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Damages: Common law damages for failure to follow disciplinary procedure

This report relates to 1 case(s)

Key points

In The Wise Group v Mitchell, the EAT holds:

  • In a case where an employee was summarily dismissed in breach of the contractual disciplinary procedure, the tribunal was wrong to award compensation for the loss of a chance to remain in employment, on the basis that if the disciplinary procedure had been followed, the employee might not have been dismissed.
  • Applying the principle in Harper v Virgin Net Ltd [2004] IRLR 390, the employee was not entitled to recover common law damages for the loss of a chance to bring an unfair dismissal claim. Where the employee would have accrued a year's continuous service (thereby enabling her to bring a statutory claim for unfair dismissal) had the disciplinary procedure been followed before a dismissal on proper notice, tribunals cannot award compensation to reflect the likely outcome of the hypothesised unfair dismissal claim.
  • On the EAT's understanding of the ratio in Johnson, such an award would be an award for the unfair manner of dismissal and not possible at common law.
  • The tribunal's decision to award compensation for the additional period over which the disciplinary process would have lasted before the contract of employment could lawfully have been terminated was not appealed against. However, the EAT stated obiter that, in light of the decision in Johnson v Unisys, it is likely that the decision on this point was not correct. In Johnson, the Lords stated that the failure to follow a disciplinary procedure was only relevant to the question of the fairness of the dismissal. It did not create contractual duties, which could be independently actionable.