Different treatment of employees following altercation did not make dismissal unfair

In MBNA Ltd v Jones, the Employment Appeal Tribunal overturned an Employment Tribunal’s finding that an employer’s inconsistent treatment of two employees made the dismissal of one of the employees unfair.

Mr Jones and Mr Battersby were employed by MBNA Ltd. MBNA Ltd held an event at Chester racecourse to celebrate its 20th anniversary. MBNA Ltd told staff that as it was a work event, the normal rules regarding conduct would apply. The event began at 7pm, however Mr Jones started drinking at 5pm and Mr Battersby started drinking at midday. Early in the evening, Mr Battersby kneed Mr Jones in the back of his leg and Mr Jones licked Mr Battersby’s face. Later on, Mr Jones had his arms around Mr Battersby’s sister. Mr Battersby kneed Mr Jones in the leg again, whereupon Mr Jones punched Mr Battersby in the face. After the event, Mr Jones went to a club with some colleagues. Mr Battersby waited outside and texted Mr Jones several times, threatening to follow Mr Jones home and “rip your f***ing b***ard head off”.

Both employees were disciplined. Mr Jones claimed that Mr Battersby had kneed him, giving him a dead leg and he had lashed out in self-defence. However, Mr Horsefield, who conducted the disciplinary hearing, concluded that Mr Jones had started the altercation by licking Mr Battersby’s face. Mr Jones was dismissed. Mr Horsefield also conducted Mr Battersby’s disciplinary hearing. Mr Horsefield found that whilst the text messages Mr Battersby sent were “of an extremely violent nature and wholly inappropriate”, they were made as an immediate response to Mr Jones hitting him and Mr Battersby had not intended to follow through on any of his threats. Mr Battersby was given a final written warning.

Mr Jones claimed that he and Mr Battersby had received inconsistent treatment and that his dismissal was unfair. The EAT disagreed. The issue was whether MBNA’s decision to dismiss Mr Jones was reasonable. The fact that MBNA may have been unduly lenient to Mr Battersby was irrelevant. Whilst an employer’s decision in a truly parallel case may support the argument that it was not reasonable to dismiss an employee, the circumstances of these cases were not similar enough for such a comparison to be appropriate. Mr Jones’s misconduct had taken place at a work event, whereas Mr Battersby’s had not. Mr Jones had punched Mr Battersby, whereas Mr Battersby had not carried his threats. As there was no question of disparate treatment, Mr Jones’s dismissal was fair.
This decision is reassuring, as it makes it clear that employers have a degree of flexibility when dealing with different misconduct allegations. However, employers are still expected to treat employees consistently. Employers should deal with similar situations in a similar way and ensure that any differences in treatment can be explained.

Limited companies are protected from discrimination under the Equality Act

In EAD Solicitors LLP and others v Abrams, the EAT has held that a limited company that was a member of an LLP could bring a direct discrimination claim based on the age of its principal shareholder and director.

Mr Abrams was a member of EAD, a limited liability partnership (LLP). He set up a limited company, of which he was the sole director and principal shareholder, for tax reasons. Mr Abrams’s company took Mr Abrams’s place as a member of the LLP and took the profit share Mr Abram would have received if he had still been a member. When Mr Abrams reached the age at which he would normally have retired from the LLP, the LLP objected to his company remaining a member of the LLP. Mr Abrams presented an age discrimination claim under the Equality Act 2010, naming himself as the first claimant and his company as the second claimant.

The EAT considered, as a preliminary issue, whether Mr Abrams’s company was entitled to bring a discrimination claim under the Equality Act. The LLP argued that since only individuals can possess protected characteristics, only individuals are protected from discrimination. The EAT rejected this argument. The Equality Act does not protect individuals on the basis of their own protected characteristics, but on the basis of treatment caused by a protected characteristic or related to it. The protected characteristic does not have to be that of the person suffering the detriment and whether the person who suffers the detriment is capable of having a protected characteristic is irrelevant. Furthermore, since a discriminator under the Equality Act must be a “person”, and it is well established that a discriminator can be a corporation, there was no reason why the “person” on the receiving end of the discrimination cannot be a corporation.

The Equality Act has a very wide remit, so this case is significant, not just in the field of employment law, but in other areas too. The biggest impact of the decision may be in the commercial and property spheres, in relation to the provision of goods, services or facilities or the sale of premises, as it confirms that a company, LLP, charity, educational establishment, or other non-natural person may sue if it receives detrimental treatment due to the protected characteristics of individuals (such as members, directors, employees, customers or pupils) associated with it. This would include a company being shunned because it employs a workforce of a particular ethnic origin, or a company losing a contract because it follows a particular religious ethic. It would also cover a refusal to let premises to a company because of its intention that the premises would be used by people with a particular protected characteristic.

Meaning of “transfer of business” under the Acquired Rights Directive

The Court of Justice in Europe has held in Ferreira da Silva e Brito and others v Estado portuges that a “transfer of a business” under the Acquired Rights Directive (from which the Transfer of Undertakings (Protection of Employment) Regulations 2006 are derived) covers the situation where a majority shareholder resolves to wind up its subsidiary, then takes over the subsidiary’s activities.

TAP, a Portuguese airline, was the main shareholder in Air Atlantis SA (AIA), which operated charter flights in the air transport sector. TAP resolved to wind up AIA and 96 employees were dismissed on the grounds of redundancy. A few months later, TAP took over many of the activities which had been carried on by AIA and the employees who had been dismissed claimed that their dismissals had been unlawful. The case was referred to the CJ for consideration of whether there had been a “transfer of a business”. The CJ took the view that the following factors suggested that that had been a transfer of a business:

  1. The acquisition of AIA’s aircraft;
  2. The transfer of customers when TAP assumed responsibility for AIA’s charter flights;
  3. The development of charter flight business on routes which had previously been served by AIA; and
  4. Assignment of staff to roles which were identical to those which they had performed for AIA.

The fact that the aircraft had been acquired was particularly significant due to the nature of the business. The activity which AIA had been carrying out had continued and the entity had retained its identity.

This case provides some useful guidance on the factors which Courts and Tribunals are required to take into account when determining whether or not there has been a transfer of a business.

Employment Law Update November 2015