Briefing: Dismissal for medical capability – the cost of not getting the process right

16 Aug 2022

When considering the process of dismissal, employers need to remember that it is a series of steps, and that even though the dismissal might be fair, a false step at any stage may lead to an adverse tribunal outcome. This briefing by rradar solicitor, Zain Zaman, looks at the case of Mrs D Daisy v. Marks and Spencer plc, which shows this very clearly.

What happened?
Mrs Daisy (the Claimant) began her employment with M&S in April 2015 and at the time of her dismissal in June 2022, was employed as a customer assistant. She worked part-time, 25.5 hours per week and was described by M&S as “loyal and hardworking”.

She began a period of absence from work due to anxiety and depression at the end of January 2021. She submitted a fit note for two weeks, followed by another for one month.

On 22 February 2021, the Claimant was invited to attend a first ill health meeting. At the meeting, she said that her anxiety and depression were caused by the pandemic in general but referred to an incident in November 2020 where a customer had been aggressive towards her when she confronted him because he was not wearing a mask in store.

Adjustments were discussed to help the Claimant return to work, including her not working on the door of the store as a store host (which involved controlling the numbers of people entering the store and reminding them to wear a mask). She was asked whether she could think of any other adjustments and replied that she could not. She concluded the meeting by saying that she would feel more comfortable about returning to work once she was vaccinated. She did not plan to return in the near future and would get another fit note.

An occupational health report was obtained dated 5 March 2021. The Claimant informed the Occupational Health physician that she did not feel protected in the workplace, referring to the incident with the aggressive customer, to an earlier robbery at the store and her concerns over COVID-19. The occupational health assessment recorded that:

“This employee is not fit for work in any capacity at present and timescales for recovery are unclear, therefore it is unlikely that a return will be feasible in the reasonably foreseeable future.”

The ill health meetings continued. On 8 April 2021, at the third ill health meeting, the Claimant advised that she was still too anxious to think about returning to work and referred to a third in-store incident involving her confronting a shoplifter.

At the fourth ill health meeting on 6 May 2021, the Claimant confirmed she had received the first dose of the COVID-19 vaccine. Adjustments were again discussed but the Claimant declined any attempt to return to work. She reiterated the three incidents at work and stated she felt vulnerable being in the store as she felt that M&S had not acted and dealt with abusive customers appropriately.

A second occupational health report was obtained 14 June 2021, which recorded:

“She states that she feels that her mental health has been affected by a customer coming into the store and verbally abusing her and she feels that management have not addressed it and this affected her mental health and has brought back past incidents in the store.”

The report did not envisage a return to work and stated no further adjustments would expedite this.

On 24 June 2021, the Claimant was invited to a fifth ill health meeting with her team manager. She mentioned that she was feeling nervous about the prospect of returning to work and raised the issue of the abusive customer and concerns that she would encounter him again. Her team manager said that she was not able to discuss the outcome of the incident because she had received advice that this would be a breach of GDPR.

The outcome of this fifth meeting was the Claimant’s dismissal on the grounds of medical capability. The Claimant received the letter of dismissal dated 25 June 2021. It recorded her absence levels, her being unable to provide a return date and there being no adjustments that could be made to support her in returning to work.

On 7 July 2021, the Claimant appealed her dismissal, suggesting M&S had treated her unfairly through not protecting her at work. The Appeal Officer met with the Claimant on 30 July 2021. The Claimant explained that although she had a number of health conditions, none stopped her from returning to work. They discussed the safety issues, and the Appeal Officer investigated these customer incidents further.

The Appeal Officer upheld the decision to dismiss by letter on 18 August stating:

“I believe from all the evidence that it was a fair dismissal, and the appeal point is not upheld as you confirmed you were not fit to work with no return date soon and no reasonable adjustments could be made. You can reapply for a role at M&S in future when you are fit and well to return to work.”

In relation to the personal safety issues, the Appeal Officer wrote that she sympathised with the way the incidents affected the Claimant; however, she concluded that the incidents were dealt with appropriately and that “I have listened to what you have said relating to security issues, but I cannot see the relevance of this to your appeal.”

