Abbey National terminated Mr Chagger's employment in 2006, asserting redundancy as the reason. Mr Chagger however believed that the real reason for his dismissal was race discrimination. The Employment Tribunal found that the selection for redundancy was found to be influenced by race and ordered compensation of £2.8 million.

The case went to the Employment Appeal Tribunal and then to the Court of Appeal who recently held that:

  • In a discriminatory dismissal case, an employer is only liable for loss caused by discrimination and so it would be appropriate for a tribunal to reduce compensation to reflect the chance that a claimant would have been lawfully dismissed in any event.
  • The level of compensation awarded is a factor entitling the Employment Tribunal to award less than 10 per cent uplift.
  • The dismissing employer remains liable for 'stigma loss' if other employers are unwilling to offer employment because the claimant has previously brought proceedings. Although the Court of Appeal thought it would rarely be necessary for an employment tribunal to consider this as a separate head of damage.

The case has been remitted to the same tribunal.

Chaggers v Abbey National, Court of Appeal