When considering whether a dismissal on the grounds of an employee’s ill-health is “fair”, a Tribunal must decide if the employer’s decision to dismiss was reasonable in the relevant circumstances. To date, there has been some uncertainty over how much relevance the Tribunal will place on whether the employer was responsible for the ill-health suffered by the employee. In the recent decision of Royal Bank of Scotland plc v McAdie, the EAT has provided useful clarification.

The facts

Mrs McAdie was dismissed due to her long-term absence because of stress.

An occupational health doctor found that the reason for her condition was the way that RBS had handled a grievance Mrs McAdie had previously raised.

A Tribunal found that Mrs McAdie's dismissal was unfair. It concluded that RBS was responsible for her ill-health as a result of the manner in which it had dealt with her grievance. The Tribunal was satisfied that no reasonable employer would have dismissed in these circumstances, because no reasonable employer would have found themselves in these circumstances. RBS appealed.

The Decision

The EAT decided that RBS had not unfairly dismissed Mrs McAdie. There was nothing that the Bank could have done to get Mrs McAdie back to work and, therefore, there had been no alternative to dismissal. The Tribunal had allowed itself to be swayed by the sympathy it felt for Mrs McAdie. The key question in any unfair dismissal claim is whether or not the employer’s conduct was reasonable in light of what it reasonably knew or believed at the time of dismissal. It will not always be necessary or appropriate for a Tribunal to reach a decision on the cause of the employee’s ill-health in order to decide that question.

However, there will be cases where the fact that the employer is responsible for the employee’s ill-health will be relevant to reasonableness. It might be necessary for employers, in these circumstances, to “go the extra mile”, for example, to find alternative employment for the employee or allow the employee a longer opportunity to return to work.

What this means for employers

This case is a useful reminder that, in ill-health unfair dismissal cases, a Tribunal will take note of whether the employer was responsible for the employee’s condition. However, an employer’s culpability in relation to the ill-health will not, automatically, render the dismissal unfair.

However, if an unhelpful medical report lays the blame for an employee’s condition with the employer, a Tribunal may well expect the employer to have been sympathetic to the employee. That may involve widening the search for alternative employment for the employee, tolerating a longer period of sickness absence than would be usual or, perhaps even exercising discretion to pay company sick pay for longer than usual. However, if, despite these additional measures, an employee is not able to return to work at all or within a sensible timeframe, then (subject to the proper procedures being followed) it will be fair for the employer to dismiss.