Ventrac Sheet Metals Limited v Fairley UKEAT/0064/10

Ventrac was a small business which employed Mr Fairley as a trainee until his dismissal in January 2010.  Ventrac suffered a downturn in business at the end of 2009 and decided to reduce the number of employees on site.  Ventrac decided it no longer needed a trainee on site.  Mr Fairley, one of the two trainees, was called to a meeting and was dismissed.  He was not pooled or advised of his right of appeal nor given an explanation or the reasons for his dismissal. 

Mr Fairley succeeded in his claim for unfair dismissal and was awarded compensation of £8,830.  The tribunal declined to make a Polkey deduction on the basis that Ventrac had not raised this and the flaws in the process were so serious that the tribunal could not be expected to speculate what might have happened if Ventrac had acted differently.  Ventrac appealed.   

Having assessed an employee’s loss, the EAT held that a tribunal may make a reduction in the compensatory award to reflect the possibility that there would have been a fair dismissal in any event.  This may be expressed as a percentage reduction or as a cap on the length of any future loss.  In Polkey the compensatory award was reduced to reflect the fact that certain procedural steps that had not been taken by the employer implementing a redundancy dismissal which rendered the dismissal unfair would not have made a difference to the decision to dismiss.   

The EAT allowed Ventrac’s appeal and reduced Mr Fairley’s compensation by 35%.  It was clear that one of the trainees was bound to have been dismissed.  The tribunal needed only have assessed the chance of each trainee being dismissed for redundancy.  Since it was clear there was a chance Mr Fairley would have been dismissed in any event, the tribunal should have made a Polkey deduction.  By making the assessment of a Polkey deduction the tribunal was not entitled to deprive Ventrac of this simply because it considered the procedural failings of Mr Fairley’s dismissal to be unacceptable.   

Key point:  A Polkey deduction will not be determined only on the basis of evidence which the employer adduces.  The tribunal will itself have to make an assessment based on all the evidence before it, disclosed by the employer or otherwise.