[1]The claimant was unfairly dismissed, his claim for unfair dismissal is wellfounded and adjourned to a remedy hearing to be listed at the earliest opportunity after the parties have provided dates of their unavailability. The parties will be provided with the remedy hearing date in due course.[2]The claimant was summarily dismissed and his claim for wrongful dismissal is well-founded and adjourned to a remedy hearing.
REASONS
[1]The claimant presented his claim for unfair dismissal on the 27 September 2023 following the issue by ACAS of the Early Conciliation Certificate on 1 September 2023.[2]The original hearing bundle totalled 199-pages increased to 223-pages in accordance with an agreement reached between the parties and case management orders. In addition, as agreed between the parties and confirmed in case management orders, on the second day of the hearing an agreed transcript of a meeting held on either the 2 May 2023 was produced and I also listened to recording, which greatly assisted me in determining this case and the credibility issues as explained below. During the claimant’s cross-examination it came to light that he had recorded a conversation with Stuart Oldfield, evidence not previously disclosed to his solicitors or the respondent, and nor has a transcript of the recording been prepared. The respondent was taken by surprise by the non-disclosure and the reference made to this evidence by the claimant. The position has been resolved by a transcript being agreed and the recording shared. Agreed issues[3]The issues were agreed between the parties from the outset and prior to oral submissions being made as set out below: 1.Unfair dismissal2.1 It is not disputed that the claimant was dismissed without notice. Reason2.2 Has the respondent shown the reason or principal reason for dismissal was related to the claimant’s conduct? Fairness2.3 If so, applying the test of fairness in section 98(4), did the respondent act reasonably in all the circumstances in treating that reason as sufficient reason to dismiss the claimant?2.4 If the reason was misconduct, did the respondent act reasonably in all the circumstances in treating that as a sufficient reason to dismiss the claimant? The Tribunal will usually decide, in particular, whether:1.4.1 The respondent genuinely believed the claimant had committed misconduct;1.4.2 there were reasonable grounds for that belief;1.4.3 at the time the belief was formed the respondent had carried out a reasonable investigation;1.4.4 the respondent followed a reasonably fair procedure;1.4.5 dismissal was within the band of reasonable responses. 3. Remedy for unfair dismissal 3.1 Does the claimant wish to be reinstated to their previous employment? 2.2 Does the claimant wish to be re-engaged to comparable employment or other suitable employment? 2.3 Should the Tribunal order reinstatement? The Tribunal will consider in particular whether reinstatement is practicable and if the claimant caused or contributed to dismissal, whether it would be just. 2.4 Should the Tribunal order re-engagement? The Tribunal will consider in particular whether re-engagement is practicable and if the claimant caused or contributed to dismissal, whether it would be just and what the terms of the re-engagement order should be.2.5 What basic award is payable to the claimant, if any?2.6 Would it be just and equitable to reduce the basic award because of any conduct of the claimant before the dismissal? If so, to what extent?. This is to be dealt with at liability stage.2.7 If there is a compensatory award, how much should it be? The Tribunal will decide:2.7.1 What financial losses has the dismissal caused the claimant?2.7.2 Has the claimant taken reasonable steps to replace their lost earnings, for example by looking for another job?2.7.3 If not, for what period of loss should the claimant be Compensated?2.7.4 Is there a chance that the claimant would have been fairly dismissed anyway if a fair procedure had been followed, or for some other reason?2.7.5 If so, should the claimant’s compensation be reduced? By how much?2.7.6 Did the ACAS Code of Practice on Disciplinary and Grievance Procedures apply? Did the respondent unreasonably fail to comply with the Code?2.7.7 If so is it just and equitable to increase or decrease any award payable to the claimant? By what proportion, up to 25%?2.7.8 If the claimant was unfairly dismissed, did he cause or contribute to dismissal by blameworthy conduct? This is to be dealt with t liability stage.2.7.9 If so, would it be just and equitable to reduce the claimant’s compensatory award? By what proportion?2.7.10 The statutory cap of fifty-two weeks’ pay will apply.[4]Wrongful dismissal / Notice pay4.1 What was the claimant’s notice period?4.2 Was the claimant paid for that notice period?4.3 If not, can the respondent prove that the claimant was guilty of gross misconduct which meant that the respondent was entitled to dismiss without notice?4.4 If not how much should the claimant be awarded?[5]Costs 4.1 How much by way of costs should be respondent pay to the claimant under Rule 78 in respect of the claimant’s wasted costs arising from the application to extend time for the presentation of the response. Witness evidence 4. The Tribunal heard oral evidence from the claimant under oath, and on behalf of the respondent it heard from Stuart Oldfield, managing director, and Michael Aspey, general manager. On the balance of probabilities I preferred the evidence given by the claimant when it came to disputed matters, particularly whether he had been instructed by Stuart Oldfield and/or Michael Aspey to stop selling products to Joule Trade Limited as the purchases were fraudulent, and he was guilty of gross misconduct when he failed to comply with instructions. On the balance of probabilities I preferred the claimant’s evidence that the respondent had no policies and procedures about taking orders over the phone and he was not instructed by Stuart Oldfield and/or Michael Aspey not to accept the orders on the basis that they were fraudulent. In arriving at this decision I appreciate that Stuart Oldfield had every right to be upset over the fraudulent transaction and it is an unfortunate aspect of this case that the respondent and individuals involved in this case were the victims of a criminal fraud though no fault of their own. It is also unfortunate that the claimant whilst not perpetrating the fraud was the person who took the orders and lost his employment as a result. Stuart Oldfield’s case is that the claimant’s actions “are known as ‘hand in the till’ and when the claimant refused to accept an offer of a demotion followed by