Mrs C Daly v Represented by:15 Mrs A Fox Solicitor HMRC — 2019

Mrs C Daly was dismissed on 12 May 2017 for alleged conduct relating to tax credits, namely that she failed to notify the Tax Credit Office of a change of circumstances and claimed as a single person while in a relationship with Mr Paul Daly. The tribunal found that conduct was a potentially fair reason for dismissal under section 98(2) ERA 1996, and that Mr McNaughton genuinely believed the allegation on the material placed before him.

The tribunal accepted that the respondent had reasonable grounds on the material contained in the IG civil report, but held that the investigation was not reasonable overall. It found that IG criminal had withheld information that was potentially relevant to the claimant's defence, including a nursery document showing Mr Daly's address, Facebook material, and witness statements from the nursery manager, a deputy headteacher and the claimant's line manager. It also found that Mr McNaughton did not pursue further enquiries when the claimant raised concerns about missing evidence and offered additional housing information, and that Mr Kennard did not follow up the issue on appeal. The tribunal held that the third limb of the Burchell test was not met and that the dismissal was therefore unfair.

On remedy, the tribunal refused reinstatement and re-engagement because reinstatement was not practicable and there was insufficient evidence to make a re-engagement order workable. It awarded a basic award of £5,495.52 and a compensatory award of £9,588.52 before reduction, including £475 for loss of statutory rights. Applying an 85% Polkey reduction, the compensatory award was reduced to £1,438.28. The tribunal made no reduction for contributory conduct and held that the total monetary award was £6,933.80, with a prescribed element of £1,367.03 for recoupment purposes.