The Claimant proceeded to make a claim at the Employment Tribunal for unfair dismissal.

What does the law say?
The Employment Rights Act 1996 sets out how a Tribunal should approach the question of whether a dismissal on the grounds of medical capacity is fair. There are two stages.

First, the employer must show the reason for the dismissal and that it is one of the five potentially fair reasons per section 98(1) and 98(2):

Conduct.
Capability.
Redundancy.
Illegality.
Some other substantial reason.

Second, provided the employer is successful at the first stage, the Tribunal must then consider under section 98(4) whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably in dismissing the employee for that reason.

A fair procedure is also essential. This requires consultation with the employee; a thorough medical investigation (to establish the nature of the illness or injury and its prognosis); and consideration of other options, in particular, alternative employment within the employer’s business.

What did the Tribunal rule?
The Judge was satisfied that the dismissal was for no other reason than capability and that M&S held a genuine belief that the Claimant was no longer capable of work, considering her length of absence, her comments that she could not say when she could return to work and the occupational health advice that there were no reasonable adjustments that could facilitate a return to work.

The Judge found that the consultation was adequate with frequent contact with the Claimant throughout her absence and five formal ill health meetings.

The Judge noted that while there had been a reasonable investigation into the personal safety issues raised or what might be done in future to ensure that she might feel safer in returning to work, the Claimant was not aware of the outcome of the investigation into the personal safety issues until she received the outcome letter from the Appeals Officer.

The Judge said that the team manager behind the decision to dismiss “had hidden behind GDPR issues as meaning she could not tell the Claimant anything else". However, the Appeals Officer did later engage with the investigation into the personal safety matters in the appeal outcome letter, with no reference to GDPR.

The Judge stated:

“It appears to me inevitable that the Respondent could reasonably have been expected to wait longer before dismissing the Claimant because it could have reasonably been expected to engage with the Claimant over the outcome of the investigation and explored with her what steps might have been taken to overcome her safety fears in that light of the outcome of that investigation.”

He added:

“I am surprised that those matters were not explored with the Claimant given that the Respondent is a well-resourced retailer in the UK and given that the plight of shopworkers and the abuse they suffer at work is generally well known.”

When considering whether the dismissal was within the band of reasonable responses, he concluded: “no reasonable employer would have chosen to dismiss the Claimant in these particular circumstances”. The Judge found M&S did not act reasonably in all the circumstances in treating capability as a sufficient reason to dismiss the claimant.

The Judge accepted the employer might have eventually dismissed the Claimant in any event after addressing her anxiety over her personal safety. He reduced compensation by 25%.

This is known as a Polkey reduction – the Tribunal has discretion to reduce a compensatory award made to an employee in a successful claim for unfair dismissal by up to 100% where they find that an employer didn’t follow a fair procedure, but that if they had, it would have made no difference to the outcome. The percentage reflects the likelihood that there would have been a fair dismissal in any event, whether certain procedural steps had been taken by the employer or not.

At the Remedy Hearing held on 19 July 2022, the Claimant was awarded £15,004.41, made up of:

A basic award of £2,213.73, and
A compensatory award of £12,790.68

What to know
The Claimant made complaints about her personal safety and if M&S had acted reasonably in sharing the findings of the investigation and worked with her to document those findings in the meetings leading up to her dismissal – including the measures to be put in place following the investigation – then it is unlikely that the Tribunal would have found in her favour when considering her claim for unfair dismissal.

Although the reason for dismissal was fair because it was on the grounds of ill health – which both sides agreed with – it was the procedure itself which fell short and led to the Tribunal finding.

M&S clearly believed that they were acting in accordance with employment law, but this was not the case. An Employment Tribunal is very late to be finding out about errors in process, so getting legal advice is crucial in avoiding the time and expense involved in legal action.

It is also worth noting that the Claimant’s team manager may have been working under incorrect advice about the scope and applicability of GDPR. This is a complex area of law and getting the right advice from experts in this topic can save expensive errors from occurring.