Veitch Penny LLP - Exeter | Crediton, Devon

Case

Peter Lewis v HSBC
Employment Appeal Tribunal - 5 May 2006

Issues

(1) The Employment Equality (Sexual Orientation) Regulations 2003 ("the Regulations")
(2) Disciplinary Procedure
(3) Gross Misconduct

Facts

This was the first high profile case heard under the Regulations. The Regulations came into force on 1 December 2003 and as per race and sex discrimination, both direct and indirect discrimination and harassment are prohibited on the grounds of sexual orientation.

Mr Lewis had been a senior employee of HSBC receiving an annual financial package of £1.6M. He was dismissed on 9 December 2004 having only been employed at HSBC for four months.

A complaint had been made against Mr Lewis by a more junior co-worker. The co-worker alleged that Mr Lewis had performed a lewd sexual act in the showers at the gym located at HSBC. HSBC initiated an investigation and both Mr Lewis and the co-worker were interviewed individually. Mr Lewis had said the allegations were fabricated because the colleague was homophobic. On completing its investigation, HSBC dismissed Mr Lewis for gross personal misconduct.

Mr Lewis brought a claim against HSBC under the Regulations. He alleged that his dismissal was in itself an act of discrimination based on sexual orientation. He contended that his employer would not have dismissed a heterosexual man in the same circumstances. He also made a number of other complaints relating to the way in which HSBC had handled the matter and the conduct of the investigation. His potential claim was worth in the region of £5M.

Decision

The Employment Tribunal found that Mr Lewis had not been discriminated against in being dismissed by HSBC. The Tribunal was persuaded on the evidence that the decision to dismiss was not influenced by sexual orientation. It found that the dismissal was wholly attributable to the HSBC's belief that Mr Lewis had been guilty of the gross misconduct alleged. However, the Tribunal went on to uphold four of Mr Lewis' other allegations of discrimination concerning the manner in which HSBC carried out its investigation.

The evidence showed that the investigation was carried out promptly and that there were independent interviews. Detailed transcriptions were taken and all reasonable efforts were made to ensure that the matter remained private and confidential. A prompt conclusion was reached and no unreasonable delay occurred. This so far is quite in line with disciplinary procedure. However, there were aspects of the procedure had which were criticised. It was found that the human resources executive, Mrs Hattrell, dealing with the procedure, had approached the investigation with a closed mind as to Mr Lewis' guilt. The evidence showed that, prior to the completion of the investigation, Mrs Hattrell had internally requested a precedent letter used to advise the outcome of a disciplinary hearing which set out a decision of summary dismissal for gross misconduct.

The Tribunal also found that the conclusions of the investigation were discriminatory because of her conduct during the interview itself. The evidence showed that she had treated Mr Lewis' evidence less favourably than the evidence of the individual who made the allegation. Mr Lewis was invited to the investigatory meeting without being advised of the subject matter of the meeting and therefore having been given no opportunity to reflect on his response. He was not allowed to correct his interview before the investigatory report was prepared whereas the individual who made the complaint. Mrs Hattrell was also criticised for relying on a hearsay allegation against Mr Lewis which had been based on flimsy evidence and was salacious. This was contrary to good practice in investigating allegations of this kind.

Comments

On paper, the procedure adopted by HSBC could not be questioned. However, on closer inspection, the manner in which that procedure was implemented by an employee who focussed upon Mr Lewis' presumed guilt. When dealing with such instance therefore, it is vital that employers show genuine fairness and objectivity.

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

This Employment Law Update does not constitute legal or other professional advice and should not be relied on as such. You should take specific advice regarding your circumstances before taking any action based on the information contained within this Update.