Mr James Samuels v Claritum Ltd — 2021

Mr James Samuels was the Chief Executive Officer of Claritum Ltd from 2002 until his summary dismissal on 19 July 2018. The tribunal found that the respondent’s stated reason for dismissal was misconduct within s.98(1) ERA 1996, based on concerns about historic expenses, salary increases, salary-splitting with wives, and the claimant’s directors’ loan account. The central issue under s.98(4) ERA 1996 was whether Professor Richard Hillum held a genuine belief on reasonable grounds after as reasonable an investigation as was warranted in the circumstances.

The tribunal found that the investigation began after Professor Hillum saw a personal receipt and then expanded to ten years of historic expense material and salary matters without first checking the existing receipts-and-expenses system with Mrs Angell, the claimant, or the accountants. It found there was no proper written statement of the specific charges before either the investigation or disciplinary hearing, that the letters sent to the claimant were opaque, and that he was not given the documents he requested in advance of the disciplinary hearing. The tribunal also noted the ACAS Code of Practice requirement to inform the employee of the basis of the problem and give an opportunity to respond before decisions are made.

The tribunal found Professor Hillum did not conduct a reasonable investigation. It accepted that he had a legitimate basis to ask questions about the expenses, but held that he formed an early and unexplained suspicion, failed to understand the bookkeeping system used by Mrs Angell, and refused or failed to consider explanations and documents offered by the claimant. It also found that seven further allegations were put to Mr Samuels for the first time at the disciplinary hearing, without fair warning or a proper opportunity to respond. Citing A-v-B 2003 IRLR 405, the tribunal said that the seriousness of the allegations required attention to material that might point toward innocence as well as guilt.

The tribunal found that Professor Hillum and Mr Ian Mackenzie had already decided the day before the disciplinary hearing that Mr Samuels’ employment would end, and that the disciplinary process was therefore predetermined. It rejected the argument that it was unfair for Professor Hillum to conduct both the investigation and the disciplinary hearing in a small company, and it also rejected the claim of inconsistent treatment with Paul Barker. Even so, the tribunal held that the dismissal was outside the range of reasonable responses and was unfair. This was a liability-only judgment and no remedy was assessed in it.