THE INDUSTRIAL TRIBUNALS

CASE REF:	322/06

CLAIMANT:		Nora McMahon

RESPONDENT:	Herbal Restaurants Limited

DECISION

The decision of the tribunal is that the claimant’s claim of unfair dismissal succeeds but is reduced by 80 per cent due to her contributory fault.  The claimant is also awarded £250 in respect of the respondent’s failure to provide her with amended written particulars of employment on promotion to the post of area manager.  The total award is £1,905.15.

Constitution of Tribunal

Chairman:			Mr I Wimpress

Panel Members:		Mr Carney
                                 	Mr Hunter

Appearances:

The claimant was represented by Mr T Kennedy, Barrister-at-Law instructed by Messrs Coleman R Hanna, Solicitors.

The respondent was represented by Mr Sheridan of Employment Law Consultancy.

1.	The Claim

	The claimant’s application to the tribunal dated 13 March 2006 comprised claims of unfair dismissal and failure to provide written particulars of employment.

2.	Sources of Evidence

The tribunal received three separate bundles of documents and heard evidence from Lee Clarke, Julie Nicholl, Peter Clarke, Fay McGovern, Lisa Mallon and Maria Fitzsimmons on behalf of the respondent and from the claimant on her own behalf.

3.	The Issues

The proceedings lodged by the claimant give rise to the following issues:

(1)	Whether the claimant was unfairly dismissed by the respondent.

(2)	Whether the respondent failed to provide the claimant with written particulars of employment in accordance with Articles 33 to 36 of the Employment Rights (Northern Ireland) Order 1996 following her promotion to the post of area manager.

4.	The Facts

The tribunal found the following facts.

The respondent runs the Kentucky Fried Chicken franchise in Northern Ireland.  The claimant‘s date of birth is 29 December 1969.  The claimant commenced employment with the respondent on 21 February 1992 as a trainee manager.  The claimant received training in cash handling while she was a trainee manager.  After six months she became a store manager and managed the Newcastle outlet.  As manager of the Newcastle outlet, she had full responsibility for cash handling and was responsible for providing training to staff in relation to same.  The claimant held the position of manager up until June 2003 when she was promoted to area manager.  This post resulted in the claimant being responsible for outlets at Newcastle, Newry, Portadown, Dungannon and one outlet in Lisburn.  

5.	The respondent operated two different systems for the lodgment of its takings.  In some outlets such as Newcastle, money was kept in a conventional safe and lodged regularly at the local bank.  In other outlets, particularly those deemed vulnerable in terms of robbery, a system was operated whereby regular collections were made by Securicor.  One of the features of this system was that the Securicor safe could only be opened if both the manager of the outlet and a member of Securicor were present.  As a result, once a lodgment was made up and placed in the Securicor safe it could not be accessed by staff and the monies were collected and taken directly to the respondent’s bank in Glengormley.  A Securicor system was in place in the Dungannon outlet as a result of number of robberies at that location.  The claimant was familiar with the Securicor system and knew how to use it.  She did however have some concerns about Securicor not turning up at the Dungannon outlet and monies therefore not being lodged.  The collections were made on Monday and Saturday but there was no manager in the Dungannon outlet on Mondays and as a result the money would be almost a week late in being lodged.

6.	In late October 2006, the Dungannon outlet was short staffed.  The Dungannon outlet had previously been managed by Clare McGuckin and Kerry Crean on a job share basis.  Ms Crean had recently moved on to a full time post elsewhere and Ms McGuckin had just returned from sick leave.  On Monday 24 October 2005, Ms McGuckin telephoned the claimant and requested the following weekend off from Thursday through to Monday.  The claimant was unable to arrange cover and therefore refused this request.  A heated exchange ensued which resulted in Ms McGuckin walking out of the Dungannon outlet.  The claimant made her way to Dungannon and made arrangements for staff from other outlets to help out.   

