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Radia v Jefferies

Claimant succeeds in part of his appeal - the Employment Appeal Tribunal holds that it was wrong to conclude that the failure by the Respondent company to hold an internal appeal did not make the dismissal unfair.

Background

In order to satisfy the requirement to act reasonably, a company must follow a fair procedure when dismissing an employee.

The questions for the Employment Appeal Tribunal to decide related to the reasonableness of the Claimant’s dismissal, and the procedural fairness of his dismissal. The questions were whether the Employment Tribunal had been wrong to hold that the Respondent company was entitled to dismiss the Claimant without any investigation and whether the Employment Tribunal had been wrong to hold that the Respondent company’s failure to give the Claimant an appeal hearing did not make the dismissal unfair.

Mr M S Radia v Jefferies International Limited

The Claimant (Mr Radia) was initially employed as an Equity Research Analyst by the Respondent (Jeffries, a US investment bank). He worked within the bank between 2006 and 2017 and became Managing Director at the end of 2009.

He brought his first claim to the Employment Tribunal during 2015; this was a claim of disability discrimination. The Tribunal dismissed the claim and made ‘adverse findings’ about the Claimant’s credibility. These findings were of ‘grave concern’ given that the Claimant was a regulated person.

The Claimant brought a further claim during 2016 alleging victimisation. He was dismissed for gross misconduct during March 2017 – the Respondent had decided that the findings in respect of his credibility meant that the Claimant could not be seen as a fit and proper person in accordance with the rules in the FCA Handbook.

A third claim was brought in the Employment Tribunal by the Claimant, who complained that his suspension, dismissal and the Respondent’s refusal to hold the hearing of his appeal against dismissal amounted to whistleblowing detriment, victimisation and unfair dismissal.

The grounds of appeal which raised arguable points of law were that the Employment Tribunal erred in law in:

1. finding that it was reasonable to rely on the findings of the first Employment Tribunal and that the findings meant that there were no further investigations which could be carried out;

2. holding that the failure to hold an appeal did not make the dismissal unfair.

First ground of appeal

The Employment Appeal Tribunal found that it had been open to the Employment Tribunal to find that there was no further investigation which the Respondent could have reasonably been required to conduct before it heard from the Claimant, as the findings spoke for themselves. Accordingly, that ground of appeal was dismissed.

Second ground of appeal

The Employment Appeal Tribunal found that the Employment Tribunal had erred in law on this point. It held that the Employment Tribunal did not make the findings (about the failure to hold an appeal) necessary to have reached the conclusion that the dismissal was not unfair. In the absence of those findings, the appeal was allowed on the second ground.

Senior Managers and Certification Regime (SM&CR)

This judgment will be of particular relevance to regulated firms, in the context of the Senior Managers and Certification Regime (SM&CR), due to come into force in December this year.

The requirement to assess the fitness and propriety of persons carrying out a controlled function means that firms will have to satisfy themselves of their senior managers and certified staff’s honesty and integrity. Significantly, a finding of deliberate dishonesty is not required – the tribunal found that the employee had misled the tribunal (or not told the truth) during the course of his evidence. Firms will need to consider whether any senior manager or certified person has been subject to any proceedings, including internal proceedings, in which there might have been a probe into their honesty and integrity.