Where a Tribunal upholds a complaint of unfair dismissal it is able to make an order for reinstatement or re-engagement of the Claimant employee. In practice, orders for re-instatement or re-engagement are very unusual and are made in less than 1% of cases.
On occasions where such an order is made, Tribunals must consider whether an order for reinstatement (returning employees to their former role on the same terms) or for re-engagement (returning to the employer in another capacity) would be more appropriate in the circumstances.
The Tribunal must only go on to consider re-engagement if it decides reinstatement is not appropriate.
In reaching its decision the Tribunal should consider:
• the wishes of the employee;
• whether it is practicable for the employer to comply with the order; and
• whether the employee contributed to the dismissal.
Where there has been contributory fault by the employee, this may affect whether it is considered just to award reinstatement or re-engagement.
In determining whether it is practicable for an employer to comply with an order, the Tribunal is likely to consider whether trust and confidence has broken down irretrievably, or whether the parties are able to put matters behind them.
British Airways plc v Valencia
Mr Valencia was employed as cabin crew at British Airways. He was dismissed for misconduct following an investigation into an incident which resulted in a flight being delayed. Following his dismissal he brought claims for disability discrimination and unfair dismissal. The Tribunal dismissed Valencia’s claim of disability discrimination, but held that he had been unfairly dismissed.
The Tribunal found that Valencia had contributed to a high degree (80%) to his dismissal. A fair dismissal might well have occurred in any event and so accordingly the Tribunal made a Polkey reduction of 50%. Valencia indicated that he wished to be reinstated or re-engaged with his employer. British Airways contested this on the basis that it was not practicable given their belief in Mr Valencia’s misconduct.
The Tribunal held that a reinstatement order would be unjust given Valencia’s high level of contributory fault. Instead the Tribunal made what it said was a re-engagement order, stating that Mr Valencia should be re-engaged in the same role and on the same terms as he had been prior to his dismissal. British Airways appealed this decision to the EAT.
At the EAT consideration was given as to which type of order was made by the Tribunal and what would be just in the circumstances.
An order for reinstatement requires an employer to treat the complainant in all respects as if he had not been dismissed. The employee will return to their job on the same terms and working with the same colleagues.
A re-engagement order is far more flexible and gives employers much more discretion over the type of role the employee can be offered. Such an order requires the employer to place the employee in a role comparable to that from which he had been dismissed, or other suitable employment.
In this case the Tribunal had made an order for reinstatement (despite concluding that this would be unjust) but called it a re-engagement.
Under statute the Tribunal had been required to consider whether it would be just to order re-engagement, and if so, on what terms. The latter question only needed to be addressed if the former was answered in the affirmative. The EAT found that the Tribunal had misapplied the law and failed to answer the first question about whether such an order was just. This was wrong in principle and not permitted by the Employment Rights Act 1996. The EAT considered that had the Tribunal taken into consideration whether re-engagement was just, it would inevitably have reached the conclusion that it was not. The EAT found it difficult to see how the high level of contributory conduct by Valencia that made reinstatement unjust did not also make the so-called re-engagement order unjust for the same reason.
Accordingly, the EAT allowed the appeal and ordered the re-engagement order to be set aside. The case was remitted to the Tribunal to deal with questions of compensation only.
Employers should be mindful that although unusual, orders for reinstatement and re-engagement can be made when a claim of unfair dismissal is upheld. Employers should be prepared to argue why both reinstatement and re-engagement should not be ordered.
For more information please contact Katie Maguire on 020 7880 4337.