Unfair Dismissal

Edward v Tavistock and Portman NHS Foundation Trust [2023] EAT 33

Summary

The Employment Appeal Tribunal (EAT) recently confirmed in the case of Edward v Tavistock and Portman NHS Foundation Trust that it is for the respondent to show that the claimant has acted unreasonably in failing to mitigate (i.e. reduce) their losses.

Facts

Mr Edward worked as a band five data quality officer for an NHS Trust for around four years, before he was demoted to a band four role in May 2018 after it was decided that he was not capable of band five work. He was then dismissed because the Trust did not have any band four vacancies.

Following his dismissal, Mr Edward was unemployed for a period of two and a half years before he obtained an eight-month fixed term contract. During this time, Mr Edward applied for a wide range of jobs in the private sector, however he did not apply for any band four roles within the NHS, as he believed that he would be unsuccessful because he had previously been dismissed from his role.

As well as a claim for unfair dismissal, Mr Edward brought claims for discrimination and harassment on the grounds of both race and age, in addition to a claim for victimisation, as he alleged that he had not been redeployed into a band four role because he had lodged a grievance, claiming that the decision to put him on a performance improvement programme was discriminatory.

Employment Tribunal (“ET”) decision

Mr Edward’s claim for unfair dismissal was struck out on the basis that he did not have the required two years’ service. Although his claims for race and age discrimination failed, his claim for victimisation was successful.

At the remedy hearing, the ET found that after a certain period of time, Mr Edward should have started to apply for band four roles in the NHS. As a result of his failure to do so, the ET reduced his loss of earnings for the remainder of the period by 50% to reflect the likelihood that he would have been able to obtain a band four position if he had applied. In respect of his future loss of earnings, the ET held that Mr Edward would be able to find a band four role, and awarded him six weeks loss of earnings, to reflect the fact that he may not find a new role immediately after the end of his fixed term contract.

Mr Edward appealed on the ground that the ET had failed to apply the correct legal test for assessing his loss of earnings and/or failed to give adequate reasons to show that it had applied the correct test. It was not clear whether the ET had placed the burden of proof on the respondent to establish a failure to mitigate loss, nor was it clear that the ET had asked itself whether Mr Edward had acted unreasonably in failing to take steps to mitigate his losses. Further, Mr Edward appealed on the ground that the ET had fallen into error by applying a percentage discount to his loss of earnings, rather than determining what would have happened on the balance of probabilities.

Employment Appeal Tribunal (“EAT”) decision

The EAT upheld Mr Edward’s appeal on the ground that the ET had failed to apply the correct test for mitigation of loss. It reaffirmed that the onus was on the respondent to show that Mr Edward had acted unreasonably in failing to mitigate his losses. Instead of applying a 50% reduction to his loss of earnings, the ET should instead have made a finding on the balance of probabilities as to when Mr Edward would have found alternative employment and at what rate of pay. The EAT sent the case back to the same ET.

Take away points

The burden of proof in establishing that a claimant has acted unreasonably and failed to mitigate their losses is on the respondent. It is not for the claimant to show that they have acted reasonably. If the respondent does not put forward evidence about mitigation, then the ET is not obliged to make a finding on the issue. The key questions for the ET to consider are as follows:

Did the claimant fail to take reasonable steps?
What would have happened had the claimant taken those steps?
When would those steps have produced an alternative income?
What amount of alternative income would have been earned?

It is always a good idea for a claimant to keep a detailed record of all job searches and vacancies that they have applied for, in case the respondent looks to argue that they have acted unreasonably and failed to mitigate their losses.

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