A guest post by Thomas Barker, student caseworker at the University of Kent’s Law Clinic
Earlier this year, the Clinic represented four members of a five-man workforce who had all been dismissed following an investigation into large scale losses at a branch of a regional building materials merchant. Our four clients (along with their manager) were dismissed on the grounds they were jointly responsible for the losses as a result of theft and/or grossly negligent management of stock controls.
Group dismissals and the law
While the fairness of misconduct dismissals is usually analysed in terms of the well-known 3-step Burchell test (the Tribunal akss whether the employer genuinely believed that the employee was responsible for an act legitimising dismissal, whether that belief was held on reasonable grounds and whether that belief was arrived at after a reasonable investigation), the case of Monie v Coral Racing  ICR 109 creates an exception applying to instances where an employer dismisses a group of employees rather than an individual.
The dismissal in Monie occurred when money was stolen from a safe in a secure location and, with no sign of forced entry, it was the employer’s belief that responsibility for the theft lay with at least one of the two employees who had authorised access to it. With neither able to offer evidence that would exclude them from suspicion, the employer decided to dismiss them both. The dilemma recognised by the Court of Appeal was whether this dismissal could be seen as fair even though, as counsel admitted, there was ‘no more than an even chance that the employee was guilty’. The Court held that it could be fair.
From the Tribunal’s perspective, a balance needed to be struck between the need to protect employees from being dismissed for acts they did not commit and preventing the potential outcome of employers having to use company resources to employ an individual who has previously stolen those very resources. In the exceptional circumstances of the secure safe in Monie the ability to fairly dismiss both key holders seemed reasonable. Unfortunately developments since this case suggest the exception is very much becoming the rule for group dismissals.
The expansion of the exception’s applicability can be traced back to the case of Whitbread v Parr. Here the Employment Appeals Tribunal introduced the following test to aid the tribunal in applying this exception:
Can the employer show that the act committed was one that would individually justify dismissal?
Had the employer conducted a reasonable investigation?
As a result of that investigation did the employer reasonably believe more than one person could have committed the act?
Had they acted reasonably in identifying each individual ‘capable’ of doing it without being able to identify an individual perpetrator?
Were these beliefs held on solid and sensible grounds at the date of dismissal?
If the answer to each of these questions is ‘yes’ then the dismissal will be fair. The significant departure from Burchell can be found in the fourth question as once it is established that the employee is capable of carrying out the act the burden of proof is, effectively, reversed. The onus is then on the employee to eliminate themselves from suspicion. It is also worth noting that, similarly to Monie, emphasis is placed on using this exception sparingly later in the judgment, that ‘such cases must… be approached by employers and tribunals alike with circumspection’.
The success of our clients’ claim hinged on the Tribunal’s interpretation of Whitbread. We relied upon distinguishing the facts of their dismissal from Whitbread and Monie on the grounds that it lacked the exceptional circumstances necessary for departing from the Burchell test.
There were many factors to distinguish our clients’ situation from the safe scenario in Monie. With shambolic management, feeble site security and a new accounting process there were several credible alternative explanations for the large scale losses experienced at the branch. Regardless, the Tribunal applied the test without even acknowledging our submissions, suggesting the Whitbread test to be the standard approach for instances of group dismissal. Once the test was recognised as applicable it became very difficult for our clients’ claim to succeed.
With the workers’ roles ill-defined by management it was exceptionally difficult for any of them to prove they had not committed the acts they were accused of, leaving the employer’s evidential burden unproblematic. The suspected act was one worthy of dismissal; a reasonable investigation was, arguably, conducted; with no labour division any of the staff could have carried out the act and, so, all could be reasonably suspected.
The manner in which group dismissal law legitimised these dismissals appears to demonstrate another obstacle in ensuring workers’ rights are protected at the Employment Tribunal.