Disciplinary Proceedings – Beware of the Knee Jerk Reaction

Disciplinary proceedings have the potential to be challenging at the best of times. Most employers will endeavour to limit the uncertainty these proceedings create (for both employers and employees) by implementing a Disciplinary Policy/Procedure.

The value of an investigatory and disciplinary procedure is perhaps felt most keenly in a situation with complex facts or genuine uncertainty about whether an employee has committed the misconduct they are accused of, or not.

In a situation where the facts seem cut and dried (and misconduct seems obvious) “following the process” can seem more of a hindrance than a help.  However, a recent case demonstrates why going through the process, even in what appears to be a “slam dunk” situation, is important.

The case – Borg-Neal v Lloyds Banking Group

Mr Borg-Neal was a long-standing employee of Lloyds Banking Group plc. From 2011, he was employed in the Bank’s Payment Design Authority as PDA Manager.

In 2021, Mr Borg-Neal attended a remote training session titled “Race Education for Line Managers”. The training was provided by an external training company, APS.

During the session, Mr Borg-Neal asked how a line manager should handle a situation in which they hear someone from an ethnic minority use a word that might be considered offensive if used by someone not within that minority. When he did not get an immediate response from the trainer, he added, “The most common example being the use of the ‘N’ word in the black community.” However, Mr Borg-Neal used the full word, rather than the abbreviation.

The external training company reported Mr Borg-Neal’s use of the word to the Bank. Following an internal investigation, the Bank decided to pursue formal disciplinary action.

The Bank concluded that Mr Borg-Neal did not intend to cause hurt or offence, that he asked the question without malice, and that the question had been valid. However, it found that he should have known better than to use the full word in a professional environment and he should have realised that this could have a serious impact, which it did.

Although Mr Borg-Neal had apologised immediately and had not repeated the word, APS had told the Bank that the trainer had been off work for four or five days afterwards. Consequently, it dismissed Mr Borg-Neal for gross misconduct. His appeal against his dismissal was rejected.

Mr Borg-Neal brought claims against the Bank for, among other things, unfair dismissal, direct race discrimination and discrimination arising from disability.

Following a hearing, the employment tribunal upheld Mr Borg-Neal’s claim for unfair dismissal and discrimination arising from disability. It rejected his claim for direct race discrimination. Mr Borg-Neal was ultimately awarded £470,000 in compensation.

Whilst the employment tribunal accepted that the Bank had genuinely believed that Mr Borg-Neal had committed gross misconduct, the context in this case was critical to the employment tribunal’s judgement.

The employment tribunal accepted that a reasonable employer could have considered Mr Borg-Neal’s use of the word to be misconduct.  However, it was relevant that:

• Mr Borg-Neal used the word only once, immediately apologised and had used the word in circumstances where he was seeking guidance on dealing with the use of unacceptable language, not as a term of abuse.
• There were a number of evidential concerns, including:
  • The Bank had no direct evidence from the trainer herself. She did not raise her own complaint about the incident. She said she did not wish to participate in the disciplinary process but did not explain why.
  • The Bank gave weight to the assertion by the founder of APS that the trainer had taken four or five days off work after the incident. However, the founder had not attended the session and did not have the specifics – two other trainers who had been present for the session made no direct complaint and were not interviewed by the Bank. Further, the Bank did not consider other potential reasons for the trainer’s absence from work.

In these circumstances, the Bank did not have reasonable grounds to consider Mr Borg-Neal’s actions were gross misconduct. It had also failed to conduct a reasonable investigation.

Having made the above finding, the employment tribunal held that the sanction of dismissal was unreasonable. Whilst it was reasonable for the Bank to take the view that the word should not have been used, whether Mr Borg-Neal should have been dismissed for having used it was another matter.

The tribunal held that no reasonable employer could or would have dismissed Mr Borg-Neal in these circumstances (the employment tribunal took into account Mr Borg-Neal’s repeated apologies, willingness to learn from the mistake etc. when making this decision). His dismissal was therefore unfair.

Mr Borg-Neal also succeeded in his claim for discrimination arising from disability but failed in his claim for direct race discrimination.

Comments

Clearly, the outcome here is very specific to the facts of the case.  However, this will often be the case with disciplinary matters.

In this case a failure to properly investigate the matter, combined with the deciding officer failing to separate the fact of misconduct being established, with the sanction that it was reasonable to impose, proved problematic for the Bank here.

It is easy to see why the Bank felt they were on solid ground, the word used is highly offensive, Mr Borg-Jones admitted using the word and it was accepted that a reasonable employer would consider Mr Borg-Neal’s actions to be misconduct.  However, the employment tribunal decided that the sanction imposed went too far. Failures in the investigation also went against them.

This case serves as a reminder of the need to consider the disciplinary process in the round (including the reasonableness of any sanction) when taking action against employees and the risks of cutting corners in an investigation, even in circumstances where an employer might feel that the facts speak for themselves.

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Although correct at the time of publication, the contents of this newsletter/blog are intended for general information purposes only and shall not be deemed to be, or constitute, legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article. Please contact us for the latest legal position.