Ms S Zdravev v Panther 1919 Ltd (in administration) and Others: 3309090/2022

EMPLOYMENT TRIBUNALS

Case No 3309090/2022

Between

Ms S ZdravevClaimant

(1) Panther 1919 Limited (in administration) (2) Mr Charles Wooldridge (3)Respondent

Before

Employment Judge George, Ms D Ballard, Ms C Tufts

Self-representing for claimant

Date 16 August 2025

JUDGMENT

[1]The name of the claimant is changed to Svetlana Zdraver.

[2]The name of the third respondent is changed to Mr Charles Wooldridge and Mr Graham Wooldridge trading as Twelve Oaks Partnership (in administration)

[3]Proceedings against the third respondent are stayed.

[4]The claimant was an employee of the first respondent within the meaning of s.230 Employment Rights Act 1996 and s.83(2) Equality Act 2010.

[5]The claimant was not an employee of the fourth to eighth respondents within the meaning of s.230 Employment Rights Act 1996 and s.83(2) Equality Act 2010.

[6]The claims against the fourth to eighth respondents are dismissed.

[7]The claimant was unfairly dismissed by the first respondent.

[8]The claimant was wrongfully dismissed by the first respondent.

[9]The first respondent is to pay to the claimant damages for wrongful dismissal/unpaid notice pay of £3,525.92 calculated as (8 weeks @ £961.62) £7,692.92 LESS an ex gratia payment of £4,167.92.

[10]The following complaints of race related harassment are well founded and succeed against the first respondent:a. LOI 5.2.1 Richard Cox called the claimant Sweat including on about 27 to 29 April 2022

b. LOI 5.2.4 in part. Colleagues specifically Cheryl Goringe on about 8 April 2022 discussed the Russian invasion of Ukraine within the claimant’s hearing saying she “hates .. everything to do with Russians.”

[11]Otherwise the race related harassment complaints against the first respondent are dismissed.

[12]The claims against the second respondent are dismissed.

[13]The following complaints of direct race discrimination about the events of 13 May 2025 are well founded and succeed against the first respondent: a. LOI 5.2.10.2 to LOI 5.2.10.5 including the complaint of constructive dismissal.

[14]Otherwise the direct race discrimination complaint is unsuccessful and is dismissed.

[15]The claim for holiday pay accrued but not taken on termination of employment not well founded and dismissed.

[16]The remaining issues will be considered at a remedy hearing to be heard at Reading Employment Tribunal on Monday 6 October 2025 at 10.00 am with a time estimate of 1 day before Employment Judge George, Ms D Ballard and Ms C Tufts.

[17]Parties against whom the claim has been dismissed need not attend the remedy hearing.

[18]No later than 29 September 2025 the claimant is to send to the first respondent and the tribunal an updated schedule of loss setting out the calculation of the compensation claimed to flow from the successful claims. Approved by: CERTIFICATE OF CORRECTION Under Rule 67, the JUDGMENT having been sent to the parties on 26 August 2025 and written reasons having been requested in accordance with Rule 60 of the Employment Tribunals Rules of Procedure, the following reasons are provided:

[1]Following a period of conciliation between 18 May 2022 and 30 May 2022, the claimant presented a complaint on 6 July 2022. This was originally against the first respondent, Panther 1919 Limited, which entered a response on 19 August 2022. Taking into account the effect of early conciliation, this means that any act which happened before 25 March 2022 is potentially out of time.

[2]We have had the benefit of a joint hearing file that originally ran to 1703 pages. There were a small number of documents that were added to it by consent, on the application of the respondent, which meant that at the start of the hearing the total number of pages were 1738. Page numbers in these reasons refer to that hearing file.

[3]There was a witness statement file of 116 pages. A number of the witnesses did not attend to be cross examined on their evidence and we have taken into account those statements and given them such weight as we think appropriate in those circumstances.

[4]The claimant gave evidence herself. She had produced not only one statement but also a supplementary witness statement, as had her daughter Anastasiia Davis, and her husband, Zach Zdravev. On marriage her legal name was changed, hence the change of name in the Case Heading. However, she was addressed during the hearing as Ms Davis since that wa the name by which she was known at work.

[5]The respondent relied upon the evidence of five witnesses:  Charles Wooldridge,  Graham Wooldridge,  Julie Thomas,  Peter Merry, and  Lauren Sandys They adopted their witness statements in evidence and were cross-examined upon them.

[6]Three contested case management decisions were made for which oral reasons were given at the time. Proportionate written reasons for those decisions are provided now.

[7]We were notified on Day 1 that an administrator had been appointed for R3 (Twelve Oaks Partnership). Having researched insolvent partnerships, Judge George raised with the parties on Day 3 whether the claim could continue against R3 in those circumstances. After hearing the parties submissions (and the claimant argued against a stay) we decided to stay proceedings against R3.a. When an Administration Order has been made in respect of a company, no legal process may be continued against the company or property of the company without consent of the administrator or the permission of the court: Insolvency Act 1986 (hereafter IA) Sch.B1, para.43(6).

b. Art.6 of the Insolvent Partnerships Order 1994/2421 provides that Schedule B1 and Part II of IA apply to insolvent partnerships. There are some amendments to the paragraphs of IA Sch B1 in its application to insolvent partnerships and they are set out in Sch.2 of the 1994 Order.

c. Para.43(5) IA as amended to apply to insolvent Partnerships (para.18 of Sch.2 of the order) says “(5) No legal process (including legal proceedings, execution, distress and diligence) may be instituted or continued against the partnership or partnership property except—

(a) with the consent of the administrator, or

(b) with the permission of the court.”

d. This means the court issuing the administration order. The standard process to be followed (as was the case in Panther 1919 LTD) is for the tribunal to invite the claimant to seek the permission of the administrators and for the claim to be stayed against that respondent in the meantime. There is no discretion on the part of the tribunal and we stayed the proceedings against R3 accordingly.

[8]R7 did not attend on day one and we decided to go ahead in their absence. They asked us to take into account a witness statement of Dean Bailey, which we agreed to do, but we decided to give less weight because he had not attended to be cross examined upon it. Our reasons were:a. There were a wide range of steps open to the Tribunal under the Rules when a party does not attend: we could strike out the response that has been entered by them (and decide whether or not to enter judgment) or we could decide to proceed against them in their absence. Their response is at page 95 and was confirmed by an e-mail of the 12 May 2025 to be a response which the company wished to adopt.

b. The burden is on the claimant to prove that she was employed by Lush@Lavershot Limited. The race discrimination and race related harassment complaints do not appear to be made against R7 as no individuals named in the discrimination and harassment complaints are actors for whom it is said R7 is liable. It can only be the unfair dismissal claim which is brought against them.

c. It is also for the claimant to prove that that claim is made in time. Given that those two matters are for the claimant to prove, there is a potential injustice to R7 if we were to strike out the response. As they request we will admit the witness statement of Mr Bailey because of the prejudice it would cause R7 not to do so. However it will certainly be given less weight than would otherwise be the case because he has not attended to be cross examined upon it.

[9]The second and fourth to sixth and eighth respondents made an application on Day 2 to produce an additional document. We rejected the application for the following reasons:a. We first considered the relevance of the document to the issues in the case and then whether admitted a late document would disadvantage one side more than it would disadvantage the other side in not being able to rely on it.

b. The document in question was said to evidence the employment by one of the respondents who are present and active of a lady of Russian national origin or Russian ethnicity. This is said to be relevant to the question of race discrimination.

c. We think it is of marginal relevance if the respondents present – who say they had no employment relationship with the claimant – after then end of the claimant’s employment employed somebody of Russian origin. That is not weighty evidence on the issues in the case.

d. The timing of the disclosure potentially disadvantages the claimant because it came during her evidence when she wasn't able to respond to it. We refused the application for those two reasons. The Issues

[10]The claimant had made an application to amend the list of issues. The application is at pages 1646 to 1647. When it was discussed with her, she decided not to pursue this in the hearing because it was not necessary to make the amendment. The question of whether there were genuine performance concerns on the part of the respondent was something the tribunal would have to consider as part of the respondents’ explanation for their actions on 13 May 2022. Their case is that the directors had genuine and reasonable grounds for performance concerns which was the reason why the claimant’s computer home drive was investigated. Their case is that the results of that investigation led to their decision to suspend her pending further investigation, and to seek a protected conversation with the claimant as an alternative. She was able to challenge whether that alleged belief in performance concerns was genuine within the scope of the existing issues.

[11]Therefore, the issues to be determined remained those set out by Employment Judge Hawkesworth in the orders made by the tribunal panel chaired by her in October 2024. Those are on page 169 of the hearing file and are not repeated lest these reasons be unnecessarily long. Who was the claimant’s employer within meaning of s.230(1) ERA? Who was the claimant’s employer within the meaning of s.83(2) EQA?

[12]In the present case there is no dispute but that the claimant was engaged under a contract of employment; the question is who was the other party to the contract.

[13]For the purposes of the unfair dismissal claim, the definitions of employer and employee is found in s.230(2) ERA which provides, so far as is material that: “(1) In this Act ‘employee’ means an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment (2) In this Act ‘contract of employment’ means a contract of service or apprenticeship, whether express or implied, and (if it is express) whether oral or in writing. (3) … (4) In this Act ‘employer’, in relation to an employee or a worker means the person by whom the employee or worker is (or, where the employment has ceased, was) employed. (5) In this Act ‘employment’ -(a) in relation to an employee, means (except for the purposes of section 171) employment under a contract of employment, and

(b) in relation to a worker, means employment under his contract; and ‘employed’ shall be construed accordingly.”

[14]As the statute says, the contract may in oral or in writing. It may be part oral and part in writing. However there has to be a contract of some kind – a legally binding agreement between the parties before it is necessary to go on to consider the issue of whether it is a contract of employment.

[15]No one test is sufficient to determine that issue. In Ready Mixed Concrete (South East) Ltd v Minister of Pensions & National Insurance

[1968] 1 All ER 433

three questions were posed:15.1 did the worker agree to provide his/her own work and skill in return for remuneration?

15.2 did the worker agree expressly or impliedly to be subject to a sufficient degree of control for relationship to be one of master and servant?

15.3 Were the other provisions of the contract consistent with its being a contract of service? One example of a factor the presence of which is consistent with a contract of service or of employment and the absence of which is inconsistent with such a contract is mutuality of obligation. Personal performance is another factor which has in previous authorities been considered to be such a factor.

[16]Different elements of the test are more or less informative in different cases. In Hall (Inspector of Taxes) v Lorimer

[1994] 1WLR 209

CA the Court of Appeal advised that the object of the exercise is to paint a picture from the accumulation of detail then stand back and make informed considered qualitative appreciation of the whole. It is necessary for us to consider whether the necessary elements of employment and hallmarks of employment are present, in particular mutuality of obligation and sufficiency control as well as whether there are any elements of the agreement which are incompatible with it being a contract of employment.

[17]Autoclenz Ltd v Belcher

[2011] UKSC 41

SC, makes clear that if what the parties said and did both at the time the agreement was entered into and subsequently makes it clear that they cannot have intended the document to encompass the whole of their agreement then recourse may be had to matters other than the document even if that document expresses itself to be the exclusive record of their agreement. As Lord Clarke said at paragraph 35 of Autoclenz, “the relative bargaining power of the parties must be taken into account in deciding whether the terms of written agreement in truth represent what was agreed and the true agreement will often have to be gleaned from all the circumstances of the case, of which the written agreement is only a part.”

[18]Without wanting to over-simplify the speeches of their lordships, the question that Autoclenz invites us to consider first of all is ‘what is the true nature of the agreement between the parties?’ focussing on the actual legal obligations of the parties and examining all relevant evidence including the written terms in the context of the whole agreement, the parties’ conduct in practice and their expectations of each other. What was agreed might be what is written down but it is not necessarily entirely included in written documents.

[19]So in Autoclenz an express clause in the written contracts that permitted the workers to provide substitutes (and thus negating the requirement for personal service) was found not to reflect reality. Furthermore, in practice they were expected to perform the work offered to them which contradicted a different express term of the written contract. The Supreme Court held that it was what had been agreed in fact which was determinative of the nature of the relationship and despite having signed contracts describing themselves as self-employed sub-contractors, they upheld the finding of the Employment Tribunal that, not only were they workers, but they were also employees.

[20]The relevance of the principles in Autoclenz to the present case arises because the claimant argues that the identity of her employer – the other party to the contract of employment – changed from time to time. While we first need to look at the written documents and determine what they meant, her argument requires us also to consider whether the true agreement was different to the strict wording of the written contract and changed from time to time.

[21]The definition of employee in the Equality Act 2010 (hereafter the EQA) is in s.83(2). It includes, but is broader than, a contract of employment because it also includes a contract personally to do work. Therefore if the claimant succeeds in showing that she was engaged under a contract of employment by these respondents, she will also fall within the definition of employee for the EQA. However, that definition does still require there to be a contract, a legally binding agreement between the parties.

[22]These are our findings of fact as relevant to our decision on the identity of the employer.

[23]The claimant argues that she was an employee of the first respondent, and the third to eighth respondents jointly based on two lines of argument.23.1 She first relies on what she says is the true meaning of the written contract of employment; she says that the true meaning of the document is that she was employed by any company within the Wooldridge Group and that the identity of the companies (the legal entities) who formed the Wooldridge Group as that was understood in her contract changed from time to time.

23.2 Her other argument is that when she was tasked to carry out work on the accounts of a particular company which benefited them, that meant she was employed by them.

[24]In support of the first line of argument, she referred to the Company Handbook which was issued to her daughter, who was employed by the Wooldridge Partnership (R8), in the kitchen or restaurant business, in Lavershot Barns. It is at page 858, and it says it is a guide to employment with Wooldridge Group at Lavershot Barns and therefore is specific to employment in that location. However, we accept the broader point that the term “Wooldridge Group” is used in documentation concerning the employment of an individual who is employed by R8, one of the legal entities alleged to have been the claimant’s employers.

[25]However, there is no sufficient reason to draw inferences from the loose use of that term in that context about the nature of the legal obligations between the claimant and individual companies or partnerships which have overlapping shareholders and control.

[26]We give more weight to the claimant’s personal contractual documents and two other documents in the hearing file about the way that the relationship operated in practice. Her contract of employment is at page 196 and it states the parties to it to be the claimant and “Panther 1919 Limited and its subsidiaries (The Wooldridge Group)”. A plain reading of this at first sight appears to be limited to Panther 1919 and subsidiaries and to define “The Wooldridge Group” for her contract in that way; we do not think a reasonable interpretation of the contractual documents is a wider group of companies that, from time to time, might be of varying membership. It is important that the identity of the employer is able to be conclusively identified by the parties and these subsidiaries of Panther 1919 are restricted to those that are listed in the accounts including in the year end 31 of January 2022.

