How warnings for misconduct can affect the fairness of subsequent dismissals

The Employment Appeal Tribunal (“EAT”) case of Perrys Motor Sales v Edwards has highlighted the significance of live warnings for misconduct when assessing the fairness of any subsequent dismissal.

The EAT concluded that the Employment Tribunal got it wrong when it ruled that Mr Edwards had been unfairly dismissed for misconduct. 

Mr Edwards had been issued with a final written warning for misconduct based upon incorrect invoicing issues.  A similar matter occurred some months later and the employer, taking into account the warning, decided to dismiss Mr Edwards.  The Tribunal considered that the earlier warning had been unclear and as such the dismissal fell outside the band of reasonable responses. 

The EAT however stated that the Employment Tribunal had been wrong to ‘go behind’ the earlier warning based on the following reasons;

  • the issue of the earlier warning had not formed part of Mr Edward’s original case;
  • it was wrong to ask itself whether the warning fell within the range of reasonable responses, rather it should have asked itself whether the warning had been issued because of a hidden agenda, was manifestly inappropriate and/or was issued without grounds; and
  • it substituted its own view for that of the reasonable employer.

The Law:

Whilst a Tribunal is entitled to take into account of a previous warning when considering the fairness of a dismissal, it should also consider any proceedings that may affect the validity of that warning, such as an internal appeal or other proceedings in which it is being challenged. It is entitled to give those as much weight as it seems appropriate.

It will be going behind a warning (which is not permissible) to hold that it should not have been issued or to hold that some lesser category of warning should have been applied.  However, it is not going behind a warning to take into account the factual circumstances giving rise to the warning. An employer, and therefore tribunals, should be alert to give proper value to all those matters.

Implications for employers:

It is important that employers are aware when issuing warnings for misconduct that they could affect the fairness of any subsequent dismissal.  In the ordinary course of events, an employer considering dismissal is not required to re-open the circumstances in which a live final written warning was given. However, it should be aware that, in limited circumstances, an employment tribunal may be obliged to do so, when considering the fairness of a dismissal. If a tribunal has a real concern that the warning may have been issued in bad faith, for an oblique motive or may have been "manifestly inappropriate," it will be necessary for an Employment Tribunal to engage in a factual inquiry and detailed scrutiny of the circumstances in which that sanction was applied.

When you are considering a dismissal where there is a previous live warning, as with any dismissal, consideration should be given to the all the relevant factual circumstances which can include the circumstances of the previous warning.  Please contact us if you require any assistance regarding dismissals.