It is well established in law that employees seeking compensation after being dismissed must try to mitigate their loss. The Employment Appeal Tribunal (EAT) held in Edward v Tavistock and Portman NHS Foundation Trust that tribunals must establish whether the wrongdoer had shown that the claimant had acted unreasonably in failing to mitigate whatever loss they had claimed.

 

Basic facts

Mr Edward, who worked for the trust from May 2016 as a band five data officer, was downgraded to band four in May 2018. He was then dismissed ostensibly because the trust did not have any band four vacancies.

Following his dismissal, Mr Edward was unemployed for over two and a half years, despite applying for a wide range of jobs in the private sector. He did not apply for any jobs in the NHS (apart from one with NHS England in November 2019, in which he was unsuccessful) because he thought it was pointless.

Mr Edward brought claims of discrimination and harassment on the grounds of both race and age. He also brought a victimisation claim, which included a complaint that he was not redeployed into a band four role because he had brought a grievance alleging that the decision to put him on a performance improvement programme was discriminatory.

 

Tribunal decision

Dismissing his other claims, the tribunal agreed that the trust had victimised Mr Edward when it failed to redeploy him to a band four “service administrator” role.

At the remedy hearing to consider his claim for loss of earnings, the tribunal acknowledged his efforts to find non-NHS work. However, it found that had he persevered in his job searches with an NHS employer, he would have found a band four role, thereby mitigating his loss of earnings. It, therefore, reduced his claim by 50%.

Mr Edward appealed on several grounds. In particular, he argued that the tribunal had failed to consider several factors when deciding that he had failed to mitigate his loss of earnings. These included the high number of roles he had applied for in the public and private sectors, including band three roles; the fact that he had ultimately obtained a role at equivalent remuneration to a band four; and the deterrent effect of a potentially damaging reference from the trust.

 

EAT decision

The EAT upheld the appeal on the basis that the tribunal needed to apply the correct test for mitigation, which requires the wrongdoer (in this case, the trust) to show that the claimant (Mr Edward) had acted unreasonably in failing to mitigate his loss. As the reasons provided by the tribunal did not expressly address the issue of reasonableness, the EAT remitted the matter to it for reconsideration.

As for the 50% reduction, the EAT held that, following the decision in Gardiner-Hill v Roland Berger Technics Ltd, the tribunal should have made a finding on the balance of probabilities as to when Mr Edward would have found alternative employment and at what rate of pay. It, therefore also, remitted this question to the tribunal for reconsideration.

Finally, the EAT emphasised that when considering mitigation, tribunals must remember that the burden of proof is on the respondent at all times. They also have to ask themselves the following questions:

  • Did the claimant fail to take reasonable steps?
  • What would have happened had the claimant taken those steps?
  • When would those steps have produced an alternative income?
  • What amount of alternative income would have been earned?