In unfair dismissal cases, employers do not have to prove that an employee is guilty. They just have to show that it was reasonable to have believed they were, and that they carried out a fair and proper investigation.

But what happens when an employer dismisses an employee, relying on confidential witness statements they obtained as part of that investigation, which they then refuse to disclose?

In Asda Stores Ltd v Thompson & ors (2004, IRLR 598), the employer convinced the appeal tribunal that they should be able to make changes to the statements to hide the identity of the witnesses before handing them over.

The employees' case was taken by Thompsons, with the support of their union.

What were the basic facts?

Three Asda managers complained of unfair dismissal to a tribunal, after an allegation that they had used illegal drugs at company events. In the course of the investigation, Asda obtained witness statements from 13 people, which it then refused to disclose to the managers. All three were dismissed.

The employees argued that the statements should be disclosed, not least because Asda had relied heavily on them when coming to their decision to dismiss them. Asda said that it could not break the promise of confidentiality that it had made to the witnesses, who had said they feared repercussions from the managers if their identities became known.

The employment tribunal agreed with the dismissed managers and ordered that the statements should be disclosed in their entirety. However, Asda successfully appealed against that decision and the case was remitted to the tribunal, with the instruction that it should look again at the documents.

In particular, the employment appeal tribunal (EAT) directed the tribunal to ensure that none of the witnesses could be identified from the statements and, if necessary, to exclude some statements altogether.

What happened next?

Despite some initial confusion as to what should happen next, the tribunal ordered the employers to supply it with the witness statements in their original form. It said that it would examine them and do whatever was necessary to conceal the witnesses' identity. The revised statements would then be sent to both parties.

The employers were not happy with this approach and said they wanted to make the necessary changes before the tribunal disclosed them to the applicants. The tribunal rejected that suggestion and ordered the employers to disclose the witness statements 
in their original form or risk having their case struck out.

The employers then appealed against that order, and the employees cross appealed, arguing that the EAT's order requiring the tribunal to maintain the confidentiality of those making the statements was ambiguous or wrong.

What did the EAT decide?

The second EAT dismissed the cross appeal, saying that there was no ambiguity in the order made by the original EAT in the case. The appeal by Asda, however, was allowed.

The EAT said that the employment tribunal had been wrong not to allow the employers to make submissions as to how the confidential statements should be edited, before disclosing them to the other side.

It also said that the tribunal had not given enough weight to the sensitive nature of the confidential information being divulged. Although the tribunal should have the final say, it was not in a position to make as informed a judgment as the employers.

The employers should, therefore, disclose the original statements to the tribunal along with their suggestions for changes, on the understanding that they would not be shown to the applicants at that stage. Before the tribunal showed the amended statements to the applicants, the employers should be given a last opportunity to comment.