Dismissing an employee? You must follow procedure

Dismissing an employee? You must follow procedure

What’s the background to the case?

Mr Radia was the managing director of a regulated financial services company. In May 2015 he brought an employment tribunal claim against his employer for disability discrimination, but was unsuccessful. On dismissing his claims, the tribunal judge found that Mr Radia’s evidence was not credible for a number of reasons.

Upon receiving the judgement, Mr Radia was suspended by his employer pending a disciplinary hearing. No investigation took place before his disciplinary, as his employer relied on the employment tribunal’s findings. He was subsequently dismissed for gross misconduct and was not offered an appeal hearing.

Mr Radia lodged a second employment tribunal claim, where he claimed that his suspension, dismissal and his employer’s decision not to hold an investigation hearing amounted to an unfair dismissal. His claims were again rejected by the employment tribunal.

Following this second rejection, Mr Radia appealed that his dismissal was unfair to the EAT on two grounds:

1. There was no investigation before the disciplinary hearing
2. He was not offered an appeal hearing on dismissal, contrary to the ACAS code and his employer’s own procedure

What were the findings?

The EAT confirmed that the dismissal was not unfair, as the manager hearing the disciplinary had relied on the findings of the employment tribunal. Even though the manager had not undertaken a separate investigation – which the EAT advised wasn’t the best procedure – they concluded that no further investigation was necessary.

However, the EAT disagreed with the employment tribunal’s decision that even if an appeal had been held, it would have made no difference. It instead found that not allowing Mr Radia an appeal hearing did amount to unfair dismissal, giving him the opportunity to claim compensation against Jeffries International Limited.

What can be learnt from this?

Whilst a formal investigation hearing may not always be necessary, there is a requirement for employers to follow reasonably fair procedures prior to dismissing an employee.

Unless advised otherwise, in order to avoid the risk of a dismissal being found unfair by an employment tribunal, it is imperative that employers:

Carry out an investigation prior to a disciplinary hearing
Hold a disciplinary hearing
Offer your employee the right to an appeal