COVID-19 Case Law: When will a dismissal be fair?

In this article, we will focus on COVID-related developments in unfair dismissal case law, which provides new practical applications of the law on dismissals in health and safety related circumstances, circumstances of dismissals for misconduct, constructive dismissal, or the catch-all of ‘some other substantial reason’ (“SOSR”) relating to COVID-19.

Unfair Dismissal Framework

Generally, an employee who has completed the applicable two-year qualifying period of service has the statutory right not to be unfairly dismissed under the Employment Rights Act 1996 (“ERA 1996”).

The dismissal of a qualifying employee will be unfair unless:

• the employer can show that the reason (or principal reason) for the dismissal was one of the five potentially fair reasons: capability or qualifications, conduct, redundancy, breach of a statutory duty or restriction, or SOSR (section 98(1) and (2), ERA 1996); and
• the tribunal finds that, in all the circumstances (including the employer's size and administrative resources) the employer acted reasonably in treating that reason as a sufficient reason for dismissal (section 98(4), ERA 1996).

Dismissals for certain reasons are also deemed “automatically unfair” and, in many such cases, employees do not need a qualifying period of employment to bring a claim. These include dismissals for reasons connected to health and safety activities and flexible working requests – both relevant to COVID-19. For example, an employee without the qualifying period of service may claim automatic unfair dismissal where they were dismissed for:

(a) telling employers about circumstances at work which they reasonably believe are harmful or potentially harmful to health and safety;

(b) leaving work or refusing to go to work where they reasonably believe there to be circumstances of serious and imminent danger which they could not reasonably be expected to avert; and

(c) taking appropriate steps to protect themselves or others in circumstances of danger that they reasonably believe to be serious and imminent, (section 100, ERA 1996).

Unfair Dismissal: Misconduct

Dismissal for refusing to be vaccinated

The question of whether it was unfair to dismiss an employee for refusing to be vaccinated was put to the test in Allette v Scarsdale Grange Nursing Home Ltd.

The Claimant was employed as a care assistant in a nursing home. In January 2021, the nursing home required all staff to be vaccinated against COVID-19, but there was no such requirement in the Claimant’s employment contract nor was there, at that time, a statutory restriction on the employment of unvaccinated workers in care homes. The Claimant refused to be vaccinated and, as a result, she was subject to disciplinary proceedings on the basis that she had refused to follow a reasonable instruction to have the vaccination. During the disciplinary hearing, the Claimant argued that her refusal to have the vaccine was due to her religious belief of Rastafarianism. The nursing home disputed that this was the true reason for her refusal as the first time she had raised it was during the hearing. Ultimately, she was dismissed for gross misconduct, and brought claims for unfair and wrongful dismissal.

The Employment Tribunal held that the Claimant was fairly dismissed and that the employer was acting reasonably. The Tribunal found that the Claimant’s reason for her refusal to accept the vaccine was based on an unsubstantiated belief that there was a conspiracy related to the vaccine rather than a religious belief, and this reason was not reasonable. It is notable that although at the time of this case there was no legal requirement that employees in a care homes should be vaccinated, the Tribunal emphasised that this requirement was entirely reasonable given the risk to residents and substantial number of deaths in care homes during the pandemic. The Tribunal further found that the Claimant knew she represented a risk to others and her actions amounted to gross misconduct.

Interestingly, the Tribunal considered that the instruction for employees to be vaccinated was an interference with the Claimant's right to respect for private and family life under Article 8 of the European Convention of Human Rights, but the employer had a legitimate aim for this requirement: namely, to protect the health and safety of residents in a care home during the pandemic.

This case makes clear that a refusal to be vaccinated may provide an employer with a fair reason for dismissal. However, the Tribunal emphasised that while it found that the Claimant's refusal to comply with the employer's instruction to be vaccinated amounted to gross misconduct, that does not mean that refusing to be vaccinated would amount to misconduct in a case with different facts. For example, different considerations may apply to a larger employer where less draconian measures could have been used (e.g., redeployment to a different sector, or unpaid leave). This decision is a reminder that the Tribunal will determine whether the employer acted reasonably in all of the circumstances, including a consideration of whether there were alternative actions that could have been taken to avoid dismissal.

Unfair Dismissal: SOSR

Carer unfairly dismissed for going to the pub shortly before lockdown

In Meynell v Stephenson, the Claimant was a carer looking after the Respondent's daughter who had cerebral palsy, and who was therefore in the vulnerable category during COVID-19. On 20 March 2020, when the UK prime minister had told people to avoid pubs, bars, clubs and restaurants, the Claimant went to the pub. The Respondent was concerned about this as it put her daughter's safety at risk, but was reassured by the Claimant that the pub had been very quiet. England went into lockdown on 23 March 2020, and the Claimant was furloughed. On 10 August 2020, she was told she was being dismissed for SOSR due to a breakdown in her relationship with her employer. She brought a claim for unfair dismissal.

The Tribunal held that this dismissal was unfair. It found that the main reason for the Claimant’s dismissal was the Respondent's belief that she had acted unreasonably in going to the pub on 20 March. However, as at that date, England was not in a national lockdown, so it was not unlawful to go to a pub, and the Respondent had not instructed her not to go. As a result, the Claimant was not in breach of any instruction from her employer, nor had she contravened any COVID-19 legislation. The Tribunal recognised the special nature of personal care relationships but held that a reasonable employer would not have found the Claimant's actions sufficient to trigger an irretrievable breakdown in the relationship. However, the Tribunal did find that the Claimant had contributed to her dismissal by going to the pub at a time when the Prime Minister had urged people to avoid them. As a result, the Tribunal made a deduction to the Claimant’s compensatory award.

Employers should note that a Tribunal will take into account the public health warnings at the time dismissal decisions were made. Actions that contravene that guidance may not qualify as SOSR for a dismissal where those actions are not ‘illegal’ (even if, as the Tribunal found, contravening that guidance was unwise when working as a carer). However, it is relevant that the facts of this case took place in early 2020, before the UK had taken any formal steps to go into lockdown, so government warnings were yet to be formulated into strict, enforceable guidance and the risks related to COVID-19 and the number of related deaths were low. This contrasts with Allette (discussed above), which relates to actions in late 2020 and early 2021, when the UK was in a full national lockdown and the scale of the pandemic and resultant death roll were widely known.

“Fire and Rehire”: Refusal to agree changes to employment contract

A key challenge for employers during the pandemic was how to furlough employees in accordance with the Coronavirus Job Retention Scheme, or otherwise make changes to employees' terms and conditions of employment such as pay reductions and/or reductions in working hours. Where employers were unable to agree the changes with employees, some resorted to “fire and rehire”; where the employer dismisses an employee with an offer of re-engagement on the new terms. While there are legal risks associated with this approach, it is not unlawful per se. A sound business reason for requiring the change in terms can constitute SOSR, and therefore a potentially fair reason for dismissal.

This is what happened in Khatun v Winn Solicitors Ltd, where an Employment Tribunal found that a solicitor had been unfairly dismissed for refusing to agree changes to her employment contract that would have given her employer the freedom to unilaterally reduce her pay and hours by up to 20%, or place her on furlough.

The employer placed half of its staff on furlough at the start of the pandemic, and required the remaining staff to oversee the furloughed staff members' cases. The Claimant was selected to continue working, and was told that all staff would need to agree to vary their contracts or face dismissal. The proposed variation would allow the firm to place an employee on furlough or unilaterally…