Re-engagement or reinstatement is an unfair dismissal remedy that is available to successful claimants in unfair dismissal claims. In practice, it is very rare for a tribunal to order that a respondent re-engage or reinstate a successful claimant, however, where a tribunal does order such, it can cause no end of trouble for respondents who are unlikely to want to take back an individual who has taken them through the tribunal system. In addition, should a claimant be successful in their re-engagement or reinstatement request, the respondent would be liable for back pay to the date of dismissal.
Whilst tribunals are under a duty to ask a successful claimant whether they wish for a reinstatement or re-engagement order to be made, in practice, compensation is the most common remedy as it allows a “clean-break” between the aggrieved parties. However, where an order is made by a tribunal that a respondent should take an employee back on their books, must the employer comply with that order? Thankfully, as confirmed in the following case, the answer is no, as long as the Respondent can show a genuine and reasonable belief as to why such an order is impracticable.
Kelly v PGA European Tour
In the original hearing in this matter, the Employment Tribunal (ET) held that K, the claimant, was unfairly dismissed from their role as Marketing Director for the PGA European Tour. The ET refused reinstatement, however ordered that K be re-engaged in the only vacant position available, Commercial Director, China.
The respondent appealed against the ET’s judgment on two specific points. The first was that the claimant’s re-engagement was impracticable as he could not speak fluent Mandarin, meaning he could not properly carry out the role. The second point related to covert recordings that the claimant had made, which were discovered after the dismissal. The respondent claimed that such actions caused a breakdown in trust and confidence between the respondent and the claimant, meaning that it would be impracticable for the Claimant to be re-engaged.
The Employment Appeal Tribunal (EAT) allowed the appeal, holding that the ET was wrong in ordering re-engagement. The EAT outlined that re-engagement would not be practicable where the employer genuinely and rationally believes that the employee is not capable of fulfilling the role they need to perform, or where the employee’s conduct had led to a breakdown in trust and confidence.
The claimant appealed to the Court of Appeal.
In its judgment, the Court of Appeal dismissed the Claimant’s case. In coming to its decision, the Court of Appeal confirmed the following points:
- when considering an order for re-engagement, the practicability of the employer complying with the order must be considered. The court summarised the caselaw on this point, which holds that the key question is “whether the employer had a genuine, and rational, belief that the employee had engaged in conduct which had broken the relationship of trust and confidence between the employer and the employee”. The Court held that where that conduct leads to the employer genuinely and rationally believing that they cannot trust the employee’s integrity moving forwards, that is sufficient to find against re-engagement.
- In addition, the Court of Appeal commented on a scenario where the employer has a “genuine and rational belief that the employee lacks the ability to perform the required role if re-engaged”. The employer must be able to prove, as opposed to merely assert, that the employee is incapable of performing the role to the necessary standards. The Court found that the EAT was correct in finding re-engagement was impracticable because the respondent did not speak Mandarin. K simply did not meet an essential requirement of the role.
What does this mean for you or your business?
This decision is a good reminder for employers who are faced with re-engagement or reinstatement threats by employees as part of an Employment tribunal claim. More and more we are seeing employees using covert recording as part of evidence, and this should always be referred to should an employer face such an order.
Whilst this is a positive case for employers, consideration should also be given to where such a defence unsuccessful. Whilst an employer can still refuse to reinstate or re-engage following an order to do so, a tribunal has the ability to order a penal award to the claimant of between 26 and 52 weeks wages where employers refuse. This figure can make a very big financial difference to any compensation finding.
These notes have been prepared for the purpose of articles only. They should not be regarded as a substitute for taking legal advice.