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Most larger employers will have a disciplinary policy involving an escalating process of warnings and culminating in dismissal. The policy may often set out examples of what may be considered to be gross misconduct (justifying dismissal of itself regardless of whether previous warnings have been issued) and it may also provide for warnings to have a limited life so that on expiry of the specified period they should not be taken into account in determining the outcome of a subsequent disciplinary process in relation to an act of alleged misconduct which took place after the expiry of the relevant warning.

So far so good, but instances of employee misconduct may not fall so neatly into the boxes set out by the procedure. In instances of “repeat offenders” employers may feel that it is appropriate to take account of previous conduct (perhaps especially if it was similar) in determining the sanction for a further offence even if it was the subject of an expired warning. But is an employer entitled to do this? After all on expiry of a warning either the slate is wiped clean or it isn’t.

The case law has not been entirely clear on the matter. In Diosynth v Thomson [2006] the employee was given a 12 month warning for failing to carry out a safety process. A few months after the expiry of that warning there was a fatal explosion and an inquiry found that the employee and several of his colleagues had failed to carry out the same process. The employee was dismissed but the employer made it clear that, had it not been for the previous warning he would not have been terminated. The Inner House of the Court of Session found that the employer could not rely on the expired warning in deciding to dismiss for misconduct. However in Airbus v Webb [2008] the outcome was different. In that case the employee, Mr Webb had been given a 12 month written warning and warned that further misconduct was likely to lead to dismissal. Three weeks after the expiry of the warning the employee was disciplined along with four colleagues for being away from the workplace without authorisation. The employer found that all had been guilty of gross misconduct. Mr Webb was dismissed but his colleagues who had no disciplinary record were given final written warnings. The Court of Appeal decided that the decision in Diosynth did not mean that expired warnings could never be taken into account by an employer in determining whether it would dismiss an employee.

The EAT considered these cases in determining the outcome in Stratford v Autotrail, the judgement in which was issued last month. Mr Stratford had a poor disciplinary record but had no live warnings on file at the time he was disciplined for using a mobile phone on the shop floor which was strictly prohibited in terms of Autotrail’s employee handbook. The Autotrail manager found, that because of “unfortunate circumstances” Mr Stratford was not guilty of gross misconduct and would be issued with a final written warning. However the letter to the employee then went on to note that it was the eighteenth time that Mr Stratford had been subject to disciplinary action and “you have given me no reason to believe that we will not be having a similar conversation in the near future.” It was further stated that “you do not understand the consequences of your actions and I do not believe this will change”. On that basis the additional decision was the Mr Stratford was dismissed with pay in lieu of notice.

Mr Stratford claimed unfair dismissal. The Employment Tribunal found that, having regard to both Diosynth and Airbus, both the employee’s disciplinary record and the belief that the employee’s conduct would not improve were to be put in the balance against the normal employment practice that once a warning has expired the slate should be wiped clean . In doing so the Employer has been entitled to decide that “enough was enough” and therefore the dismissal was fair. Mr Stratford appealed.

On appeal the Employment Appeal Tribunal (EAT) restated the guidance of the Court of Appeal in Airbus that:


• The decision on fairness ultimately depends on the interpretation of the legislation i.e. section 98 of the Employment Rights Act;
• It is open to a Tribunal to find that a dismissal for misconduct is fair even though the employer has taken account of the employee’s previous similar conduct which was the subject of an expired final written warning;
• The fact of the previous misconduct, the fact that a final warning was given and that it had expired at the date of the later misconduct are all circumstances relevant to whether the employer acted reasonably and the legislation does not single out any particular circumstances that are necessarily determinative of the question of fairness.

In applying this the EAT decided that the Employment Tribunal had not made any error in coming to its decision that Mr Stratford was fairly dismissed. The EAT stated that the situation in Diosynth was different where the Employee had only one previous warning which had expired and which had tipped the balance rather than , as in Mr Stafford’s situation, where the whole lengthy disciplinary record was being taken account of in deciding to dismiss. On that basis the decision that Mr Stratford was fairly dismissed was upheld.

Comment

It appears that the employee in this case did himself no favours. He was even late for the disciplinary hearing because he went for a cigarette break; however on a proper application of the case law the outcome might be said to be surprising and arguably wrong.

The principles set out in Airbus deal with a situation where the employer is considering, against a background of expired warnings, whether to dismiss on the basis of a subsequent act of misconduct. In that particular case there had been found to be an act of gross misconduct which might independently have justified dismissal. However, in Mr Stratford’s case, the employer expressly found that there was no gross misconduct. It issued a final written waring in relation to the latest offence but then went on to dismiss on the basis of the disciplinary history which included expired warnings. While it is true that Mr Stratford had an exceptionally bad disciplinary record it is arguable that the situation was actually very similar to that in Diosynth and that the employer was unfairly relying on expired warnings to dismiss in response to conduct which it itself had decided did not merit dismissal. The approach of issuing a final written warning in response to the latest act of misconduct but going on to dismiss is an unusual one and leaves the employer open to accusations that it was either effectively issuing two different punishments in response to the same misconduct or was unfairly revisiting old acts of misconduct.

Employers should therefore treat the decision with some caution and not regard it as giving free reign to take account of expired warnings when determining the proper outcome of disciplinary proceedings. If there is a concern about repeat offences it is open to the employer to pro-actively consider issuing final written warnings with extensive live periods e.g. up to 24 months or indeed to refresh these in response to subsequent acts which do not amount to gross misconduct. On that basis the employer will be likely to be better placed to properly have regard to the previous disciplinary record.


If you have any queries about a misconduct issue please contact any member of the Stronachs’ Employment Team.


Eric Gilligan, Partner.

Chambers UK 2018

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