal Tribunal (EAT) found that the tribunal should have considered separately the likelihood that these employees would have been dismissed in any event under a fair process and whether a percentage reduction to any compensatory award would therefore be appropriate (following Polkey v AE Dayton Services Limited 1987).


The EAT sent the case back to the tribunal to consider what would have happened had the procedure been fair and the extent, if any, to which the compensatory award should be reduced. The EAT said the tribunal could reach one of four conclusions:




  • The employee was more likely than not to have been dismissed. In this case, statute provides that the dismissal is not unfair (section 98A(2) Employment Rights Act 1996).


  • There was a less than 50% chance that the employee would have been dismissed anyway, with compensation reduced on a percentage basis.


  • The employee would have been dismissed at some time in the future. Compensation should be limited to that period of time.


  • Employment would have continued indefinitely. A tribunal should only reach this conclusion where the absence of reliable evidence prevents it from making a realistic prediction.


Key implications


This case gives useful guidance on whether a dismissal is unfair if the employee would have been dismissed in any event if a fair process had been followed, and compensation due. This issue has been unclear since section 98A(2) was introduced in 2004. The EAT also confirmed that, with rare exceptions, the evidence presented to a tribunal should be enough for it to make a sensible prediction.



By Hayley Robinson, solicitor, Macfarlanes





 

Personnel Today
Personnel Today

Personnel Today articles are written by an expert team of award-winning journalists who have been covering HR and L&D for many years. Some of our content is attributed to "Personnel Today" for a number of reasons, including: when numerous authors are associated with writing or editing a piece; or when the author is unknown (particularly for older articles).

previous post
Mona Lisa guards at Louvre art gallery in Paris to strike for more pay to compensate for stress
next post
Clare Chapman, NHS workforce director-general, says staff engagement is key to health service culture change

You may also like

Uber has more drivers than ever as worker...

11 Aug 2022

‘Pushy’ lawyer awarded £152k for sex discrimination

8 Aug 2022

HMRC looking to recoup £1.4bn from businesses’ use...

1 Aug 2022

Ministers release guidance to clarify UK employment status...

28 Jul 2022

Met loses appeal against reinstating senior officer

27 Jul 2022

Underpayment not reported due to ‘fear and insecurity’

25 Jul 2022

Supreme Court: Holiday pay for part-year staff should...

20 Jul 2022

The risks of sexual harassment in the metaverse

14 Jul 2022

Whistleblower awarded £12k in Subway unfair dismissal case

13 Jul 2022

M&S worker who suffered abuse from shoppers wins...

13 Jul 2022
  • 6 reasons why work-based learning is better than traditional training PROMOTED | A recent Fortune/Deloitte survey found that 71% of CEOs are anticipating that this year’s biggest business disrupter...Read more
  • Strengthening Scotland’s public services through virtual recruiting PROMOTED | This website is Scotland's go-to place for job seekers looking to apply for roles in public services...Read more
  • What’s next for L&D? Enter Alchemist… PROMOTED | It’s time to turn off the tedious and get ready for interactive and immersive learning experiences...Read more
  • Simple mistakes are blighting the onboarding experience PROMOTED | The onboarding of new hires is a company’s best chance...Read more
  • Preventing Burnout: How can HR help key workers get the right help? PROMOTED | Workplace wellbeing may seem a distant memory...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2022

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2022 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+