Katherine was a star!
Stuart v London City Airport Limited | 2013
Conduct is a potentially fair reason for dismissing an employee. However, for the dismissal to be fair an employer must have followed a fair dismissal procedure.
It is for the employment tribunal to decide whether or not the procedure followed by the employer was fair. For the tribunal to find that the procedure was fair in a misconduct case it will need to satisfy itself that:
- the employer had a genuine belief in the employee’s guilt
- the belief was reasonable for the employer to hold; and
- it was reached after the employer had carried out as much investigation as was reasonable in the circumstances.
In this case the Court of Appeal had to decide whether the employment tribunal had been correct in deciding that a reasonable investigation had been carried out in a case of alleged theft.
Mr Stuart worked at London City Airport (‘LCA’). While on an official break Mr Stuart went into the airport departure lounge and visited the duty free shop. A member of staff at the duty free shop suspected Mr Stuart had taken some goods without paying for them. The police were called and Mr Stuart was apprehended in the shop next door to the duty free shop. He was found to have in his possession a bottle of perfume and two lipsticks for which he had not paid.
Mr Stuart was suspended and a disciplinary procedure was started.
Mr Stuart’s argument was that he had picked up a number of items and then, while waiting in the queue, he had been beckoned over to a seating area outside the shop by a colleague. Mr Stuart argued that he had no intention of stealing the items and that he felt he was still in the general shop area.
Mr Dodds carried out the investigation on behalf of LCA. He took oral statements from Mr Stuart and the manager of the duty free shop. He also took a written statement from the employee of the duty free shop who had first suspected Mr Stuart had stolen the goods.
Mr Dodds concluded from the statements that the duty free shop manager had not seen Mr Stuart doing anything suspicious. However, he had been informed that Mr Stuart was acting suspiciously and that he had left the shop without paying for some items. The manager had then called airport security and the police became involved.
Mr Dodds concluded that the shop was clearly marked and Mr Stuart had left the boundaries of the shop without paying for the perfume or the two lipsticks. However, Mr Dodds did not review any CCTV footage or interview other witnesses who had witnessed the incident.
LCA summarily dismissed Mr Stuart for dishonest conduct and breach of trust. Mr Stuart appealed but he was unsuccessful in his appeal.
A fair dismissal?
Then, Mr Stuart brought a claim for unfair dismissal. The employment tribunal held that the investigation carried out by LCA was reasonable and that the decision to dismiss Mr Stuart was fair.
Appeal to the Employment Appeal Tribunal (‘EAT’)
Mr Stuart appealed to the EAT on the grounds that the employment tribunal’s decision was perverse. He argued that the allegations reflected very seriously on his character and therefore, it was incumbent on the employer to investigate the circumstances carefully. In these circumstances, a reasonable investigation required more than ensuring that Mr Stuart had left the shop. He argued that the allegation that he had concealed the items should have been examined in greater detail. He said that additional evidence such as CCTV footage should have been considered and additional witnesses should have been interviewed.
The EAT allowed Mr Stuart’s appeal. It found that the tribunal’s conclusion that LCA had formed a reasonable belief as to Mr Stuart’s dishonesty and breach of trust on reasonable grounds, following a reasonable investigation was unsustainable. On that basis it held that the employment tribunal’s decision had been perverse.
LCA appealed to the Court of Appeal.
The Court of Appeal’s decision
The Court of Appeal restored the decision of the employment tribunal holding that Mr Stuart had been fairly dismissed. It concluded the employment tribunal’s decision was not perverse. The employment tribunal had directed itself correctly and had specifically addressed the criticisms that Mr Stuart had made about LCA’s investigation.
The Court of Appeal said it was important to consider the level of investigation required by LCA. The EAT had criticised LCA’s failure to look at CCTV footage or interview a potential witness. The witness and the CCTV footage could have shed light on whether or not Mr Stuart was concealing items. The EAT found that the circumstances went to the heart of the allegation of dishonesty. However, the Court of Appeal highlighted the fact that Mr Stuart’s defence in the disciplinary and appeal hearings had been that he had not knowingly left the duty free shop area. LCA had thoroughly investigated that point. This included visiting the area concerned. Following the visit the disciplinary and appeal officers concluded that the demarcations were clear and therefore Mr Stuart could not have been under the impression that he was still in the duty free shop area.
LCA concluded that Mr Stuart’s evidence had been unreliable in relation to his main defence. The Court of Appeal thought it was therefore reasonable for LCA to prefer the witness evidence of the duty free shop manager and employee over that of Mr Stuart. On this basis further investigations were not required. The Court of Appeal was satisfied that based on Mr Stuart’s defence, LCA had carried out a sufficiently thorough disciplinary investigation.
Mr Stuart had been acquitted of theft in the criminal court. Notwithstanding this fact the Court of Appeal thought the employment tribunal had been entitled to find that LCA had acted reasonably in dismissing him.
This case highlights the need to carry out a fair procedure in relation to dismissals for misconduct. Both the employment tribunal and the Court of Appeal believed the employer had carried out a reasonable investigation. What is interesting to note is that it was reasonable for the employer not to consider additional evidence where it had already formed a view as to the employee’s credibility. The circumstances where this is applicable may be few and far between but it does show that if an employee’s evidence is shown to be dishonest in respect of one part of his defence it is reasonable to conclude that his credibility in relation to another part of his defence is adversely affected.
This case also helps employers because a disciplinary investigation will be less open to criticism if the employer can show it has investigated all aspects of the employee’s defence as raised at the time of the investigation. LCA was able to show this is what it had done.
Finally, the Court of Appeal was at pains to remind everyone that the decision of the employment tribunal was not a decision as to whether or not the employee was in fact guilty of theft. That was a question that had been tried in a criminal court and the employee had been acquitted. The question for the employment tribunal was a different one, namely whether the employer had acted reasonably in dismissing the employee.
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