A recent decision by the Employment Appeal Tribunal(EAT) in the case of Kelly-Madden v Manor Surgery has clarified the previously unclear position relating to dismissals by employers who fail to carry out a proper procedure prior to dismissal.
(This case does not refer to the procedure introduced by the Dispute Resolution Regulations 2004, whereby failure to comply with the procedure can result in a finding of automatic unfair dismissal).
Kelly-Madden was practice manager in a doctors' surgery. She took unauthorised payments for overtime, and was dismissed once this was discovered. KM maintained that her predecessor had advised her this was acceptable and that one of the partners had checked the accounts and passed the payments. KM was dismissed without these claims being investigated.
The Employment Rights Act states that "failure by an employer to follow a procedure in relation to the dismissal of an employee shall not be regarded for the purposes of section 98(4)(a)as by itself making the employer's action unreasonable if he shows that he would have decided to dismiss the employee if he had followed the procedure".
KM argued that as 'procedure' related to an employer's internal procedures, S.98A(2) did not apply, because her employer did not have any such procedures.
The EAT rejected KM's narrow interpretation of the Act for a wider one, finding that the earlier tribunal was correct in finding that even were a proper procedure to have been followed, she would have nevertheless been dismissed by her employer.
Until KM the principle regarding procedure (over and above the Statutory Disciplinary Procedures) was that of the decision in Polkey v AE Dayton Services Ltd that procedurally flawed dismissals are unfair except where the carrying out of a proper procedure would have been ‘utterly useless’ or ‘futile’. This reversal of Polkey in the new EAT interpretation of the unclearly worded Section 98A(2) of the employment Rights Act 1996 means that employers have made a significant gain in defending unfair dismissal claims.
© Workrep 27 / 11 / 2006