Under the Employment Rights Act 1996 (section 98 (4)) one of the important steps needed for an employer to demonstrate a fair dismissal to an Employment Tribunal is to demonstrate that a fair investigation has taken place.
It is generally good practice to hold a separate investigation meeting before a decision is taken to proceed with an invitation to a disciplinary hearing. The ACAS code of practice at paragraph 5 also makes this point. It is frequently however assumed that without a separate investigation meeting any subsequent dismissal will be unfair. That however is wrong and this has just been re-confirmed by the Employment Appeal Tribunal (EAT) in the Judgment Sunshine Hotel v Goddard.
In the case the EAT confirmed there is no legal requirement for an employer to hold an investigation meeting. Section 98(4) plus the ACAS code of practice requires an employer to act “reasonably”. The key points for an investigation is to consider all the relevant evidence (not just the evidence that supports the employer’s case) and make sure that the employee knows the evidence and full details of the allegations they are facing in advance.
Of course, employers also have to be aware of their own procedures. If there is a disciplinary policy which always requires an employer to hold a separate investigatory meeting, then in such situations that may (but will not always) mean that a subsequent dismissal is unfair.
The case is good news for employers. We would generally advise that a separate investigation meeting is best practice, but the case goes to show that in some situations (if, for whatever reason, that step has been missed) it is not necessarily fatal to an unfair dismissal defence.
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Motor Industry Legal Services (MILS Legal Ltd) provides fully comprehensive legal advice and representation to UK motor retailers for one annual fee. It is the only law firm in the UK which specialises in motor law and motor trade law. MILS currently advises over 1,000 individual businesses within the sector as well as the Retail Motor Industry Federation (RMI) and its members.