The Employment Appeal Tribunal ("EAT") has held that a "Step 1" letter which invited the employee to a disciplinary hearing but which failed to warn him that his employer was contemplating dismissal, breached the Statutory Dismissal and Disciplinary Procedures and rendered the employee's dismissal automatically unfair.
Whenever employers are contemplating dismissing an employee, they must make this clear in their Step 1 letter inviting the employee to attend a disciplinary hearing.
In Zimmer Limited v Mr Brezan, Mr Brezan was employed as a Regional Sales Manager for the South of England. He used his own car for business purposes and claimed mileage and expenses. When his employers investigated his mileage and expenses claims, they became concerned and invited him to attend a disciplinary hearing.
However, the invitation (a "Step 1" letter under the statutory procedures) only stated that the meeting was to "discuss his mileage and expenses claims". It did not state that Zimmer considered the matter to be an act of gross misconduct or that one outcome of the disciplinary hearing could be Mr Brezan's dismissal.
An Employment Tribunal found that Zimmer had failed to comply with Step 1 of the statutory procedures and that accordingly Mr Brezan's dismissal was automatically unfair.
Zimmer appealed to the EAT on the grounds that the statutory procedures do not require employers to warn employees that they are contemplating dismissal in the Step 1 letter.
However, the EAT rejected this argument and upheld the Employment Tribunal's finding of automatic unfair dismissal.
In the EAT's view, employees are entitled to have an idea of what type of sanction the employer is considering when they are invited to a disciplinary hearing and in a dismissal case, that the employer is contemplating dismissal. Under the statutory procedures, a failure to comply with any step in the procedure renders any subsequent dismissal "automatically unfair".
When the statutory procedures are repealed on 6 April 2009, a failure to warn employees that they are at risk of dismissal will not render the dismissal "automatically unfair", but it will be a breach of the new ACAS Code.
As Tribunals will have to take the requirements of the ACAS Code into account when deciding cases, employers will risk a finding of unfair dismissal and any compensation that is awarded to the employee being increased by up to 25%.