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Employee’s post termination activity can be taken into account when awarding compensation

22 October 2013 Latest

In a recent ruling, the Employment Appeal Tribunal held that there were certain circumstances in which it was appropriate for a tribunal to take a former employee’s post termination conduct into account when calculating the compensation to be awarded for a successful unfair dismissal claim.

The former employee in the case, a teacher, had been convicted of assault and sentenced to 6 weeks in prison after his dismissal from a school in Cumbria. The tribunal had found his dismissal to be unfair.

Under the Employment Rights Act, when deciding on the compensatory award in an unfair dismissal a tribunal must consider all matters that it finds “just and equitable” bearing in mind the loss sustained by the employee” as a result of his dismissal.  Previous case law allows misconduct pre-dismissal but discovered after dismissal to be taken into account when deciding on the compensatory award, but not post-termination conduct.

However, the EAT said that caselaw did not forbid a tribunal from taking into account whether post termination conduct “had an impact on the claimant’s ability to work.”  In this case, Mr Bates’ assault conviction was of potential relevance as his loss of pension claim was made on the basis that he would have continued working.  “The claimant’s conviction for assault and sentence of a term of imprisonment may have substantially reduced his pension loss and a tribunal determining the proper compensatory award in this case would plainly be entitled to take into account that evidence”, said Mr Justice Supperstone in his ruling.

This is a common sense approach.  Mr Bates’ conviction and sentence may have substantially reduced his pension loss and it seems proper that this is taken into account by the tribunal when assessing future losses for the purposes of awarding compensation for unfair dismissal.

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