resignation he was summarily dismissed on the 5 May 2023 without any procedures being followed in breach of the ACAS Code of Practice as Stuart Oldfield was unaware any disciplinary process was required under the ACAS Code. 5. The Tribunal was referred to various documents in the agreed bundle, the written statements and recordings. Having considered the oral and written evidence and written and oral submissions presented by the parties (the Tribunal does not intend to repeat all of the submissions, but has attempted to incorporate the points made by the parties within the body of this judgment with reasons), I have made the following findings of the relevant facts resolving the conflicts in the evidence. Facts[6]The respondent is in the business of supplying building materials throughout the United Kingdom, particularly in the North West. At the time of the claimant’s dismissal it was a small employer employing a managing director, Stuart Oldfield, and six other managers, including Michael Aspey, the general manager. Stuart Oldfield’s Father was also a director and worked in the business. Stuart Oldfield had no experience of conducting investigations and disciplinary processes, believing managing employees was akin to dealing with his family, and he repeatedly referred to treating the claimant as his son, referring to a number of matters including a car loan which benefitted the claimant.[7]The claimant started working for the respondent on the 17 October 2017 until his summary dismissal on the 5 May 2023 from the position of sales manager, which included generating sales with no management or people. At the time of his dismissal the claimant was paid an annual salary of £45,000 plus commission if he exceeded a target of £70,000.00 together with the use of a company car. The claimant was not provided with Statement of Terms and Conditions of Employment from commencement of employment to termination, and the respondent’s failure in this regard has resulted in an argument as to whether the claimant was sales manager or not. The respondent had no policies and procedures and Stuart Oldfield was unaware of the ACAS Code of Practice and its effect on the respondent’s statutory obligation when it came to a disciplinary procedures and dismissal for gross misconduct. In short, no procedure whatsoever was followed prior to the claimant being dismissed without notice or a payment in lieu of notice and the breaches of the ACAS Code of Practice are numerous going to the heart of the fairness of the claimant’s dismissal.[8]It is important to note that the respondent had no oral or written Procedures or Policies concerning accepting business from new clients, and there were no agreed processes concerning taking payment over the telephone either via debit or credit cards. For a number of years the claimant understood the process entailed recording the account number, expiry date, address and postcode and three digit number on the back of the card, which he would insert before waiting for confirmation that the payment had gone through. The claimant would also carry out a credit check. There were no issues with payments being accepted using this process until a new customer, Joule Trade Ltd, placed an order on the 28 March 2023 with the claimant who was working in the office at the time.[9]It is agreed between the parties that on the 28 March 2023 Stuart Oldfield was abroad visiting his sick Mother and the claimant regularly made contact with him about the business and the orders placed by Joule Trade Ltd, six transactions in total over a period of 3 days totalling a payment via credit card of £31,400.00. The claimant’s evidence that Stuart Oldfield was pleased with the sales was found to be more credible that Stuart Oldfield’s evidence that “instantly alarm bells started ringing” and he told the claimant “this is definitely fraud” after the first order as placed on the 28 March 2023 for an invoice total of £3167 including VAT payment for which had cleared as far as the claimant was concerned following his usual practice. It did not became evident until various communications on the 7, 10, 13 and 15 April 2023 from Worldpay to Stuart Oldfield recorded that the transactions were fraudulent.[10]It was only after the second order was placed that Stuart Oldfield allegedly told the claimant “do not sell any more to this company” an instruction the claimant ignored according to Stuart Oldfield, whose evidence on this point I did not find at all credible. In the bundle there are numerous text messages for the period 24 December 2022 through to dismissal, including exchanges concerning a new account on the 31 January 2022 and various other orders. There is no contemporaneous evidence in the bundle to Stuart Oldfield giving the claimant instructions in or around 28 March 2023. The email exchange at the time makes no mention of this management instruction. However, there are other management instructions given to the claimant in relation to non-payment of goods including a client that “might go bust” and threatening the issue of a “CCJ.” The text messages reflect the claimant’s admittance to hospital on 8 April 2023 onwards. The clamant was told to meet Stuart Oldfield on the 24 April 2023. April 2023 text messages reflect the claimant was considering an offer he had been made and was instructed to bring his fuel car back to the office.[11]Nothing was said to the claimant by Mike Aspey, the general manager, who was responsible for loading up the vehicles with the product purchased by Joule Trade Ltd, despite his evidence that the managing director Stuart Oldfield had rang him up and “asked me to stop taking them. It was absolutely manic with orders coming in and that I was out of the yard getting orders out for delivery most of the time and Gareth was manning the phones…I said to Stuart that I had already told Gareth to stop…multiple times but he didn’t give a shit.” I found Mike Aspey’s evidence to be a fabrication and not at all credible. It made no sense that he, as general manager, placed the goods in the vans having warned the claimant to stop selling and warning him “if this is fraud you are fucked.”