[27]Those accounts start at page 1368. The list of subsidiaries is at page 1396, and those are; Wooldridge Contractors, Wooldridge Plant, Wooldridge Ecotec, Wooldridge Construction and Wooldridge Developments. We accept the respondents, evidence (which is supported by those accounts) that the Wooldridge Group, as understood at the time the contract was entered into, was construction and development based. That is supported with the letter heading on the page 239 letter confirming the claimant’s appointment as Financial controller for Wooldridge Group. We also accept, and indeed, the claimant appeared not ultimately to disagree with the proposition that R4 to R8 are not concerned with that line of work. A number of R4 to R8 were not in existence at the time the claimant’s employment started. Therefore a consequence of the way she puts her case is that she must also be arguing that the identity of her employer changed from time to time. There was no issue of an amended contract at any time.

[28]We also give weight to page 316, which is an e-mail from Mr Merry to the claimant. It evidences internal management recharging of the cost of work done for subsidiaries. We accept Mr Merry’s evidence that, usually, there were recharges to the three entities listed in that email (R4, R6 and R8). However, Mr Wooldridge (R2) had decided they should not be charged for services provided by Panther 1919 in the financial year 1 February 2022 to 31 January 2023. The fact of this internal recharging between the first respondent and its subsidiaries (as defined in the accounts) and between the first respondent and the other businesses, support the respondents’ position that, employees were employed by R1 but provided services to subsidiaries of R1 but also to other legal entities that shared some common directors, whether or not they were formally in the Wooldridge Group. This included the accounts services which were provided by the claimant and other members of the accounts team.

[29]The claimant provided a structure that is set out at page 758 and she sought to argue that the first respondent was just providing payroll services not the services of the staff. However, that was contradicted by the evidence, particularly oral evidence from Mr Merry, that there was internal recharging for staff services and not merely the repayment of wages. The claimant also appears to accept in that document (page 758) that R4, formerly Lavershot Oaks, is providing a similar type of service now. These findings are also consistent with Mrs Thomas’s evidenced that, as the HR director, she was providing management services to a number of legal entities in the wider group. It is true that the role description for the Wooldridge Group Financial Controller (page 371) the position to which the claimant was appointed in 2021, describes the role as including specific tasks for R3, R4, R6 and an entity referred to as “Lush at Lavershot”. Whether that has any connection with R7 we do not know. Tasks connected with monthly management accounts for subsidiaries of R1 are also listed. Nevertheless this does not amount to an agreement between those entities and the claimant or show that they assumed any legal obligations with regard to her.

[30]Finally, Mr Merry was clear and credible about his own employment by Panther 1919. As the Finance Director for the group, and he was the claimant’s line manager. This means when we are considering as part of the test for employment whether the claimant is under the direction or control of a particular legal entity, her line manager, as the Finance Director, was responsible for day-to-day direction of her work and he was employed by Panther 1919. R1 was responsible for her pay.

[31]We reject the claimant’s first line of argument that, on a natural and fair reading her contract means that she was employed by the entities who made up The Wooldridge Group which had a fluctuating membership. She may have been employed by R1 and its subsidiaries but none of those subsidiaries as defined in the accounts are respondents to the case; they were also placed in administration at the same time as R1. Although there is evidence that the term Wooldridge Group is in other contexts taken to mean a group of legal entities which include at least R4, none of these respondents are or were subsidiaries of R1. They were not parties to the contract of employment.

[32]In order for the claimant to succeed in her secondary line of argument, she needs to persuade is to imply the existence of a contract of employment between herself and a range of other entities which vary from time to time. The test for whether you can imply the existence of legal obligations between parties is a high hurdle. The question is whether it is necessary to imply the existence of the contract.

[33]We do not think that it is necessary to do so. That more complicated structure involving several changes to the identity of the contracting parties does not need to exist in order to explain the arrangement. A far simpler explanation – one consistent with the evidence - is that the claimant was employed by R1 which was contracted to provide services to a number of other companies – sometimes at a cost and sometimes not. Even if it were possible to imply the existence of legal obligations, the question of whether the test for a contract of employment is met poses an additional hurdle. We have found that the evidence of the claimant’s line manager is that he was employed by Panther 1919 and, although an employer may authorize the employee of another legal entity to carry out the duties and role of the employer, that would again require us to infer the existence of a far more complicated structure than is supported by the evidence. There is no evidence that the claimant was acting under the direction or control of any of R4 to R8.

[34]There is no basis in the present case to conclude that the way the arrangement operated in practice differed from the contractual position. The claimant was employed by R1 and its subsidiaries and not by R4 to R8.

[35]The claimant alleges that R1 was put into administration in order to avoid her claim. That is not relevant to the issue of who was the employer under the ERA or the EQA. There are occasionally, but rarely, circumstances in which is can be shown that there was a deliberate act to evade responsibility for a debt which might be relevant to whether a debt can enforce a judgement made against one company against another but that is not a matter for the employment tribunal. Findings relevant to the other issues in the case

[36]The first issue in time concerns Richard Cox who described himself as a contractor of R1. We therefore thought it was prudent to consider whether he was in the position where R1 should be responsible for his action if he were not directly employed by them under a contract of employment.

[37]We heard evidence from the claimant on this and we accept that Mr Cox was effectively in the same position vis-à-vis R1 as people he worked alongside who were direct employees save that he submitted invoices. Therefore, we accept that he was engaged on a contract to provide services personally within the wider definition of employment for the EQA. He has not attended to give evidence or to be cross-examined upon his statement. That was admitted subject to the weight we could give it.

[38]In that statement he denies the allegations. In paragraph 4 of his statement he said that he was in the habit of calling the claimant “Svet” rather than “Sweat”, as alleged. The claimant’s paragraph 71 and 72 refers specifically to her complaints in relation to his conduct and dates one such incidents to a period of three days between 27 and 29 April

[39]Without prejudice to their main argument that they were not her employer – and therefore that the complaints should not succeed as against them, R4 to R8 in the alternative defended these allegations on the basis that the claimant lacked credibility. The argument was principally based on the allegations depending solely upon her oral evidence.

[40]It is true that at the supporting witnesses who attended to give evidence in support of the claimant’s case did not themselves witness directly the events that she relates. As the respondent argued, beyond the claimants oral evidence, there is no supporting evidence. They also point to the evidence of Mr Merry and Mrs Thomas, who did give evidence and were cross examined. The former was in the department that the claimant worked in and the latter in the office more generally. They deny ever hearing the comments complained of, or comments of that kind. It is accepted by the claimant that she made no contemporaneous complaints to them. Both parties stressed that, until late February 2022, the relationship between the claimant and Mr Merry, the claimant and Mrs Thomas had been good.

[41]Our view is that the claimant is not deliberately trying to mislead us. She specifically explained that she had recreated an email which had not been available in disclosure so she demonstrated an understanding of the importance about being precise and avoiding misleading the Tribunal. There are parts of her evidence which are plausible. In particular, in paragraphs 76 and 77 detail and context are provided which support the allegations contained in those paragraphs. The details she provides there about allegations against Mr Cox, make those allegations credible. We accept that he did the acts set out in List of Issues 5.2.1 and 5.2.2..

[42]We turn to the allegations against Joe Orbell. Here, in his statement, he put those allegations down to a misunderstanding of his habit of mimicking a catch phrase from the film “Taken”. Although not in the list of issues, the claimant's witness statement also says that he made a comment following the outbreak of the Ukraine War (see her paragraph 76) and that, on 6 May 2022, he commented about her food in a mock Russian accent, see paragraph 79 of her statement.

[43]The comment referred to in paragraph 76 is not in the list of issues. We do not draw a conclusion about that because it would be wrong to consider as an allegation within scope of the list of issues something that the respondents had not had notice was being relied on save as background. The context in the first few months of 2022, was the invasion of Ukraine by Russia took place on 24 February 2022 . We can imagine in the context of news reports covering details of the Ukraine War and, in particular, on sanctions of Russian people living in the United Kingdom, that colleagues, knowing the claimant to have Russian heritage, might well have said something about her having her assets frozen. She, herself, says that it may well have been intended as a joke but was upsetting.

[44]Another matter about which we accept the claimant’s evidence is where she tells us that Martin Taylor approached her to reassure her. That piece of evidence suggests that he had noticed some comments which might have upset her. It also suggests that insensitive comments about the War were not universal, in the sense that not everybody was allied with them.

[45]On the other hand, we have some concerns about how reliable some of the details that the claimant outlined in her oral evidence, in particular, are. We find that some people made some comments about Russian people rather than there being at a general mood of anti-Russian feeling in the company. Nevertheless, that probably did cause upset,

[46]The claimant's daughter gave evidence that the claimant spoke about feeling upset about the mood and that is also supporting evidence that this is not something the claimant has simply invented for the purposes of the claim. The context makes some of what she alleges was said at that time seem improbable.

[47]Having made some general comments, we look at this specific allegation against Mr Orbell. He seems to have mimicked an accent, which the claimant took to be Russian, but which he said was not intended to be either targeted at her or Russian. She said that on 6 May he commented on her food. She did not make it clear to him that that was objectionable, but she was, as a matter of fact, upset by something she regarded as rude.

[48]She does not seem to have been significantly upset by the conduct of Mr Cox or Mr Orbell prior to the war. However, there is a distinction between the allegations against Mr Cox and those against Mr Orbell. In respect of Mr cox, the claimant, we accept, made clear to him that she wanted him to call her by her full name Svetlana or Lana for short, rather than his chosen, somewhat, pejorative, version of her name.

[49]We find that the claimant became more sensitive to comments when the Russian invasion of Ukraine was a topic of conversation. It is a difficult situation because, on the one hand, discussing a matter of global significance that happens to involve Russia is not something that could reasonably be regarded as harassment in the workplace, but, on the other hand, when making a general comment, the speaker need to be alert to the risk that people will be upset or hurt. It is quite possible, given the shock the invasion caused, that some individuals would go beyond a conversation that just discusses the war itself, into criticism, or hurtful observations.

[50]Although the claimant listed 5 individuals in the list of issues and in her further and better particulars (page 138). However, her witness statement only gives specific detailed allegations against Cheryl Garlinge. See Claimant’s statement paragraph 76 (WB page 27), and her supplementary statement paragraph 5.6 (WB page 48). Comparing that with the list of issues in particular, there is nothing in the claimant’s witness statement that specifically evidences people discussion discussing Russian actions in her earshot which was intimidating for her. Doing so, of itself, is not necessarily unreasonable or intimidating.

[51]The claimant recounts that Miss Garlinge said that she hated President Putin; that is not targeted at the claimant. Although the other half of the comment alleged against Miss Garlinge is targeted towards Russian people generally, other than that one comment, the claimant does specify particular things said which amount to generalisations being made about people of Russian heritage (LOI 5.2.24.2). She did not, in her witness statement, refer to people asking her to justify the war and she does not generally say that people were having these conversations with her rather than that they were having the conversations in her hearing. The definition of harassment does not necessarily require the unwanted comments to be made directly to the complainant but if the context is that the comment was overheard then that is relevant to whether it could reasonably be regarded as harassment or was intended to be harassment.

[52]We accept that two specific comments were, as a matter of fact, made as alleged by the claimant; those are Mr Orbell’s comment “are you not a Russian spy do you not worry about the sanctions against yourself and your assets to get frozen”, and the comment by Miss Garlinge. “I hate Putin and everything to do with the Russians.” However, as I have already said, the first is not within the allegation specifically referred to within list of issue (5.2.4) which sets out the allegations concerning the people in the workplace generally. Nevertheless, it provides context which allows us to assess whether the specific comment which we have found was made by Miss Garlinge fulfils the definition of harassment.

[53]As in LOI 5.2.5, the claimant alleges inappropriate and racially explicit language against both Charlie Wooldridge and Graham Wooldridge. However, in her witness statement, she did not specifically allege that Graham Wooldridge said anything in particular. Her general allegation of not acknowledging her presence, as attested to in her paragraph 74, does not include him. This is an illustration of an occasion where the claimant has, when setting out her claim, had a bit of a scattergun approach to her allegations which sometimes lack precision. We need to take care to consider where she has been consistent in her descriptions and where she has not, and should consider any supporting context to the allegations before making our findings. While we accept that the claimant does not set out to mislead, this scattergun approach could be misleading and we do not simply accept the allegations that are made.

[54]The claimant was asked to specify, when she was giving oral evidence, any other occasions when language said to been used by Charlie Wooldridge that might fall within LOI 5.2.5, other than the specific instance that is alleged in LOI 5.2.6. She did not specify any other occasions.

[55]Our impression was that the claimant and Charlie Wooldridge had limited day-to-day communication because she was in the Accounts Department, and she was managed directly by the finance director. We accept Mr Woolridge’s explanation that, as a commercial director, he oversaw the decisions at a higher level. He might see the claimant every day, but he did not, we find, interact with her frequently or closely.

[56]The allegation in LOI 5.2.6 was pinpointed in the claimant’s statement evidence to having occurred on 25 March 2022. The claimants evidence of the incident has been broadly consistent, and we accept that the changes in the list of issues were due to an error of transcription not to the claimant changing her version of events. The context was that she and Mr Merry had to have one of their regular meetings in the boardroom and Mr Charles Woodridge and Mr Graeme Woodridge were looking at a computer screen in the former's office. They were looking at details on screen that was something to do with the economic outlook generally which, no doubt, was impacted by the Ukraine War. At that time, the Group’s economic position was likely to be uncertain as a result of the shock to the economy on a global level. That may have affected their personal investments. Mrs Thomas agreed that material prices, certainly for the construction business, were affected. Although Charles Woodridge said that was only after the claimant’s resignation, we are looking at a date for this alleged incident of about one month after the invasion. We think that everybody's recollection is sufficiently clear that we can recall how fast things proceeded over the initial weeks of the invasion. We accept that the global market experienced a considerable shock and that is relevant context against which to assess the plausibility of the claimant’s account. We think it is plausible and credible that the claimant was working as she said, with Mr Merry and that the comment was made. We reject Mr Wooldridge and Mr Merry’s denials that the former said to Graham Wooldridge, in the course of a discussion, “Fucking Russians”.

[57]Otherwise, the allegations in LOI 5.2.6 , 5.2.8 and 5.2.9 are not made out.

[58]As to LOI 5.2.5.2, the claimant has not shown the sort of detail which would have amounted to a credible account to satisfy us, on the balance of probabilities, that the outward behaviour of the directors changed towards her in the period February to May 2022. We recognise that they say that the relationship was less warm in that because they were concerned about a dip in performance, as Mr Merry had described it to them. However, for the underlying factual allegation for this harassment claim or discrimination complaint to succeed, there needs to be something more concrete than the one comment. The claimant has shown the “Fucking Russians” comment was made. That is the extent to which the claimant has shown that the allegations in LOI 5.2.5., 5.2.6, 5.2.8 and 5.2.9 are made out.

[59]In reaching this conclusion we have re-read with care the claimant's account of the alleged door slamming incident in her paragraph 78. Our impression of Charles Wooldridge is that he is somewhat heedless and unobservant about others and lacks awareness of how his words and actions present to others. It is not necessarily to his credit that he, as he stated in his evidence, is apparently so unaware of the sensitivities and needs of the employees of the company he directs. The claimant was only two removed from him in the hierarchy. However, we accept that this is his general demeanour and disposition. It causes us to think that the claimant’s account of the door slam incident shows more about how she felt about it than about how objectively it was. We do not accept that she was targeted rather than he was preoccupied, and we do not find that he deliberately slammed the door in her face.

