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Manner of dismissal matters: Johnson v Unisys again

Earlier this year the Court of Appeal took another look at the question of whether or not damages could be awarded at common law for the adverse impact of steps taken by an employer which culminate in a dismissal.

In Edwards v Chesterfield Royal Hospital NHS Foundation Trust [2010] EWCA Civ 571 the Claimant complained that his employers had failed to follow the correct disciplinary procedure in his case and that as a result of that failure he was dismissed. The issue is significant because following Johnson v Unisys [2001] UKHL 13 damages for wrongful dismissal were restricted to payment for the relevant notice period and could not include damages for loss of reputation or distress caused by the way in which steps leading to the dismissal were taken. Further damages could only be claimed by those who were in a position to bring a statutory claim for unfair dismissal or who had suffered a breach of contract which was separate and distinct from the dismissal. Those Claimants who found themselves in the latter category were most fortunate as their claims for damages would not be subject to the statutory cap. 

The Respondent in Edwards argued that the decision in Johnson v Unisys meant that Mr Edwards’ right to damages even if successful was limited to payment for his notice period. However the Court of Appeal found that because the disciplinary procedure was incorporated into Mr Edwards’ contract of employment he would, were his claim to be made out, have suffered a breach of an express term separate and distinct from any wrongful dismissal. He would therefore be in a position to claim damages for loss which flowed from that breach, such as loss of earnings beyond his notice period in circumstances where the damage to his reputation affected his ability to obtain new employment. 

For an employee such as a surgeon, for whom opportunities for employment outside the NHS are plainly limited, this could lead to a significant damages claim. The Respondent is appealing the decision – watch this space.

Dr Joanna Kerr / 1st Nov 2010


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