In Edwards v Chesterfield Royal Hospital NHS Foundation
Trust the Court of Appeal considered the claim of a hospital
doctor who had been summarily dismissed for misconduct.
He alleged that the employer had not followed its own disciplinary
procedure and claimed damages for breach of contract and wrongful
dismissal. He claimed that, as a result of the dismissal, he
would never work again in the NHS other than locum posts. He
estimated his current and future loss of earnings at something over
£3million.
In the High Court, the employer successfully argued that on a
wrongful dismissal claim a claimant could only recover i) the
amount that he would have been paid during his notice period (in
this case, three months' salary); and ii) possibly his pay for
the period that he would have remained employed had the
disciplinary procedure been carried out properly.
In the case of Johnson v Unisys the claimant was prevented
from enhancing his damages by claiming for breach of the duty of
trust and confidence. The House of Lords stated that the
implied duty of trust and confidence applicable to every employment
contract does not apply to a dismissal. If an employee thinks
that his dismissal is unfair, he must make a claim of unfair
dismissal to an employment tribunal and any compensatory award will
be capped (currently at £65,300).
However, the claimant in this case successfully argued in the Court
of Appeal that if he is able to show that there was a breach of
contract (the failure to follow correct disciplinary procedure)
prior to the dismissal which caused him loss, he may sue for that
breach in the normal way. Therefore, in such circumstances,
his damages will not necessarily be limited by the length of his
notice period.
Point to Note -
- This claimant was able to increase his damages claim by identifying a breach of contract not necessarily connected to the dismissal which had caused him loss. The employer's difficulty in this case arose from the fact that it had two different disciplinary procedures applicable for personal or professional misconduct respectively. In this case it tried to combine the two, fell foul of its own rules and so breached its own contract. In the case of a senior employee, such a breach may have a dramatic effect on the amount at stake in the employee's claim by making it, in effect, unlimited. Other employers should take note and take legal advice on the correct procedure.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
