In Vignakumar v Churchill Group Limited, the Employment Appeal Tribunal (EAT) has shed light on the correct approach to cases where evidence of misconduct is uncovered subsequent to dismissal and ruled that it was open to the Employment Tribunal (ET) to find that a fair dismissal was likely to have taken place at a later date and to reduce the level of the compensation award accordingly.

Mr Vignakumar began working as a shift engineer at the Churchill Hotel in the West End of London in May 1993. In 1998, he agreed to a new shift pattern that included some night working, although he mostly worked during the day, only working at night when he provided cover for the absence of other engineers who did work the new shift pattern. In 2010, a new Director of Engineering attempted to enforce the 1998 terms and required Mr Vignakumar to work the rotating shift pattern. He went off sick with work-related stress on 16 November 2010 and never returned to work.

Mr Vignakumar presented expert medical evidence that working night shifts was likely to harm his mental health and was dismissed in April 2011 on purported lack of capability grounds. His claims of unfair dismissal and disability discrimination were upheld by the ET. His compensation was reduced by 65 per cent, however, after his former employer presented evidence, which had only come to light after his dismissal, that Mr Vignakumar had been working for himself whilst on sick leave.

In dismissing Mr Vignakumar’s appeal, the EAT rejected his plea that the ET had misdirected itself in law when it ruled that, in reaching its conclusion, it had been unnecessary to make a firm finding as to whether there had in fact been gross misconduct on his part. On the basis that the employer had reasonable grounds for believing him guilty of such misconduct, the ET was entitled to find that the likelihood was that he would have been fairly dismissed after a further period of time. Arguments that the ET’s decision was perverse or inadequately reasoned were also rejected.

The employer had cross-appealed on the basis that Mr Vignakumar should have been awarded nothing for his future loss from the date on which, according to the ET’s findings of fact, he would probably have been fairly dismissed. Rejecting that argument, the EAT found that there was nothing to preclude the ET from making an award on a percentage basis if it was satisfied that it was more likely than not that Mr Vignakumar would have been fairly dismissed at some point in the future.