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04th July 2016

Dismissal for Ill Health

The ACAS Code of Practice on Disciplinary and Grievance Procedures (the “Code”)

The Code provides practical guidance for employers, employees and their representatives and sets out the basic principles for handling disciplinary and grievance situations in the workplace. A failure to follow the Code does not, in itself, make a person or organisation liable for any claim; however; the Employment Tribunals will take the Code into account when considering relevant cases. Most importantly, the Tribunal has the power to increase any awards made in relevant cases by up to 25% for an unreasonable failure to comply with any provision of the Code.

This raises the question, what is a relevant case?

Holmes v Qinetiq

In the recent case of Holmes v Qinetiq, Mr Holmes had worked as a security guard for Qinetiq. He had a number of long absences due to problems with his back, hips and legs. As a result Mr Holmes was dismissed on grounds of ill health on the basis that he was no longer capable of carrying out his role as a security guard.

Mr Holmes was successful in a claim for unfair dismissal, as Qinetiq failed to consider an up to date occupational health report prior to dismissing him. Mr Holmes argued that Qinetiq failed to follow the Code and as such his compensation should be uplifted.

The Tribunal refused in this instance to award an uplift in compensation as it stated that the Code does not extend to dismissals on ground of ill health.

Mr Holmes appealed against his decision.

The Appeal

The Employment Appeals Tribunal (“EAT”) dismissed the appeal and confirmed that the ACAS Code of Practice on Disciplinary and Grievance Procedures only applies to dismissals where there is “culpable conduct”, due to misconduct or poor performance. In other words the Code applies to all cases where an employee’s alleged actions or omissions involves conduct or performance which requires either correction or punishment.

Whilst it is clear that misconduct issues will involve “culpable conduct”, the EAT made a distinction between “culpable conduct” and “non-culpable conduct” relating to poor performance in this case. It was considered that, where poor performance is a consequence of genuine illness or injury, it is difficult to see how culpability would be involved, or how disciplinary action would be justified. Where an employee is absent through ill health leading to dismissal, disciplinary action cannot ordinarily be invoked, and therefore, the Code does not apply.

On the other hand, the EAT gave an example of “culpable conduct” relating to poor performance, where ill health leads to a failure to comply with sickness absence procedures or where there is a belief that the absence is not genuine. This would involve an element of culpability and would lead to the disciplinary procedure being invoked, and therefore the Code would apply.

This decision confirms that the ACAS Code will only apply to poor performance where there is an element of “culpable conduct” on behalf of the employee. Most importantly, if poor performance is as a result of a genuine illness, employers are not bound to follow the Code and the Tribunal will not be able to award an uplift in compensation for a failure to follow the Code.

A Note for Employers

Employers should be aware of this distinction, and note that is it not always appropriate to follow the ACAS Code before dismissing employees. It is important to have structured policies and procedures in place in respect of disciplinary and performance management, which should incorporate the ACAS Code, and which should be followed.

This case also highlights that employers should be careful to ensure that an ill health dismissal is based on up to date medical evidence which demonstrates the likelihood of an employee returning to work and their ability to carry out their role in the future.

Anthony Fox - Napthens LLP – Employment Law Specialist


Business Support Manager

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