[60]Mr Merry said that he did not recall the “Fucking Russians” comment. We accept that it probably made no impact on him. The claimant does not say that she said anything or commented or complained at the time. The factual allegation against him is that he took no action and, to that extent, the core factual allegation in LOI 5.2.7 is made out in relation to that one incident.

[61]That brings us to the events of the 13 May 2023. The claimant knew nothing about any concerns on the part of her employer prior to 13 May 2025. Indeed, when she went into the meeting on that day, she was expecting it to be about something else. The evidence of alleged events running up to that date therefore comes from the respondents.

[62]Their account is that, probably because the directors asked Mr Merry why he was not doing tasks they expected of him in his role as finance director, Mr Merry reported to them that the claimant had not stepped up to the role of finance controller as he expected. She had been appointed in about late March 2021, see the letter to the mortgage company at page 239. She had a period of handing over to the incoming management accountant. It is hard to understand why, if she had not made the expected progress since her appointment in March 2021, that was not addressed at the end of year review for December 2021, or, indeed, at any time in the next 14 months.

[63]She had monthly meetings with Mr Merry. He accepted that he did not raise performance concerns. His only explanation was that he knew it would damage the working relationship, possibly fundamentally. The only example of non-performance that he produced in the hearing was on one occasion in April 2022 where Karolina Smigiel apparently told him that she was not getting support from the claimant with the work she had to do on the audit. This is disputed by the claimant who showed us emails to evidence support she provided, and thanks provided by Ms Smigiel. In any event, this is a one off occurrence.

[64]The claimant had, at the same time, just done a significant amount of work assisting with refinancing which is a one off event rather than part of the regular day-to-day work of the financial controller and might well have impacted on her performance in the short term. There is no evidence of substance that the claimant was not productively engaged in work or carrying out her duties satisfactorily. Mrs Thomas’ evidence was that the claimant always seemed to be busy. There was limited disputed evidence from Mr Merry about time keeping but even evidence that the claimant was taking phone calls in the car park did not amount to evidence that she was doing that in work time.

[65]Put simply, the evidence put before us does not justify the level of suspicion that Mr Merry professed to have, or that he generated with the other directors. They had concerns only because Mr Merry reported his own concerns on to them. That engendered a level of suspicion, certainly on the part of Mrs Thomas, that led Mr Merry to seek advice from a solicitor and to authorize Mr Saddington to investigate the claimant’s home drive. By that we mean the folder on the respondent’s cloud based electronic filing system where, in common with other employees, she was able to keep personal files password protected. Mr Saddington he found a quantity of the claimant's personal files, some of which were work related personnel documents, and many of which were personal in a broader sense. Some related to her husband's company. She had helped him with those accounts and been paid an income for that help (see payslip at page 241).

[66]It is not necessary for us, in order to determine the issues in the case, to decide whether or not this was done in work time. We are considering whether the employer had reasonable and proper cause for their actions and also whether Mr Merry was motivated by race in his actions.

[67]With regard to that, the claimant points to comparator information. We have heard a quantity of evidence, not all of which we will set out in this judgment. We only set out in the judgment the evidence and our findings that it is necessary to make in order to decide the issues in the case. The most relevant comparator is Eva Mitchell and that is because it was Mr Merry who made the decision in her case, she worked in the same department as the claimant. She alleges that Mr Wooldridge made all of the decisions, but we reject that evidence.

[68]We prefer his evidence (i.e. that of R2) and that of Mrs Thomas about the decision making process. Indeed, we prefer that evidence to Mr Merry’s evidence; the Finance Director sought to give the impression that the board of directors collectively, including him, made the decision to investigate the claimant’s home drive and then to consult the lawyer. As we said previously, we accept that Mr Woolridge had a high level involvement and expected Mr Merry to sort it without having to be involved in the detail. He was simply told by Mr Merry that the solicitor had given them a script and that he was going to deal with it in accordance with the solicitor’s advice.

[69]So, returning to the situation of Eva Mitchell. She may not have been in an absolutely identical situation but, nevertheless, what happened there is sufficiently similar to the claimant’s situation to provide useful evidence of how someone who was not of Russian national origins would have been treated in materially the same circumstances. The claimant noticed that Eva Mitchell's performance was dipping when it had previously been good. She was working from home during the COVID. She was juggling childcare. She was, apparently, taken through a disciplinary process and told to work from the office rather than work from home.

[70]Notably, there is no suggestion that the first respondent investigated her home drive or sought solicitors’ advice about entering into protected conversation. Their first step was to talk to her about the reasons why her performance appeared to have dipped. To that extent it is a comparable situation to the claimant’s, because the claimants performance had apparently or allegedly dipped (although we have not been provided evidence to substantiate that) and yet the first step was not to talk to her.

[71]Part of the reason that Ms Mitchell’s situation is not completely comparable is that R1 thought that they knew that the reason which might have affected her performance was conflicting childcare duties when the schools were not fully open. Nevertheless, the first step that was taken was to talk to her.

[72]It is hard to accept Mr Merry's proferred reason for not talking to the claimant when the step that he took instead was to investigate her personal drive. If the reason he had avoided talking to the claimant informally to say that he had noticed a dip in performance, or that he was concerned that she was not picking up all of the tasks in the job that to which she had been promoted, was that of the threat of damage to the relationship, then it is hard to imagine why he thought it would be less problematic to take such an intrusive step as to investigate her personal drive.

[73]Having found what they found Mr Merry, after consulting Mrs Thomas, instructed solicitors who provided advice. We made clear to the witnesses that the advice of the solicitors was covered by legal professional privilege and that the privilege was that of the client, R1, who was not present before us. None of the parties before us would have been in a position to provide a valid waiver. Mrs Thomas (who had been consulted by Mr Merry was aware of the intended investigation) gave clear evidence that they expected that a full investigation would lead to a finding of gross misconduct and dismissal. Mr Merry was also steadfast in saying that he did not know whether there was gross misconduct or not. However, in this we think the recollection of Mrs Thomas – a family member of the directors in the family company – should be given weight. The employer (R1) had not decided to dismiss her but expected that they would have to dismiss her. This view was formed, certainly by Mrs Thomas, before the claimant knew anything about their concerns.

[74]Although we accept that Mr Merry did read through the script at page 367 we are nevertheless critical of his actions.74.1 Going into that meeting the claimant did not understand what a protected conversation was. She may have said that she agreed to it, but the whole thing was obviously going to be a complete shock to her, making it hard, if not impossible, for her to be in the frame of mind to make a judgment about the choice she was being given, or to even understand what she was being told. It was extremely likely that she would not understand what a protected conversation would mean when it was explained in those circumstances.

74.2 The time frame offered, as set out in the script, of a few minutes, is, to put it mildly, inconsistent with ACAS Guidelines on Protected Conversations which say there should be 10 days consideration of any offer to leave employment on a settlement agreement. The failure to follow this guidance means there is a risk that factor would be taken into account and lead to a conclusion that there has been improper conduct in the protected conversation which allows the employee to refer to it in any unfair dismissal complaint.

74.3 The claimant clearly took away from what Mr Merry said that she had a few minutes to decide whether to resign (which is in the script) and if she did not then she would be suspended and put through a disciplinary process, the likely outcome of which was that she would be dismissed for gross misconduct. It is only the underlined passage which is not in the script although it does include that she should be told that she would be suspended pending investigation of a disciplinary charge of gross misconduct.

74.4 Mr Merry may have read through the script he clearly departed from it to the extent that he added what the likely outcome of the process would be. Maybe he was pressed by the claimant to explain in more straightforward language what this meant. Given that that was what the director's expectation was, we accept that he said words to the effect that her choice was either to resign or to be put through a process, the likely outcome of which was that she would be dismissed for gross misconduct. Objectively, the claimant was confronted with an accusation of gross misconduct for the first time and an ultimatum to resign or face likely dismissal, which she was to respond to within a few minutes.

[75]In those circumstances the allegation set out in list of issues 5.2.10.2 and those in 5.2.10.3., 5.2.10.4 and 5.2.10.5 are made out in that those events happened as a matter of fact. However, the claimant has not shown that Mr Merry told Karolina Smigiel and Marta in advance that she was going to lose her job, that is an unwarranted conclusion that the claimant has drawn from the facts that are available to her. She was required to type and sign a resignation letter after she confirmed her intention to resign. In fact, she resigned already so the typing of the letter cannot itself contribute to any breach of contract. Law applicable to the remaining issues in dispute 75 Section 95(1)(c) of the Employment Rights Act 1996 makes it clear that a dismissal includes the situation where an employee terminates the contract of employment (with or without notice) in circumstances in which he is entitled to terminate it without notice by reason of the employer’s conduct. This is commonly referred to as constructive dismissal and the leading authority is Western Excavating (ECC) Ltd v Sharp

[1978] ICR 221

CA. If the employer is guilty of conduct which goes to the root of the contract or which shows that he no longer intended to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any further performance of it. The employer’s conduct must be the cause of the employee’s resignation and thus the cause of the termination of the employment relationship. If there is more than one reason why the employee resigned then the tribunal must consider whether the employer’s behaviour played a part in the employee’s resignation.

[76]In the present case the claimant argues that she was unfairly dismissed because she resigned because of breaches of the implied term of mutual trust and confidence; a term implied into every contract of employment.

[77]The implied term of mutual trust and confidence imposes an obligation that the employer shall not, without reasonable and proper cause, conduct itself in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between employer and employee. One question for the tribunal is whether, viewed objectively, the facts found by us amount to conduct on the part of the respondent which is in breach of the implied term. Whether the employment tribunal considers the employer’s actions to have been reasonable or unreasonable can only be a tool to be used to help to decide whether those actions amounted to conduct which was calculated or likely to destroy or seriously damage the relationship of trust and confidence and for which there was no reasonable and proper cause.

[78]Whether or not there was a fundamental breach requires considering whether the conduct is: “a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract.” Western Excavating (ECC) Ltd v Sharp

[1978] ICR 221

, CA

[79]Whether a breach of another term is a fundamental breach is a question of fact and degree taking into account the following:79.1 the effect on the employee is relevant;

79.2 the employer’s subjective intention is not a key part of the test. It may be relevant, but the intention must be judged objectively;

79.3 whether the employer acted reasonably is not part of the test;

79.4 a breach of the implied term of mutual trust and confidence necessarily goes to the root of the contract.

[80]If that conduct is a significant breach going to the root of the contract of employment (applying the Western Excavating v Sharp test) and the employee accepted that breach by resigning then she was constructively dismissed. The conduct may consist of a series of acts or incidents which cumulatively amount to a repudiatory breach of the implied term of mutual trust and confidence.

[81]Once she has notice of the breach the employee has to decide whether to accept the breach, resign and claim constructive dismissal or to affirm the contract.

[82]Once the tribunal has decided that there was a dismissal they must consider whether it was fair or unfair in accordance with s.98 ERA 1996. “Section 98 Employment Rights Act 1996

(1) In determining for the purposes of this Part whether the dismissal of an employee is fair or unfair, it is for the employer to showa. the reason (or, if more than one, the principal reason) for the dismissal, and b. that it is either a reason falling within subsection (2) or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held.

(2) A reason falls within this subsection if ita. Relates to the capability or qualifications of the employee for performing work of the kind which he was employed by the employer to do, b. Relates to the conduct of the employee, c. Is that the employee was redundant, or d. ...

(3) …

(4) Where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal was fair or unfair (having regard to the reason shown by the employer)-

a. depends on whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and

b. shall be determined in accordance with equity and the substantial merits of the case.”

[83]The definition of direct race discrimination is set out in s.13 EQA and the definition of harassment is found in s.26 EQA. The statutory tests have been incorporated into the statement of issues starting at page 156.

[84]All claims under the EqA (including direct discrimination, victimisation and harassment) are subject to the statutory burden of proof as set out in s.136. This has been explained in a number of cases, most notably in the guidelines annexed to the judgment of the CA in Igen Ltd v Wong

[2005] ICR 931

CA. In that case, the Court was considering the previously applicable provisions of s.63A of the Sex Discrimination Act 1975 but the guidance is still applicable to the equivalent provision of the EqA.

[85]When deciding whether or not the claimant has been the victim of direct discrimination, the employment tribunal must consider whether he has satisfied us, on the balance of probabilities, of facts from which we could decide, in the absence of any other explanation, that the incidents occurred as alleged, that they amounted to less favourable treatment than an actual or hypothetical comparator did or would have received and that the reason for the treatment was disability. If we are so satisfied, we must find that discrimination has occurred unless the respondent proves that the reason for their action was not that of disability.

[86]We bear in mind that there is rarely evidence of overt or deliberate discrimination. We may need to look at the context to the events to see whether there are appropriate inferences that can be made from the primary facts. We also bear in mind that discrimination can be unconscious but that for us to be able to infer that the alleged discriminator’s actions were subconsciously motivated by disability we must have a sound evidential basis for that inference.

[87]The provisions of s.136 have been considered more recently by the Supreme Court in Hewage v Grampian Health Board

[2012] ICR 1054

UKSC. Where the employment tribunal is in a position to make positive findings on the evidence one way or the other, the burden of proof provisions are unlikely to have a bearing upon the outcome. However, it is recognized that the task of identifying whether the reason for the treatment requires the Tribunal to look into the mind of the alleged perpetrator. This contrasts with the intention of the perpetrator, they may not have intended to discriminated but still may have been materially influenced by considerations of disability. The BOP provisions may be of assistance, if there are considerations of subconsious discrimination but the Tribunal needs to take care that findings of subconscious discrimination are evidence based.

[88]Furthermore, although the law anticipates a two stage test, it is not necessary artificially to separate the evidence adduced by the two parties when making findings of fact (Madarassy v Nomura International plc

[2007] ICR 867

CA). We should consider the whole of the evidence when making our findings of fact and if the reason for the treatment is unclear following those findings then we will need to apply the provisions of s.136 in order to reach a conclusion on that issue.

[89]Although the structure of the Equality Act 2010 invites us to consider whether there was less favourable treatment of the claimant compared with another employee in materially identical circumstances, and also whether that treatment was because of the protected characteristic concerned, those two issues are often factually and evidentially linked (Shamoon v Chief Constable of the RUC

[2003] IRLR 285

HL). This is particularly the case where the claimant relies upon a hypothetical comparator. If we find that the reason for the treatment complained of was not that of disability, but some other reason, then that is likely to be a strong indicator as to whether or not that treatment was less favourable than an appropriate comparator would have been subjected to.

[90]What is and what is not harassment is extremely fact sensitive. So, in Richmond Pharmacology Ltd v Dhaliwal

[2009] IRLR 336

EAT at paragraph 22, Underhill P said: “We accept that not every racially slanted adverse comment or conduct may constitute the violation of a person's dignity. Dignity is not necessarily violated by things said or done which are trivial or transitory, particularly if it should have been clear that any offence was unintended. While it is very important that employers, and tribunals, are sensitive to the hurt that can be caused by racially offensive comments or conduct (…), it is also important not to encourage a culture of hypersensitivity or the imposition of legal liability in respect of every unfortunate phrase.”

