Implying dismissal

Homeserve v Dixon

The statutory dismissal and disciplinary procedures state that employers have to tell their employees in writing in advance of a disciplinary hearing that they may be dismissed. In Homeserve v Dixon, the Employment Appeal Tribunal (EAT) said that employers do not have to spell out the risk of dismissal explicitly.

Basic facts

Mr Dixon had worked for Homeserve for nearly seven years as a service engineer when, in April 2006, he and a colleague were spotted by their manager (Mr Pye) doing a “foreigner” (vernacular for doing a private job).

He was suspended on full pay and invited on 24 April to a disciplinary hearing to consider the allegation of “breach of contractual obligations, namely conducting private business using company property.” He was also told he could be accompanied by a colleague or a trade union official.

Mr Dixon admitted the charge and was summarily dismissed for gross misconduct on 2 May. He exercised his right of appeal, but was unsuccessful and then claimed unfair dismissal.

Relevant law

Schedule 2, part 1, of the Employment Act 2002 Act says:

• step 1: employers must send their employee a letter setting out the alleged conduct that might result in dismissal or disciplinary action 
• step 2: employers must then have a meeting, once they have informed the employee what it’s all about and the employee has had a reasonable opportunity to think about how to respond

Tribunal decision

The tribunal agreed with the company that Mr Dixon had been dismissed for a potentially fair reason under section 98 of the Employment Rights Act 1996. It said that it was reasonable for the company to “come to the conclusion that he was guilty of the misconduct alleged and that dismissal fell within the band of reasonable responses.”

However, the tribunal then said that the dismissal was automatically unfair under the statutory dismissal and disciplinary procedure because the company had failed to say in its step 1 letter of 24 April that dismissal was a possible outcome of the hearing. Nor had Mr Dixon been able to put his side of the story properly.

EAT decision

Relying on Alexander v Brigden Enterprises Ltd (2006, IRLR 422), the EAT said that the employer only has to state the issues in “broad terms” in the step 1 letter. In other words, that the employee is at risk of dismissal and why. In this case, the EAT said that it was implicit in the employer’s letter of 24 April that dismissal was a possible outcome from the hearing.

The EAT then said that although the statutory procedure refers to step 1 and step 2, it is not “a requirement that the step 2 events should follow the step 1 letter. It seems to us that the matters set out in step 1 may precede or come at the same time as, or post date, the step 1 letter”.

The tribunal had therefore been wrong to infer that Mr Dixon should have received something from his employers between the step 1 letter and the disciplinary hearing.

The facts of this case were “stark”. The EAT said that it was obvious from the letter that Mr Dixon would immediately know why he was being asked to a disciplinary hearing, as it specifically said that Mr Pye (who had caught him red-handed) would be presenting the case against him.

Finally, the EAT criticised the tribunal for deciding that Mr Dixon was not given sufficient detail to enable him to put his side of the case properly, as there was no evidence to substantiate that assertion.

The EAT therefore dismissed the claim of unfair dismissal.