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Failure to offer appeal hearing amounts to unfair dismissal according to EAT

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The appellant in the recent case of Radia v Jeffries International Limited, Mr Radia, was a Managing Director of a regulated financial services company.

He had previously brought two claims against his employer. The Employment Tribunal’s decision in the first claim criticised the credibility of his evidence and found him evasive. On receiving the judgement, Mr Radia was suspended by his employer pending a disciplinary. No investigation took place before the disciplinary hearing, which instead relied on the findings of the first Employment Tribunal. As he was a regulated person the employer decided that as a result of the Employment Tribunal’s decision on Mr Radia’s credibility, they could no longer employ him and consequently dismissed him for gross misconduct.

Mr Radia was not offered an appeal hearing.

Mr Radia appealed to the EAT that his dismissal was unfair because (1) there was no investigation before the disciplinary hearing, although at such hearing Mr Radia was given the opportunity to comment on the Employment Tribunal’s findings; and (2) he was not offered an appeal hearing to his dismissal contrary to the employer’s own procedure and contrary to Acas best practice.

The EAT upheld the Employment Tribunal’s decision that the dismissal was not unfair on the basis that the disciplinary hearing had relied on the findings of the first Employment Tribunal and the employer had not undertaken a separate investigation. Although they expressed the view that this was not the best possible procedure they concluded that the Employment Tribunal were open to find that no further investigation was necessary and that the decision reached at the disciplinary hearing was within the range of reasonable responses. 

The EAT did find, however, that not allowing Mr Radia an appeal hearing amounted to unfair dismissal. The ET described this decision by the employer as wholly irregular, contrary to best practice, a breach of the Acas code and contrary to the employers own appeal process, but nevertheless found the dismissal fair. The EAT stated, “We do not say that it would not have been open to this ET, correctly directing itself in law, to have held that the dismissal was not unfair […] however […] it seems to us that the ET did not make findings that were necessary to make such a conclusion good”.

Notwithstanding the decision in this case, employers should note that it is best practice to have a separate investigatory and disciplinary stages.

It is also a reminder to ensure that in almost all cases, employees should be given the right to appeal a disciplinary outcome.