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12 Mar 2014

Can an employee stop an on-going disciplinary process and make the employer start again?

Employment alert email

In a recent Supreme Court decision it was held that employees have an implied contractual right to a fair disciplinary process, which employers must respect: Chhabra v West London Mental Health NHS Trust.

C obtained an injunction to prevent the NHS Trust from proceeding with its original disciplinary hearing on the basis the process was unfair. The court held that the Trust had breached C's implied contractual right to a fair disciplinary process by allowing the case investigator's original conclusions about the severity of the allegations to be recategorised by the Trust's HR advisor as allegations of gross misconduct. The Trust therefore had to stop its original process and carry out a new investigation.

The Trust had a contractual disciplinary policy, but this decision will apply equally where the policy is non-contractual.

What does this mean for employers?
Employers must be aware that failing to follow a fair disciplinary process may expose it to risks, in particular when dealing with high earners; or those with professional qualifications who would find it hard to secure alternative employment within their profession as a result of disciplinary action (e.g. lawyers, accountants, those registered with the FCA, teachers or the medical profession).

Although you can - and should - warn employees that their actions may amount to gross misconduct and could lead to dismissal, employers need to think carefully about whether the charges could, in fact, justify dismissal.

In the same way, you must ensure that the conclusions of the person chairing any disciplinary hearing (or appeal) are their own and not influenced in any way or substituted by those of the employer.

This judgment is likely to be of interest to the large number of financial services institutions presently conducting internal investigations into suspected regulatory contraventions. Recent reports suggest as many as two dozen traders have been suspended or placed on leave by banks, in relation to allegations of misconduct in the foreign exchange markets.

Following this decision, it is all the more important that individuals placed on long-term leave, or suspended pending the outcome of such investigations, are treated fairly throughout. Care must be taken to ensure that the findings of any investigation commissioned and designed to protect the interests of the employer, are not deployed in a disciplinary context as a substitute for an independent and fair inquiry into individual culpability.


Paul Reeves

Paul Reeves

T:  +44 20 7809 2916 M:  +44 7919 694 135 Email Paul | Vcard Office:  London