Unfair Dismissal: Procedure and Polkey

15 June 2016

Can a dismissal be found to be procedurally unfair without specifying the breach of procedure?

No, held the EAT in Express Medicals v O'Donnell.

The Claimant was the minority shareholder in a company. There were discussions with the majority shareholder to negotiate an exit, after a falling out between them, but he was dismissed while the process was still continuing. The employment tribunal noted that there was an "ongoing discussion and dialogue" but found the dismissal unfair because "no particular procedure" had been followed.

The Respondent argued that this was a dismissal for some other substantial reason but neither party addressed the issue of whether the ACAS Code of Practice would apply, and nor did the employment tribunal make a finding on the point. In circumstances where there had already been some dialogue between the parties, it also failed to specify what further steps the Respondent ought to have taken.

It was a further error not to make a Polkey deduction where there had been a finding of fact that the relationship had "seriously deteriorated and could not necessarily be considered to remain tenable".

With thanks to Daniel Barnett’s employment law bulletin which provided the details of this case.

If an award to a claimant is made in an unfair dismissal case, it usually consists of two elements: a basic award and a compensatory award. The basic award is based on pay, age and years of service, and the compensatory award covers the financial loss relating to the dismissal. Both are subject to limits and potential deductions. One of the most common deductions to compensatory awards is called the Polkey deduction (or reduction) and it can occur when an employer has been found to have acted unfairly in dismissing an employee by failing to follow correct procedure.

Read more from Acas on understanding the Polkey deduction.