Was the dismissal reasonable in all the circumstances?

Establishing a “fair reason” is only the first step to any fair dismissal. The next step is for the tribunal to be satisfied that the dismissal was reasonable in all the circumstances. The tribunal must consider all relevant facts and circumstances and decide whether the employer acted fairly or unfairly in dismissing the employee for that reason, taking into account, in particular, the employer’s size and administrative resources.

A tribunal cannot substitute its own view for that of the employer as to whether a dismissal decision was reasonable. Instead, the tribunal must take a much more restrictive approach, asking whether the dismissal decision fell within the band of reasonable responses available to an employer. A very harsh decision can be fair, as long as it falls inside this band of reasonable responses. The leading case confirming this test is HSBC Bank v Madden [2000] IRLR 827.

Before carrying out any dismissal, the employer must use a fair dismissal procedure. However, in Whitbread PLC v Hall ([2001] IRLR 275), the Court of Appeal confirmed that the “band of reasonable responses” test applies not only to the final decision to dismiss, but also to the dismissal procedure used. In other words the use of a flawed procedure will only make a dismissal unfair if no reasonable employer would have used it.

Before carrying out a dismissal for any reason, the employer must conduct a reasonable investigation into the facts. But again, in Sainsburys Supermarkets Limited v Hitt ([2003] IRLR 23 CA), it was decided that the “band of reasonable responses” test also applies to pre-dismissal investigations.

When deciding whether a dismissal was fair or unfair, a tribunal will not take into account facts that emerge after the dismissal date (unless the employer should have considered them in any appeal).

Only the state of mind or knowledge of the decision-maker is relevant. He or she will not be assumed to have information known to others within the organisation, unless that knowledge could have been uncovered through a reasonable investigation (Orr v Milton Keynes Council [2011] EWCA Civ 62). This underlines the importance of good preparation and of making sure all relevant facts are before the decision-maker at the hearing, and of always attending the hearing unless there are exceptionally good reasons not to.

In deciding whether no reasonable employer would have made the decision to dismiss, tribunals will take into account all the facts, including, for example, an employee’s disciplinary record and length of service (Strouthos v London Underground [2004] IRLR 636) and other mitigating factors such as any apology. These issues are looked at in more detail below.