[91]The importance of giving full weight to the words of the section when deciding whether the claimant’s dignity was violated or whether a hostile, degrading, humiliating or offensive environment was created for him was reinforced in Grant v HM Land Registry & EHRC

[2011] IRLR 748

CA. Elias LJ said, at paragraph 47: “Tribunals must not cheapen the significance of these words. They are an important control to prevent trivial acts causing minor upsets being caught by the concept of harassment.”

[92]Furthermore, in Weeks v Newham College of Further Education [2012] EqLR 788 EAT, Langstaff P said: “17....Thus, although we would entirely accept that a single act or a single passage of actions may be so significant that its effect is to create the proscribed environment, we also must recognise that it does not follow that in every case that a single act is in itself necessarily sufficient and requires such a finding. ... 21. However, it must be remembered that the word is ‘environment’. An environment is a state of affairs. It may be created by an incident, but the effects are of longer duration. Words spoken must be seen in context; that context includes other words spoken and the general run of affairs within the office or staffroom concerned.” Conclusions

[93]We start with our conclusions on the unfair dismissal. We remind ourselves about Mr Merry’s action on 13 May. When making those findings we referred to the numbering in List of Issues Section 5 which concerns the race discrimination complaints. However the same events were relied on in list of issues 2.1.1. Not all of the details were made out but the core allegation was that an ultimatum was put to the claimant that she should resign or would be suspended and put through the disciplinary process, and likely be dismissed for gross misconduct. That was made out and we accept that the claimant has shown that was conduct which was likely to damage or seriously destroy the relationship of trust and confidence and that there was no reasonable or proper cause for it.

[94]Of course, it is possible for an employer to have difficult conversations without breaching the implied term of mutual trust and confidence, including where it is necessary to tell the employee that they are to be suspended or that there is to be an investigation under the disciplinary process. It can be necessary to warn an employee when a disciplinary action is contemplated that dismissal might be possible outcome. The difference is that what Mr Merry said, we accept, is that the claimant was to be suspended pending an investigation and would be dismissed or that dismissal was likely because that was his and Mrs Thomas’ expectation. Furthermore, typically when difficult conversations are necessary, even if the employee’s confidence in the employer is objectively affected by what they are told, the employer has a reasonable and proper cause for their actions.

[95]Giving that ultimatum was conduct that was calculated or likely to destroy the relationship of trust and confidence. The reasons why we say R1 had no reasonable or proper cause are:95.1 Objectively, there had been basis for concluding the claimant’s performance was worse;

95.2 The first step taken in response to nebulous concerns was to investigate her Home Drive;

95.3 They might argue that, whether or not they had good reason to investigate her Home Drive, the real question is whether they had reasonable and proper cause to suspend the claimant pending investigation and offer her a protected conversation;

95.4 However, the shortness of time the claimant was given to respond was outside the ACAS Guidelines;

95.5 What she was actually told was in terms of an ultimatum which gave her to understand that the outcome of the disciplinary investigation was a foregone conclusion – R1 did not have reasonable and proper grounds for such a statement before carrying out the investigation or hearing the claimant’s explanation for the presence on her Home Drive of documents suggesting that she had carried out accountancy work for her husband’s company.

95.6 Since they departed from the script (of which we are critical in any event) their reliance on professional advice does not provide reasonable and proper cause for their actions.

[96]The claimant resigned in response to that ultimatum and therefore accepted the fundamental breach of contract. She was dismissed by R1.

[97]We need to consider whether that dismissal was unfair. R1 is not present. They might have argued that the reason for Mr Merry's actions were conduct. The respondents case has been that they had uncovered evidence of what they believe to be potential gross misconduct. However, they have not shown before us that they had reasonable grounds for dismissing on 13 May. Indeed, Mr Merry stressed frequently that he did not know whether the claimant was guilty of gross misconduct or not. Any question of whether she might have been dismissed fairly had they gone through the proper process is for a remedy hearing. The unfair dismissal claim therefore succeeds against R1.

[98]The wrongful dismissal claim succeeds because the claimant was entitled to eight weeks’ statutory notice less the ex gratia payment of one month salary.

[99]We move onto the EQA complaints. The same facts are relied on as harassment and discrimination in the alternative.

[100]The definition of detriment in the EQA means that, if a particular act is found to be an act of harassment, it cannot also be a detrimental act for the purpose of a direct race discrimination complaint.

[101]The acts that are set out in LOI 5.1.1, 5.1.2 and 5.1.3 occurred as a matter of fact. We accept that Mr Orbell used the comments in that accent (whether or not it was intended to mimic an Albanian accept) because the claimant is Russian.

[102]The misstatement of a Russian name as an English word about an unpleasant thing (a reference to sweat) is a derogatory way to say a Russian name (LOI 5.2.1). That is a link between Mr Cox's actions and race.

[103]However, there is no link to race in allegation LOI 5.2.2 concerning the comments about the claimant’s skirt. Indeed, the claimant, herself, said it was more to do with sex. Therefore, that particular allegation does not succeed as a race related harassment complaint or a race discrimination complaint.

[104]The link to race in relation to LOI 5.2.3 is that Mr Orbell mimicked an accent and commented on what a Russian person would eat. This is not something that would have been said had the claimant not been Russian.

[105]On the balance of probabilities, giving even limited weight to the statements of the alleged perpetrators, we do not think that these acts were done with the purpose of creating the harassing effect.

[106]We go on to consider whether they had that effect and whether it was reasonable for the comment to do so. In terms of Mr Cox's actions, we accept that Miss Davis asked him not to call her “Sweat” and she asked him to call her Svetlana or Lana. It is that aspect of this comment which causes us to think for him to persist after that means it is reasonable for the claimant to consider it to have the effect of harassment. We are mindful that ordinary exchanges in the workplace should not lightly be made unlawful and that we should guard against encouraging a culture of hypersensitivity. However, once he persisted in mispronouncing her name, we think it crossed the line into meeting the statutory test. A name is an important part of identity and it can offend someone’s dignity for it to be persistently mispronounced.

[107]Conversely, bearing in mind the advice from the Employment Appeal Tribunal about the weight which needs to be given to the statutory test, and the need to consider the objective element that it has to be reasonable to regard the conduct as having the harassing effect, the one off comment that was described by the claimant in her paragraph 79, by Mr Orbell, was rude, but it could not reasonably be regarded as hostile, derogatory, or intimidating. we do not think it meets the statutory test.

[108]We go on to consider whether the mimicry of an Eastern European or Slavic accent and commentary on what the claimant was eating was direct race discrimination. We conclude that it does not meet the test for detriment. Mr Orban was not in a position of responsibility or authority over the claimant and the test is whether the reasonable employee would consider themselves to be disadvantaged in their employment by reason of this mimicking of the claimants action. The race discrimination complaint based on this event fails as the act did not amount to a detriment.

[109]Returning to the complaints of harassment, to a limited extent, the core allegations in LOI 5.2.4 is made out in particular in relation to paragraph 76 of the claimant's witness statement. The context was that she was the only Russian at the time in the office. The Ukraine War was a topic of conversation and national news because it was shortly after the invasion. One Polish colleague was affected because of family members on the Polish/Ukrainian border.

[110]The specific comment by Miss Garlinge set out in paragraph 76, is the only comments alleged within LOI 5.2.4 which has been established as having taken place. Otherwise the complaint is not made out as against other individuals. However, we are satisfied that other comments which were hurtful were made at the time including the comments by Mr Orbell namely, “Are you not a Russian spy? Do you not worry about the sanctions against yourself and your assets to get frozen? There were criticism made of President Putin’s actions and criticism of the war generally sufficient to cause a colleague to check in with the claimant to see whether she was affected by the mood.

[111]Those are part of the relevant circumstances in which Miss Garlinge said how she hated Putin and everything to do with Russians. In all of the circumstances, this does amount to unwanted conduct which created an intimidating, hostile and offensive environment for the claimant and she probably found that humiliating. As a matter of fact, it caused claimant considerable upset for Ms Garlinge to cross the line and say that she hated Russians rather than focusing on a discussion of the actions of the state or the war. That is what gives this the quality. The harassment complaint succeeds in relation to that comment. It cannot both succeed as a harassment complaint and a discrimination complaint.

[112]The allegation at LOI 5.2.5 is not made out as a matter of fact and does not succeed for that reason.

[113]So as far as LOI 5.2.6 is concerned, Mr Wooldridge did say “Fucking Russians” on 25 March 2022. The comment was not directed at her. Even on her account she said that it was said by him to Mr Graham Wooldridge in the context of the impact on the market or on their business of the Russian invasion. It was, no doubt, upsetting and unpleasant for her in the context of her heightened sensitivity at that time. It does appear now to take on an importance in her mind when seeking to explain the otherwise hard to explain events of 13 May 2022. It was unpleasant, he should have been alert to the possibility of offence by the claimant, however we do not think that it was reasonable, given the pressure on work in the director's at that time, that it should be regarded as meeting the statutory test as a one off occurrence.

[114]For similar reasons, it does not meet the test of detriment for the direct race discrimination complaint.

[115]LOI 5.2.7 complains that Mr Merry failed to respond to hearing Mr Wooldridge say Fucking Russians. The claimant clearly wanted, and needed, more reassurance than she received. But, given that the act itself was not harassment, it was not harassment to fail to respond to it and neither is a detriment for the purposes of the s.13 EQA complaint.

[116]The alleged facts underpinning LOI 5.2.8 and 5.2.9 are not made out so those fail both as allegations of harassment and direct race discrimination..

[117]We then reach LOI 5.2.10, the acts of 13 May 2022. The claimant has shown that Mr Merry did instruct Mr Saddington to block her computer. However, the entire reason for that was that he expected to suspend her. It was a consequence of that decision not less favourable treatment in itself. Anyone else being suspended for similar reason would have had their access to R1’s system blocked. The direct discrimination complaint based on that fails.

[118]Similarly, as the action had nothing to do with race it was not related to race and the race related harassment complaint based on that fails.

[119]In their essence, the allegations that are set out in LOI 5.2.10.2 are made out in that the claimant has shown that those events occurred. Those were the principle reasons why the claimant resigned. We have accepted her account of Mr Merry’s conduct in relation to the protected conversation. He required the claimant to write a resignation letter to confirm her oral resignation. Mr Saddington had to unlock the computer so she could do so, and she had someone standing over her while she did. She was then required to leave without taking anything other than her handbag and that was done in front of her team.

[120]Although Eva Mitchell’s situation is not completely on all fours there is a difference of treatment earlier in the process in that she was spoken to when performance concerns arose and the claimant was not. The explanation for Mr Merry's decision not to talk to the claimant is difficult to understand and illogical. We reject it. We do not think that this was the reason why he did not speak to her about her performance although that leaves us not understanding what the reason was.

[121]There is, in fact, no evidence of poor performance so there was insufficient justification for the apparent suspicion which led Mr Merry, after consulting with Mrs Thomas, to investigate the hard drive. Having done so there may have been sufficient grounds to suspend the claimant and start an investigation. However, it was premature to combine that with a protected conversation and that was conducted improperly. All of those seemed to us to be matters which call for an explanation.

[122]We have had evidence from Mr Merry about his reasons. Ignoring that for the moment as we must we think that they are matters from which, in the absence of any explanation, it could be inferred that the claimant was treated less favourably than someone who was not of Russian origin would have been treated and that reason for that treatment was that of race. The burden of disproving discrimination transfers to R1.

[123]When the burden then transfers to the employer to disprove race discrimination that they need to show cogent evidence in order to satisfy that burden. Mr Merry said that he did not expect the outcome to be that the claimant would resign, and to some extent, he appeared to get into a situation that he did not know how to handle. Nevertheless, he seemed – despite his evidence that he did not know whether there was gross misconduct or not – at the time he seems to have believed that the claimant would be found guilty of gross misconduct and probably would have to be dismissed. That was patently a premature conclusion.

[124]R1 is not present or represented at this hearing and the only evidence of the reason for the actions is not cogent or logical, in our view. We therefore do not think that the first respondent has satisfied the burden on them, and we find that the constructive dismissal was an act of direct race discrimination.

[125]There remains the holiday pay claim.

[126]We accept Mrs Thomas’ evidence in para.9 of her witness statement, where she explained how the holiday pay was calculated. We accept that that was the appropriate way to do so. The claimant argued that, had she not been dismissed, she would have accrued further holiday. She had leave booked which she did not have an opportunity to take. There may be losses which she regards as flowing from the dismissal, but they are not valid grounds for a claim under the Working Time Regulations 1998 regulation 16 for pay for holiday accrued but not taken on termination of employment. There is nothing further owing in that respect.

[127]As the claimant has succeeded in her unfair dismissal claim, she will be claiming loss of earnings from the point of dismissal and that would include the earnings covering any holidays that she would have taken. Those losses fall into that part of the calculation. But as a holiday pay claim, there is nothing further owing. Approved by:

REASONS

[1]The claimant has applied for a reconsideration of the judgment under r.68 of the Employment Tribunal Procedural Rules 2024. Having considered the application under r.70(2), the employment judge considers that there is no reasonable prospect of the judgment being varied or revoked on those grounds. The application for a reconsideration is rejected.

[2]As it happens, the claimant made her application for reconsideration before the written record of the judgement had been sent to the parties. Judgement with oral reasons was given on 15 August 2025. Written reasons were requested on 28 August 2025. I apologise for the time taken to complete them which was due to pressure of work. They are sent at the same time as this reconsideration judgment.

[3]The procedure for an application for a reconsideration is set out in r.70 Procedural Rules 2024. It is a two stage process. If the employment judge who chaired the tribunal panel which made the judgement considers that there is no reasonable prospect of the original decision being varied or revoked the application shall be refused under rule 70(2) and the Tribunal shall inform the parties of the refusal. Otherwise the Tribunal shall send a notice to the parties setting a time limit for any response and seeking the views of the parties on whether the application can be determined without a hearing. That notice may set out the Judge’s provisional views on the application. Unless the judge considers that a hearing is not necessary in the interests of justice, if the application is not rejected under rule 70(2), then the original decision shall be reconsidered by the full tribunal who made the original decision.

[4]The power to reconsider a judgement under rule 70 can only be used if it is necessary to do so in the interests of justice. That is apparent from the wording of the rule itself and, as it was held, by HH Judge Shanks in Ebury Partners UK Limited v Acton Davies

[2023] IRLR 486

EAT a central aspect of the interests of justice is that there should be finality in litigation. “It is therefore unusual for a litigant to be allowed a ‘second bite of the cherry’ and the jurisdiction to reconsider should be exercised with caution. In general, while it may be appropriate to reconsider a decision where there has been some procedural mishap such that a party has been denied a fair and proper opportunity to present his case, the jurisdiction should not be invoked to correct to suppose that error made by the ET after the parties have had a fair opportunity to present their cases on the relevant issue. This is particularly the case where the error and it is one of law which is more appropriately corrected by the EAT.” (Para 24 of the judgement of HHJ Shanks).

