Unfair Dismissal - What Matters is the Decision Maker's Mindset

For an employee to succeed in a claim of unfair dismissal, they must be able to show that their employer has acted unreasonably, and unfair conduct on the part of individual colleagues or managers is immaterial unless it can properly be attributed to the employer. The Court of Appeal made that point in a whistleblowing case that raised an issue of general importance (Royal Mail Limited v Jhuti).

The case concerned a woman who expressed concerns to her line manager that sales staff might be in breach of regulatory guidance by offering incentives to clients. His response was to put her under intense pressure to withdraw the allegation and to subject her to harsh and unreasonable criticism of her performance. After she went off sick, suffering from stress, she was ultimately dismissed following a disciplinary investigation conducted by a second manager. Unsatisfactory performance was cited as the reason for the termination of her employment.

After she launched proceedings, an Employment Tribunal (ET) found that she had been subjected to unlawful detriment for whistleblowing, contrary to Section 47B of the Employment Rights Act 1996. However, the ET rejected her claim that she had been automatically unfairly dismissed, contrary to Section 103A of the Act.

The latter decision was reached on the basis that the second manager had decided to dismiss her in good faith and was unaware of her line manager's unfair motives for alleging poor performance. That ruling was subsequently reversed by the Employment Appeal Tribunal (EAT), which found that the line manager's unlawful motivation should be treated as the reason for her dismissal.

In upholding the employer's appeal against the EAT's decision, the Court noted that what mattered was the mental processes of the second manager, who was the person authorised by the employer to take the decision to dismiss. The woman's dismissal was therefore not automatically unfair. The Court, however, found that its ruling did not preclude her from advancing a claim for losses occasioned by her dismissal as compensation for the unlawful detriments to which she had been subjected.

The matter was returned to the ET for the amount of her compensation to be assessed.