[12]The six invoices from the respondent to Joule Trade Ltd are dated 28, 29 and 30 March 2923 and nothing else was heard about the sales until Worldpay contacted the Stuart Oldfield on the 15 April 2023 informing him of the fraud by Joule Trade Ltd in relation to all the transactions. The claimant was oblivious of the situation until he was contacted via a text message on the 29 April 2023 by Stuart Oldfield who suspended the claimant and threatened immediate dismissal if he spoke to anyone; “Gareth You are suspended with immediate effect. Do not attempt to come into the premises at all for anything…if you attempt to enter the premises the police will be called immediately.” In a text dated 29 April 2023 Stuart Oldfield wrote; “The reason I didn’t tell you why you were suspended was because I didn’t know whether you could keep quiet about the investigations going on through ‘Joules Trade Limited’ It is now a lot deeper than just card transactions…This is a very serious fraud…if I find you have spoken to anyone else about this you will [be] dismissed immediately.”[13]In a text message sent to the claimant on the 1 May 2023 Stuart Oldfield wrote “I am lifting your suspension from tomorrow morning. Can you meet me in the office first ting please.” The claimant was not informed what the meeting was about and he was not told it was to be a disciplinary hearing at which he could be dismissed. It is notable that Stuart Oldfield was capable of texting the claimant when suspending him, and yet there was no such communication on the 28, 29 and 30 March 2023 when he believed a fraud was taking place, and this further undermines Stuart Oldfield’s evidence that he had instructed the claimant not to sell product to Joule Trade Ltd at the time because he suspected fraud. 2 May 2023 meeting[14]The claimant met with Stuart Oldfield with no idea as to what allegations he was facing. We adjourned the first hearing partly due to running out of time and also in order that a transcript of a recording taken by the claimant could be produced and case management orders were agreed as to how this would be achieved. A transcript was agreed and I also listened to the whole recording noting the aggressive and confrontational manner in which Stuart Oldfield conducted that meeting, leaving the room to get documents when the claimant was trying to explain his position, regularly cutting across the claimant and not giving him an opportunity to put forward his version of events. The disciplinary hearing was unfairly carried out, from the failure to set out any allegations, provide evidence, provide copies of documents relied on, oppressively shout and swear at the claimant and ranting about all manner of allegations not linked to the alleged fraud, such as the claimant’s poor relationship with other employees. Listening to the recording was enlightening. Unlike the written transcript, the shouting by Stuart Oldfield and not the claimant who could hardly get a word in edgeways, the hectoring, bullying and the swearing was central to how the meeting proceeded, with Stuart Oldfield clutching at any possible reason to reduce the claimant’s salary to £30,00 and force an agreement that he would remain at work (failing which his wife’s car would be taken away) demoted and any payments over the £30,000 salary would be used to pay back the £31,400 defrauded by Joule Trade Ltd together with a punishing payback of any bad debts from sales, for example, if a bad debt is £1000 the claimant would be required to pay £3000 from any sales bonus he generated.[15]It is accepted that the claimant informed Stuart Oldfield that he was recording the meeting, and this was agreed with reference being made by Stuart Oldfield to it being used in court. The claimant was open about his intention, which goes to his credibility. This was no covert recording to trap Stuart Oldfield in any way. The transcript records the claimant as saying very little, he was not given the opportunity to say much as evidenced in the recording itself. For example, Stuart Oldfield questioned the claimant as follows “What I’m saying is why should I re-employ you, why should I employ you as a person. See see what you’ve done in the last couple of weeks while I was in Tenerife…You came onto the phone multiple times to me when this guy was buying and I said to you ‘do not sell that stuff to him, this is really really dodgy, the guy is a fraud’ and you came off the phone and sold it to him.”[16]The claimant responded “”well it’s not…you didn’t, you didn’t say it in that way when we was on the phone. Stuart when I said…” Stuart Oldfield cut across the claimant “Gareth” the claimant pointed out “let me…you’re giving…obviously this is a meeting, Stu, where it takes two people to have a conversation and when I want to speak…” at which point Stuart Oldfield left the room before returning with documents not previously shown to the claimant saying “these are the sales…Every single one of them is a visa credit and I said to you ‘do not sell it to the customer if its visa credit.” The claimant responded “okay” and when it was put to him again “okay and I didn’t realise…I didn’t really look and I, I’ll say that I, I didn’t even look at the authorisation code.” The transcript does not reflect the way in which the conversation took place in that it was a very quick exchange, the claimant was unsure and Stuart Oldfield’s actions aggressive to the extent of extreme bullying. It was not a calm and professionally conducted meeting where a dismissing officer was attempting to carry out a fair investigation to get to the truth of the matter. Stuart Oldfield was angry, he had made up his mind that the claimant should pay for the money the respondent had lost through the fraud. He referred to the claimant having ADHD and dyslexia, and I did not accept Mr Forest’s submission that an innocent employee would have responded with a clear defence. It was apparent to me on the evidence the claimant was disadvantaged by the manner in which Stuart Oldfield had approached the meeting, and he was not given the opportunity to put forward his defence in any meaningful way. When the claimant stated he had spoken to Worldpay who confirmed in taking the three digit security code, postcode, address and house number and “get it authorise, you are not in the wrong. You can be taken for fraud by anybody, you will not know it personally…credit or debit card they don’t, it’s the same…and if I have got…they will give a recording for it,” Stuart Oldfield’s response was “okay, okay, well that’s fine because you’re going have to go to the police station and give interviews.” Stuart Oldfield did not agree to making contact with WorldPay and check if what the claimant was saying was correct, and there is no evidence in the bundle that he has ever taken this step. In short, Stuart Oldfield produced no satisfactory evidence that the claimant did anything other than follow the correct procedure, and I found as a matter of fact on the evidence before me for the purpose of the wrongful dismissal claim the claimant did follow the correct process as required in order to obtain authorisation for payment by Joule Trade Ltd and he is not responsible for the fraud.