In DLA Piper’s latest case report, the Court of Appeal considered the familiar question of when an employment tribunal can find an employer’s misconduct dismissal to be unfair, and in what circumstances that finding can be successfully challenged on appeal.
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Newbound v Thames Water Utilities Ltd
Facts
Mr Newbound had been employed in sewer maintenance by Thames Water for 34 years.
Before an annual inspection of a sewer, he and his manager agreed to use breathing apparatus feeding air from above ground.
They went through the safe system of work form, SHE4, which applied to more complex tasks. The SHE4 was a new document and stipulated that breathing apparatus must be used.
Mr Newbound worked alongside Mr King, a contractor, and Mr Andrews, “the competent person in charge”, who was responsible for safety.
While on site, Mr Newbound, Mr King and Mr Andrews discussed whether or not they needed the breathing apparatus and, following a gas test, took the view that they did not. This subsequently came to the attention of Mr Newbound’s manager.
Following an investigation and disciplinary procedure, Mr Newbound was summarily dismissed for gross misconduct. However, Mr Andrews received only a written warning, on the basis that he was less experienced and had shown more remorse.
Tribunal and EAT decisions
The employment tribunal found that Mr Newbound had been unfairly dismissed, holding that the decision was not within the band of reasonable responses. The tribunal highlighted the difference in treatment between Mr Newbound and his colleague.
Thames Water appealed. The Employment Appeal Tribunal (EAT) found that the employment judge had failed to consider the gravity with which Thames Water viewed the misconduct in question.
The EAT said that the judge had substituted his view of the circumstances, rather than considering whether or not Thames Water had acted reasonably. Mr Newbound appealed to the Court of Appeal.
Court of Appeal decision
The appeal was allowed by the Court of Appeal and the tribunal’s unfair dismissal decision restored.
The Court of Appeal emphasised that it was for the employment tribunal to determine the facts, and its decision should be overturned only where there is an error of law or the decision is perverse.
The Court of Appeal considered some of the long-established tests for unfair dismissal.
Once an employer has shown the reason for dismissing an employee, the tribunal must then decide whether or not the dismissal for that reason is fair. The answer to that question depends on whether or not, in the circumstances (including the size and administrative resources of the employer’s undertaking), the employer acted reasonably or unreasonably in treating that reason as sufficient for dismissal.
This includes consideration of whether or not there was a reasonable investigation and reasonable grounds for the belief, and finally whether or not the dismissal was with the range of reasonable responses.
When considering whether or not a dismissal is unfair, a tribunal must also ensure that it does not substitute its view for that of the employer.
The Court of Appeal noted that, while the “band of reasonable responses” has been “a stock phrase in employment law for over 30 years”, the band “is not infinitely wide”.
On the issue of disparity of treatment, the Court of Appeal had to consider whether or not Thames Water had treated similar incidents less seriously and two employees involved in the same incident were treated differently.
When reviewing the employment tribunal’s decision, the Court of Appeal regarded the following as being crucial:
- Thames Water had always given Mr Newbound considerable discretion in how he carried out his work, including in relation to breathing apparatus.
- The SHE4 was only recently introduced and Mr Newbound had received insufficient training on its significance.
- The requirement for breathing apparatus in the SHE4 was discussed quickly between Mr Newbound and his manager and the potential disciplinary consequences of failing to use the apparatus were not explained.
- Although treated more leniently, Mr Andrews had also failed to comply with SHE4 in relation to the breathing apparatus, even though he was in charge of the health and safety aspects of the work.
The Court of Appeal was satisfied that the employment tribunal had applied the correct test and could conclude that dismissal was not within the band of reasonable responses open to Thames Water, particularly given the disparity in treatment between Mr Newbound and Mr Andrews.
Implications for employers
There is often a perception that employers will be given significant latitude to decide whether or not dismissal is appropriate where there have been breaches of health and safety rules.
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This case highlights that such latitude will only go so far, and also clearly shows the importance of consistent treatment of employees who commit the same offence.
Many employers will be sympathetic to Thames Water’s situation in trying to uphold its health and safety duties and safeguard its staff working in hazardous conditions. However, the employment tribunal’s reasoning highlights the need for new procedures to be accompanied by a proper “launch” and appropriate training, and their significance should always be communicated effectively to employees.
