Personal liability for discrimination

The case of Bungay and another v Saini and others clarifies the position in relation to how damages in discrimination claims can be awarded against individuals who have been named as respondents in those claims.

In this case, Mr Saini and Mr Chandel were employed by the All Saints Haque Centre and were dismissed, allegedly for gross misconduct. After their dismissal, complaints were made to the West Midlands Police that Mr Saini and Mr Chandel were guilty of obtaining property by deception and they were subsequently arrested and held in cells before eventually being released without charge. Both individuals brought claims of unfair dismissal and discrimination on the grounds of religious belief against their former employer and against two of its directors, Mr Bungay and Mr Paul. The employment tribunal (ET) found that the named directors, acting as agents for the ex-employer, were the 'prime movers' in the discriminatory conduct against Mr Chandel and had told a third director that they wanted to get rid of him because he was a Hindu. Accordingly Mr Chandel's claims for unfair dismissal and discrimination were upheld and Mr Saini's claim for unfair dismissal was also upheld (his claim for discrimination, which was based on harassment because of Mr Chandel's beliefs, was unsuccessful).

The ET awarded compensation to Mr Saini and Mr Chandel in the sum of £37,000 (in respect of the discrimination element of the claims only) for which the ex-employer, and the named directors were held to be jointly and severally liable. The impact of a joint and several award is that the claimants are entitled to recover the entirety of the funds from any of the respondents, albeit that the respondents may then have claims against each other for a contribution. In this case the ex-employer went into insolvency leaving the two directors, Mr Bungay and Mr Paul, jointly and severally liable for the damages.

Mr Bungay and Mr Paul appealed the ET's decision on the basis that, amongst other things, the damages should not have been awarded on a joint and several basis. They argued that there were other directors who had not been named as respondents and so had escaped liability which could not be fair. The case of Way v Crouch [2005] IRLR 603 was previously authority for the proposition that damages should be apportioned between the respondents to the extent that each is responsible for the damage caused. In this case the Employment Appeal Tribunal (EAT) preferred the reasoning in Gilbank v Miles [2006] IRLR 538 in which an individual respondent and an employer were held to be jointly and severally liable.

This case highlights the danger for senior executives and employees who may be liable for their personal actions in the workplace. Individuals often assume that any liability will be met by the employer but this will not necessarily be the case where an award is joint and several. In particular, if an employer is in financial difficulty, individuals should be very wary of being left to pay the whole sum awarded if the company goes into insolvency. Executive directors should also check the scope and limitations of their D&O liability insurance policy.

To find out more, please contact Lauren McLardie

Order for re-instatement

A recent EAT decision demonstrates that the remedies of re-instatement and re-engagement can be a powerful weapon in the hands of a claimant.

In King v Royal Bank of Canada, Ms King worked for the Royal Bank of Canada. She was unceremoniously sacked after she raised an issue with her performance appraisal. She was summoned, without warning, to a meeting with HR and told that her role was redundant. HR then presented her with a compromise agreement. No individual consultation process was followed and she was not offered a right of appeal. 

Unsurprisingly, Ms King brought a claim for unfair dismissal. In her claim form, she stated that she would like to be either re-instated (ie given her old job back) or re-engaged (ie re-employed but in a different job) by the bank.

The tribunal decided that Ms King had been dismissed unfairly. However, it ignored the fact that she had asked to be re-employed in some capacity by the bank. Instead, when deciding what remedy to award her, the tribunal simply awarded compensation for her having been unfairly dismissed.

Ms King appealed the tribunal's decision as to remedy. She argued that it had failed to take account of her request to be re-instated or re-engaged. In her appeal, she relied on a legal argument that the tribunal judge had failed to take account of section 112 of the Employment Rights Act 1996 (the ERA), in which a tribunal must ask a claimant whether (s)he wishes an order for re-instatement or re-engagement to be made. Under section 116 ERA, there is a list of matters which a tribunal must take into account when deciding what remedy to award, which includes whether a claimant has asked for re-instatement or re-engagement. 

The bank resisted Ms King's arguments. Among other things, it argued that the relationship between Ms King and itself had deteriorated to such an extent that it would be unreasonable and unrealistic for her to be re-instated or re-engaged.

The Appeal Tribunal agreed with Ms King - it said the tribunal ought to have considered making an order for re-instatement or re-engagement. Importantly, it rejected the argument that it was impracticable for the bank to re-employ Ms King - because the bank was a large employer, the Appeal Tribunal said it was reasonable to assume that Ms King could be employed in some capacity which would not involve her working with the individuals with whom she had quarrelled.

The decision confirms that if a claimant asks for re-instatement or re-engagement, the tribunal must consider making such an award. Employers face a real risk of having to re-employ individuals whom they do not wish to re-employ, unless there is evidence, for example, that the relationship of trust and confidence is irretrievably broken down.  In the event that re-engagement or re-instatement is awarded, employers must comply, or face paying an additional award to the employee for their non-compliance. This means that, during settlement discussions, employers should weigh up the risks of having to re-employ an individual. If the commercial impact of re-employment in some capacity is significant (for example, if an employee would be entitled, upon re-employment, to a large bonus), the employer may wish to consider increasing the offer of settlement to discourage the employee from pursuing their claim at the tribunal.

To find out more, please contact Charlotte Stafford

Social media - defining acceptable standards of conduct

Despite us living in a digital era, tribunal decisions on the use of social media by employees have, surprisingly, been relatively few and far between. Unfortunately, this has left employers in a precarious position of second guessing what exactly could be considered 'one tweet too many'.

What has derived from a recent decision involving Apple is that the starting point for any employer is a comprehensive social media policy.

Mr Crisp, who worked in an Apple store, received an induction upon the commencement of employment during which it was made clear that any commentary on Apple's products, or critical remarks about its brand, were strictly prohibited.

Despite Mr Crisp signing a statement confirming that he understood and accepted the company's policy, he subsequently posted derogatory comments about his job as well as Apple's products on his ‘private’ Facebook page. A colleague, who had access to his Facebook page noticed the comments and reported him to the company.

Mr Crisp, who was subsequently dismissed on the basis that his comments constituted misconduct, issued a claim for unfair dismissal. The ET rejected his claim, finding that Apple had a clear social media policy in place and that it had made it clear to Mr Crisp during the induction process that comments of the type he posted were strictly prohibited.

The importance of Apple's image, which the tribunal accepted was central to its business, was undoubtedly a key factor in the tribunal's decision, but the tribunal also observed the ability (or lack of) to prevent the information Mr Crisp had posted from being replicated elsewhere.

It has been held in an earlier ET decision, in the case of Gosden v Lifeline Project Limited, that the nature of a private e-mail sent by the claimant from his home computer to a friend, which contained sexist and racist views, constituted gross misconduct because he could not reasonably expect that its contents would remain private and not be forwarded. However, by contrast, in the case of Taylor v Somerfield, Mr Taylor was found to have been unfairly dismissed after posting on YouTube a video clip of colleagues fighting with plastic bags while at work. Despite the clip being available to the public, the fact it appeared to have been viewed only eight times was a determining factor.     

Therefore, whilst limiting access to a social networking page does not necessarily ensure that an employee will be able to avail himself of privacy protection, equally the actual content and potential/actual readership of an email, post or tweet will be equally determinative issues.

Unfortunately, where there is no clear guidance or boundaries to work within, at least for the moment, these remain challenging times for employers and only emphasise the importance of having a comprehensive social media policy in place to define acceptable standards of behaviour.

If you need advice on your social media policy, please contact Andrew Haywood