Mr Paul Stobart v Zen Internet Limited HELD AT: Manchester — 2024

The claimant, Mr Paul Stobart, was employed as Chief Executive of Zen Internet Limited from October 2018 and was dismissed on 23 March 2023, with termination taking effect on 31 March 2023. He brought a single complaint of unfair dismissal under Part X of the Employment Rights Act 1996. The respondent relied on capability and/or some other substantial reason as the potentially fair reason for dismissal, citing the claimant's failure to achieve projected profitability targets during his tenure as CEO.

Employment Judge Johnson found that capability was correctly raised as the reason for dismissal, but that the respondent rendered the dismissal unfair by failing to follow a fair procedure. The respondent did not formally establish the facts, did not inform the claimant of the problem through a structured process, did not arrange meetings at which he could be accompanied and put his case, did not allow an opportunity to improve, and did not provide an appeal. The Tribunal noted that the ACAS Code of Practice on Disciplinary and Grievance Procedures applied regardless of the claimant's seniority.

Applying Polkey, the Tribunal concluded it was almost certain that a fair procedure would have resulted in a fair dismissal on capability grounds, and that such a dismissal would have occurred by no later than 31 May 2023. Contributory conduct under sections 122(2) and 123(6) ERA 1996 was considered but did not apply, as the case concerned capability rather than conduct. Remedy was adjourned to a separate one-day hearing in the Manchester Employment Tribunal.