It has long been assumed that once a warning is given it becomes pretty much fact, and therefore that later decisions, such as redundancy selection or next-stage disciplinary dismissals, can safely be built on top of it. After all, runs the argument, if the employee thought that the warning was not legitimate, he had the protection of his right of appeal at that time.
The principal exception to the rule about not going back to old warnings is where they are not given in good faith, a Tribunal-designed measure to prevent employers creating a procedural basis for a redundancy or a disciplinary dismissal by imposing spurious reprimands in the run-up to it. But again, surely any bad faith argument should have got a decent airing at the appeal stage, so when would this ever actually come up?
One example is obviously the case where the appeal itself is also conducted in bad faith by the employer. Another will be where the employee is prevented from appealing at all. In Way –v– Spectrum Property Care Limited, Mr Way was given a final warning by his manager, Mr Brooks, for hiring a relative without disclosing the fact as required by company procedures. However, Mr Brooks was alleged to have known full well of Mr Way’s relationship with the new hire and to have agreed to the recruitment nonetheless. Against that background, Mr Way said that his warning was an attempt by Mr Brooks to cover up his own involvement in the hire, i.e. was given in bad faith. When he asked about appealing, however, Mr Way was wrongly told (as Spectrum ultimately admitted) that if he did so there was a risk that the sanction would be escalated to dismissal, and that he would be much better off by just letting the matter lie.
So Mr Way did not appeal and the warning was consequently still live when he sent an inappropriate email in breach of Spectrum’s rules several months later and was dismissed. It was accepted that had that prior warning not been there, he would have got only a warning for the email and would not have lost his job.
The Employment Tribunal ruled his dismissal fair – the prior warning was there and had not been appealed against, so tough luck. The EAT agreed. However, the Court of Appeal decided that Mr Way had done enough at the Tribunal to raise the bad faith argument, that the Tribunal should therefore have considered it, and that it had not done so. The Court has sent the matter back to the Tribunal to look at that point. If it agrees that the warning was not given in good faith, then it will effectively disappear and Mr Way’s dismissal will become unfair.
But how does an employer assess “bad faith” for this purpose? The Way case does not much help us in this, but it is still potentially a crucial part of determining the fairness of a termination, so here goes:
A warning will still count as issued in good faith even though:
(i) the employer’s genuine belief that there were grounds for it was objectively mistaken;
(ii) the warning was at a higher level than the Tribunal itself would have imposed;
(iii) there were procedural defects in the disciplinary process; or
(iv) the employee did not think that it was fair.
On the other hand, a warning may be held issued in bad faith if:
(i) the employer knows that grounds for it do not exist;
(ii) it is driven by consideration of the employee’s race or sex or other protected characteristic;
(iii) it is designed to cover up someone else’s misconduct or poor performance;
(iv) it is imposed specifically to make it easier to dismiss the employee at a later date;
(v) there is unarguable evidence of pre-determination of guilt; or
(vi) the employee is deliberately misled or blocked in relation to his rights of appeal.
The lessons for employers from the potential over-turning of the fairness finding in the Way case are therefore these:
(i) keep records of your disciplinary process and, in particular, of the facts which led you to believe that there were grounds for taking disciplinary action;
(ii) don’t create disclosable correspondence, internal or external, which points to pre-determination of the disciplinary decision;
(iii) be seen to investigate pre-decision any allegations of bad faith or discriminatory intent on the part of the disciplining manager; and
(iv) be seen to notify the employee of his right to appeal and don’t act so as to discourage him from pursuing it.