Tribunal did not need ‘to look behind’ a final written warning to consider its fairness

EAT decision confirms that Tribunals should only do so in limited circumstances.

Assuming a potentially fair reason for dismissal can be established (for example, misconduct), a Tribunal will concern itself with whether or not an employer acted reasonably or unreasonably in treating that reason as sufficient for dismissing the employee when taking all the circumstances of the case int account.

Several factors will feed into this, including the fairness of the conduct of the employer in any procedure leading up to a dismissal. Where an employee is facing capability or misconduct, this will often involve an employer issuing warnings which ultimately lead to a final written warning before an employee is dismissed.

A recent case has highlighted the approach taken by Tribunals toward the fairness of an employer issuing a final written warning before dismissal took place.

Case: Fallahi v TWI Limited [2021]

Mr Fallahi was employed as Senior Project Leader for TWI. TWI raised concerns about Mr Fallahi’s performance which were initially dealt with via informal performance management and the setting of objectives and targets to be met over the following 12 months.

However, before the first deadline arrived, Mr Fallahi’s manager felt there was a lack of progress and so a formal capability hearing was called, at which point a final written warning was issued. As part of the warning, a three-month review period, with objectives and targets, was set out. However, two months into this the manager felt insufficient progress had been made.

TWI and Mr Fallahi subsequently entered into settlement negotiations and Mr Fallahi stayed off work sick. No settlement was agreed and a capability meeting was held.  Mr Fallahi was dismissed on capability grounds in his absence. Mr Fallahi brought an unfair dismissal claim which was dismissed by a Tribunal.

At Tribunal, Mr Fallahi argued that the dismissal was unfair due to various procedural issues but in particular that the sudden use of a final written warning was not justified. Mr Fallahi wanted to open up the circumstances surrounding the issuing of the warning and TWI’s potential motives for this, but the Tribunal held that it did not have to because the issuing of the warning was procedurally and substantively appropriate.

Mr Fallahi appealed on this point, arguing that the procedural flaws meant issuing the warning was “manifestly inappropriate”, a phrase drawn out of case law which considered the degree to which Tribunals must look at the motives behind issuing of warnings.

The EAT upheld the Tribunal’s decision noting that the Tribunal had been entitled on the evidence to determine that the circumstances surrounding the issuing of the final written warning made the issuing of the warning fair. The EAT highlighted that concerns with Mr Fallahi’s performance were long standing and TWI’s capability procedure allowed it to go straight to final written warnings and that doing so was reasonable in this case.

The procedural flaws Mr Fallahi had drawn on did not make the overall handling of the matter unfair, nor did it make the final decision to dismiss unfair.

Comment

The broad message from this case is that procedural flaws will not leave employers defenceless in cases of unfair dismissal and it reaffirms the point that Tribunals will not seek to look behind warnings at the employer’s motives, unless the issuing of the warning itself is clearly inappropriate.

In this case, the Tribunal and EAT drew on the fact that there was considerable history to Mr Fallahi’s manager’s concerns about his performance and informal steps were taken to manage this before TWI issued a warning. The fact TWI jumped straight to a final warning was not inappropriate in these circumstances – the capability procedure allowed for it and Mr Fallahi had come nowhere near meeting the objectives and targets set as part of the informal process.

What will likely make a final warning, and possibly a first warning, inappropriate is where it is issued in over-reaction to a minor matter, a dip in performance or a first instance of these issues.