7.	In addition to these staff problems, the claimant learned on 3 November 2005 that a CER evaluation team had arrived in Dublin and this placed an additional burden on the claimant as she had to ensure that the outlets in her area achieved sufficient marks from the inspectors.  The Dungannon outlet had failed a recent inspection and the Newcastle outlet had scraped a pass.  This resulted in pressure to obtain good marks in the remaining three outlets in the claimant’s area.  The claimant decided to base herself in Portadown due to its central location.  In preparation for inspection the Portadown outlet required to be thoroughly cleaned.  Unfortunately, a member of staff spilled something on the floor which the claimant slipped on and hurt herself.  She sustained very bad bruising on her back and elbow and a cut to her elbow as well.  She was unable to do manual work but did not seek medical treatment.  The Human Resources Manager, Lisa Mallon telephoned the claimant and the claimant was crying while they were speaking.  After lunch the claimant went to the Newry outlet because she expected it to be inspected next.  Shortly after she arrived she was told that the CER Team had arrived in Portadown.  Later in the afternoon the claimant arranged to meet up with James Boden at the Portadown outlet.  Mr Boden asked the claimant what he should do with the takings at the Dungannon as he had not used the Securicor system before.  The claimant advised him to make up the lodgments in the usual way and that she would lodge it in the bank at Newcastle.  Mr Boden traveled to the Portadown outlet by taxi in the late afternoon.  Thereafter the claimant took Mr Boden and another employee home.  Mr Boden assured the claimant that the money which represented one day’s takings was reconciled or balanced.  The money was contained in a KFC chip bag which was often used by staff for this purpose as it was inconspicuous.  Before dropping Mr Boden off, he passed the bag to the claimant and she placed it in the zip compartment of her handbag.  Mr Boden advised the claimant that it contained approximately £1,100.  The money was all in notes.

8.	The claimant lived in Newcastle and intended to lodge the money the next day (4 November) although it was her normal day off but in the event she went to the Newry outlet after leaving her children off early in the morning before the bank opened as she was concerned that it might be inspected.  The claimant could have lodged the money in the First Trust Bank in Newry but forgot to do so because she was focused on preparing for the CER inspection.  The claimant was also suffering from the after effects of the fall and influenza and in her words felt “totally wiped out”.  

9.	On Saturday 5 November, the claimant intended visiting all the stores in her area but after visiting the Newcastle and Newry outlets, she felt so poorly that she returned home to bed.

10.	On Sunday 6 November the claimant did her paperwork at home, although the entry made in the red book by the claimant stated that she made a store visit to the Dungannon outlet.

11.	On Monday 7 November, the claimant attended a routine meeting at the respondent’s Head Office on the Lisburn Road in Belfast. 

12.	On Tuesday 8 November, the claimant was engaged in interviewing prospective new staff at the Portadown outlet in the morning.  She then went to the Dungannon outlet.  By this time five more days’ takings were in the day safe. The Securicor system was not being used. Later that afternoon, the claimant and Claire counted out the money and balanced it against the cash register ring off for each day.  Each day’s lodgment was placed in a small bag and all were then placed inside one large Kentucky Fried Chicken bag.  The lodgments amounted to £10,576.80.

13.	The claimant traveled home by car on Tuesday evening with the lodgments in her unlocked glove compartment.  She stopped off at a service station to do some shopping leaving the lodgments in the glove compartment of the car.  When she opened the zip compartment of her handbag inside the service station, she saw the lodgment that she had placed there previously.  She had completely forgotten about putting it there.  The claimant decided to take all of the lodgments to the Newcastle branch on the next day. The claimant left the money in the car while she went into the store to purchase milk and bread.  The car was in her full view for most of her visit to the shop.  After doing her shopping she went home and hid both the large Kentucky Fried Chicken bag and her handbag.  The claimant could have deposited the lodgments in a night safe either at Portadown or Newcastle but did not do so. 

14.	On Wednesday 8 November, the claimant went to the Newcastle bank.  Before the claimant reached the bank, Claire phoned her and advised that the counterfoil in respect of one of the lodgments was not in the bag.  The claimant parked in Main Street, Newcastle at 9.45 and waited for the bank to open.   She had eight separate lodgments with her which were still in the large Kentucky Fried Chicken bag.  When the bank opened the claimant went in immediately and completed the lodgment forms including a replacement form in respect of the lodgment with the missing counterfoil.  When the claimant reached the top of the queue, she informed the cashier that the lodgments were not for the Newcastle outlet and asked if the money could be lodged while she waited.  The cashier checked with a more senior member of staff who advised that the lodgments would have to be taken to the back office for processing.  The claimant therefore left the lodgments at the bank in the expectation that the counterfoils would be collected later by a member of staff from the Newcastle outlet.

15.	The claimant first became aware of a problem with the lodgment when she stopped to get petrol at 3.00 pm and received a call on her mobile phone from Fay McGovern who said that she had been informed by Peter that there was a problem with the Dungannon lodgment and she told the claimant to meet her at the Dungannon outlet.  The respondent’s Operations Manager, Julie Nichol, also attended at the Dungannon outlet.

16.	The claimant, Ms McGovern and Ms Nicholl spent some time going through the Red Book which was maintained in order to keep records of lodgments and other transactions.  Telephone contact was established with the Newcastle outlet and four or five of the lodgment counterfoils were initially retrieved from the Newcastle Bank.  Subsequently all but one of the missing counterfoils were located.  After making further checks it was decided to wait another day to see if the missing money came through.  

17.	On Saturday 11 November, the claimant attended at the Dungannon outlet with Ms McGovern.  They went through the Red Book again and examined the Securicor safe.  It was clear that there were some discrepancies in the Red Book as the amounts lodged did not match the individual days.

