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No damages for wrong decision to dismiss

Posted on 10th December 2009
Case law

The High Court has recently confirmed that damages for wrongful dismissal are limited to loss of earnings for the time it would take for the contractual disciplinary procedure to be completed and the employee's contractual notice period.

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Edwards v Chesterfield Royal Hospital NHS Foundation Trust [2009]

Background

Dr Edwards was a consultant employed at the Chesterfield Royal Hospital. In February 2006 Dr Edwards was dismissed for gross professional and personal misconduct. His appeal was unsuccessful.

In High Court proceedings Dr Edwards claimed damages for his three months' notice period. He also claimed damages for the time it would have taken for the Trust to properly complete the disciplinary procedure. Unusually, Dr Edwards also tried to claim damages based on his continued employment as a result of the Trust dismissing the allegations against him, as, he claimed, it should have done.

The decision

The High Court was not impressed with Dr Edwards' attempt to widen the scope for damages for wrongful dismissal. The Trust was allowed to lawfully dismiss Dr Edwards once it had completed its contractual disciplinary procedure by giving him notice to terminate his contract.

The amount of time for an employer to complete the disciplinary procedure will vary from case to case and will depend on the facts.

The High Court looked at the leading authorities and noted that in Gunton v Richmond upon Thames LBC [1980] the Court of Appeal had created the principal of the "Gunton extension" - where damages are recoverable for the loss of salary the employee would have earned had his or her employee followed its contractual disciplinary procedure in addition to damages for the contractual notice period. Importantly, the Gunton extension had not made the employer's right to give notice at the conclusion of the disciplinary proceedings dependant on whether those proceedings upheld the allegations of misconduct.

The High Court concluded that there was no authority to allow an employee to claim greater damages if he could show that the disciplinary proceedings would have prevented his dismissal. Nor was there any right for Dr Edwards to require the court to overturn the decision to dismiss. This would be an issue for an employment tribunal to determine as part of a statutory claim for unfair dismissal.

Comment

Dr Edwards was not able to change the basic principal that an employer is entitled to end a contract of employment as soon as it validly could by giving notice under the contract (see Laverack v Woods of Colchester Ltd [1967]).

Of course the potential trouble with claims for unfair dismissal is the statutory cap on compensation. This was perhaps why Dr Edwards was trying to expand the case law to obtain increased damages for breach of contract.

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