[5]Since the claimant made her application on the basis of her notes of our oral reasons and since our written reasons are provided at the same time as this reconsideration judgment, the claimant may find it helpful to refer to our written reasons for our conclusion that she was employed by R1 only.

[6]The basis of her application is that she argues our reliance upon evidence about intercompany recharges was flawed because of inconsistencies between the respondent’s witness statements and oral evidence about that issue. She also wishes to correct an answer that she gave in her own oral testimony. She states that when she accepted that when she accepted in evidence that recharges happened she meant recharges of inter company purchases and credit card statements not recharges for wages or work carried out by accounts department.

[7]Our written reasons have now been approved and I refer to those. It was based on more than the question of recharges – not least the law on what is a contract of employment. As can be seen, it was not disputed that the claimant carried out work on the accounts of R4 to R8. Her role description as Financial Controller made clear that her role included carrying out work on the accounts of other companies. We rejected the argument that a contract (whether of employment or of any other kind) could be implied, relying upon basic contractual principles. We were aware of the inconsistency between Mr Wooldridge’s statement evidence and Mr Merry’s oral evidence and preferred Mr Merry’s oral evidence on this point.

[8]The claimant states that there has been a misunderstanding about the evidence concerning recharges by management charges from the first respondent to the companies and partnerships that are the other respondents in this claim. She says that there were several companies that she worked for (R5 and R6) which were never subject to management charges. She clarifies that she should not be understood as having agreed that there were inter-company recharges of the cost to Panther 1919 of services.

[9]However these are either points which were have been made at the final hearing and were unsuccessful or could have been made at the final hearing and weren’t. In those circumstances, there are no reasonable prospects of the judgment about the identity of the employer being varied or overturned. The reconsideration application is rejected under r.70(2) Employment Tribunal Procedure Rules 2024. Date: 1 October 2025 Approved by

[10]Therefore, if the ET3 from R3 is regarded as containing an admission that the claimant was employed by Twelve Oaks Partnership (rather than an admission of dates of employment and not the identity of the employer), it was accompanied by and incorporated a Grounds of Response which appeared to conflict with it the contents of the form. We consider that the response of R3 was equivocal and should not be taken as a concession that the claimant was employed by it. The position was clarified in the later Amended Grounds of Response and it has never been suggested that, by that document, R3 had resiled from a binding admission. It certainly was not the evidence of the individual partners that the claimant was employed by that partnership and they both gave evidence at the liability hearing.

[11]The reasons why we found that the claimant was not an employee of any entity other than R1 still stand notwithstanding the slight evidential difference in the position of R3. As we found in para.26 of our written liability reasons, Panther 1919 Limited and its subsidiaries (The Wooldridge Group) was restrictively defined in the company accounts and did not include Twelve Oaks Partnership. They were not a party to the original contract of employment.

[12]It is true that the email relevant to our conclusion in relation to R4, R6 and R8 does not refer to R3. Nevertheless, Mr Merry’s evidence about his own employment status and his understanding of the claimant’s when he directed her in her role is persuasive (para.30 of the written liability reasons). There was no express contract of employment between the claimant and R3, whether written or oral.

[13]In the absence of an express contract, we would need to imply the existence of a contract of employment for the claimant to be joinly employed by R1 and R3. At common law, the test for implication of a contract is whether or not it is necessary to explain the actions of the parties: James v Greenwich London Borough Council

[2008] ICR 545

CA.

[14]The claimant has failed to show that there was any implied contract between her and Twelve Oaks Partnership. The relationship is explained by the contract of employment between her and Panther 1919 Ltd and the provision of services by that legal entity to the partnership from time to time. We accept that this would sometimes have been at a cost to the partnership and sometimes not at the discretion of the directors and that the directors of R1 were the partners of R3. That is insufficient to remove the divisions between the entities and regard employees of one entity as employed by other entities who benefitted from their labour. Law relevant to Remedy for unlawful discrimination and harassment

[15]When considering the correct approach to the assessment of financial loss caused by the statutory torts of direct race discrimination and race related harassment, the successful claimant is entitled to be compensated for the loss and damage which arises naturally and directly from the wrongful act: Essa v Laing Ltd

[2004] IRLR 313

, CA. So far as possible, the Tribunal must put the claimant into the position that they would have been in but for the unlawful conduct: Ministry of Defence v Cannock [1994] I.C.R. 918 EAT. It was also held in Essa v Laing that there is no need to show that the loss claimed was reasonably foreseeable, provided that a direct causal link between the act of discrimination and the loss can be made out. The discriminator must take their victim as they find them.

[16]If it can be shown that psychiatric and/or physical injury can be attributed to the unlawful act then the employment tribunal had jurisdiction to award compensation: Sheriff v Klyne Tugs (Lowestoft) Ltd

[1991] IRLR 481

, CA.

[17]Judicial College Guidelines 17th Ed. are a useful source of guidance about the factors to be taken into account and the levels of comparable awards. In particular, we have regard to Chapter 4 - Psychiatric and Psychological Damage. Section (A) - Psychiatric Damage Generally “The factors to be taken into account in valuing claims of this nature are as follows: (i)the injured person’s ability to cope with life, education, and work; (ii)the effect on the injured person’s relationships with family, friends, and those with whom he or she comes into contact; (iii)the extent to which treatment would be successful; (iv)future vulnerability; (v)prognosis; (vi)whether medical help has been sought.(a) Severe In these cases the injured person will have marked problems with respect to factors (i) to (iv) above and the prognosis will be very poor. £66,920 to £141,240

(b) Moderately Severe In these cases there will be significant problems associated with factors (i) to (iv) above, but the prognosis will be much more optimistic than in (a) above. While there are awards which support both extremes of this bracket, the majority are somewhere near the middle of the bracket. Cases involving psychiatric injury following a negligent stillbirth or the traumatic birth of a child will often fall within this bracket. Cases of work-related stress resulting in a permanent or long-standing disability preventing a return to comparable employment would appear to come within this category. £23,270 to £66,920

(c) Moderate While there may have been the sort of problems associated with factors (i) to (iv) above there will have been marked improvement by trial and the prognosis will be good. Cases of work-related stress may fall within this category if symptoms are not prolonged. £7,150 to £23,270

(d) Less Severe The level of the award will take into consideration the length of the period of disability and the extent to which daily activities and sleep were affected. Cases falling short of a specific phobia or disorder such as travel anxiety when associated with minor physical symptoms may be found in Chapter 14: Minor Injuries. £1,880 to £7,150”

[18]If the loss has been caused by a number of factors, in principle it is open to the Tribunal to reduce compensation so that it reflects only the extent to which the unlawful discrimination contributed to the employee’s loss if there is a rational basis on which to apportion responsibility for those losses as between the different causes: Thaine v LSE

[2010] ICR 1422

, EAT and Hatton v Sutherland

[2002] ICR 613

, CA and BAE Systems (Operations) Ltd v Konczak

[2018] ICR 1

, CA. The Tribunal must take care, however, where there is a pre-existing health condition or vulnerability and where separate awards for alleged psychiatric injury and injury to feelings are sought, to avoid double recovery because the aim is to award compensatory damages.

[19]We remind ourselves of the case HM Prison Service v Johnson

[1997] ICR 275

EAT where it was said, among other things, that the awards for injury to feelings should be compensatory rather than punitive and that, on the one hand, they should not be so low as would diminish respect for the antidiscrimination legislation but on the other they should not be excessive. Awards should bear some broad general similarity to the range of awards in personal injury cases. We should also remind ourselves of the purchasing power of the value of the award of everyday life and balance that with the need that awards for discrimination should command public respect.

[20]We also remind ourselves of the cases of MOD v Cannock

[1994] IRLR 509

and Alexander v The Home Office

[1988] ICR 604

. The injury must be proved, our findings must be evidentially based and the injury for which compensation is claimed must result from the discrimination which has been proved.

[21]The well-known case of Vento v. Chief Constable of West Yorkshire Police (No. 2)

[2003] ICR 318

CA. Following the judgment in Da’Bell, which increased the levels of the bands to take into account inflation since the Vento decision, the lowest band was increased to £6,000, the middle band from £6,000 to £18,000 and the highest band, reserved for the most serious cases, £18,000 and above. The Presidents of the Employment Tribunals in England & Wales and Scotland have since published Presidential Guidance by which the Vento bands are updated annually. The present claim was presented on 6 July 2022 and therefore the applicable bands for claims presented after 6 April 2022 area. Between £29,600 and £49,300 for the most serious cases with some exceptional cases meriting an award over £49,300;

b. Between £9,900 and £29,600 for serious cases not meriting an award in the highest band;

c. Between £990 and £9,900 for less serious cases, such as an isolated or one-off act of discrimination or harassment.

[22]The Vento bands are designed to encourage broad consistency as between different cases because the aim is compensate for genuinely injured feelings, not to punish an employer. It is important, therefore, to seek evidence of injury. This can be particularly challenging when, as here, the claimant has succeeded in some but not all of her complaints. As Judge Barry Clarke said in Eddie Stobart Ltd v Graham

[2025] EAT 14

para. 40, in every kind of discrimination case, a claimant will usually suffer some injury to feelings. Judge Clarke went on to say in para.41 of Eddie Stobart that the manner of discrimination can provide a control mechanism, a guide to inferring the extent of the injury suffered by the claimant.

[23]This is a useful control when, as here, the claimant had relied on, in effect, a course of conduct, but succeeded on three discrete complaints of conduct by three different people. The manner of discrimination in those actions can be a tool from which to draw an inference about the extent of the injury suffered by the claimant and whether the injury she describes suffering is a reliable basis for findings of fact. Aggravated Damages

[24]The claimant argues that this is a suitable case for an award of aggravated damages. They are, in principle, available for an act of discrimination: Armitage, Marsden and HM Prison Service, Johnson [1997] I.R.L.R. 162 EAT. They are compensatory rather than punitive and are available when the respondent has behaved in a high-handed, malicious, insulting or oppressive manner when discriminating against the claimant. In Metropolitan Police Commissioner v Shaw [2012] I.C.R. 291 EAT, Underhill P, as he then was, cautioned against the risk that a separate award of aggravated damages can lead a tribunal, unconsciously, to punish a respondent rather than compensate the victim. There is also a risk of duplication of compensation and the Tribunal must be satisfied that there is a causal connection between the exceptional or contumelious conduct and the aggravation of the injury. In many cases it will be appropriate rather to include in compensation for injury to feelings an element which reflects the way in which the victim was treated.

[25]Aggravated damages are available to compensate for the manner in which legal proceedings are conducted where that amounts to misconduct (Zaiwalla & Co v Walia [2002] I.R.L.R. 697, EAT) but the Tribunal should have regard to the total size of the award for non-pecuniary damages and note the relationship with injury to feelings. Aggravated damages are available if the harm is uncompensated for by other remedies. Adjustments to compensation

[26]In assessing compensation, it is necessary to ask what would have occurred had there been no unlawful discrimination; if there were a chance that the losses would have occurred in any event then, in the normal way, that must be factored into the calculation of loss: Chagger v Abbey National plc

[2010] IRLR 47

, CA.

[27]Under s.207A Trade Union and Labour Relations (Consolidation) Act 1992, the tribunal can adjust compensation by up to 25% where there is a claim which concerns a matter to which a relevant ACAS Code of Practice applies and the employee or the employer have unreasonably failed to comply with it.

[28]In para.77 of Biggs v Slade [2022] I.R.L.R. 216 EAT, Griffiths J described this as a four stage test where it is argued that the employer’s conduct is such as to merit an uplift. First, is the case such as to make it just and equitable to award any ACAS uplift. This itself requires the Tribunal to identify the conduct which is said to amount to a failure and the relevant paragraph which was not complied with as well as considering whether there was an unreasonable failure to comply with the provision and whether it is just & equitable to make an award. The second stage is to decide what would be a just & equitable percentage, not exceeding 25%. This must reflect all the circumstances including the seriousness and/or motivation for the breach. Then thirdly, does the uplift overlap or potentially overlap with other general awards and what is the appropriate adjustment to avoid double-counting. Finally, the tribunal should apply a final sense-check to see whether the sum of money represented by the application is disproportionate in absolute terms and should any further adjustment be made.

[29]Interest is payable on awards in discrimination cases by virtue of the Employment Tribunals (Interest on Awards in Discrimination Cases) Regulations 1996 (Interest on Awards Regulations 1996). The tribunal is required to consider whether to make such an award whether or not a party has applied for it. Ordinarily interest on any sum for injury to feelings is calculated for the period beginning on the date of the contravention and ending on the day of calculation (reg.6(1)(a)). Interest on any other sum of compensation is calculated from the mid-point between the date of the contravention and the date of calculation (reg.6(1)(b) read with reg.4(2)). The tribunal retains a discretion where it considers that, in the circumstance of the case as a whole or to a particular sum in an award, serious injustice would be caused if interest were to be calculated for the periods in reg.6 to calculate interest for a different period or for different periods in respect of various sums in the award (reg.6(3)). Compensation for Unfair Dismissal

[30]The Tribunal had calculated and awarded compensation for wrongful dismissal in the judgment sent to the parties on 26 August 2025. Were the claimant to be compensated for loss of earnings which would have ben earning during her 8 weeks’ notice period, she would be compensated twice in respect of the same period of time. Another way of looking at it is that her loss starts on 8 July 2022, the first day after the 8 weeks’ notice period.

[31]The claimant succeeded in her complaints of unfair dismissal and discriminatory dismissal. We decided that it would be in accordance with the overriding objective to award compensation for loss of earnings under the Equality Act 2010 for the discriminatory dismissal and not under the Employment Rights Act 1996. The claimant is not entitled to two sets of loss (one under each Act) for loss of earnings covering the same period. However, she has been waiting for a resolution of the claim for longer than might ordinarily be expected for a case of this kind because the original hearing was postponed when the respondents did not attend, the first (and then only) respondent having gone into administration. It was not unreasonable of the claimant to have applied to join other parties – in particular R2 who was potentially personally liable. The unfortunate delay in relisting is a consequence of long waiting times in this region.

[32]Awarding loss of earnings as compensation for discrimination means that the Tribunal is able to award interest of the award which will go some way to compensate the claimant for that long wait. The Tribunal does not have authority to award interest on an award of compensation for unfair dismissal under s.118 ERA.

[33]Therefore the award of compensation for unfair dismissal will consist of the Basic Award calculated in accordance with s.119 ERA and compensation for loss of statutory rights under s.123 ERA.

[34]The claimant’s employment started on 11 November 2013 and ended on 13 May 2022. She therefore had 8 complete years’ service at the time of her effective date of compensation. Her age at the time of her resignation was 42 years and her date of birth is 3 July 1979. This means that she turned 41 years of age on 3 July 2020 and had been over the age of 41 years for one complete year as at her effective date of termination.