18.	The claimant attended a further meeting at the respondent’s Head Office on either Monday 13 or Tuesday 14 November.  She met with Ms McGovern, Ms Nichol and Mr Clarke in the boardroom and was advised that a lodgment of £1,226.54 was missing.  The claimant did not agree with this figure.  The claimant was told to go to the bank and find the missing lodgment.  The claimant discovered after the meeting that Mr Boden had not put a lodgment slip in one of the bags and that therefore there was still one slip missing when the claimant made the lodgments at the bank.  

19.	The claimant made arrangements to view the bank’s video footage on Thursday 16 November.  The video evidence proved inconclusive as it was impossible to make out how many individual bags of money were placed on the counter by the claimant.  It did show the claimant dropping something but there was no suggestion that it was part of the lodgment. The claimant phoned Ms Nichol and advised her about the video footage and that the bank was going to follow up the investigation at its end.

20.	The claimant then made her way to Head Office and spoke to the Personnel Manager, Lisa Mallon.  Ms Mallon told the claimant to write out a statement about what had occurred at the bank.  The statement included an offer to repay the missing money.  After doing so the claimant went into the boardroom with Ms Mallon.  Ms Mallon examined the statement and then advised the claimant that she was being suspended and handed her a letter to this effect.

21.	On 21 November 2005, Ms Mallon sent the claimant a letter inviting her to attend a formal disciplinary hearing on 23 November 2005.  The letter advised that Ms Mallon and Ms Nichol would be present at the hearing.  The letter stated that the purpose of the hearing was “to consider an allegation of misappropriation of funds and failure to follow company procedure.” The claimant was further advised that the respondent considered this to be a matter amounting to gross misconduct and that a potential outcome of the hearing was her dismissal without notice.

22.	The respondent’s disciplinary code contained a non-exhaustive list of examples of Gross Misconduct which would render an employee liable to summary dismissal and included at item 5 the following:

“Theft or misappropriation of company property.”
	
23.	The claimant attended the hearing on 23 November accompanied by a work colleague.  Ms Nicholl and Mr Lee Clarke was also in attendance and the latter took a note of the evidence.  The hearing was conducted by Ms Mallon although Ms Nicholl made occasional comments.  The hearing took the form of Ms Mallon asking the claimant a series of questions and covered a number of topics including the missing lodgment, why the Securicor safe was not used, cash handling procedures and the duties of an area manager.  There was also an exchange about the meaning of the word ‘misappropriation’.  The claimant indicated that she understood it to mean the intentional taking of money for one’s own personal use and in response Ms Mallon stated twice that the claimant was not being accused of taking the money.  The claimant also made reference to another employee who had also lost money but was treated differently from her.  

24.	The hearing was adjourned and the claimant was asked to attend a further meeting on 1 December 2005.  At the meeting on 1 December 2005, there was some discussion as to whether the claimant was being accused of deceiving the respondent and keeping the missing money for her own use but Ms Mallon assured the claimant that she was not being accused of taking the money.  The meaning of ‘misappropriation’ was also discussed and Ms Mallon indicated that the case against the claimant was based on it being defined as the “fraudulent appropriation of funds or property entrusted to your care but actually owned by someone else.”  The claimant also provided details of cases where store managers had either been robbed or lost money.   The first case involved a Colin Benson who was either robbed or lost money on his way to a night safe one and a half years previously.  Mr Benson agreed to pay it back. The second case was that of Martin Doherty which had been referred to briefly at the previous meeting.  According to the claimant, this incident occurred earlier in the year at Portrush when he lost money which fell out of his pocket on the way to the bank and he also agreed to pay it back on a weekly basis.   The claimant said that she believed that these were similar cases to her own in that they went to the bank on their own in contravention of procedures. It was common case that no disciplinary action was taken in respect of these employees. The claimant also referred to an occasion when she was asked to deposit a large sum of money at a bank.  There was also a lengthy discussion about the events leading up to the loss of the money.

25.	There was a further short meeting on 12 December and thereafter the claimant received a letter from Ms Mallon dated 13 December 2005 inviting her to a meeting on 14 December 2005.  At the meeting on 14 December, Ms Mallon informed the claimant that she was being dismissed and handed her a letter which she then read to the claimant before passing to her.  The letter insofar as material reads as follows:

“The hearing had been arranged to discuss alleged breaches of the Company Disciplinary Rules [in] relation to an allegation of mis appropriation of funds and failure to follow company procedures.  The company considers that each allegation could amount to gross misconduct.

Over the course of the various meetings addressing the above matters, you were given every opportunity to explain and account for your actions and have been provided with minutes of those earlier meetings.  I enclose with this letter a minute of the meeting of 12th December.

