A recent High Court decision, where the reinstatement of an employee was ordered after five years out of the business, should ring alarm bells for employers who are considering imposing a "holding suspension" on employees.  Tread carefully, check your facts and seek advice are the learning points from the latest judicial guidance on this tricky issue.

Speed Read

The case concerns an employee who had been suspended pending investigation of misconduct (the circulation of inappropriate material). He was dismissed in 2009. The case was appealed from the EAT to the Circuit Court and ultimately to the High Court where it was held that the decision to dismiss was disproportionate and unreasonable. The principles of "basic fairness" applied at this early stage of the investigation and the Court found that the employer failed to adhere to them. The High Court ordered that the employee be reinstated after over five years out of the business.

Analysis

It came to the attention of the respondent employer that inappropriate emails were circulating from a number of employees’ accounts including the claimant. As a result the claimant was placed on paid suspension (or special paid leave as it was also called in the respondent's policy), pending an investigation. In other words, a "holding suspension" which was not intended to be a penalty was imposed on the claimant.

What went wrong?

Noonan J was particularly critical of what he held to be the unjustified suspension of the employee and that view seems to have been influenced by the following factors. First, the Court noted that the employee had an exemplary record prior to these events. Second, the employer's investigation involved five employees but only three were suspended including the claimant and there was no clear reason as to why only three were suspended.  Third, the claimant received virtually no notice by the manager of the meeting at which he was to be suspended. Fourth, he was given almost no information as to the reason for the imposition of the holding suspension other than it was "something to do with emails" (and the case report suggests that the claimant was "marched out the door"). Fifth, there was no evidence to suggest that the investigation or disciplinary procedure would be in any way interfered with by the claimant were he to remain in work rather than being suspended.

When is a holding suspension justified?

The Court noted that suspension is an extremely serious measure which (either paid or unpaid) can cause irreparable damage to a claimant’s reputation and standing.  It stated that "it is potentially capable of constituting a significant blemish on the employee’s employment record with consequences for his or her future career”.  The Court noted that a holding suspension which is not intended to be punitive can in effect trigger serious consequences for the employee.  For these reasons, the Court noted that a holding suspension should not be undertaken lightly and only after full consideration of the necessity for it pending a full investigation of the conduct in question.  The Court helpfully outlined four instances where suspension will normally be justified, if it is necessary:

  • To prevent the repetition of the conduct complained of;  
  • To prevent interference with evidence;  
  • To protect persons at risk from such conduct; or  
  • To protect the business reputation of the employer where the conduct of the employee is known to those doing business with the employer.

On foot of the evidence before it, the Court did not believe that the Claimant's suspension was necessary as the employer had already preserved the evidence in relation to the emails and it was extremely unlikely on the evidence that the employee would re-offend. The Court was particularly critical of what it perceived to be of the employer "sending a message" to employees that this type of conduct would not be tolerated. The Court decided that the decision to suspend must be one taken on its merits by reference to the employee in question and the investigation. It should not be used as a means of sending a message to employees.

Tips and Traps

  • Apply the principles of "Basic Fairness": - In this case the court rejected the proposition that the claimant had no entitlement to natural justice or fair procedures even though the employer was attempting to impose a "holding suspension".  It was acknowledged that whilst the full range of fair procedures could not be invoked at that point (e.g., the right to representation, the right to cross examine witnesses, the right to be fully informed of the charges), the Court decided that basic fairness dictated that “at least a rudimentary explanation of the reason for the suspension which admitted of the possibility of some exculpatory response” was required.   
  • Check your Disciplinary Policy: - Ensure that your disciplinary policy and procedures provide for paid suspension of employees pending the outcome of an investigation and disciplinary procedure i.e. the right should be expressly reserved in the contract/policy documentation.   
  • Check your Facts: - Examine whether the employee’s suspension is required for the purposes of carrying out an investigation and in analysing this look at the four circumstances outlined above by the Court.   
  • Spell it Out: - Give the employee written confirmation of the reason for his or her suspension, together with a copy of the appropriate extract from the company’s disciplinary policy and procedures and make clear what the next steps are and when they will happen.   
  • Keep Moving: - Conduct the investigation as swiftly as possible (and if necessary the ensuing disciplinary process) without delay.  Suspensions should be for as short a time as possible. The longer an employee is on suspension the stronger the argument that their reputation is damaged as a result of the suspension.  
  • Seek Advice – Suspension is a serious step. Check your policy. Check your facts and seek advice to make sure that the business is not exposed to an unfair dismissals claim or the risk of the employee seeking the intervention of the High Court to interrupt the suspension and restore the employee to their active employment