Conduct and culpability

12 July 2017

This case centered on the question of whether or not an employer has to prove culpability in a conduct dismissal case.

Mr Ktorza was an executive director on the foreign exchange desk of the bank. He had received two final written warnings, the second of which was still live at the time he was disciplined for a practice called ‘short-filling’ or ‘partial-filling’, which means not (initially, at least) carrying out a client’s order in full.

JP Morgan Securities plc v Ktorza

This case centered on the question of whether or not an employer has to prove culpability in a conduct dismissal case.

Mr Ktorza was an executive director on the foreign exchange desk of the bank. He had received two final written warnings, the second of which was still live at the time he was disciplined for a practice called ‘short-filling’ or ‘partial-filling’, which means not (initially, at least) carrying out a client’s order in full. He claimed to have not been aware of the employer’s instruction to refrain from that practice, but went on to be dismissed. The tribunal found that that was unfair.

The Employment Appeal Tribunal (EAT) was critical of the decision of the employment tribunal that for someone to be fairly dismissed for conduct, their conduct has to have been in some way culpable (negligent, dishonest or reckless, for example). The EAT made it clear that an employer who has identified conduct as the potentially fair reason for dismissal doesn’t need to go on and establish that the conduct in question was culpable. The tribunal should simply ask: did the employer act reasonably in treating the reason as sufficient for dismissal?

So it is the thought-process and the reasonableness of the employer at the time they took the decision to dismiss that is under scrutiny. And of course the fairness of the procedure – including a proper investigation – carried out.

The case has been sent to a fresh tribunal for a re-hearing.


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