Following the meeting on 12th December we considered all the representations you have made relating to the above allegations and note that;- 

You admit to having improperly removed a sum of £1,196 forming part of the takings of Wednesday 3rd November 2005 rather than giving it to Securicor as required by normal procedures.  You admit to retaining that sum of £1,169 for 6 days and you then claim to have deposited that sum with the bank at Newcastle on Wednesday 9th November 2005and that the bank have lost that deposited sum.  On thorough investigation the bank have advised that they have no record of the deposit of the sum in question and you have failed to give a reasonable explanation as to the lack of a lodgment slip representing that amount.

You have failed to identify any mitigating factors and it is our conclusion that you have misappropriated the funds in question.  

I consider your actions to be Gross Misconduct and I therefore have no alternative but to take the severest sanction an employer can take against an employee and to summarily dismiss you.”

The letter went on to deal with other matters and concluded by advising the claimant that she had the right of appeal to Maria Fitzsimmons.

26.	The claimant was not given any opportunity to make representations or speak on her own behalf at this point in the process. Ms Mallon then required the claimant to give her keys of the company car and her work mobile phone.  

27.	The claimant submitted a letter of appeal and an appeal hearing took place before Maria Fitzsimmons on 3 January 2006.  At the appeal hearing, the claimant raised three general grounds of challenge procedural, investigatory and consistency.

Procedural

(a)	The role of Lee Clarke at the first disciplinary hearing.

(b)	The role of Lee Clarke at the second disciplinary hearing.

(c)	The role of Ms Fitzsimmons at the disciplinary hearing that was scheduled to take place on 9 December 2005.

(d)	The reference in a letter dated 21 December 2005 to Ms Mallon attending at an appeal meeting.

(e)	The qualifications and seniority of those involved in the disciplinary process.

(f)	The presence of the claimant’s child at the final disciplinary meeting on 9 December 2005.

Investigatory

(a)	The amount of time spent by many people trying to establish the amount of money that was missing.

(b)	The alteration of the entries in the Red Book by Ms Nicholl.

(c)	The failure of Ms Mallon to allow the claimant to produce her diary during the interviews.

(d)	Omissions from head office minutes including the management of the exchange of euros.

(e)	The inability of Mr Clarke to keep a minute of the disciplinary hearing.

(f)	Putting words in Mr Boden’s mouth.

Consistency

(a)	Inconsistency in comparison with Mr Benson and Mr Doherty.

(b)	An occasion in December 2004, when Ms Nicholl asked the claimant to carry a large sum in cash and lodge it in the night safe.

(c)	The failure of Ms McGovern to follow company procedures by asking the claimant to carry out her own mystery shopper evaluations.

(d)	The involvement of Employment Law Consultancy (‘ELC’) in the decision making process.

28.	Ms Fitzsimmons determined that it was necessary for her to investigate all of the matters raised by the claimant in her appeal.  This included looking at the documentation in relation to the disciplinary hearings, examining the Red Book and other paperwork, reading the claimant’s diary, reading the minutes of all the disciplinary meetings and minutes provided by the claimant, reading Mr Boden’s statement, viewing the CCTV footage at the bank, obtaining confirmation from the bank of the events on 9 December 2005 and interviewing Ms Nicholl. 

29.	On 3 March 2006 the claimant received a detailed decision letter From Ms Fitzsimmons in which she addressed each of the matters raised by the claimant and rejected each of the claimant’s criticisms. Ms Fitzsimmons then went on to set out her conclusions as follows:

“You have expressed that the investigation into the allegations against you has not been thorough and in particular have said that the amount missing has not been established.  On investigation it is clear that the sum missing was initially difficult to ascertain due to irregularities in cash handling procedures for which you were responsible.  It is however clear that these alterations were made due to your failure to observe proper practice which led to uncertainty as to the correct figures and hence the alteration.  What is beyond doubt and which you have categorically confirmed, is that you had a sum in the region of £1,169 in your possession which ought to have been lodged in the company account and which was never received.    You have suggested that the bank has been responsible for this loss.  I do not consider that the exact figure is critical and in any event the difficulty arises due to your failure to follow well established company accounting procedure.  Whilst I have thoroughly investigated your appeal I cannot accept the points made are actually relevant to the allegation under consideration.  No variation in cash handling procedures or problems with staff will justify the retention of funds.  You had indicated that you felt that the bank was responsible.  I have thoroughly reviewed CCTV film of the events in question, sought confirmation from the bank as to the events on 9th November 2005 and am satisfied that a thorough investigation of the bank’s role has been carried out which does not lead me to believe that the bank are responsible.  I feel that (sic) all reasonable steps have been taken to ascertain what occurred.

