Maximising and minimising losses in the Employment Tribunal

New rules for SSP, 'In the News' and a selection of Q&As

Damage limitation is a crucial part of any tribunal claim.

I recently represented an employer client in a tribunal which we knew we had little chance of winning. It was a clear case of unfair dismissal and no matter how robust the defence was, realistically, it was doomed from the start.

It was a case I advised settling from the outset and my client agreed, but sadly the settlement figure the ex-employee wanted far outweighed what he would realistically achieve when his losses were totalled up.

In most tribunal claims one can fairly accurately predict a best and worst case scenario when it comes to assessing losses up to the tribunal hearing. Discrimination claims can be much harder but generally one can predict a likely band of loss. It is the 'future losses’ which are most speculative because they are very subjective.

Generally, tribunals ask that a Claimant sets out how much he/she is claiming in a document we call a ‘Schedule of Loss’. These can vary wildly. In this case the Claimant had pulled one from the internet. It was set out in the correct format, but it had heads of loss which couldn’t be claimed for - it was clearly used for a high value discrimination claim. As the Claimant was not legally represented he was literally doing the best he could under the circumstances, but the problem was, he was vastly over-inflating what he could realistically claim and therefore giving himself false hopes.

I served a ‘Counter Schedule’ hoping that it would bring him back to earth, but sadly, it was not to be and he insisted on demanding a sum which was totally unrealistic under the circumstances.

My client agreed that it was uneconomic to settle for such a high sum and with the cost of my representation it was still worth attending the tribunal with the knowledge the Claimant would probably win, but with the intention of limiting any tribunal award as much as we possibly could.

So how did we do this?

One option, which is often overlooked and wasn’t suitable in this case for practical reasons, is that my client could have considered an offer to reinstate or redeploy the employee. This works better in larger organisations where there is scope to do so without causing friction between the managers who initially sanctioned the dismissal, or where there is no animosity between the ex-employee and employer (perhaps in a redundancy case).

As reinstatement was out of the question we had to put ourselves in the shoes of the dismissed employee. So we immediately started searching for work. We purchased the local paper and made a point of highlighting any jobs which were suitable in the ‘Situations Vacant’ section. Most job hunting is now undertaken online, so we regularly trawled recruitment websites and then printed and saved any suitable jobs. We also registered with employment agencies because they had positions which were not advertised on the recruitment websites.

Occasionally we helped the ex-employee by forwarding jobs which we considered were suitable. We didn’t inundate him with them, but drip fed the odd one or two prior to the tribunal hearing. He didn’t respond but he might have come back to us and said, ‘Thanks for the information, but I’ve already found something’. That would have been ideal as we would then be able to have asked him when he started the new job and the level of pay he was receiving. It makes for calculating losses even more accurate in the Schedule.

Over time we collated a substantial file of suitable positions. We disclosed them to him and included the file in the joint bundle for use at the hearing.

It is for my client, the employer, to establish that the Claimant has not ‘mitigated his loss’, and has acted unreasonably in not sourcing alternative work. This position was set out in the case of Cooper Contracting Limited v Lindsey where the Employment Appeal Tribunal set out a number of principles on employee mitigation:

  1. The burden of proof is on the wrongdoer; a Claimant does not have to prove that he has mitigated loss.

  2. It is not some broad assessment on which the burden of proof is neutral. 

  3. What has to be proved is that the Claimant acted unreasonably; he does not have to show that what he did was reasonable.

  4. There is a difference between acting reasonably and not acting unreasonably.

  5. What is reasonable or unreasonable is a matter of fact.

  6. It is to be determined, taking into account the views and wishes of the Claimant as one of the circumstances, though it is the Tribunal’s assessment of reasonableness and not the Claimant’s that counts.

  7. The Tribunal is not to apply too demanding a standard to the victim; after all, he is the victim of a wrong. 

  8. The test may be summarised by saying that it is for the wrongdoer to show that the Claimant acted unreasonably in failing to mitigate.

In our case we had literally hundreds of positions set out in date order. Now, I’m not saying that we expected the Claimant to apply for every one, but the tribunal Judge could see there were a significant number of jobs the Claimant could have applied for and I asked a number of questions in relation to this, such as:

  1. How much free time did the Claimant have during the day now that he was unemployed?

  2. How often did he visit the job centre?

  3. How much time did he spend browsing recruitment sites?

  4. How long did it take to complete an application?

  5. How many applications could he write in a normal day?

  6. How many did he write?

  7. Did he register with an employment agency?

These questions caused the Claimant difficulty because it was evident he spent much of his time doing other things and not searching for work.

As it turned out this tactic paid dividends, because the Claimant turned up without any evidence of their job search, applications or interviews. He had literally sat at home waiting for the tribunal hearing to come round in the knowledge that he would, in all likelihood win his case. And he did.