[17]The transcript also makes it clear that throughout the transactions with Joule Trade Ltd the claimant was in contact with Stuart Oldfield who said “you’re on the phone to me left right and centre to tell me how fucking what, what a great fucking salesman you are.” This comment reflects the truth of the situation and not the gloss put on the incident by Stuart Oldfield, who was understandably aggrieved that the respondent through the claimant accepting the sales, had been subjected to a fraud. The reality is that at the time both the claimant and Stuart Oldfield were pleased with the sales until Worldpay made contact about the fraud, and then Stuart Oldfield’s sole objective was to ensure that the claimant reimbursed the respondent. Stuart Oldfield shouted at the claimant “…this is happening because you’re fucking doing it…its all down to you…you’re not a fucking professional…every single time something goes tits up its down to you…to be honest with you I’m not bothered as to whether you leave or not…the only way I’m going to employ you in this business from now onwards is not as a sales rep but as an internal…basically where you started off in the earlier days and …the only way you’re gonna learn about these sorts of things is to pay it back. It’s £31,400. So I would say I’m taking…and your car’s gone because I don’t want you as a sales rep…I will be taking your wife’s car back because I own your wife’s car…so if you put your resignation in, I will be legally taking your wife’s car back and I will sell it…and whatever the difference is between what I’ve paid for it and what you owe us, er, will be taken off, okay?...So I’m offering you to reduce your salary…and all of the commission you earn comes off that bill until it’s paid…now if we get the money back legally it reduced off you, off the debt but It’s the only way I’m going to employ you” [my emphasis].[18]It is notable that during the 2 May 2023 meeting the claimant referred to being suspended and Stuart Oldfield, despite the clear instruction in text messages, denied that he had; “I didn’t suspend you. I’ve never suspended you…I’ve never suspended you and at no point did I suspend you” making it clear that “if you come back here I want you, I want you back up to help Mike and help Mike the way you have been doing, erm, I want you to do sales and admin the same as you’ve been doing…you’ve never been suspended, I never have suspended you, so you can put this on record here, er, if you, you, if you come back here, you know, I’ve also rewritten, er, me and Ken have rewritten, erm, the sales, er, and the bad debts, so there’s also a new contract to sign…whatever the bad debt is, comes back off your commission, okay?...So, I’m done, if you want your job it’s here, and if you don’t tell me… recording ends”. Stuart Oldfield’s insistence that the claimant was not suspended and had resigned at the meeting has absolutely no credibility and undermines the case he is putting forward at this liability hearing.[19]Following the meeting Stuart Oldfield texted the claimant “As you have verbally resigned this morning. Please don’t forget to put this in writing to me as promised tomorrow morning. I am sorry that you feel that way but I accept your resignation.” There had been no resignation and when the position was made clear by the claimant who emailed Stuart Oldfield on the 2 May 2023 “You said hand your resignation in and I said I’ll get advice Stuart and come back to you with a letter on which way we need to move forward. Like I have said I’m not handing my resignation in.”[20]Stuart Oldfield emailed on 2 May 2023 “I offered you a new salary with a company car this morning to which you refused my offer. You then told me that you would hand me written confirmation of your resignation tomorrow.” A further email was sent to the claimant “I accept your verbal resignation this morning…you were suspended last Thursday on the advice of the Police as you are technically still a suspect…you have let me down on multiple occasions and each time I have tried to steer you back…On this occasion you have gone one step too far especially as I told you “DO NOT TAKE THESE TRANSACTIONS” as they are probably fraudulent. Unfortunately your greed to earn commission surpassed you. You even changed the REPS CODE on our system so it was you who earned the commission for these sales…”[21]The claimant responded at 15.05 the same day “…I’m not handing a letter of resignation in I’m not agreeing to the new terms of employment that you offered this morning.”[22]The claimant’s Solicitors in an email sent on 3 May 2023 referred to the “purported suspension but this has been lifted/rescinded. Beyond that the position is that our client has not resigned. You have unilaterally sought to impose a significant variation to a fundamental term of our client’s employment contract (his salary) and our client will not accept the variation…our client is…willing and able to continue his employment on his current contract…”[23]Stuart Oldfield on behalf of the respondent emailed the claimant’s solicitors on the 5 May 2023 confirming a solicitor “has advised me to dismiss Gareth Marden with immediate effect…” The effective date of termination of employment was 5 May 2023. The claimant was dismissed for a number of reasons all culminating from the fraudulent transactions ending with the claimant’s refusal to accept a reduction in his salary aimed at the respondent recouping all the money it had lost and may lose in the future is there is a bad debt. Had the claimant accepted the terms put forward by Stuart Oldfield at the 2 May 2023 meeting he would have remained in employment on a substantially lower salary with no commission until the fraud was made good. At no stage did Stuart Oldfield genuinely believe the claimant participated in the fraudulent action of Joule Trade Limited and nor did he genuinely believe the claimant had disregarded a genuine management instruction not to have any dealings with Joules Trade Limited after the first tranche of sales. Stuart Oldfield was aware the claimant had followed the only procedure he could have when accepting the business, as set out above, and he could not have held a genuine belief the claimant disregarded instruction so as to benefit from the commission, which was never explored with the claimant. In short, Stuart Oldfield could not reconcile the claimant’s “greed for commission” with a fraudulent transaction given no commission would be earned on unpaid bills. Stuart Oldfield was angry over the fraud and struck out aggressively at the claimant in the hope of recouping the money out of salary