Having concluded my investigation in your appeal I must conclude that I reject your appeal and must affirm the decision of the disciplinary panel.”

30.	After being dismissed by the respondent, the claimant obtained employment on 12 January 2006 on a temporary six month contract with F S Herron.  The claimant then obtained another temporary position with Down Lisburn Trust in October 2006.  The claimant has since obtained a permanent position with Spa Business Services where she commenced work on 8 December 2006.  The claimant has not claimed Jobseeker’s Allowance or Income Support since being dismissed.

31.	The Law

Article 130 of the Employment Rights (Northern Ireland) Order 1996 insofar as relevant provides as follows:

“130.—(1)	In determining for the purposes of this Part whether the dismissal of an employee is fair or unfair, it is for the employer to show—

(a)	the reason (or, if more than one, the principal reason) for the dismissal, and

(b)	that it is either a reason falling within paragraph (2) or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held.

(2)	A reason falls within this paragraph if it—

(a)	relates to the capability or qualifications of the employee for performing
work of the kind which he was employed by the employer to do,

(b)	relates to the conduct of the employee,

(c)	is that the employee was redundant, or

(d)	is that the employee could not continue to work in the position which he held without contravention (either on his part or on that of his employer) of a duty or restriction imposed by or under a statutory provision.

(3)	

(4)	Where the employer has fulfilled the requirements of paragraph (1), the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer)— 

(a)	depends on whether in the circumstances (including the size and 
administrative resources of the employer's undertaking) the employer acted 
reasonably or unreasonably in treating it as a sufficient reason for dismissing
the employee, and

(b)	shall be determined in accordance with equity and the substantial merits
of the case.”

We bear in mind the approach commended in British Homes Stores -v- Burchell [1980] ICR 303, in relation to the showing of a reason for dismissal in a misconduct case where Arnold J stated:- 

"What the Tribunal have to decide every time is, broadly expressed, whether the employer who discharged the employee on the ground of the misconduct in question (usually, though not necessarily, dishonest conduct) entertained a reasonable suspicion amounting to a belief in the guilt of the employee of that misconduct at that time. That is really stating shortly and compendiously what is in fact more than one element. First of all, there must be established by the employer the fact of that belief; that the employer did believe it. Secondly, that the employer had in his mind reasonable grounds upon which to sustain that belief. And thirdly, we think, that the employer, at the stage at which he formed that belief on those grounds, at any rate at the final stage at which he formed that belief on those grounds, had carried out as much investigation into the matter as was reasonable in all the circumstances."

Useful guidance as to the application of Article 130 is to be found in the case of Iceland Frozen Foods v Jones [1982] IRLR 439 where the Employment Appeal Tribunal in applying the then equivalent English provision stated as follows:

“(1) the starting point should always be the words of section 57(3) themselves;

(2) in applying the section an industrial tribunal must consider the reasonableness of the employer's conduct, not simply whether they (the members of the industrial tribunal) consider the dismissal to be fair;

(3) in. judging the reasonableness of the employer's conduct an Industrial tribunal must not substitute its decision as to what was the right course to adopt for that of the employer;

(4) in many (though not all) cases there is a "band of reasonable responses to the employee's conduct within which one employer might reasonably take one view, another quite reasonably take another;

(5) the function of the industrial tribunal, as an industrial jury, is to determine whether in the particular circumstances of each case the decision to dismiss the employee fell within the band of reasonable responses which a reasonable employer might have adopted. If the dismissal falls within the band the dismissal is fair: if the dismissal falls outside the band it is unfair.”

The tribunal must therefore apply the three limbs of the Burchell test followed by the Iceland Frozen Foods test, namely whether the decision to dismiss was within the band of reasonable responses.

32.	The Parties’ Contentions

Mr Sheridan on behalf of the respondent submitted as follows:

(1)	The claimant was dismissed for not following the company cash handling procedures and this constituted gross misconduct.

(2)	The respondent carried out a reasonable investigation and had a reasonable belief that the claimant had committed an act of gross misconduct.

(3)	The respondent carried out a reasonable disciplinary hearing.

(4)	The respondent carried out an appeal hearing.

(5)	The decision to dismiss the claimant for this offence was within the range of reasonable responses to a failure to follow cash handling procedures which resulted in a loss of monies and was not unfair.

(6)	In the alternative, the claimant had contributed significantly to her own dismissal and any awards should therefore be reduced by 100%. 

Mr Kennedy on behalf of the claimant submitted as follows:

(1)	There was no basis for concluding that the claimant was guilty of misappropriation.  Mr Kennedy submitted that the claimant had removed money from the Dungannon outlet with the full knowledge of other members of staff  and admitted in a document dated 17 November 2005 that she had made mistakes and gave an unequivocal undertaking to pay the money back if it failed to turn up.  Mr Kennedy submitted that the respondent had neither acknowledged nor given any consideration to this undertaking. In particular, he placed reliance on Maria Fitzsimmons’ statement that the claimant at no stage acknowledged that she was responsible for the loss of the money.

