Unfair dismissal judgments: how employee conduct can reduce the cost

A recent EAT decision considers when unfair dismissal compensation can be reduced because of an employee’s own conduct.

What happened?

The Claimant, a warehouse worker, was unsuccessful in an internal job application. He raised a grievance about the process and posted the grievance on Facebook with a comment that “capitalist dictatorship is evil and needs to be destroyed” (the “original Facebook post”). A few days later, he made another post referring to the recruiting manager’s surname being similar to that of a controversial figure.

His employer investigated after seeing the original Facebook post. At the investigation meeting, the Claimant was given the social media policy but was not asked to remove the post.

At the disciplinary hearing, the focus was only on the original Facebook post, which the Claimant had already removed. He said he did not realise it breached policy and explained that personal issues had affected him. He was summarily dismissed and appealed.

Before the appeal, the Claimant made further Facebook posts, including comments sharing the appeal manager’s email address and criticising the disciplinary manager.

The appeal was rejected and the Claimant brought an unfair dismissal claim.

What did the Tribunal decide?

The Tribunal found the dismissal unfair. It held that there were no reasonable grounds to treat the original Facebook post as gross misconduct, particularly as the Claimant was not aware of the social media policy at the time and had not been told to remove the post. 
The Tribunal ordered both reinstatement and an award of compensation but reduced the compensatory award by 10% because the Claimant had not kept the grievance confidential. The employer appealed the remedy.

What did the EAT think?

The EAT held the Tribunal was wrong on remedy. In respect of reinstatement, they had not considered all relevant factors when deciding whether reinstatement was practical, including the effect of the Claimant’s conduct on other staff and the impact of his conduct during the litigation.

The EAT also clarified that:

• When reducing the basic award for contributory conduct, a Tribunal can take account of blameworthy conduct before dismissal, even if the employer did not rely on it when dismissing or did not know about the conduct at the time. Here, that could include other Facebook posts made by the Claimant before the dismissal decision.
• When reducing the compensatory award, the Tribunal could also consider the Claimant’s conduct before the appeal hearing that contributed to the dismissal being upheld. 
  The case was sent back to the same Employment Tribunal to reconsider the degree of contributory conduct and whether reinstatement is practical and just.  

Why does this matter?  

Significant changes to unfair dismissal law come into force in January 2027. As a result, employers are likely to face more unfair dismissal claims and more sophisticated arguments about compensation, both in the Tribunal and in settlement discussions.  This case illustrates the way in which unfair dismissal awards can be adjusted where an employee’s conduct justifies a reduction in compensation. 

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