Really Easy Car Credit Limited v Thompson UKEAT/0197/17/DA; January 3, 2018

Really Easy Car Credit Limited (R) is a small family owned company selling second-hand cars. Ms Thompson (T) began working for R on June 20, 2016 as a telesales operator. T discovered she was pregnant during the week beginning July 25, 2016 and began experiencing pains over the weekend of July 30–31. T was due to work on Tuesday, August 2nd but called in sick saying she had to go to the hospital. R was unaware at the time that in fact T attended hospital for a pregnancy scan and one of the owner’s of the company reassured T that it was not a problem she was off sick.

Another owner, Mr Crawford, felt this was the ‘last straw’ and that T could have gone to hospital while not due to work. R had previous problems with T’s performance and conduct. Mr Crawford wanted to terminate T’s contract immediately but was talked out of it by other owners.

When T returned to work on August 3rd there was an incident between T and a customer. A manager, Mr Fullerton, spoke with T, who became upset, and went home shortly after. That afternoon R decided T should be dismissed due to her ‘emotional volatility’, poor conduct and performance. Mr Fullerton drafted a letter that same day to T confirming the decision; however, rather than post it, R decided to hold a meeting with T to hand over the letter.

Mr Fullerton spoke with T on August 4th, during which T informed him she was pregnant. On August 5th, T duly returned to work. Mr Fullerton handed T the letter and explained the reasons for dismissal, emphasising that it had nothing to do with her pregnancy.

Employment Tribunal

T brought claims for unfair dismissal and pregnancy discrimination, alleging the real reason for her dismissal was pregnancy. T contended that the letter provided on August 5th was falsely backdated and that the decision had only been made once R had learned of her pregnancy on August 4th.

The ET did not accept this aspect of T’s case. It was satisfied that R took the decision to dismiss T on August 3rd but did not communicate it until August 5th. The ET further accepted that the reasons for T’s dismissal were her emotional volatility and performance. It accepted the events of August 2nd and 3rd as being the final straw.

Although not pleaded by T, the ET considered that it must have been obvious to R that T’s attendance at hospital and her emotional state were both pregnancy related and it ought not to have gone ahead with the dismissal. On this basis the ET was satisfied that T had proven facts sufficient to reverse the burden of proof and R failed to satisfy it that the dismissal was in no sense whatsoever related to T’s pregnancy. The ET found for T despite this not being her pleaded case.

Employment Appeal Tribunal

R appealed the decision on five grounds:

The ET had misapplied the law in finding the decision to dismiss on August 3rd was not discriminatory but the failure to reverse that decision on August 4th or 5th amounted to unfair dismissal and/or discriminatory dismissal.

The ET had erred in law in failing to apply the correct legal test.

The ET erred in law in finding for T on a case not pleaded by her.

The ET failed to make further findings of fact such as would give rise to a prima facie case. The ET further erred in failing to make any findings as to R’s explanation that the company did not know of T’s pregnancy when the decision to dismiss was made.

The ET had failed to make sufficient findings of fact generally or provide adequate reasons for its decision. In essence, T contended that the ET was entitled to make the findings it did and the ET’s conclusions were open to it on its own findings of fact, even if not following the case specifically pleaded by T.

 In essence, T contended that the ET was entitled to make the findings it did and the ET’s conclusions were open to it on its own findings of fact, even if not following the case specifically pleaded by T.

The ET had accepted that R made the decision to dismiss on August 3rd and that if R had posted the letter to T on August 3rd then it would have succeeded in its defence. The ET did not make any findings that any further decision was taken once R was informed of T’s pregnancy. So the decision was untainted by knowledge of T’s pregnancy.

However, the ET had found R liable by omission. It appeared that the ET considered R ought to have taken positive steps in revisiting its decision following August 4th and that the reason for T’s prior pregnancy related behaviour would have become obvious to R.

The EAT considered the correct test to be applied however was whether T’s pregnancy had been the reason/primary reason for her dismissal (automatic unfair dismissal) or whether her dismissal had been because of her pregnancy (s18(2) EA). For the latter the ET would have needed to be satisfied there was a prima facie case, following which the burden of proof would shift to R. The test required R to have knowledge of T’s pregnancy when it took the relevant decision, and did not impose an obligation on R to revisit its decision after acquiring knowledge.

The EAT therefore agreed with R’s objection to the ET’s application of an incorrect legal test. The ET did not make findings sufficient to support a prima facie case, indeed its only finding was that the decision to dismiss was taken on August 3rd and was not tainted by discrimination.

The EAT went on to state that the ET had misapplied the burden of proof by imposing a positive obligation on R to take a further decision once it had acquired knowledge of T’s pregnancy. This was not the correct approach as a matter of law. Further, T herself had not advanced this case and it was unsupported by the ET’s own findings.

The EAT further stated that the ET is bound to determine the case as put to it and not some other. T’s case was that she was dismissed because she informed R that she was pregnant. However the ET found for T on the basis that R failed to make a new/different decision after discovering T was pregnant.

The EAT therefore allowed the appeal, set aside the ET’s findings and remitted the case for reconsideration by a differently constituted ET.

Implications for practitioners

Practitioners should be live to circumstances where the ET’s findings depart from the pleaded case before it, as these may be challengeable.

Further, once a decision to dismiss has been taken it is often advisable to communicate this to the employee as soon as possible. Knowledge of pregnancy obtained after the decision to dismiss has been taken will not necessarily taint the decision, even if communicated after knowledge is acquired.

This article was first published in the Discrimination Law Association Briefing 859-871.