and commission, disregarding the reality of the situation and being prepared to argue any point even if it meant presenting a less than accurate history of the events and so the Tribunal found. Law and conclusion applying the facts to the law[24]The legal principles are largely undisputed between the parties. In oral submissions Mr Forrest argued that had this case come before the Tribunal in the 1070’s the respondent would have no difficulties as it was a small employer working as a family where the claimant was treated more like a son and he had forfeited the trust shown to him. I have taken into account the fact that the respondent is a small employer and had this in mind during deliberations recognising the limitations of Stuart Oldfield who ran it like a family concern and the effect on him when the fraud came to light. I did not however accept the claimant had “deliberately disobeyed” Stuart Oldfield’s instructions, who was “almost his Father...and deliberately gone ahead with the motive of greed to ignore clear instructions…and make sales to a dodgy company.” Mr Forests submissions are undermined by the lack of credibility in his witnesses, not least, as stated by Mr Forrest, Stuart Oldfield is aware of the “potentially dangerous sales” and “does not know more until the Worldpay letters.” The reason why Stuart Oldfield does not know more lies in the fact that he said and did nothing for approximately just under a month after the transactions had taken place. This is surprising given Stuart Oldfield’s evidence that he told the claimant to stop selling because he feared a fraud was being committed. Mr Forrest also relies on the claimant’s failure to protest his innocence, ignoring the aggressive and confrontational manner in which Stuart Oldfield conducted the meeting on the 2 May 2023 which prevented the claimant from putting his version across. Mr Forest alleged the claimant had refused to accept he had defrauded the respondent and yet there was no suggestion of the claimant being personally involved in the fraud.[25]Section 98 of the Employment Rights Act 1996 (“the 1996 Act”) provides that an employee has the right not to be unfairly dismissed by his employer. Section 98(1) of the 1996 Act provides that in determining whether the dismissal is fair or unfair, it is for the employer to show the reasons for the dismissal, and that it is a reason falling within section 98 (2) of the 1996 Act. Section 98(2) includes conduct of the employee as being a potentially fair reason for dismissal. Being party to a fraud and/or ignoring a reasonable management instruction to avoid a fraud would fall under the definition of misconduct.,[26]Section 98(4) provides that where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal if fair or unfair (having regard to the reasons shown by the employer) depends on whether in the circumstances (including the size and administrative resources of the respondent’s undertaking) the employer acted unreasonable or reasonably in treating it as a sufficient reason, and this shall be determined in accordance with equity and the substantial merits of the case. I accept in this case the respondent was a small employer and this has been taken into account when considering section 98(4).[27]Where the reason for dismissal is based upon the employee’s conduct, the employer must show that this conduct was the reason for dismissal. For a dismissal to be procedurally fair in a case where the alleged reason for dismissal is misconduct, Lord Bridge in Polkey –v- A E Dayton Services Limited [1981] ICR (142) HL said that the procedural steps necessary in the great majority of cases of misconduct is a full investigation of the conduct and a fair hearing to hear what the employee has to say in explanation or mitigation [my emphasis]. This dis not happen in Mr Marden’s case. It is the employer who must show that misconduct was the reason for the dismissal, and must establish a genuine belief based upon reasonable grounds after a reasonable investigation that the employee was guilty of misconduct – British Home Stores Ltd v Birchell [1980] CA affirmed in Post Office v Foley [2000] ICR 1283 and J Sainsbury v Hitt [2003] C111. In short, the Tribunal is required to conduct an objective assessment of the entire dismissal process, including the investigation, without substituting itself for the employer.[28]The Court of Appeal in British Leyland (UK) Ltd v Swift [1981] IRLR 91 set out the correct approach: “If no reasonable employer would have dismissed him then the dismissal was fair. But is a reasonable employer might reasonably have dismissed him, then the dismissal was fair…in all these cases there is a band of reasonableness, within which one employer might reasonably take one view and another reasonably take a different view. In between extreme cases of misconduct there will be cases where there is room for reasonable disagreement amongst reasonable employers as to whether dismissal for the misconduct is a reasonable or unreasonable response: LJ Mummery in HSBC Bank Plc v Madden [2000] ICT 1283. In the case of Mr Marden I find that no reasonable employer would have dismissed him taking into account all of the circumstances of this case.[29]In Boys and Girls Welfare Society v McDonald [1996] IRLR 129, the EAT clarified that there is a neutral burden of proof when it comes to establishing whether the Burchell test has been satisfied. If the Tribunal finds that the Burchell test is satisfied, it will then consider whether the decision to dismiss fell within the range of reasonable responses available to a reasonable employer in the circumstances. The tribunal’s findings in this regard will depend on the individual circumstances of the case. In Mr Marsden’s case the Burchell test was not satisfied. The range of reasonable responses test applies both to the decision to dismiss and to the investigation Sainsbury’s v Hitt (above). This means that the tribunal has to decide whether the investigation was reasonable, not whether it would have investigated things differently. In Mr Marsden’s case there was no investigation and further, it cannot be said that the claimant was “caught with his hand in the till” as pleaded by the respondent. In arriving at this view I have taken into account the principle that it is irrelevant whether or not the Tribunal would have dismissed the employee if it had been in the employer’s shoes: the tribunal must not substitute its view for that of the employer: Foley v Post Office; Midland Bank plc v Madden (above).