[35]Her weekly gross pay of £961.53 was over the statutory maximum imposed by s.227 ERA which, in respect of termination of employment on or after 6 April 2022 was £571 per week. The Basic Award shall be calculated on the basis of £571 per week.

[36]Therefore the calculation of her Basic Award under s.119 is as follows: (1 year @ 1.5) X £571 856.50 (7 years @ 1) X £571 3997.00 4,853.50

[37]As the claimant had the right to long notice and the right not to be unfairly dismissed, she has lost something of tangible value to her as an employee. She has not included a sum for loss of statutory rights in her schedule of loss. However she is acting in person, she may not have realized that it is commonly awarded. Given the relatively high salary she had, we value the loss of those rights to her at £500.

[38]She is not presently in work; but that is not a precondition for such an award. We have found that her employment would probably have ended lawfully in any event no later than 29 February 2024 with the administration (see below paras.102 & 103). Nevertheless, that was nearly two years after the effective date of termination and it is not just & equitable to adjust the compensation awarded for loss of statutory rights because of an event which (on that hypothetical narrative) would have taken place nearly two years after she lost her statutory rights. The sum awarded for this head is a conventional or notional sum and, although it is not awarded if there is a finding that the employee would have been fairly dismissed at the end employment ended in any event, that is not the situation in the present case.

[39]An uplift for an unreasonable failure to comply with an applicable ACAS Code of Conduct shall be applied to both the Basic and Compensatory Awards (see below paras.119 - 127). Compensation for unlawful discrimination and harassment Injury to Feelings caused by race related harassment

[40]The claimant succeeded in two complaints of race related harassment.a. that Richard Cox had called her Sweat in a corruption of her name including on about 27 to 29 April 2022 and

b. that on about 8 April 2022 a colleague discussed the Russian invasion of Ukraine within her hearing saying they “hate(s) … everything to do with Russians.”

[41]It is difficult to translate hurt feelings into a monetary award because subjective feelings, such as those of unhappiness, humiliation and stress, are incapable of measurement according to any objective scale. Nevertheless, it is possible to assess how deeply the claimant felt about the incident which has been found unlawful, how many areas of her life were affected by her emotional reaction to it (how broad the effect was) and how long she felt that way.

[42]As we note above, Judge Barry Clarke noted in Eddie Stobart Ltd v Graham

[2025] EAT 14

at para.41, that the manner of discrimination can provide a control mechanism, a guide to inferring the extent of the injury suffered by the claimant. This is useful when, as here, the claimant’s original complaint was that there was a discriminatory course of conduct, but she has only succeeded on two discrete complaints of harassment.

[43]The first successful complaint was recounted by the claimant in para.72 of her statement. In that she described visiting Mr Cox in his office to discuss company recharges sometime between 27 and 29 April 2025. She was wearing a new black skirt and Mr Cox looked her up and down, grinning unpleasantly and said “That is a very short and sexy skirt, Sweat, doesn’t your husband mind you wearing such revealing outfits to work?”. She states that the comment was unnecessary, made her feel very uncomfortable and disturbed so much that she forgot why she had come to his office and left without the information she came for. This was the specific incident proven against a backdrop of her allegation that he called her “Sweat” more than once to her face. It is apparent from her account that part of what made her feel uncomfortable is the comment about her clothes which she considered to be more sex related than race related. Nevertheless, we have accepted that the use of the corruption of her name meant the comment was related to race and it is artificial to try to separate out the upset caused by this corruption of her name from feelings of discomfort caused by the accompanying sexist remark.

[44]As the comment is of a different kind to the other successful complaint and both are different in nature to the successful direct discrimination complaint, we have decided to assess an appropriate award in respect of three separate unlawful acts under the Equality Act 2010, and then step back and consider the totality of the award to ensure that the award is proportionate as a whole.

[45]The claimant came across to us when discussing this comment in the hearing as still being disturbed and affronted when she had to recount it, even recognizing it as an isolated event. Nevertheless, feelings of being uncomfortable and disturbed which were probably relatively short term and transitory in nature merit an award at the very bottom of the lowest band of awards. We have decided that an appropriate award is £1,000 to which interest will be added.

[46]The other successful harassment complaint is covered in para.76 of the claimant’s statement. The totality of the description covers a number of aspects of 8 April 2022, including alleged comments by Mr Orbell which were not among the list of issues. We have not made a declaration in the judgment about those alleged comments. However, the background to the specific comment by Ms Garlinge was that general comments, including this one, had made the claimant feel like an outsider and as though she was being blamed or scapegoated for what was happening in Ukraine. We recall her evidence that she spoke to her daughter about it and that was also the evidence of her daughter.

[47]That has to be balanced against there being a number of incidents which were not successful, including the allegation that R2’s outburst “Fucking Russians” was an act of race related harassment. Nevertheless, we think that the impact on the claimant of this incident was longer lasting and more severe than that of the comment of Mr Cox. We say that because it contributed to her feeling like an outsider and judged as responsible for something rather than an isolated incident that she merely described as making her feel uncomfortable. We have decided that an appropriate award for the second act of harassment is £1,500 to which interest will be added.

[48]In both cases interest will be calculated at the judgment rate from the date of the incident (we take the mid-point of the range of dates for the first incident) to the date of the remedy hearing. Compensation for loss caused by discriminatory dismissal

[49]The narrative of events set out by the claimant is that after the 13 May 2022, when she resigned because of the first respondent’s conduct, she found part time work. She alleges that she realized following several interviews that her opportunities for work in the local area were limited because of the influence of the Wooldridge Group and the Wooldridge family but also because of her lack of reference from them, given that the sector she works in requires and particularly values trust and honesty. She states in the schedule of loss that she is worried that people will have a negative attitude towards her because of her Russian heritage and that these thoughts continue to intrude upon her.

[50]She obtained work after her resignation 2 to 3 days per week for a contact of her husband. This involved a 1.5 hour commute one way to work. She was supporting a company implementing a new Accounting and Reporting Software package and this continued for about 9 months. We find, based on this, that, immediately after she was dismissed, she was functioning professionally (see the claimed personal injury below). This role came to an end in approximately March 2023, according to her oral evidence.

[51]As at 13 May 2022 she had one last exam to sit in order to complete professional qualifications and sat that exam, hoping to complete her training to improve her employment oporutnities. However, she states that the psychological effects of her experiences have adversely affected her cognitive function and she failed her exam. She says that a lack of self belief means that she has stopped studying and this is “heartbreaking and discouraging”.

[52]When she gave oral evidence at the remedy hearing, it became apparent that, in fact her position is that she has experienced such an adverse effect on her mental wellbeing because of the constructive dismissal and the events of 13 May 2022 that she is unfit to work and therefore has loss of earnings because she is not fit to work.

[53]She argues that, were it not for the constructive dismissal, she would have remained in employment with the respondent indefinitely. She acknowledged that a number of staff left shortly after Mr. Merry departed but states that, had she not been dismissed, the department would not have been destablised and therefore there is no good reason to conclude that she would have left at that time. She also argues that she would have remained in employment until retirement age and therefore claims a career-long future loss.

[54]She contrasts that with what she argues would have been the counterfactual had she remained in employment. She did not know at the time, but knows now that Peter Merry was thinking of leaving the company and did resign about one month after the end of her own employment. She argues that, had she remained in post, the likelihood is that he would have resigned for his own reasons in any event, and she would have been appointed to his role. If not then, then she would have been appointed Financial Director when he retired or left voluntarily.

[55]In terms of financial losses, she states that the following flow directly from the dismissal:a. Loss of earnings;

b. Pension losses;

c. Loss of Private Health Insurance;

d. Discretionary annual bonus (not mentioned in the schedule of loss but covered in oral evidence).

[56]Therefore we need to consider whether the claimant has shown on the balance of probabilities that, had the discriminatory dismissal not taken place, she would have remained in employment until retirement, Mr Merry would nevertheless have departed and she would have been appointed to his role as Financial Director. Then we need to decide whether Mrs Zdravev has shown that, as a result of the unlawful acts, she has suffered psychological personal injury such that she is unfit for work and will be for the foreseeable future such that her loss is career long.

[57]It is convenient to consider first whether the claimant has shown that she suffered personal injury which was caused by the constructive dismissal. This is because of the overlap between her claim for loss of earnings caused by the (constructive) dismissal and loss of earnings caused by her being unfit to work, which state of affairs she attributes to the treatment on 13 May 2022.

[58]The claimant’s argument set out in her Excel spreadsheet is that there are six separate conditions caused by the respondent’s actions for which she should be compensated. The page numbers below are to the pages in Tab H where the evidence may be found that is relied on by Mrs Zdravev to show the fact and cause of the alleged personal injury). She claims a total of £388,280 for the following alleged conditions:a. Psychiatric and Psychological Damage; (Phobia, anxiety,depression, panic attacks) (Mrs Zdravev cross refers to her GP report at pages 1533-1534, and an assessment on 6 March 2025 by a therapist at pages 1521-1533)

b. Twitching when stressed;

c. Cardiac arrhythmia exacerbated by stress, panic attacks and anxiety (see pages 1504-1506);

d. Adjustment disorder ( Post-Traumatic Stress disorder ) (see pages 1533-1534, 1521-1530);

e. Orthopaedic injury- back (see pages 1047, 213-217, 1496-1499);

f. Chronic pain -fibromyalgia (page 1533).

[59]As set out above, in principle, if it can be shown that psychiatric or physical injury can be attributed to either act of harassment (dating from 8 April 2023 and 28 April 2023) or to the constructive dismissal (13 May 2023) then the employment tribunal can award compensation for it.

[60]However, it is clear that the claimant’s orthopaedic injury predates these incidents by as much as 6 or 7 years; page 1497 is a screenshot of a form she completed which suggests she reported to her treating physician that it started “1 year ago” when she consulted them in 2017. The claimant complained in her witness statement that a heavy workload, and long hours contributed to the cause of back pain (see her paragraphs 18 to 21) but none of the issues in the claim, let alone the successful ones, are alleged to have caused this injury. There is no justifiable basis for us to award compensation for that alleged injury.

[61]The medical evidence relied on for the other types of alleged injury is found in the hearing file starting at page 1504 as detailed above. Our findings on these records are that:a. She was dismissed on 13 May 2022.

b. In May 2022 she was referred for a 24-hour ECG which was normal (page 1504).

c. In June 2022 her GP recorded her as experiencing stress, anxiety, and depression. Page 1533 is a letter from her GP dated 24 March 2025 saying, presumably from their records, that they had first seen her in June 2022 with unexplained physical sympstoms including nerve twitching, although all physical tests were normal.

d. On 4 November 2022 she attended an appointment at the cardiology department. She reported episodes of fast heart rate and missing beats lasting for a few seconds with those symptoms associated with dizziness, problems with vision and breathlessness; they happened several times a week. There were also episodes of very slow heart rate mainly overnight which she stated could wake her up with symptoms of dizziness and lack of energy (page 1504).

e. As recorded above, during this period she was working 2 to 3 days a week in a role which required her to travel 1.5 hours each way. This part-time employment came to an end in March 2023.

f. In April 2023 the GP (page 1533) recorded her attending the surgery again with severe sleep disturbance, loss of appetite and low self-esteem. We note that this was after her part-time alternative role came to an end.

g. Dr Nielsen then says “By May” (presumably May 2023) she was again suffering from “significant physical symptoms including twitching” and a physical examination was entirely normal.

h. The claimant also relies upon a letter from a Doctor of Chinese Traditional Medicine who treated the claimant in Spring 2023 and noted symptoms of anxiety, insomnia, depression, muscle tension and twitching on 11 April 2023 (page 1534). His opinion is that the symptoms were caused by the stress of being forced to leave her job. However, there is nothing in the available evidence that satisfies us that Dr Alberto’s qualifications make him expert in mental health problems in a way which would allow him to give an reliable expert opinion about the cause of any mental health problem. Furthermore, his letter does not state what information he was provided with or what the sources of his information were. was which means we are unable to correlate the basis of his opinion with our findings about what happened.

i. Mrs Zdravev has been in contact with her GP regularly since May 2023. She saw the mental health worker on 8 January 2025 when a PHQ-9 depression screening test showed severe depression and a GAD7 score showed severe anxiety. She has been diagnosed with generalized anxiety disorder (page 1533).

j. In March 2025 the claimant was diagnosed with fibromyalgia and has told her GP that the pain is 10/10 and keeps her awake at nights.

k. The GP states that “our impression [is] that the root cause of this mental health issue is distress endured after leaving her job as a financial controller in 2022.”

l. The GP report at page 1533 from the Waterfield Practice was described as “not agreed” in the Hearing File Index. The GP is a generalist, not a specialist mental health professional such as a psychiatrist or psychologist. This means we should look with care at the reliability of their opinion evidence about the cause particularly where it is challenged and – what is more relevant – when there may be a difference between the account provided to them by the claimant and our findings about what occurred.

[62]The claimant produced a report by a Registered Mental Health Nurse from Onebright (page 1522) which was described in the index as a complete mental health assessment. This describes the claimant as thinking every day about the situation following her enforced resignation with a lot of anger and frustration. The nurse recorded the claimant’s account of eye twitching and that she was “unable to manage stressors, [felt] on edge and body starts shaking and twitching, get angry very quickly (sic)”. The assessment was carried out in 10 March 2025 and she further described her feelings as,a. Angry and low, upset, unhappy, scared tearful with lack of confidence;

b. She felt like this daily;

c. She struggled to sleep and was sleeping around 4 hours per day;

[63]Her GAD-7 and PHQ-9 scores for anxiety and depression were severe (page 1525). The prescribed medication at that time was 15 mg of Mertazapine. She was also prescribed Levothyroxine 50 mg one day then 75 mg the next but we presume that was for a thyroid problem and unconnected with mental health problems caused by the unlawful acts. At the time she was working part time on her partner’s accounting and said that her ability to work was impaired very severely (page 1527).

[64]There are forensic limitations of the medical evidence before us. None of the documents is written by an individual who is independent of the claimant and who states that they understand they have a responsibility to the Tribunal to comply with the professional duties of an independent expert. In some cases, their expertise to comment on the causes of mental health problems is limited and/or unexplained. It is not stated that the medical professionals were aware that their opinion was being asked for the litigation. In fairness to the doctor, the GP records their “impression” rather than opinion and states the cause to be “distress endure after leaving her job” (our emphasis) rather than distress caused by being required to leave her job.

[65]The GP’s letter is a summary of the claimant’s medical history which suggests that her symptoms caused her to seek medical treatment more regularly only from Spring 2023 and not immediately when her employment with the first respondent ended. The absence of a full medical history means that it is not clear that the GP has reviewed the full history to see whether her account that her present symptoms are caused by the respondent’s actions in 2022 is objectively valid or consistent with the contemporaneous notes. For example, although the report at page 1533 states she has attended for stress, anxiety and depression since June 2022, the absence of a full set of medical records means that we do have comprehensive evidence about her previous mental health. It is recorded at page 1529 that she experienced post natal depression as a reaction to moving country and the birth of her daughter for which she had counselling in 2003/4. Did this indicate a previous vulnerability in respect of which the respondent must take her as they find her? Did this indicate a prospect that an event would have triggered an instance of poor mental health irrespective of the unlawful acts? We need to weigh up the uncertainties disclosed by the state of the evidence.

