The EAT has recently provided useful guidance to the question - can an ill-health capability dismissal be fair where the employer was responsible for the condition leading to the dismissal?
There are six potentially fair reasons for dismissal. One of these is capability. Even if the employer can show capability to be the reason for dismissal, it will only be fair if it was reasonable in all the circumstances for the employer to rely upon that reason.
In Royal Bank of Scotland v McAdie, Mrs McAdie went off sick with work-related stress. Her employment was terminated on grounds of ill health. Mrs McAdie complained to an employment tribunal of unfair dismissal.
Employment tribunal’s decision
The employment tribunal upheld her claim. It concluded that RBS was responsible for her ill-health as a result of the way in which it had dealt with her grievance. It held that 'no reasonable employer would have dismissed in these circumstances because no reasonable employer would have found themselves in these circumstances'. RBS appealed to the EAT.
EAT’s decision
The EAT accepted that it was open to the employment tribunal to find that RBS had been responsible for Mrs McAdie’s ill health. It also accepted that an employment tribunal should not ignore the fact that an employer caused the ill-health. In its view, however, the fact that an employer has caused the incapacity, however culpably, cannot prevent it from ever effecting a fair dismissal.
The EAT stated that 'there must be cases where the fact that the employer is. . . responsible for an employee’s incapacity is, as a matter of common sense and common fairness, relevant to whether, and if so, when, it is reasonable to dismiss him for that incapacity' and that in those circumstances, it might be necessary for the employer to 'go the extra mile' in finding alternative employment for the employee or putting up with a longer period of sickness absence than would otherwise be reasonable.
However, in this case, the employment tribunal had fallen into the error of focusing on what had given rise to the situation. The correct question was whether it was reasonable for the employer to dismiss Mrs McAdie when it did, in the circumstances as they were at that time, including the fact that the employer’s mishandling of the situation had led to her illness.
Had the tribunal focussed on the correct question, it could not legitimately have concluded that the decision to dismiss was outside the range of reasonable responses. The medical evidence was unequivocal that Mrs McAdie was unfit for work and there was no prospect of recovery. She agreed that she wanted her employment to terminate. There was therefore no alternative to dismissal.
Comment
This case is helpful to employers who have caused an employee’s ill-health. The EAT clarifies that it is wrong to say that an employer can never dismiss fairly in situations where it has caused the employee’s ill-health.
Practically, however, employment tribunals will want to see strong evidence, in such situations, that employers have 'gone the extra mile' before dismissing.
Action
Even where an absent employee has a potential claim against you such as for personal injury or discrimination, you should be proactive in managing their absence.
EEF can help you achieve this: see our Managing Sickness Absence seminar, 2007 and our Sickness Absence Toolkit