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17th July 2018

Tribunal Tale – Really Easy Car Credit Limited v Thompson

Background

Employees who are pregnant or on maternity leave have a number of protections under employment law. One of the most basic is that it is unlawful to dismiss an employee where the reason (or primary reason) for doing so is that she is pregnant.

Not only could that decision lead to a finding of unfair dismissal (whether automatic or otherwise), it is also likely to constitute direct discrimination, as the employee is being treated less favourably because she is pregnant.

However, employers often face the situation whereby they wish to dismiss an employee for reasons not linked to the pregnancy. This case highlights that timing can be crucial in such circumstances.

The facts of the case

Ms Thompson was employed by Really Easy Car Credit Limited (RECC) from June 2016, and became aware that she was pregnant in July 2016. Around the last weekend of July 2016, Ms Thomson experienced some pains brought on by the pregnancy and called in sick to work on Tuesday 2 August 2016. RECC did not know that Ms Thomson visited the hospital for a pregnancy scan.

RECC had been considering its options in relation to Ms Thomson before that time, as there were issues with both her performance and conduct. One of the owners of the company wished to terminate Ms Thomson’s employment following the absence on 2 August, but after discussion with the other owners the company decided not to dismiss her at that point.

On 3 August 2016 there as an issue involving Ms Thomson and a customer, following which Ms Thomson became upset and went home. Immediately afterward, RECC decided to dismiss Ms Thomson due to her ‘emotional volatility’ and the previous issues with her performance and conduct.

One of the company’s owners, Mr Fullerton, drafted a termination letter that same day but decided to give it to Ms Thomson at a face-to-face meeting instead of posting it.

On 4 August 2016 Mr Fullerton spoke to Ms Thomson, and Ms Thomson told him of her pregnancy. On 5 August 2016, when Ms Thomson returned to work, Mr Fullerton informed her of her dismissal and stated that the reasons for it were not related to her being pregnant. Ms Thomson then claimed unfair dismissal and discrimination.

The ET and EAT’s decision

At the Employment Tribunal (ET), Ms Thomson tried to argue that her dismissal was because she was pregnant, and that the other issues relied on by RECC were not the real reason for letting her go. The ET did not agree with Ms Thomson, finding that the decision to dismiss her had in fact been made on 3 August 2016, based on the incident with the customer as well as the previous conduct and performance issues, before the company had knowledge of her pregnancy.

However, the ET went on to state that RECC should have been aware that the hospital visit and her emotional state were linked to her pregnancy and, moreover, that it should have overturned its decision to dismiss her on that basis. The ET also stated that the burden of proof had shifted to RECC, who therefore had to evidence that the reason for the dismissal had nothing to do with her pregnancy; a burden that RECC hadn’t been able to discharge.

That finding was made despite it not being part of Ms Thomson’s argument. Nevertheless, the ET decided the claims in Ms Thomson’s favour.

RECC appealed on several grounds, stating that the ET had erred by finding that the decision to dismiss Ms Thomson was made fairly but that deciding not to change its mind following disclosure of her pregnancy made the decision unfair and discriminatory. RECC also argued that the ET could not make decisions based on arguments not made by Ms Thomson.

The Employment Appeal Tribunal (EAT) looked at whether the reason, or primary reason, for Ms Thomson’s dismissal was that she was pregnant. The EAT agreed with the ET on its finding that the decision to dismiss Ms Thomson was made before she disclosed her pregnancy, which meant that the decision had not been unfair or discriminatory. 

The EAT went on to say that RECC was not obliged to go back on that decision just because it found out that Ms Thomson was pregnant, and also that the ET could not make findings based on arguments presented by it and not by Ms Thomson.

The EAT therefore upheld RECC’s appeal and has sent the case back to be considered by a different ET.

What does this mean?

This case should be welcomed by employers as a common sense approach to dismissal in those circumstances. It confirms that, provided that a decision to dismiss an employee is not based on an unfair reason such as pregnancy, subsequent knowledge of that pregnancy does not compel the employer to reverse its decision.

One of the strengths of RECC’s case was its lack of knowledge of the pregnancy, so an employer who already knows that an employee is pregnant may find it more difficult to argue that the pregnancy was not the reason or primary reason for the dismissal, particularly if the dismissal closely follows disclosure of a pregnancy. In that event, documented notes of previous performance and conduct issues are likely to be key pieces of evidence.

Either way, this case highlights the potential risk of not implementing a decision when made, and the significance of being able to show that the decision was made at a particular time. Dismissing an employee immediately after being informed of their pregnancy will generally be questioned, and many employers have kicked themselves for not moving more quickly in those circumstances.

If you have any questions on any of the issues raised in the above article, please contact Seanpaul McCahill.

17th July 2018