[30]The degree of investigation required very much depends on the circumstances. The Court of Appeal in the well-known case of Shrestha v Genesis Housing Association Ltd [2015] EWCA Civ 94 made it clear that it is not necessary for an employer to extensively investigate each line of defence advanced by an employee. This would be too narrow an approach and would add an “unwarranted gloss” to the Burchell test. What is important is the reasonableness of the investigation as a whole. The employer should assess its approach taking account of the following: The strength of the prima facie case against the employee, and the seriousness of the allegations and their potential to blight the employee’s future. In Mr Marsden’s case an allegation of fraud is a blight for his future as a sales manager and there was no prima facie case against him such that the respondent could ignore the requirement for a proper investigation into the allegation that the claimant had disregarded Stuart Oldfield’s instruction to generate more commission.[31]It is clear from the exchange between the claimant and Stuart Oldfield that the claimant was also under investigation for being party to the fraud in some way. In the well-known case of A v B [2003] IRLR 405, it was stated that the employer’s investigation should be particularly rigorous when the charges are particularly serious or the effect on the employee is far-reaching. The Court of Appeal in Salford Royal NHS Foundation Trust v Roldan reinforced the principles [2010] IRLR 721, in which an employee with four years’ service faced a not only a “a real risk that her career would be blighted by this dismissal.” In A v B (above) Elias J made the following points:• Serious allegations of criminal misbehaviour must always be the subject of the most careful investigation (at least where they are disputed), bearing in mind that the investigation is usually being conducted by laymen and not lawyers.• Even in the most serious cases, it is unrealistic and quite inappropriate to require the safeguards of a criminal trial. However, careful and conscientious investigation of the facts is necessary and the investigator charged with carrying out the inquiries should focus no less on any potential evidence that may exculpate or at least point towards the innocence of the employee as they should on the evidence directed towards proving the charges. It is notable that Stuart Oldfield was the investigator and decision maker despite being a key witness in the allegation that the claimant had disregarded his instructions.• This is particularly the case where, as is frequently the situation, the employee is suspended and has been denied the opportunity of being able to contact potentially relevant witnesses. Despite Stuart Oldfield’s protestations the claimant was clearly suspended until dismissal.• Employees found to have committed a serious offence of a criminal nature The term “gross misconduct” connotes the most serious types of misconduct, such as theft or violence, warranting instant dismissal. It will be conduct that “so undermines the relationship of trust and confidence ... that [the employer] should no longer be required to retain [the employee] in his employment” (Neary v Dean of Westminster [1999] IRLR 288).[32]The question for the Tribunal is the reasonableness of the decision to dismiss in the circumstances of the case, having regard to equity and the substantial merits of the case. The Tribunal will not substitute its own view for that of the respondent. In order for the dismissal to be fair, all that is required is that it falls within the band of reasonable responses open to employer. It is necessary to apply the objective standards of the reasonable employer – the “band of reasonable responses” test – to all aspects of the question of whether the employee had been fairly dismissed, including whether the dismissal of an employee was reasonable in all the circumstances of the case.[33]The test remains whether the dismissal was within the range of reasonable responses and whether a fair procedure was followed. Section 98 (4) provides that where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal if fair or unfair (having regard to the reasons shown by the employer) depends on whether in the circumstances (including the size and administrative resources of the respondent’s undertaking) the employer acted unreasonable or reasonably in treating it as a sufficient reason, and this shall be determined in accordance with equity and the substantial merits of the case.[34]With reference to the first agreed issue, namely, has the respondent shown the reason or principal reason for dismissal was related to the claimant’s conduct I find that it has not, and further, in applying the test of fairness in section 98(4), it did not act reasonably in all the circumstances in treating misconduct as sufficient reason to dismiss the claimant. In short, the respondent did not have a potentially fair reason for dismissing the claimant.[35]The respondent relies on ‘conduct’ as being the potentially fair reason for the claimant’s dismissal, pursuant to s. 98(2)(b) ERA 1996. I have in mind the legal principle “the reason for the dismissal “…is the set of facts known to the employer or, it may be, of beliefs held by him which cause him to dismiss….” Abernethy v Mott, Hay and Anderson [1974] ICR 323 at 330 per Cairns LJ). For the reasons set out above. I do not accept on the balance of probabilities that the dismissing officer, Stuart Oldfield, genuinely believed the claimant had been guilty of misconduct, let alone gross misconduct that involves either deliberate wrongdoing or gross negligence which entitled him to summarily dismiss the claimant. Stuart Oldfield had not instructed the claimant to refuse the follow up purchase contracts with Joule Trade Limited and for the reasons already stated I did not find him a credible witness on this point. Stuart Oldfield became concerned for the first time after the communications from Worldpay, following which his sole aim was to recoup the monies lost from the claimant as evidenced by his high level of aggression in the recorded meeting with the claimant when he argued the claimant had not been suspended against clear evidence that he had. Stuart Oldfield’s only way to recoup the money was to use any means possible to pressurise the claimant to accept a reduction in pay including the threat of dismissal/resignation or be dismissed.