Can You Dismiss an Employee Charged with a Criminal Offence on the Basis of a Risk to Your Reputation?
The Employment Appeal Tribunal (EAT) considered whether an employer had fairly dismissed an employee in view of the potential reputational risk after he was charged with a criminal offence.
Lafferty v Nuffield Health
Mr Lafferty had worked for Nuffield Health (Nuffield) since 1996. He was a co-ordinator and theatre porter and his duties involved moving anaesthetised patients to and from operating theatres.
On 17 February 2018, Mr Lafferty was arrested and charged with assault with intention to rape. He was subsequently suspended by Nuffield on full pay.
On 9 March 2018, Mr Lafferty met with a hospital manager, Mr Lamb, who made it clear that he was not making any judgment on guilt or innocence but needed to assess the potential reputational damage to the charity. Mr Lamb was aware that other charities had recently experienced problems regarding inappropriate behaviour which had impacted upon their reputation. Given the nature of the charges against Mr Lafferty, Mr Lamb felt that it would not be appropriate for Mr Lafferty to return to work until after his trial. As Mr Lafferty was unable to provide any information on the timescales for the trial, Mr Lamb decided it would not be a proper use of charitable funds to suspend Mr Lafferty on full pay for an indefinite period of time and therefore dismissed Mr Lafferty on notice because of the potential reputational risk to Nuffield.
By the time of Mr Lafferty's appeal against this decision, Mr Lafferty remained on bail and no date had been set for trial. The appeal officer, Mr Lofthouse, concluded the potential reputational damage to Nuffield in this case when the case came to court was considerable, given that Mr Lafferty worked with the most vulnerable patients. Continuing to employ Mr Lafferty in these circumstances might be regarded as a breach of a duty of care to patients by Nuffield. The decision to dismiss was upheld but Mr Lofthouse also determined that if the charges were dropped or he was acquitted, Mr Lafferty would be reinstated on the same terms and conditions of employment. Mr Lafferty claimed unfair dismissal.
The tribunal held that the dismissal had been fair. Nuffield had shown it had genuine concerns that if Mr Lafferty was convicted there was the potential for serious reputational damage. Nuffield had acted reasonably in dismissing Mr Lafferty for this reason. It had sought further information from Mr Lafferty and considered alternatives to dismissal, but had ultimately concluded there was too great a risk in view of the increased scrutiny in the sector. Mr Lafferty appealed.
The EAT upheld the tribunal's decision. In reaching its decision, the EAT noted that the nature of Mr Lafferty's job could have given him an opportunity to commit more of the kinds of act that he was charged with. Mr Lafferty had not been dismissed because Nuffield believed he was guilty, but because of the significant risk of reputational damage to an organisation in the charitable sector. The risk of reputational damage could provide justification for dismissal even where criminal charges were not proven, depending on the facts of the particular case.
Practical Points
The EAT noted that this was a difficult case with an unusual set of circumstances. The nature of the employee's job, the risk to the reputation of the employer compounded by the fact that, at the relevant time, charities were under increased scrutiny to tackle inappropriate behaviour, meant dismissal in these circumstances was fair.
The EAT noted that it will not be open to employers to dismiss for reputational reasons simply because an employee is charged with a criminal offence. There would need to be some connection between the allegations and the potential for damage to reputation. Nuffield had also demonstrated that it had considered alternatives to dismissal and had acted reasonably in rejecting them.
The circumstances that led Mr Lofthouse to offer reinstatement are likely to be specific to this case and it is not clear that this would be the right course of action in other cases. Reputational risk may well exist whether the individual is convicted or not.
For further advice on unfair dismissals, please contact Ellie Boyd in our Employment Law team on 020 7665 0940, or complete the form below.