(2)	The claimant did not breach any cash handling or banking procedures that were applicable to area managers and even if she did act in breach of procedures, the respondent acted unreasonably in dismissing her.

(3)	The claimant was dismissed by Ms Mallon without any consideration being given to alternative disposals and no opportunity was given to the claimant to enter a plea in mitigation.   

(4)	On appeal, Maria Fitzsimmons conducted further investigations without giving the claimant the opportunity to respond to same.  Ms Fitzsimmons also neglected to consider alternative disposals and again no opportunity was given to the claimant to enter a plea in mitigation.   

(5)	Neither Ms Mallon nor Ms Fitzsimmons accepted that there were any mitigating factors notwithstanding that a number of mitigating factors were drawn to their attention in the course of the hearings.

(6)	Neither Ms Mallon nor Ms Fitzsimmons took account of the claimant’s disciplinary record.

(7)	The claimant was treated differently from Martin Doherty in that he was allowed to repay missing money by Ms McGovern without any disciplinary process whereas the claimant was not afforded a similar opportunity to reach a similar agreement with Ms McGovern.

33.	Analysis of Evidence and Relevant Law

The evidence clearly establishes that the claimant was dismissed for a potentially fair reason namely her conduct in the form of misappropriation of funds and failure to follow company procedure.  Whether or not the decision to dismiss the claimant was actually fair depends upon the application of the Burchell test and the Iceland Frozen Foods test and we will now proceed to address these tests on a stage by stage basis.

(1)	Did the respondent believe that the claimant was guilty of misappropriation of funds and failure to follow company procedure?

The first point of note is that the disciplinary charge was comprised of two elements namely the misappropriation of funds and failure to follow company procedure.  

In relation to the first element, the Eleventh Edition of the Concise Oxford English Dictionary defines ‘misappropriate’ as to dishonestly or unfairly take for one’s own use. Misappropriation therefore clearly connotes that something has been taken dishonestly and this is reinforced by the fact that misappropriation is bracketed with theft in the examples of gross misconduct set out in the respondent’s disciplinary code. 

It must also be acknowledged that the list of offences contained in the disciplinary code was not intended to be exhaustive and there is nothing in the list that precisely mirrors the charge leveled against the claimant.  The respondent was therefore free to frame the disciplinary charge as it did and to regard it as gross misconduct.  

We do not believe however that the respondent intended to accuse the claimant of theft.  During the course of both the disciplinary hearing and the appeal Ms Mallon and Ms Fitzsimmons expressly disavowed any suggestion that the claimant had taken the missing money for herself and had there been any evidence that this had occurred no doubt the respondent would have charged the claimant with theft.  We have therefore come to the conclusion that in charging the claimant with misappropriation of funds the respondent was simply trying to convey its belief that the claimant had mishandled the money resulting in its loss rather than stealing it.  The fact that Ms Mallon and Ms Fitzsimmons indicated in their evidence to the tribunal that they did entertain the suspicion that the claimant had taken the money for her own use does not undermine the respondent’s state of belief in the charge as formulated. 

Having regard both to the size of the missing lodgment and the claimant’s bizarre behaviour in retaining both the missing lodgment and a substantial amount of monies that belonged to the respondent for approximately six days, we are satisfied that the respondent has established that it had a genuine belief that the claimant had committed an act of gross misconduct in the form of misappropriation of funds.

In relation to the second element of the charge, we have no difficulty in concluding that the respondent believed that the claimant had failed to follow company procedures on the basis of the claimant’s actions in keeping a large amount of money in her possession for approximately six days and banking it rather than making use of the Securicor safe.  There were also valid criticisms of the manner in which the red book was completed by the claimant.

(2)	Was the belief that the claimant was guilty of misappropriation of funds and failure to follow company procedure reasonable?

The loss of a large amount of money in circumstances where the records of the Dungannon outlet were far from perfect coupled with clear evidence that the claimant had possession of the money for a significant period of time in breach of the respondent’s procedures before it went missing undoubtedly rendered the claimant liable to be charged with a serious disciplinary offence that would lay her open to being found guilty of gross misconduct and thereby liable to summary dismissal.  

While there was a degree of equivocation in the respondent’s evidence as to what precisely constituted misappropriation of funds we are satisfied that in the particular circumstances of this case it amounted to no more than retaining money over a period rather than leaving it in the Securicor safe in accordance with the respondent’s procedures or banking it.  The fact of the matter is that a significant sum that the claimant was responsible for went missing and this would not have occurred had the claimant performed her duties in accordance with the respondent’s clear instructions which were disseminated through training and weekly meetings at the respondent’s head office.

