Grayson v Paycare: EAT 5 Jul 2016

EAT Unfair Dismissal: Polkey Deduction – The Employment Tribunal decided that the Respondent had dismissed the Appellant unfairly due to lack of any consultation before making him redundant. There was no appeal (by way of cross-appeal) against the decision that the dismissal was unfair. The Tribunal decided, however, that the Appellant should receive no compensatory award because, if a fair procedure had been followed, he would have been dismissed by the same date in any event. The Appellant employee appealed against that decision.
The decision to reduce the compensatory award by 100 per cent was unsustainable in law. It was unsupported by any evaluation, based on evidence and with the burden on the employer, of the chance that the Appellant would have been dismissed by the same date if a fair procedure had been followed. It was not clear whether or on what evidential basis the Tribunal had assessed the chance at 100 per cent, or whether it had made its finding on the balance of probabilities.
Tribunals need to disentangle in their minds the separate questions that may arise where a redundancy dismissal is procedurally unfair. The date until which the employee’s employment would have continued if he had not been dismissed as a consequence of the redundancy exercise, is a distinct issue from that of evaluating the chance that, if a fair procedure had been followed in that exercise, the employee would have survived it and continued in employment.
When considering the latter issue, the Tribunal must envisage that the consultation that was not carried out, which fairness required, would have been carried out in good faith and with an open mind. That requires an evaluation, based on evidence, of what alternatives to redundancy the employer would have considered, had it acted fairly.
The Polkey issue would be remitted to the same Tribunal for reconsideration. It would not be desirable to remit the issue to a freshly constituted Tribunal in circumstances where the first Tribunal had heard the evidence and the employer would be unable (applying the Ladd v Marshall rule) to call fresh evidence on the remission. A fresh Tribunal would be mainly restricted to a paper exercise and would not have heard the oral evidence.

Kerr J
[2016] UKEAT 0248 – 15 – 0507
England and Wales


Updated: 18 January 2022; Ref: scu.566595