When we turned to the issue of remedy the Judge was less than impressed with his efforts to mitigate his loss and awarded only two months loss of pay following his dismissal. At the end of the day my client could live with a finding of unfair dismissal and he was not too much out of pocket.

This is a salutary lesson to those bringing or defending a claim for unfair dismissal, because it cuts both ways. A Claimant turning up to a hearing with a file full of their job search history, letters of application and results of interviews will be looked upon very favourably by the tribunal and would, in all probability, maximise their economic losses if they hadn’t, by that time, found alternative employment.

So, if there is a tip in this, here it is:

Whether you are an employer or employee, start that job search immediately and keep a full record for use at the hearing.

Statutory Sick Pay Scheme ends on 30 September

Employers are currently able to reclaim Statutory Sick Pay (SSP) where staff have had to self-isolate due to Covid, or could not work because they have Covid. This has been the case since the first lockdown in March 2020.

However, under the The Statutory Sick Pay (Coronavirus) (Funding of Employers’ Liabilities) (Closure) Regulations and the Statutory Sick Pay (Coronavirus) (Funding of Employers’ Liabilities) (Northern Ireland) (Closure) Regulations 2021, SSP will revert to the position pre Covid, in that the employer will lose the government support and have to pay the SSP of £96.35 per week.

An interesting point to note is that the rule permitting SSP to be paid from day one has not been lifted, so this has the effect of putting employers in a worse position than they were pre pandemic.

  • A Co Tyrone vet has won a landmark case against a Stormont department which could result in a compensation payout of up to £1m after a judge ruled she was unfairly dismissed for voicing concerns about potential bovine Tuberculosis (TB) in the cattle supply chain.

  • Sacked for calling women ‘Love’ at work. Inappropriate comments and banter may be considered sexual harassment and ultimately lead to a finding of gross misconduct.

  • Lakes director jailed for £280,000 fraud. A managing director siphoned more than £280,000 of his employer’s funds into three business accounts of a friend, a court heard.

  • Teacher wins unfair dismisssal case after telling pupil to get into cupboard.

  • New mum wins £40,000 from BA who refused part time hours when she had a baby. A fight attendant was discriminated against by British Airways after she requested changes to her working hours following the birth of her premature baby.

  • Morrisons workers win key legal battle in equal pay fight. In the decision it was confirmed that Morrisons’ retail workers can rely on the supermarket’s distribution centre workers as comparators in their claims for equal pay.

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A selection of Q&As from my social media feeds:

Q Your content is interesting…I wonder if you could comment on my situation. Over the last 17mths, due to Covid, I have averaged an extra 21 hrs a month- I am contacted to work 18 hrs a week - and other than my usual hourly rate I have not received any holiday entitlement or other recompense. I understand that is against guidance as my overtime has been regular but wonder how this can be put right? My employer is aware and I pointed it out 12 mths ago too. I have been there for 7 yrs and am entitled to 5 weeks annual leave now.

A Check your employment contract first. There may be a clause which covers overtime and the pay rate for agreeing to do it. Because you are an hourly paid worker, as a minimum you are entitled to include the regular overtime in your holiday calculation and should be paid the additional overtime at your normal hourly rate. You should raise this matter by way of a formal written grievance requesting the back pay and additional holiday. If your request is ignored you have the opportunity to claim in the employment tribunal for an unlawful deduction from pay.

One point to note is that there are strict tribunal time limits. You have three months (less one day) from the date of the last deduction (when you were last underpaid) to make a claim and you must start by contacting ACAS with a view to obtaining a Pre Claim Conciliation Certificate. You will need the certificate before starting the tribunal claim. It can be done simply online.

Q I was off work for 25 days after a heart attack, my employer scored me down on the Bradford scale for this, first time I’ve ben off in 8 years. Is this right?

A The Bradford Scale can be a very useful tool for addressing and monitoring absence, but it does have its drawbacks. Whilst you have been scored down, it should not have too great an impact as it really ramps up for short term frequent absences. That being said, employers should be careful if the absence is disability related as it can leave them open to claims of disability discrimination. Whether a heart condition is classed as a disability is subjective and would depend on the long term effect it is having on you. Without delving any deeper, it may be that it is classed as a disability. I suggest you have a word with your employer, either informally or by way of a grievance and see if you can have this issue addressed and possibly have your Bradford score adjusted to take this into consideration.

Q I’ve worked 18 years for a company, they are now making redundancies. How much can I expect to get or can I ask more than they offer?

A As always, check your contract or company redundancy policy as you may be entitled to more than the statutory minimum. In the absence of anything contractual, you are entitled to:

12 week’s notice pay (your employer can make you work your notice) and;

  • half a week’s pay for each full year you were under 22,

  • one week’s pay for each full year you were 22 or older, but under 41,

  • one and half week’s pay for each full year you were 41 or older.