The respondent has therefore comfortably established a reasonable belief that the claimant was guilty of misappropriation of funds and failure to follow company procedure

(3)	Did the respondent carry out a reasonable investigation?

The respondent carried out a detailed and searching investigation of the matters alleged against the claimant.  Statements of evidence were taken from relevant witnesses and the respondent’s financial records and in particular the red book was the subject of careful consideration.  We are therefore satisfied that the respondent carried out a reasonable disciplinary hearing.

(4)	Did the he respondent carry out a reasonable disciplinary hearing?

Ms Mallon’s conduct of the disciplinary hearing left no stone unturned in her pursuit of establishing and interpreting the facts.  This is evidenced by the fact that the hearing was conducted over three separate days in order that all possible evidential matters were addressed.  A number of criticisms were made of the hearing and we will examine each of these in turn. 

Inconsistent Treatment 

During the course of the disciplinary hearing the claimant drew Ms Mallon’s attention to two other employees whom she alleged were treated differently. It is clear that both individuals were dealt with before Ms Mallon was charged with the task of tightening up the respondent’s disciplinary procedures and neither is therefore of assistance to the claimant.

Failure to take into offer to repay missing money

Neither Ms Mallon nor Ms Fitzsimmons was obliged to take account of the claimant’s apparent willingness to repay the missing money.  Moreover, although the claimant had stated this at the earliest opportunity she had taken no steps to put it into practice and clung to the hope that the money would turn up. 

Failure to take account of the claimant’s disciplinary record

It is clear from the evidence that both Ms Mallon and Ms Fitzsimmons were fully aware that the claimant had only one minor disciplinary incident during her thirteen years with the company and that it was spent.  There is no evidence that they failed to have regard to it and the claimant’s case at its height amounts to no more that a failure to give adequate weight to this factor.  We view that as a wholly unmeritorious point as it is clearly a matter for the respondent to weigh up and while a tribunal might have accorded it greater weight it could not be plausibly contended that the respondent’s approach to this issue either at the disciplinary hearing or the appeal was outside the range of reasonable responses.

Mitigation

In relation to mitigation, it must be born in mind that internal disciplinary hearings are not to equated with courts of law and while it is patently correct that the procedure adopted must be fair, that does not mean that the hearing proceeds in the same manner as a criminal trial with opening and closing speeches and pleas of mitigation where appropriate.  In our view it is sufficient if the employee is given an adequate opportunity to draw any mitigating circumstances to the decision maker’s attention before the hearing concludes. 

Ms Mallon clearly did not properly appreciate how mitigation should be addressed at a disciplinary hearing and in particular it was apparent from Ms Mallon’s evidence that she regarded mitigation as a matter which should be dealt with on appeal.  While it is certainly the case that defects in disciplinary hearings may be cured through an appeal, this does not relieve the first instance disciplinary body of the obligation to deal with mitigation properly.  Furthermore, the statement in Ms Mallon’s letter that the claimant had failed to identify any mitigating factors is plainly wrong.  We have carefully considered the records of the three disciplinary hearings conducted by Ms Mallon and find that all of the potential mitigating circumstances outlined in the claimant’s evidence to this tribunal were in fact drawn to Ms Mallon’s attention by the claimant in the course of the hearing.  Ms Mallon also recalled the claimant telling her that she was ‘stressed out’ due to running the Dungannon outlet as well as the other stores in her area.  Ms Mallon accepted that she was aware of the claimant’s long service did not take it into account. 

Ms Mallon attempted to deflect criticism by suggesting that the claimant failed to put forward any mitigating circumstances.  As indicated above potential mitigating circumstances did emerge in the course of the disciplinary hearings but in an unstructured way and without any opportunity for the claimant to address mitigation as a separate item either before or after the decision that the claimant had committed the offence. We are therefore satisfied that Ms Mallon did not give proper consideration to the mitigating factors in the claimant’s case.

Alternative Disposal

It is also clear that having found the case against the claimant proved, and being satisfied that the claimant guilty of gross misconduct, Ms Mallon believed that the only sanction open to her was summary dismissal.  This is clear both from the terms of her letter to the claimant and her evidence to the tribunal.  In this belief she was plainly wrong.  While an offence of gross misconduct clearly renders an employee liable to summary dismissal, it is by no means inevitable and in particular cases there may be features that would render such an outcome unjust.  The respondent was obliged to give proper consideration to alternative disposals and it is plain that Ms Mallon did not do so although in our view the sanction of summary dismissal was fully warranted.

(5)	Did the respondent carry out a reasonable appeal hearing?

