Lord Diplock
Viscount Dilhorne
Lord Simon of Glaisdale
Lord Edmund-Davies
Lord Fraser of Tullybelton)
Lord Diplock:
My Lords,
Viscount Dilhorne:
My Lords,
"I agree to the above conditions concerning the termination of my employment and confirm that I have no further claims against the company.
That was not signed by the respondent and on the 1st November, 1974, the offer to pay £6,000 ex gratia and six weeks' salary in lieu of notice was withdrawn, the letter of that date stating that since the 23rd October information had come to light that the respondent had been guilty of gross misconduct; and that the appellant would treat the respondent as summarily dismissed.
'"6(1) In determining for the purposes of this Schedule whether the dismissal of an employee was fair or unfair, it shall be for the employer to show -
"(a) what was the reason (or, if there was more than one, the principal reason) for the dismissal and
"(b) that it was a reason falling within sub-paragraph (2) below or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which that employee held.
•'(2) In sub-paragraph (1)(b) above the reference to a reason falling within this sub-paragraph is a reference to a reason which -
"(a) related to the capability or qualifications of the employee for performing work of the kind which he was employed by the employer to do, or
"(b) related to the conduct of the employee, or..."
"(8)... the determination of the question whether the dismissal was fair or unfair, having regard to the reason shown by the employer, shall depend on whether the employer can satisfy the tribunal that in the circumstances (having regard to equity and the substantial merits of the case) he acted reasonably in treating it as a sufficient reason for dismissing the employee."
"(2) Where on a complaint under this paragraph the industrial tribunal -
"(a) finds that the grounds of the complaint are well-founded, and
"(b) considers that it would be practicable and in accordance with equity, for the complainant to be reinstated or re-engaged by the employer or to be engaged by a successor of the employer or by an associated employer,
"the tribunal shall make a recommendation to that effect, stating the terms on which it considers that it would be reasonable for the complainant to be so reinstated, re-engaged or engaged.
"(3) Where on such a complaint the industrial tribunal finds that the grounds of the complaint are well-founded, but -
"(a) the tribunal does not make such a recommendation as aforesaid, or
"(b) the tribunal makes such a recommendation and (for whatever reason) the recommendation is not complied with,
"the tribunal shall make an award of compensation, to be paid by the employer to the complainant, in respect of the dismissal."
"19(1) Where in any proceedings on a complaint under paragraph 17 above an industrial tribunal makes an award of compensation to be paid by a party to the proceedings (in this paragraph referred to as the party in default) to another party (in this paragraph referred to as the aggrieved party) the amount of the compensation shall, subject to paragraph 20 below, be such amount as the tribunal considers just and equitable in all the circumstances, having regard to the loss sustained by the aggrieved party in consequence of the matters to which the complaint relates, in so far as that loss was attributable to action taken by or on behalf of the party in default.
"(2) The said loss shall be taken to include -
"(a) any expenses reasonably incurred by the aggrieved party in consequence of the matters to which the complaint relates, and
"(b) loss of any benefit which he might reasonably be expected to have had but for those matters,
"subject, however, to the application of the same rule concerning the duty of a person to mitigate his loss as applies in relation to damages
recoverable under the common law of England and Wales or of Scotland, as the case may be.
"(3) Where the industrial tribunal finds that the matters to which the complaint relates were to any extent caused or contributed to by any action of the aggrieved party in connection with those matters, the tribunal shall reduce its assessment of his loss to such extent as, having regard to that finding, the tribunal considers just and equitable."
"(6)... the determination of the question whether the dismissal was fair or unfair, having regard to the reason shown by the employer, shall depend on whether in the circumstances he acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee; and that question shall be determined in accordance with equity and the substantial merits of the case."
"The question in every case is whether the employer acted reasonably or unreasonably in treating the reason as sufficient for dismissing the employee and it has to be answered with reference to the circumstances known to the employer at the moment of dismissal.
"If an employer thinks that his accountant may be taking the firm's money, but has no real grounds for so thinking and dismisses him for this reason, he acts wholly unreasonably and commits the unfair industrial practice of unfair dismissal notwithstanding that it is later proved that the accountant had in fact been guilty of embezzlement. Proof of the embezzlement affects the amount of the compensation, but not the issue of fair or unfair dismissal".
I will deal later with the question whether such proof would affect the amount of compensation to be paid.
"A reason for the dismissal of an employee is a set of facts known to the employer, or it may be of beliefs held by him, which cause him to dismiss the employee. If at the time of his dismissal the employer gives a reason for it, that is no doubt evidence, at any rate as against him, as to the real reason, but it does not necessarily constitute the real reason. He may knowingly give a reason different from the real reason out of kindness..."
"Decisions of this sort not infrequently are made in Scotland. They are intended to reflect the position where a dismissal is unfair for technical reasons, but it is proved that had the technical fault not existed dismissal would still have occurred…. In the common law of Scotland the concept of injuria absque damno is not unfamiliar in the field of reparation... and for that reason it may be possible in this country more readily to accept that a dismissal can be unfair, i.e., contrary to the statute, without automatically attracting compensation. In the present case had we been able to agree with the tribunal that the dismissal was unfair we would not have disagreed with their conclusion that the appellant had suffered no loss in consequence."
"if it is satisfied that it is based on a wrong principle, e.g. is inconsistent with the finding of unfair dismissal".
Lord Simon of Gbisdale:
My Lords,
Lord Edmund-Davies
My Lords,
Lord Fraser of Tullybelton:
My Lords,
Appeal dismissed
Note 1 (1888) 39 ChD 339 [Back] Note 2 (1971) 3 All E.R. 1313 [Back] Note 3 (1973) 8 I.T.R. 33 [Back] Note 4 (1973) 8 I.T.R. 463 [Back] Note 5 (1973) 8 I.T.R. 228 [Back] Note 6 (1975) 10 I.T.R. 52 [Back] Note 7 [1976] I.R.L.R. 178 [Back] Note 9 (1973) 8 I.T.R. 33 [Back] Note 10 (1973) 8 I.T.R. 33 [Back] Note 11 (1974) 9 I.T.R. 288 [Back] Note 12 (1974) 9 I.T.R. 288 [Back] Note 13 [1977] I.R.L.R. 30 [Back] Note 14 (1977) 12 I.T.R. 180 [Back] Note 15 (1976) 11 I.T.R. 232 [Back] Note 16 [1977] I.R.L.R. 30 [Back]