This week’s case is about uplifts to tribunal awards under Section 207A Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA). Under Section 207 TULCRA an Employment Tribunal can award an uplift of up to 25% to a compensatory award for an employer’s failure to ACAS Code of Practices relating to disciplinary, redundancy or grievance procedures. Any award can significantly increase the financial liability of the employer as the compensatory award is often the largest part a tribunal award.

Rentplus, the Respondent, were in the business of purchasing properties to be rented out in partnership with housing associations. Ms Coulson, the Claimant, was Director of Partnerships. Her role was to lead the development of the business working closely with the CEO.

In 2017, the Respondent’s CEO stepped down. The Respondent appointed a new CEO to start in the autumn. As part of the transition process a decision had been made to dismiss the Claimant and she was frozen out of her role once the new CEO started.

In early 2018 the Respondent reorganised its structure. The Claimant was invited to take part in a consultation process. The Claimant submitted a grievance about the redundancy process and this was rejected. The Claimant was dismissed via redundancy and commenced an Employment Tribunal claim for unfair dismissal and sex discrimination.

The Employment Tribunal upheld all claims. For the unfair dismissal it found that the Claimant’s dismissal was unfair and that the redundancy and grievance process had been a total sham because the decision taken to dismiss the Claimant had occurred a year before the Respondent started redundancy consultation.

The Tribunal awarded an uplift of 25% under TULCRA because the failures in the redundancy process were so egregious. This was covered in one simple line of the judgment. The Respondent appealed on the grounds that the Tribunal had erred in applying the uplift because the Employment Tribunal had not clearly defined the employer’s failure to follow the ACAS Code of Practice.

The Employment Appeal Tribunal considered:

  1. Was this a claim in which the ACAS codes applied.
  2. Whether there had been a failure to comply with the code of practice: (a) Whether that failure was ignoring the Code of Practice altogether or departed from the code. (b) Whether that failure was deliberate or inadvertent. (c) Whether there were any mitigating factors.
  3. Was the failure to comply with ACAS unreasonable.
  4. Is it just and equitable to award an uplift of 25%.

The EAT held that as this was a claim relating to both a redundancy and grievance that the ACAS code of practices did apply. The ET had held that there had been a failure to follow the code and that was due to the process being a ruse to dismiss the Claimant based on the Respondent’s historical decision. As the process was found to be an egregious sham it was therefore unreasonable to not follow the ACAS code of practice and in such circumstances it is just and equitable to award an uplift of 25%.

The Takeaway Point

Today’s case highlights the importance of conducting thorough procedural dismissals or grievances. Failure to do so can have costly consequences. More interestingly in this case the Respondent now has a finding of fact against it that senior management conducted a discriminatory dismissal procedure in bad faith. For an employer that partners with housing associations with stringent procurement processes this could be more costly than the uplift.