Veitch Penny LLP - Exeter | Crediton, Devon

Case

Diosynth Ltd v Morris Thomson
Scottish Court of Session-(1st February 2006)

Issues

(1) Disciplinary action
(2) Unfair dismissal
(3) ACAS Code of Practice on Disciplinary and Grievance Procedures

Facts

Diosynth was a chemical company which carried out chemical reactions on an industrial scale. Mr Thomson was employed as an operator in the pharmaceutical division. One process the company carried out was "inerting", which involved pumping air out of a container and replacing it with inert gas. Failure to carry out this process correctly could lead to an explosion and injury or loss of life. Consequently, health and safety issues were of particular importance to the company. The company's disciplinary procedure stated that "serious breach of safety rules, potentially involving loss of life or limb" and "flagrant failure to follow company documentary procedures and regulations" would be treated as gross misconduct.

In 2000, Thomson had been disciplined for failing to inert a vessel. He was disciplined, given a written warning and suspended without pay for three days. The warning letter stated that the letter would stay on his record for a period of twelve months.

In November 2001, an explosion at the plant resulted in the death of a worker. An investigation into the accident revealed that there had been widespread failure to property inert the vessels. As a result, eighteen employees (including Thomson) faced allegations relating to the failures which were classified as potential gross misconduct. During the investigation, Thomson accepted that he had failed to inert vessels on three occasions and had also falsified records to that effect.

A disciplinary hearing was convened, and the Company's directors concluded that in view of the earlier warning letter Thomson could not follow clear safety instructions. The earlier warning was taken into account even though it had expired. The two incidents led the directors to decide that Thomson should be dismissed. The other employees involved were given final warnings.

Thomson's claim for unfair dismissal was dismissed. The tribunal found that the prior warning was part of the overall context of the decision.

The decision was appealed by Thomson. The Employment Appeal Tribunal (EAT) allowed the appeal and the matter was then referred to the Court of Session.

Decision

The Court of Session confirmed the EAT's decision that Thomson had been unfairly dismissed by taking into account the expired warning. It noted that Diosynth should not have issued a warning which contained a time limit if they intended to rely upon it. This does appear to contradict the ACAS Code of Practice on Disciplinary and Grievance Procedures, which states that a warning which is left hanging over an employee's head for an indefinite time is not normally consistent with good employment practice. However, the ACAS advisory handbook which accompanies the Code of Practice recognises that there may be exceptional circumstances where the misconduct is so serious (verging on gross misconduct) that it cannot realistically be ignored. If the warning letter had stated this, then the dismissal would probably have been considered fair.

Comments

This case does provide some practical guidance for employers. Whilst warnings should normally have expiry dates, in certain circumstances (e.g. the significant danger of injury or harm as in this case), there is no reason why a warning should not stay on a person's file for a longer period of time. This should be spelt out in the employer's disciplinary procedure or staff handbook. However, where a warning is given an expiry date, employers should take steps to ensure that they are physically removed from the personnel file as soon as they are expired, and disregarded in any subsequent disciplinary action from the personnel file.

Rachel Billen – Associate Solicitor, Commercial Department at Veitch Penny.
Tel: 01392 278381, Fax: 01392 410247, Email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it