[36]There is a suggestion that the respondent dismissed the claimant because he changed codes to his own account in order to benefit from the commission gained by the Joules transaction. The problem for the respondent is that this was a matter which allegedly only came to light after the claimant was dismissed, and it was a matter that was never investigated. The claimant’s case is that he had authority to input codes into his own name. As set out above, I did not find Stuart Oldfield an accurate historian, and do not accept on balance that his evidence in relation to the act of alleged misconduct that came to light after dismissal had any credibility to it. This is relevant to the analysis of contributory fault referenced further below. It is incomprehensible that Stuart Oldfield relies on the claimant changing the codes as a reason for dismissal and yet did not investigate or produce any documentary evidence of this either prior to or immediately after the meeting with the claimant on 2 May 2023. I prefer submissions made by Ms Baylis that on the chronology Stuart Oldfield made the decision to keep the claimant as an employee but asked him to take a deduction in pay in order to continue to work there. The claimant sought legal advice and then refused, Stuart Oldfield therefore dismissed him because he had legal representation and would not accept a deduction in pay, rather than misconduct.[37]As the respondent has not satisfied the burden of establishing a potentially fair reason for the dismissal, I am not required to consider the reasonableness of the decision to dismiss and there is no burden on either party at this stage. However, in the alternative assuming the respondent had satisfied me that there was a potentially fair reason for dismissal (which for the avoidance of doubt it had not) I have proceeded to consider the remaining issues agreed in this case.[38]With reference to the issue, namely, if the reason was misconduct, did the respondent act reasonably in all the circumstances in treating that as a sufficient reason to dismiss the claimant, I find that it did not taking into account the burden of proof is a neutral one, when considering reasonableness of the dismissal for ‘conduct’ under s. 98(4) ERA 1996. The Burchell test had not been met according to the band of reasonable responses test applied to all three strands – Iceland Frozen Foods (above).[39]Turning to the individual strands set out in the Burchell test, on the balance of probabilities I was not satisfied Stuart Oldfield genuinely believed that the claimant was guilty of the misconduct alleged for the reasons set out above, he had no reasonable grounds upon which to sustain that belief and had not carried out such investigation as was reasonable in all the circumstances of the case. The text messages exchanged during the relevant time did not reflect the case Stuart Oldfield is now putting forward. Stuart Oldfield was aware of the sales. The claimant carried out the usual security checks including a credit rating. The claimant was not told that the transactions were likely to be fraudulent until after the Worldpay communications when it was too late to stop them by which time almost a month had passed without Stuart Oldfield referring to any fraudulent transaction, which further undermines Mr Oldfield’s version of events including the suspension on 27 April lifted on 2 May 2023.[40]With reference to the next issue, namely, was the claimant’s dismissal procedurally fair, it was not and the breaches in procedure went to the heart of fairness. The claimant’s dismissal was inevitable after he refused the reduction in salary and commission. The way in which Stuart Oldfield addressed the disciplinary allegations drove a coach and horses through the ACAS Code of Practice. There was no independent investigation. There was no invite letter. No allegations were not set out in the disciplinary invite letter. The claimant was not advised of his right to be accompanied. The disciplinary hearing unfairly carried out; the claimant was in shock, he was not given an opportunity to have his say, he was cut off by Stuart Oldfield who is shouting and swearing, at times overly aggressive and confrontational when the claimant tried to dispute what is being said and put forward his version. There was no disciplinary outcome letter. The claimant was not advised of his right to appeal. Stuart Oldfield dealt with the disciplinary process from start to finish despite being a key witness of fact that required investigation. The allegations were unclear. The claimant did not understand the allegations and therefore he could not defended himself in full. He was no asked about the process he allegedly should have adopted when accepting purchase contracts over the telephone. The reason for the claimant’s dismissal were not recorded in writing other than a reference by Stuart Oldfield to him receiving legal advice that he had been advised to dismiss the claimant with “immediate effect.” There was no explanation as to why the claimant’s behaviour should attract the ultimate punishment of summary dismissal, designed for acts of gross misconduct that entitled the respondent to dismiss without notice. There was no explanation as to how a summary dismissal fell into the factual matrix of this case when far from dismissing the claimant Stuart Oldfield made it clear at the recorded meeting of 2 May 2022 that he wanted the claimant to remain employed stating “I honestly, I think, you know, you’re a good person, You’re a nice person, You’re heart’s in the right place…” but on a lower salary in order that he could recoup at an exorbitant rate all bad debts and the defrauded money.[41]Returning to the lack of investigation, Ms Bayliss referred to the requirement to hold such investigation as is reasonable in all the circumstances is only really applicable where misconduct is suspected. Clearly if the employee admits that he has committed the misconduct, there is little purpose in carrying on any investigations. The employer will then be acting reasonably in believing that the misconduct has been committed Royal Society for the Protection of Birds v Croucher [1984] IRLR 425, [1984] ICR 604. I took the view that despite Mr Forrest’s submissions to the contrary, on reading the transcript and following the recording, there was no admission on the part of the claimant. An investigation was necessary, however, this did not take place because Stuart Oldfield knew the truth of the matter, he did not hold a genuine belief that the claimant had committed an act of gross misconduct, and his sole aim was to reduce the cost of employing the claimant for the respondent and reimburse the financial losses through a salary sacrifice. Stuart Oldfield, as dismissing officer, can only take into account matters of which it was aware at the time he dismissed on 5 May 2023. Ms Bayliss is correct in her submission that the fact that the employee did not in fact commit the misconduct is irrelevant. The relevant question is simply whether the employer had reasonably concluded that he did at the time of dismissal. The employer can only take into account matters of which it was aware at the time of dismissal: Devis (W) & Sons Ltd v Atkins [1977] AC 931, [1977] 3 All ER 40, [1977] IRLR 314, [1977] ICR 662, HL at para 23).