Employer's Mistaken Belief in Resignation Can Be Fair Dismissal Reason, Rules EAT
The EAT has ruled that an employer's genuine, though mistaken, belief that an employee resigned can constitute a potentially fair reason for dismissal under the Employment Rights Act 1996.
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Recruitment Firm Wins Appeal Over Unfair Dismissal Claim
Impact Recruitment Services Ltd has successfully appealed an Employment Tribunal decision that had ruled in favour of Ms I Korpysa in an unfair dismissal claim. The Employment Appeal Tribunal (EAT) found that the original tribunal had erred in its assessment of the dismissal.
The Case Background: Belief of Resignation
The core issue revolved around whether Impact unfairly dismissed Ms Korpysa, a warehouse operative placed at Howden Joinery Ltd. A key communication was a phone call with Impact’s on-site account manager, Mr Filipski, where differing accounts emerged regarding whether Ms Korpysa requested her P45, implying resignation.
The original tribunal's majority decision was that Impact had unfairly dismissed Ms Korpysa, believing she had resigned when she had not. They deemed this belief not a potentially fair reason for dismissal. However, the EAT disagreed.
EAT Ruling: Mistake Can Be 'Substantial Reason'
His Honour Judge Auerbach, presiding over the EAT, clarified that an employer's genuine, albeit mistaken, belief that an employee had resigned could indeed be a “substantial reason” for dismissal under Section 98(1)(b) of the Employment Rights Act 1996. This section allows for a dismissal to be fair if it's for a reason falling within subsection (2) or some other substantial reason of a kind such as to justify the dismissal of an employee.
The EAT determined that the original tribunal had wrongly assumed that the reason for dismissal was intrinsically unfair without properly considering whether it constituted a ‘substantial reason’. The EAT also criticised the original tribunal's assessment of procedural fairness.
Remittal to Tribunal
The case has been remitted back to a new employment tribunal to decide afresh whether Impact has shown that the reason for dismissal was a substantial reason within Section 98(1)(b), and, if so, whether the dismissal was fair or unfair, applying the test in Section 98(4) of the Employment Rights Act 1996. The new tribunal must consider the facts as already established.
This ruling provides important clarification for employers facing similar situations. It emphasises the need for tribunals to consider whether a genuine but mistaken belief can amount to a substantial reason for dismissal and to properly apply the tests for fairness outlined in the Employment Rights Act 1996.
Read the entire judgement here: Impact Recruitment Services Ltd v Ms I Korpysa [2025] EAT 22