Your weekly pay is currently capped at £544.

Without knowing your age I can’t say how much you will receive, but it should be simple to work out from the above.

Can you ask for more than is offered? Of course, there’s no harm in asking. Sometimes employers will offer extra and ask you to sign a Settlement Agreement to prevent you making a tribunal claim. If they ask you to sign an Agreement and only offer you the statutory minimum then you can go back with - ‘I’ll sign but only if you pay me x’.

Q Can your employer lower your salary by just giving you a letter that’s not been signed by yourself and no new contract given?

A Yes….but that would be a very dodgy move! Pay is a fundamental term of your employment contract. When employers seek to change terms, especially fundamental terms, they should always consult with the employee first and seek their agreement. I can’t imagine many workers would be willing to take a lower salary, although in these difficult times some employees are happy to take a pay cut if it keeps the business afloat and their job secure.

Changing a fundamental term unilaterally (without consultation) can leave the employer open to a breach of contract claim and a constructive unfair dismissal claim (if you have more than 2 years’ service), so they should consult with you and if you agree to the change, provide you with written confirmation within one month.

Q Firstly, love your content. Keep it up. My two questions are personal to me but if you feel you can do a blog about their contents to help others, please do so.

Question 1.

I have accepted a new position and start in one week. I'm told historic employees got 29 days holidays plus another 5 days after 5 years of service. However new employees do get this 5 year extended grace. Can they discriminate between old and new in this way.

Question 2.

My wifes company car park is adjacent a large food retailer who engaged a third party to undertake some work. Part of there work schedule was to spray selected parts, this lead to overspray covering about ten cars, including my wife's. I spoke to the contractor who admitted blame and asked me to get a quote for rectification (£500). They also acknowledged receipt of the same. This was a week ago and they ignore my calls. The food chain says they did the work and are liable. Whilst I have the contractors telephone number I do not have their company name and the food chain won't divulge their suppliers. Have I really hit a dead end or do I have options left. Thank you for any input.

A 1. Yes, they can offer you different terms to historic employees providing they are not specific to you because of a protected characteristic (i.e. age, disability, sex etc), but to all new starters.

2. (not employment law related but I’ll give it a go!) Simple - claim against the food chain, they will either counterclaim against the contractor or suddenly change their mind and divulge the name of the company to you.

Q If you’re directly employed by a company to undertake all types of maintenance especially electrical if qualified would it be the responsibility of the company to supply the tools or can they say once employed that you have to even when not written in your contract?

A This is something which should be agreed at the outset, but I don’t see a problem with the company asking you to supply your own tools. You have little choice but to comply or they will simply dismiss you, and with less than two years’ service there is little, if anything, you can do.

However, this does raise health and safety issues. Your equipment will have to undergo testing and be suitable for the work and the company must be satisfied that it is. Liability for injuries and accidents caused by your faulty electrical equipment will undoubtedly fall on your employer so, in my opinion, and I’m no health and safety expert, they would be wise to supply their own equipment to you.

Q If you are suspended for bullying and make a counterclaim of bullying against the accuser and they aren’t suspended, is this discrimination?

A For an action to be discriminatory you have to be treated differently because you have a protected characteristic, such as age, race, sex disability etc. I doubt that this is the case here. You are saying because only you were suspended that amounts to discrimination. There has to be more than that. An employer has the right to suspend you if they feel it is appropriate under the circumstances. It prevents any alleged bullying whilst the allegation is investigated.

It may be that your counter allegations are so serious as to warrant your accusers suspension as it may result in a finding of gross misconduct resulting in summary dismissal, but at this point it appears pointless to suspend both parties. I suppose you could say, ‘He who makes the first accusation benefits from the suspension!’ Remember too that suspension is not a disciplinary sanction, should be for a short a period as possible and generally should be paid.

Q Employer has failed to provide contract of employment despite asking multiple times. Where does my friend stand legally?

A Your friend is legally entitled to a written statement of terms and conditions of employment. I suggest he/she contacts the employer one last time and makes a request, in writing, for a statement of terms and conditions of employment. If there is no progress following the final request your friend has the option to bring a claim to the tribunal under section 11(1) of the Employment Rights Act 1996:

Where an employer does not give a worker a statement as required by section 1, 4 or 8 (either because the employer gives the worker no statement or because the statement the employer gives does not comply with what is required), the worker may require a reference to be made to an employment tribunal to determine what particulars ought to have been included or referred to in a statement so as to comply with the requirements of the section concerned.

The tribunal will then determine what the terms and conditions are. Your friend is protected from detrimental treatment by asking for the terms or taking the matter to an employment tribunal. If he/she is dismissed as a consequence it will undoubtedly amount to automatically unfair dismissal - see section 104(1) of the Employment Rights Act 1996.

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