[42]Finally, I found on the balance of probabilities that the dismissal was not within the band of reasonable responses taking into account the principle that the Tribunal must be particularly careful not to step into the employer’s shoes. Dismissal was not within the range of reasonable responses and a fair procedure was not followed. The respondent has not fulfilled the requirements of subsection (1), and having regard to the reasons shown by the respondent, including the size and administrative resources of the respondent’s undertaking, it has not acted reasonably in treating it as a sufficient reason determined in accordance with equity and the substantial merits of the case. The claimant was unfairly dismissed and the claim for unfair dismissal is well-founded. The remaining agreed issues relating to the unfair dismissal[43]As agreed with the parties, I have agreed to deal with the “Polkey no difference rule” and contributory fault.[44]With reference to the agreed issue, namely, is there a chance that the claimant would have been fairly dismissed anyway if a fair procedure had been followed, or for some other reason, I find on the factual matrix set out above that there was no chance the claimant could or would have been fairly dismissed at any stage in the future. Ms Baylis submitted that Stuart Oldfield was content for claimant to continue working for the company providing he accepted the pay cut. I accepted the Tribunal does not have the information necessary to formulate whether there could have been a fair dismissal for all the reasons set out above, particularly where the stated reason for dismissal is the changing of the codes, which claimant says was as a result of Stuart Oldfield’s Father allowing the change which he has never been asked about and is not a witness as the matter was never investigated. Contrary to Mr Forrest’s oral submission Stuart Oldfield did not “bend over backwards to be fair” to the claimant and I did not accept the argument that there would have been a fair dismissal had a “normal sort of arrangement” consisting of investigation and appeal have taken place taking into account that there were six managers including Stuart Oldfield’s Father, who was also a director and had allegedly agreed that the claimant could change sales codes on the computer, which was never looked at or investigated. Contributory fault[45]The tests for the basic and compensatory award are different.[46]With reference to the issue, namely, would it be just and equitable to reduce the basic award because of any conduct of the claimant before the dismissal, it was not on the findings of facts above.[47]With reference to the issue, namely, if the claimant was unfairly dismissed, did he cause or contribute to dismissal by blameworthy conduct, I found he did not and it would not be just and equitable to reduce the claimant’s compensatory award. I did not find the the claimant’s conduct was culpable and blameworthy in the sense that it was foolish, perverse or unreasonable in the circumstances (Nelson v BBC (No.2) [1980] ICR 100). In Steen v ASP Packaging Ltd [2014] ICR 56, EAT, the EAT, summarising the correct approach under S.122(2), held that it is for the Tribunal to: identify the conduct which is said to give rise to possible contributory fault, decide whether that conduct is culpable or blameworthy, and decide whether it is just and equitable to reduce the amount of the basic award to any extent. I did not accept Mr Forrest’s submission that there should be reduction to claimant’s basic and compensatory award on account of contributory conduct. I preferred the submissions put forward by Ms Baylis that the claimant did not believe transactions were fraudulent. On the evidence before me, the possibility of fraud did not cross the claimant’s mind given he had carried out all the usual procedures, including a credit search, and I do not accept that Stuart Oldfield at any stage instructed the claimant to stop the purchases because they could be fraudulent. I have found Stuart Oldfield an inaccurate historian whose evidence cannot be relied on, and it seems incredible that the text exchange in March 2023 would not have reflected his concern and disquiet about the fraudulent nature of the transactions. I find it unexplainable that Mike Aspey, the general manager with authority over the claimant, who supported Stuart Oldfield’s version of events, continued to help load the vehicles with product in the knowledge of Stuart Oldfield’s alleged instruction and fraudulent dealings. Wrongful Dismissal[48]With reference to the issue, namely, was the respondent entitled to summarily dismiss the claimant, given my findings above, it was. The claimant’s conduct did not constituted a repudiatory breach of contract and his dismissal without notice was therefore unlawful.[49]In conclusion, the claimant was unfairly dismissed and his claim for unfair dismissal is well-founded and adjourned to a remedy hearing to be listed at the earliest opportunity after the parties have provided dates of their unavailability. The parties will be provided with the date in due course. The claimant was summarily dismissed and his claim for wrongful dismissal is well-founded and adjourned to a remedy hearing. Case Management Orders[50]The following case management orders are made to assist the partis prepare for a remedy hearing:[1]The partis will within 7-days of the date this Reserved judgment is sent to then 9see below) will write to the Tribunal with their unavailability dates for a 1-day hearing to take place in the next 6 months by CVP video link. An in person hearing can take place if any party requires tis.[2]The claimant will send to the respondent an updated schedule of loss and evidence of mitigation no later than 23 January 2025.[3]The respondent will send to the claimant a counter-schedule of loss no later than 7 February 2025 and any documents relating to mitigation.[4]The parties will agree a list of issues relating to remedy within 14-days of the counter-schedule of less .[5]If costs continues to be an issue the parties will confirm whether costs can be dealt with in the 1-day allocation, if not, it will be listed separately as it is imperative the claimant’s remedy hearing is not delayed.[6]The parties will agree a remedy bundle 14-days before the remedy hearing. 2 January 2025