[66]Our impression of the claimant is that she remains affected by actions which we have not found to be unlawful. The most detailed report into the claimant’s state of mental health does not attempt to give an opinion of the cause of the symptoms the claimant describes and the registered mental health nurse would probably not have been aware that some actions of the respondent which have affected the claimant were not causally relevant.

[67]The claimant is angered by the administration order and the sense that, as a result, her employers are “going to get away with it” as she sees it. She was also angered by the individual directors not attending the final hearing in October 2024 which she regards as disrespectful. Their non-attendance was on professional advice because the (then) only respondent was in administration.

[68]None of the medical evidence (even that about which we have reservations) attempts to set out a prognosis for how long the claimant is likely to experience her present symptoms or what the prospects of recovery are. As at the date of the most recent report, she appears to be waiting for talking therapy.

[69]All of the above are reasons why we should not give the report as much weight as we would independent medical expert evidence. There is also the fact that the claimant appears to have functioned professionally between her dismissal and March 2023, until her temporary role ceased. In those circumstances, can we be satisfied on the balance of probabilities that the unlawful acts caused identifiable psychiatric harm, what was any such harm and what were its impacts and prognosis?

[70]We reject the claimant’s claim in the Schedule of Loss that she has PostTraumatic Stress disorder. This is not substantiated by the medical evidence. Nor is a specific phobia mentioned in the reports in the hearing file. Adjustment Disorder is described in the nurse’s assessment as the primary problem with Anxiety – Mixed Anxiety and Depression as the secondary problem (page 1530).

[71]It is stated in the GP’s letter that she has been diagnosed with fibromyalgia. However, for us to be satisfied that this was caused by the first respondent’s acts, we would require expert neurologist’s evidence. The claimant’s oral evidence was that it was caused by stress but we would require more reliable expert evidence of causation to award compensation for that condition as a discrete impairment.

[72]Despite those reservations, we are persuaded that dismissal in the circumstances of 13 May 2022 caused the claimant stress, anxiety and depression to the extent reflected in the medical evidence set out in paragraph 61 to 63 above. This appears to have become a chronic problem – the Adjustment Disorder we find to be a reaction to the loss of her employment which for her is a type of bereavement triggered by the circumstances of her departure which are, in essence, the unlawful discrimination. We are satisfied that twitching is a symptom of or reaction to stress because that is supported by the nurse’s assessment. The twitching and cardiac arrhythmia appear to be physical symptoms of stress, according to the GP’s letter. They fall to be compensated for within the compensation for generalized anxiety disorder. They are not (on the evidence before us) separate conditions in themselves but an aggravating feature of anxiety and depression in the claimant’s case.

[73]The claimant’s oral evidence about the immediate effect on her of the events of 13 May 2022 are mirrored in her description to the nurse set out in page 1524. She vividly and credibly described real shock on that date “they pushed me out in minutes”. She comes across as preoccupied and ruminating upon those events and the lack of apparent explanation for the actions. It seems likely to us that alternative employment gave her focus which kept intruding thoughts at bay. The real consequences to her career probably became apparent when she started looking for work as the part-time role was coming to an end.

[74]We are satisfied that a medical professional has diagnosed depression and anxiety and, as recently as March 2025, this was recorded as severe (page 1525). 10 sessions of CBT have been recommended and, so far as we are aware, are yet to take place. The goal is stated to be to “break negative thought cycle. Switch thoughts off. Develop healthy coping skills. Experience pleasure and happiness.”

[75]She has experienced the frustration of three years pursuing the respondent through litigation and it must be hoped that the conclusion of that process and appropriate treatment as recommended will have the effect that her symptoms improve. She has put an impressive amount of effort into learning the law and processes to achieve this goal and described herself as unable to switch off and crying on a daily basis. She stated that she had stopped trusting people.

[76]We accept that these psychological problems have adversely affected her concentration to the extent that she was unable to complete her accountancy qualifications when she attempted to do so.

[77]It is apparent that the claimant is still upset by matters which we have not found to be unlawful, specifically the alleged general atmosphere following the invasion of Ukraine. However, there is no rational basis on which to divide the psychological harm into a part caused by the unlawful acts and a part which was caused by work based events which were not unlawful. The psychological harm we have found is an indivisible whole the causes of which cannot logically be divided between the unlawful acts and matters which we have found not to be unlawful such as the majority of the harassment allegations.

[78]We set those findings against the guidance in the Judicial College Guidelines 17th Edition set out above. Without medical evidence about the prognosis, we are not satisfied that the prospects of the claimant recovering are poor. She is able to copy with most aspects of life although her cognitive function has been affected in terms of concentration. She is working on her husbands accounts, she has prepared thoroughly and effectively for the litigation. Although that has not been at all a pleasant experience, it is relevant to how she presents as against the categories in the JC Guidelines. Representing herself has required focus, learning, drafting – no doubt done with support but it causes us to think that as the litigation concludes and her time is less absorbed by it she will be able to return to work. This will require learning to trust but there is a planned course of treatment leading to expected improvement.

[79]In the absence of evidence that the prognosis of recovery is poor we do not think this falls within the moderately severe category. It cannot be said that this is an instance of work-related stress resulting in a permanent or long-standing disability preventing a return to comparable employment. She is presently affected to some extent but we regard the time scale over which the symptoms as having been shown as “not prolonged”. The facts found fall within the Moderate category which has a scale of £7,150 to £23,270. There is no evidence, particularly no medical evidence to conclude other than the prognosis is that the claimant will recover in time.

[80]The claimant seems to have been continuously affected by the events of 13 May 2022. We regard this as falling in the middle of the Moderate bracket. The appropriate award is £12,000.00. We award interest on that at 8% from 31 August 2023. The reason for that is that the 17th Edition updates the figures in the bands to take account of the effects of inflation using the RPI for August 2023. The effect of being uncompensated prior to 31 August 2023 is accounted for in the increase of the figures in the Guidelines.

[81]Taking the date of the remedy as the date of assessment, simple interest is awarded for 28 months @ 8% which is £2,240.00.

[82]There is a real risk in the present case, where a substantial award for an Adjustment Disorder, stress, anxiety and depression has been made, of overlap with an injury to feelings award.

[83]She has vividly described her feelings immediately after being required to resign in the events of 13 May 2022 which involved the purported pretermination negotiations becoming the delivery of an ultimatum. There is no logical basis to distinguish between the effects of those acts which are individually pleaded, particularly as the successful complaints detailed in LOI 5.2.10.2 to LOI 5.2.10.5 are different elements of the same incident.

[84]However, as the reaction deepened into the psychological harm which has been compensated for as personal injury, her feelings of anger, hurt and confusion are compensated for as part of that psychological harm.

[85]Nevertheless, she lost a job with an employer whom she had served loyally for 9 years. She was evidently very committed to the company. There was a family connection with the Group and the other related businesses because her daughter worked for a different business for a time. This would deepen the sense of betrayal when, without any warning, she was presented with an ultimatum. She felt very humiliated by the circumstances of her departure. She told us (as she told the mental health assessor page 1524) that she nearly had a serious car collision because she ran a red light, such was the effect on her concentration of the events of that day.

[86]Those are hurt feelings from the incident itself which persisted and properly fall to be compensated for separately to the personal injury. Doing the best we can, we assess the compensation for that in the lower Vento bracket to avoid duplication of compensation. Had we not assessed the personal injury element separately, this would undoubtedly have been a middle band Vento case.

[87]Three years of anger and frustration – which is long lived because of the course the litigation has taken means that the impact on her feelings is relatively serious. We award close to the very top of the lower band: £9,000. Interest will be awarded at 8% from the date of the act (13 October 2025) to the date of calculation.

[88]We are mindful that separate awards have been made in respect of two distinct unlawful acts. This means that the total award for injury to feelings is £11,500. With interest the award is more than £14,800. We are content that this is proportionate to our findings about the hurt caused to the claimant by the unlawful acts as a whole. Aggravated Damages

[89]The way that the conduct relied on by the claimant as justifying an award of aggravated damages was described, it amounted to the act itself. She states in her updated Schedule of Loss that the way the respondent handles the dismissal was humiliating, malicious and insulting. However, we have already awarded compensation for the effect on her and she has not shown some separate feature which caused an identifiable aggravation of her hurt. This is not a suitable case for an award of aggravated damages. Loss of Earnings – if the claimant had not been dismissed what would her earnings have been?

[90]The base figures used by the claimant in the Excel Spreadsheet (the Lost Opportunity tab) are predicated on the Tribunal accepting as a fact that the following is more likely than not:a. That she would have received an increase to £55,000 per annum in September 2022;

b. That her annual salary in the role of Financial Controller would have increased by 10% in the financial year 2023/2024 to £60,500 p.a. – the increase taking effect from 6 April 2023;

c. That her salary would have increased with effect from 6 April 2024 to £75,000.00 per annum gross.

d. That she would have received a 5% increase on that salary with effect from 6 April 2025 and a further 5% increase the following year taking her to £82,687.50 from 6 April 2026;

e. That she would have been promoted to Finance Director when Mr Merry left or retired meaning her salary increased to £90,000.00 p.a. in the financial year 2027/28.

f. That she would be awarded a 5% increase in salary every financial year thereafter until retirement.

[91]The claimant based her argument that she would have received a 10% increase on the salary range offered in the first respondent’s advertisement for her replacement. The role was advertised at an annual salary of £55,000 to £70,000 (page 745). She stated that her salary would have been increased in December 2022 to £60,500. However that is a 10% increase not on the £50,000 she was earning in May 2022 but on the £55,000 bottom of the band advertised for her replacement. Her presumption is that, in September 2022 her salary would have been increased from £50,000 to £55,000, a 10% increase some 18 months after her promotion into the role.

[92]However, her account of past practice does not support the inferences she urges us to draw. She was appointed Financial Controller in March or April 2021 and her salary increased on promotion from £42,000 to £50,000. Her oral evidence was that salary increases were announced in and took effect in December. She was not awarded a payrise in December 2021 because she had been promoted 9 months previously. By the anniversary of her appointment, Mr Merry was expressing the view that the claimant had not grown into the more senior role in the way he had expected.

[93]She was asked whether she had been awarded a payrise in December 2020 and said that she had in fact been awarded a bonus of £3,000 as a lump sum which she described as a Christmas bonus for hard work awarded on a discretionary basis to all staff. Nevertheless we think it probably that an inflationary payrise of 5% would have been awarded in December 2022 as she alleged despite being discretionary and not a contractual entitlement.

[94]We consider her assumption that she would have received a payrise of 10% in September 2022 as entirely speculative. There may be a number of reasons why the advertised rate for the claimant’s replacement started higher than her own salary. She was an internal promotion and part qualified. The advertisement requests “Qualified or [qualified by experience]” and states that the salary will reflect experience. Furthermore, there is no evidential basis for her claim to a 10% increase in 2023/2024.

[95]We also think it highly unlikely that the claimant would have bee promoted to Finance Director. Separate to the unproven and unsubstantiated allegation of misconduct (which we disregard), the directors perceived the claimant as not yet performing at the level of the Financial Controller role. Although they did not prove grounds for their concern about her performance, nevertheless the prospects of a second promotion were remote on any analysis. Mr Merry handed in his notice in July 2022 and left in September 2022 for reasons which he stated – and we accept – were unrelated to the events of 13 May 2022. His evidence to the liability hearing was that he had found a job which was only 10 minutes from his home and that it was “no secret that Wooldridge had been having some financial issues at that time. It was going to be a good position for me with a different company.” Part of his reason was the deteriorating financial situation of companies within the wider group.

[96]It is unlikely that, had the claimant still been employed at that time, the first respondent would have promoted her only 18 months after her last promotion when the support she had provided to the outgoing Finance Director had not yet reached the level required of the Financial Controller role.

[97]We need to consider how long the claimant would have remained in employment with the first respondent had they not breached her contract of employment. They are not participating in the hearing and therefore not here to present evidence or argument that, had she not resigned, they would have dismissed her had they investigated the alleged misconduct raised by Mr Merry in the meeting on 13 May 2022.

[98]The claimant emphatically denied the allegation giving details about what her explanation for the presence of the documents on her personal drive would have been, had a proper and fair investigation taken place. There is no sound evidential basis for us to find that there is a prospect she would have been dismissed in any event. However, the question is whether the claimant has proven that her loss continued to retirement.

[99]The assessment of the counter-factual needs to address the fact that the first respondent and its subsidiaries went into administration on 28 February 2024. The claimant argues that she would have remained in employment with one of the companies in the wider group – employment (even if by a different legal entity) which she states is not available to her because of the constructive dismissal.

[100]What happened was the rest of the finance department had left by the end of 2022. We know nothing about the personal reasons of the other individuals. It is possible that there was a destabilizing effect of the first respondent losing the claimant and Mr Merry so quickly after one another. It equally seems plausible that the accounts team could see the financial problems that Mr Merry could see and thought it prudent not to be associated with failure.

[101]As we say above, we are not persuaded that, had the claimant stayed in employment, she would have received more than inflationary payrises.

[102]She said in the remedy hearing and the individual recruited as Financial Controller is still working in the business. However the claimant’s relationship with the directors was strained because of workplace events which she did not show to be unlawful discrimination or harassment. It is more likely than not that her colleagues in the accounts department would have left in any event probably because of concerns about the financial viability of the company. We think it more likely than not that Mrs Zdravev would have left the first respondent’s employment no later than the date of the administration for reasons entirely unrelated to the respondent’s unlawful act. Either she would have left for personal reasons prior to the administration or because she did not want to be associated with a failing company – as was probably the case with Mr Merry and the rest of the accounts team. As a backstop, if she had still been in employment there would probably have been a new Finance Director and it is too speculative to find that Mrs Zdravev’s employment would have transferred to one of the remaining solvent companies.

[103]The period of her loss is therefore from the end of her notice period (which is covered by the compensation for wrongful dismissal) to the 28 February 2024 (the date of the administration). That is 8 July 2022 to 28 February 2024.

[104]She would probably have been awarded Christmas bonuses of £3,000 in December 2022 and December 2023 and would probably have received a 5% payrise each December also.

[105]The best evidence of her remuneration at the time of dismissal is her payslip for 15 April 2022 (page 306) and her payslips for 15 May 2022 and 13 June 2022 (page 1503) when she was paid a full month’s wages. From that we make the following findings about the claimant’s wages: Monthly salary £4,167.003 Fire Warden4 £25.00 £4,192.00 gross p.c.m.

[106]It seems likely that the entry noted as “salary sacrifice” was the claimant’s contribution to her pension. Therefore the amount of the employer’s pension contribution per month was £(292.42 – 182.35). If correct, that is 2.64% of gross which is less than the statutory minimum contribution to an occupational pension scheme of 3%. We therefore find that the contractual obligation of the respondent was to contribute 3% gross salary to a pension scheme and the monthly loss of those employer’s pension contributions is £125.76. That was certainly the claimant’s oral evidence. 3 This amounts to an annual salary of £50,000. 4 We have heard no evidence about this payment but it seems to be a regular payment made for responsibilities which would have continued had she remained in employment.