The appeal hearing undertaken by Ms Fitzsimmons was also commendably thorough in its scope although it was more a review or re-investigation rather than a re-hearing.  Many of the criticisms made in relation to the disciplinary hearing were repeated in relation to the appeal hearing as well as one additional point that the respondent failed to permit the claimant to the further investigations undertaken by Ms Fitzsimmons.  Again it is necessary to examine each in turn.

Inconsistent Treatment 

It is clear from the decision letter that Ms Fitzsimmons gave careful consideration to the suggested comparators but was not satisfied that they were relevant.  We cannot find any fault in her approach to this issue.

Failure to take into account the claimant’s offer to repay missing money

The record of the disciplinary hearing was considered by Ms Fitzsimmons and she must therefore be taken to have been aware of the claimant’s offer to repay the money and we are therefore not persuaded that she left this out of account.

The failure to afford the claimant an opportunity to respond to further investigations

It is clear Ms Fitzsimmons did not afford the claimant the opportunity to respond to her investigations and rather simply gave her decision in writing at a later date without any further opportunity for the claimant to contribute.  We regard this as unfair.

Mitigation

Although no specific opportunity was afforded to the claimant to say anything in mitigation, it is clear from the transcript of the hearing that all possible mitigating factors were considered by Ms Fitzsimmons but like Ms Mallon she did regard them as mitigating circumstances.  We are satisfied that Ms Fitzsimmons meant that these factors did not excuse the claimant’s behaviour. 

Failure to take account of the claimant’s disciplinary record

There is no evidence that Ms Fitzsimmons gave any consideration to the claimant’s disciplinary record and this was probably due to the nature of the appeal which took the form of a re-investigation.  It would therefore appear that this matter was left out of account.

Alternative Disposal

Again the criticism is made that alternative disposals were not considered by Ms Fitzsimmons.  It must be remembered that the whole point of an appeal is to review the earlier decision and it is implicit in this concept that alternative disposals are possible.  For example Ms Fitzsimmons might not have been satisfied that the charge was proven in which case the appeal would have been upheld.  In addition, Ms Fitzsimmons gave evidence that she did not regard a final written warning or demotion as either appropriate or warranted and we are therefore satisfied that consideration was given to alternative disposal.

(6)	Was the decision to dismiss the claimant for the offences within the range of reasonable responses?

We are satisfied that the decision to dismiss the claimant was within the range of reasonable responses to a failure to follow cash handling procedures which resulted in a loss of monies and was not unfair.

It is clear that the claimant was extremely foolish and acting contrary to instructions in retaining the lodgements.  The claimant accepted that taking the money out of the store was in breach of the respondent’s procedures.  However, dismissal for a single offence will rarely be justified unless theft or dishonesty is involved and as we have said both Ms Mallon and Ms Fitzsimmons told the claimant that she was not being accused of taking the money.  The claimant indicated a willingness to pay the missing monies during the first disciplinary hearing but never followed this up with any concrete action. According to the claimant she fully intended to pay the money back but it is clear that she held off doing so in the hope that the money would turn up.

The claimant’s misappropriation of funds and failure to adhere to the respondent’s procedures for cash handling clearly constituted a potentially fair reason for the claimant’s dismissal but the manner in which both the disciplinary hearing and the appeal hearing were handled renders the dismissal unfair.  To put it another way, the respondent could have fairly dismissed the claimant had the procedures adopted by it been operated fairly. 

34.	The respondent offered no evidence to refute the claimant’s contention that the respondent failed to provide her with amended written particulars of employment on her promotion to the post of area manager and we are therefore satisfied that this aspect of the claim is made out.

35.	As we are satisfied that both the disciplinary hearing and the appeal hearing were flawed, we must next turn to the matter of compensation.

36.	It is clear that the claimant had contributed significantly to her own dismissal and in all the circumstances we consider that the award should be reduced by 80%.

Basic Award

£280 x 13 = £3,640 - £2,912 (contributory fault) = £728.00

Compensatory Award

From 14th December 2005 – 12th January 2006

£349.53 x 4.1 = £1,433.07 

From 12th January 2006 – 1st April 2006

£144.15 x 11.3 = £1,628.89 

From 1st April 2006 – 16th September 2006

£12.69 x 24 = £304.56 

From 16th September 2006 – 30 October 2006

£208.07 x 6.1 = £1,269.23 

Total Compensatory Award = £4,635.75 - £3,708.60 (contributory fault) = £927.15

Loss of Statutory Rights 

£250

TOTAL AWARD

£1,905.15

This is a relevant decision for the purposes of the Industrial Tribunals (Interest) Order (Northern Ireland) 1990.

Chairman:

Date and place of hearing:	22nd, 23rd, 24th January 2007, 5th, 6th, 19th 20th February, 2nd, 28th March 2007 at Belfast.

Date decision recorded in register and issued to parties: