Alboni v Ind Coope Retail Limited [1998] IRLR 131
The Court of Appeal has found that tribunals have to consider events during the notice period in determining both the reason for dismissal and whether or not the employer acted reasonably in treating that reason as sufficient to dismiss.
Ms Alboni and her former partner were employed under a joint contract of employment to manage a pub. Their contract contained a term that "your employment is inextricably bound to that of your partner. Therefore if the employment of either of you terminates, that of the other person will also terminate automatically".
Ms Alboni's partner resigned, trying to make it plain that it was he alone who was resigning and not Ms Alboni. The employer replied accepting the resignation not only on his behalf, but also on behalf of Ms Alboni, with the effective date of termination to take place some weeks later. She was therefore to be treated as dismissed.
Before the effective date of termination, the employer advertised for new managers for the pub. Ms Alboni applied and the employer indicated that it was prepared to considered her application, in her sole name, provided that she submitted a business plan.
Ms Alboni sent off a business plan, but it was never actually received by the employer and the dismissal took effect as provided for in the notice of acceptance of termination on the part of the employer.
In finding the dismissal fair, the tribunal took into account the employer's willingness to consider Ms Alboni's application for the manager's position during her own notice period.
The tribunal was prepared to take into account conduct on the part of the employer after notice of dismissal had been given, but before that dismissal became effective.
The Employment Appeal Tribunal reversed this decision, finding that the tribunal was not entitled to take into account events after the giving of notice of termination in deciding the reason for dismissal.
The Court of Appeal, in a muddled judgment, restored the decision of the industrial tribunal. It found that the tribunal had to take into account events between the date notice was given and the date that notice took effect both at the stage of determining the reason for dismissal and at the stage of determining whether the employer was entitled to rely on that reason as sufficient to dismiss. Accordingly, the Court of Appeal restored the decision that the dismissal was fair.
This decision is worrying and inconsistent with the structure of unfair dismissal legislation. The appeal court in Ms Alboni's case followed its own decision last year in Parkinson v March Consulting Limited.
In both cases, the court made the mistake of confusing when a dismissal takes place with the reason for that dismissal. The reason for dismissal should generally only be determined when that decision to dismiss is communicated to the employee.
That is at the point of giving notice of dismissal and is a well established principle from the Court of Appeal's decision in Devis & Sons v Atkins. Likewise, determination of whether it was reasonable to treat that reason as sufficient to justify dismissal should not generally include events occurring after notice to dismiss is given.
There are exceptions to the principle in Devis v Atkins and circumstances where it will be appropriate to consider events after the giving of notice when deciding whether it was reasonable for the employer to rely on the reason for dismissal.
Subsequent events may, exceptionally, establish the truth of evidence relating to events prior to the issue of notice. Subsequently discovered misconduct might be relevant to the determination of remedies.
Information coming to light after notice is given might exceptionally impact on the reason for the dismissal - such as an instantaneous recovery from supposed ill health. In determining the reasonableness of the employer's reliance on the reason to dismiss, tribunals should take account of evidence emerging during an internal appeal.
However, the circumstances in which such events should be taken into account should be strictly limited and, in any case, those events should generally only be relevant to compensation.
As it stands, the appeal court decision serves as encouragement to employers to dismiss first and then ask questions designed to justify the dismissal as fair afterwards.
That has to be a retrograde step, which suggests that the court has not properly understood the concept of unfair dismissal as being inextricably linked to the actual reason for dismissal itself.