[107]From the gross monthly salary, we need to calculate her salary net of tax and employee’s national insurance contributions. However we see from the payslips that she contributed £8.66 per month to the national lottery and £76.13 towards healthcare. Like the employee’s pension contributions, these sums are her remuneration which she has chosen to spend in that way. She should be compensated for the loss of those sums despite them not being part of her take home pay. The national lottery and healthcare contributions have been deducted from her pay net of tax and national insurance before her pay was remitted to her. We infer that from the order of deduction in the central column on page 306. The figures on page 306 show her take home being calculated as follows: £ Salary 4167.00 Fire Warden 25.00 SSP 19.87 Salary sacrifice (182.35) PAYE Tax (576.00) National Insurance (399.42) National Lottery (8.66) Healthcare (76.13) Sick days unpaid (192.00) Take home 2777.31

[108]It would undercompensate the claimant to use the take home figure as her monthly loss net of tax and national insurance.

[109]The June 2022 payslip shows: Gross Salary year to date of £13,495.22, Tax paid to date of £2,288.20 and NI paid to date of £1,308.82. This means net salary for three months of £13,495.22 - £(2,288.20 + 1,308.82) = £9,898.20. This is £3,299.40 net per month. We regard that as a more accurate assessment of her net loss of wages per month at the point of dismissal than averaging the take home pay for reasons we have explained. It avoids needing to add back into the calculation sums deducted for the National Lottery and Healthcare and would include compensating the claimant for the loss of the fire warden premium. It means that, over the course of a year, the claimant paid approximately 20% of her income in Tax and National Insurance taking into account the personal allowances.

[110]The claimant also lost the benefit of Private Health Insurance. We accept her evidence, despite the absence of her P11D, that this was a benefit declared to HMRC as having an annual value of £1,000.00 and on which she was taxed. This must have been the value to her of her employer’s contribution to the health insurance. The post tax value was £1,000 x 0.8 or £800. This amounts to a net monthly loss of £66.67.

[111]With the 5% inflationary payrises, her pay would have increased over the period covered by the loss as follows: Date Gross pcm Gross pcm Net Tax/NI Net Tax/NI before rise after 5% rise before rise after 5% rise From 4,167.00 4,375.35 3,299.40 3,464.37 01.01.2023 From 4,375.35 4,594.12 3,464.37 3,637.59 01.01.2024

[112]We consider that the appropriate way to assess loss of pension is to calculation the amount of the contributions which would have been made into the claimant’s pension scheme during the 21 – 22 months of the loss. We have consulted the Presidential Guidance principles for compensating pension loss (10 August 2017) and the 4th Edition of the 3rd revision of the Principles for Compensating Pension Loss from 2021. The claimant has a defined contributions pension scheme. Taking account of the Principles and the period of loss, calculating the lost contributions is the appropriate measure of loss.

[113]Based on those findings, the amount of the remuneration and employer’s pension contributions which the claimant would have received each month during the various periods is as follows: £ 8.7.2022 to 31.12.2022 Loss of earnings pcm net of tax/NI 3,299.40 Pension 3% of gross (£4,167.00) 125.01 Health insurance £66.67 net p.c.m. 66.67 Loss p.c.m. 3,491.08 1.1.2023 to 31.12.2023 Loss of earnings pcm net of tax/NI 3,464.37 Pension 3% of £4,375.35 pcm gross 131.26 Health insurance as above pcm 66.67 Loss p.c.m. 3,662.30 1.1.2024 to 28.2.2024 Loss of earnings pcm net of tax/NI 3,637.59 Pension 3% of £4,594.12 pcm gross 137.82 Health insurance as above pcm 66.67 Loss p.c.m. 3,842.08

[114]Those monthly figures have been used as the basis of the calculation of loss in the table in paragraph 128 below. The loss of the annual bonus is added. This would have been paid after deduction of tax and national insurance so the loss of £3,000 gross will be compensated for with a payment of £2,400.

[115]The sums received from alternative employment are deducted. The claimant has set these out in the tab of her Excel spreadsheet and totalled them on page 3 of her schedule of loss as net income of £49,919.68 and pension contributions of £6,332.76. However, those are payments referable to a longer period than we have found is covered by the loss attributable to the actions of the first respondent.

[116]The ex-gratia payments she also lists in the Schedule of Loss have already been accounted for in the calculation of her wrongful dismissal compensation. However, we did not deduct the £3,782.49 net pay earned in the month of June 2022 which was earned during the notice period. We include that in the sums deducted for income in mitigation now. Those are as follows: June 2022 3,782.49 July 2022 – 5 April 2023 17,649.805 Employer pension 22/23 @ 3% of 775.34 gross £(17,649.80 ÷ 0.8 X 0.03) 6 April 2023 – 5 April 2024 14,430.766 LESS 1 month as period of loss ends (1,202.56)7 24.2.2024 and is therefore approx. 11 months of that financial year 13,228.20 13,228.20 Employer pension 23/24 @ 3% of 496.06 gross £(13,228.20 ÷ 0.8 X 0.03) Total earnings in mitigation 35,931.89

[117]The respondent has not shown failure to mitigate on the part of the claimant and we accept that all her losses up to 28 February 2024 do flow from the unlawful act. Our findings on the personal injury caused by the discriminatory act are relevant because her loss of focus/cognitive difficulties are connected with that. In those circumstances, we think the respondent would have struggled to show that the claimant had unreasonably failed to mitigate her loss more than she has.

[118]Interest will be awarded on the damages for financial loss caused by the discriminatory dismissal from the midpoint between 8 July 2022 and 24 February 2024 to the date of calculation. That is from 2 May 2023 to 29 December 2025 which is 973 days. ACAS uplift

[119]Mr Merry invited the claimant to the meeting on 13 May 2022 because of files which had been found on the home drive of her work account. The claimant strenuously denies that she had done anything wrong or improper or that any of the work she carried out for her husband’s company had been done on work time. She has also insisted that this would have quickly been established had a proper investigation been carried out. 5 Column K on “income earned” Tab. 6 Column R on “income earned” Tab. 7 £14,430.76 ÷ 12

[120]We refer back to our findings about the meeting of 13 May 2022, in particular those set out in paras.73 & 74 of the written liability reasons. Mr Merry and the directors suspected gross misconduct. Therefore the ACAS Code of Conduct on disciplinary procedures applied to the situation.

[121]Paragraph 4 of The Code of Practice contains 6 bullet points which are described as the elements of a process which deals with issues fairly. The last four require the employer to:a. Carry out any necessary investigations to establish the facts of the case;

b. Inform employees of the basis of the problem and give them an opportunity to put their case in response before any decisions are made;

c. Allow employees to be accompanied at any formal disciplinary meeting; and

d. Allow an employee to appeal against any formal disciplinary decision.

[122]As we found (written liability reasons para.73), R1 had reached the point before ever speaking to the claimant where they “had not decided to dismiss her but expected that they would have to dismiss her”. This was, in effect, a concluded view so the collective mind was closed – despite a formal decision not having been made. There had not been any formal disciplinary meeting and the formal decision had not been taken so the right to an appeal had not been activated. However, the decision to rid themselves of the claimant had been effectively made before she had any idea of what she was accused of, without giving her an opportunity to put her case and therefore before the necessary investigations were carried out.

[123]R1 had taken legal advice. They should have known that they needed to be more careful but acted prematurely. We rejected R1’s explanation for their actions as not being a cogent or logical explanation (see written liability reasons para.124). This was not at all the sort of case where the facts are so clear and self-evident that there were reasonable grounds for ignoring the ACAS principles which are designed to ensure fairness for employees. There was an unreasonable failure to follow the ACAS Code of Conduct by not opening an investigation and seeking an explanation from the claimant before reaching a view about her probable guilt.

[124]In principle, therefore it is just & equitable to apply an uplift to the compensation by reason of this failure. We regard this as a serious breach of the Code. The consequences were that she resigned because, instead of being taken through a fair process, she was presented with an ultimatum. This was a total failure to follow the Code and, in principle, we start by considering whether there are reasons why a 25% uplift should not be applied.

[125]We remind ourselves that this was what amounted to the breach of contract which meant that she was dismissed and consider whether it would be disproportionate to increase the award by the maximum; would it be duplicating compensation because the same wrongdoing led to the fundamental breach of contract and amounted to the breach of the ACAS Code of Conduct?

[126]We think that it is just & equitable to impose a 25% uplift in this case. First, there is a punitive element about the provision of s.207A TULR(C)A 1992. It is frequently the case that the same factual matters which caused the claim to succeed are the breach of the Code which merit an uplift. The purpose is to mark the Tribunal’s assessment that there is, in the present case, no justification for the way in which the first respondent approached the claimant about this matter. The second reason we impose a 25% uplift is that, based on the claimant’s explanations at the liability hearing, there was a real prospect that a fair investigation would have exonerated her. Finally, the peremptory way in which R1 dealt with her caused significant upset and harm to Mrs Zdravev; beyond compensation for that harm it is right that the Tribunal sends a signal to the directors in this case that there are real world consequences of failing to follow the practical and fair guidance given by ACAS.

[127]For the avoidance of doubt, there is no basis for an adjustment to the awards for harassment under s.207A TULR(C)A. Calculation of compensation for discrimination and harassment

[128]Applying our findings and conclusions above, the calculation is as set out in the following table. All rounding is done to two decimal places. related Caused by LOI 5.2.1 1,000.00 Interest @ 8% from 28.04.2022 to 295.24 29.12.2025. 1342 days @ £0.22 per day ITF incl interest from LOI 5.2.1 1,295.24 Caused by LOI 5.2.4 1,500.00 Interest @ 8% from 8.04.2022 to 449.46 29.12.2025. 1362 days @ £0.33 per day ITF incl interest from LOI 5.2.4 1,949.46 Caused by discriminatory 9,000.00 Interest @ 8% from 13.05.2022 to 29.12.2025 1327 days @ £1.97 2,614.19 per day ITF incl interest from dismissal 11,614.19 11,614.19 Damages for personal injury 12,000.00 Interest @ 8% from 31.08.20238 to 29.12.2025. 28 months @ £80 per 2,240.00 14,240.00 month Loss of Earnings and pension9 Loss per period 08.07.2022 to 31.12.2022 @ £3,491.08 p.c.m. 177 days @ £114.78 per day 20,316.06 Annual bonus (awarded net) 2,400.00 Financial loss to 31.12.2022 22,716.06 22,716.06 01.01.2023 to 31.12.2023 12 months @ £3,662.30 p.c.m. 43,947.60 Annual bonus (awarded net) 2,400.00 Financial loss to 31.12.2023 46,347.60 46,347.60 1.1.2024 to 29.02.202410 2 months @ £3,842.08 p.c.m. 7,684.16 7,684.16 Subtotal - LOSS before 76,747.82 mitigation/interest/uplift LESS earnings and pension from (35,931.89)11 (35,931.89) mitigation Subtotal – LOSS before 40,815.93 interest/uplift Interest @ 8% from 02.05.2023 to 29.12.2025. 973 days @ £8.95 per 8,708.35 day Subtotal: loss of earnings 49,524.28 49,524.28 before ACAS uplift TOTAL DISMISSAL 75,378.47 COMPENSATION BEFORE UPLIFT 25% uplift for s.207A TULR(C)A 18,844.62 (see s.207A(5) for order of increments) DISMISSAL COMPENSATION 94,223.09 94,223.09 AFTER UPLIFT (before grossing up) 8 See para.80. 9 See paras.113 for the calculation of monthly loss. 10 See paras.102 & 103 11 See para.116. Non-dismissal harassment award 3,244.70 (£1,295.24 + £1,949.46) Total Award for Discrimination 97,467.79 and harassment (before grossing up) Grossing Up

[129]As the compensation for wrongful dismissal, unfair dismissal and the discriminatory dismissal totals more then £30,000, the claimant will be liable to pay income tax under s.401 Income Tax Earnings and Pensions Act 2003. To avoid disadvantage to the claimant and to ensure that the post-tax award reflects the compensation she is due, the award will be grossed up to estimate the tax she will have to pay on the award. This requires us to estimate the tax she will pay during the present tax year.

[130]She gave evidence that she expected to receive £12,592.32 income in the tax year 2025/2026 (see column AD of the “income earned” tab of her spreadsheet). The personal allowance in the present year is £12,570. We therefore approach the grossing up calculation on the basis that her earnings from alternative employment will extinguish her personal allowance but that she will not earn other income above that. The applicable income tax rates are: Basic Rate £12,571 to £50,270 20% Higher rate £50,271 to £125.140 40% Additional rate Over £125,140 45%

[131]The grossing up calculation applies these figures to the compensation for unfair dismissal (to the extent that is calculated net) and discrimination connected with the termination of her employment (to the extent that it is subject to tax). Our expectation is that the separate injury to feelings awards for the acts of harassment would not be subject to income tax. The wrongful dismissal compensation was calculated using gross figures provided by the claimant in her schedule of loss namely £961.62 gross per week. This should be paid after deduction of tax and does not need further grossing up. However, the fact that it will use up some of the £30,000 tax free allowance for termination payments is factored into the calculation. Similarly, the Basic Award is calculated using gross figures and does not require further adjustment but will be taken into account in calculating how much of the taxable award is within the Tax Free element.

[132]Awards of compensation for personal injury are exempt from tax under s.406 ITEPA 2003 but awards of compensation for injury to feelings are not. Therefore the grossing up calculation will increase the compensation for unfair dismissal, the injury to feelings award (including interest and ACAS uplift) and the loss of earnings/pension/benefits (including interest and ACAS uplift). £22,640.33 is added to the award to take account of the tax we estimate will be payable calculated as follows: Compensatory award for 625.00 Unfair dismissal ITF award due to 11,614.19 25% ACAS uplift on ITF 2,903.55 award Financial losses for 49,524.28 discriminatory dismissal13 25% ACAS uplift on 12,381.07 financial loss TOTAL sum calculated net 77,048.09 that will be taxed GROSSING UP: £30,000 tax free 30,000.00 LESS Basic Award (6,066.88) (calculated gross but taxable) LESS wrongful dismissal (4,407.40) (calculated gross but taxable) Amount of compensation 19,525.72 up to the £30,000 Tax Free element Amount of compensation 57,522.37 that should be taxed £(77,048.09 – 19,525.72) Gross Tax Net Award Award Personal Allowance (used 12,571.00 by earnings in alternative employment) Basic Rate 20% on first 47,123.75 9,424.75 37,699.00 £37,699 of award Higher Rate 40% on 33,038.95 13,215.58 19,823.37 £(57,522.37 – 37,699.00) = £19,823.37 Totals 70,879.87 22,640.23 51,952.67

[133]If the claimant considers that it is in the interests of justice to amend the grossing up calculation because we have failed to take into account an important matter then she should apply for a reconsideration of the calculation. 12 Incl.interest 13 Incl. interest Approved by: