An employment tribunal, having found that a decision to dismiss an employee was substantively and procedurally reasonable and within the band of reasonable responses open to the employer, had erred by holding that the employee's dismissal was unfair on grounds of disparity. The tribunal had also failed to apply its own clear findings of fact that the decision to dismiss had not been tainted by the employee's race.

The appellant firm of solicitors (L) appealed against a decision of an employment tribunal that the respondent former employee (D) had been unfairly dismissed and that it had discriminated against her on racial grounds. D, a black Afro Caribbean, had been employed by L as a solicitor. During her employment, D had failed to return to work after a period of vacation and had missed a time limit in proceedings for which she had been responsible. Disciplinary proceedings were instituted against D and attempts to reach a compromise agreement to leave failed. D was dismissed for gross misconduct. The tribunal held that the substantive treatment of D's termination and the disciplinary procedures were reasonable and that the dismissal was within the band of reasonable responses open to L. However the tribunal upheld D's unfair dismissal and race discrimination claims on the basis that another employee, a black African, who had missed court deadlines on three occasions had been treated differently by L, in that she had not been disciplined. L submitted that (1) in respect of the unfair dismissal claim the tribunal had failed to apply the correct statutory test; (2) the tribunal had failed to make sufficient findings of fact as to whether the circumstances of D and the other employee were truly comparable; (3) before finding a prima facie case and applying the burden of proof provisions in respect of race discrimination, the tribunal ought to have considered whether the less favourable treatment was on racial grounds.

HELD: (1) The tribunal, having found that the decision to dismiss D was substantively and procedurally reasonable and within the band of reasonable responses open to L, had erred by holding that D's dismissal was unfair on grounds of disparity. By concentrating on an inconsistency between the treatment of D and the treatment of the other employee it had lost sight of the true question posed by the Employment Rights Act 1996 s.98(4). The tribunal had to take care not to allow questions of disparity with earlier treatment to supplant the statutory test, Hadjioannou v Coral Casinos Ltd (1981) IRLR 352 and Paul v East Surrey District Health Authority (1995) 305 applied. (2) It was by no means self evident that the circumstances of D and the other employee were comparable. There were several potential differences. However, it was for the tribunal to determine whether the circumstances were truly comparable, and had it been the only issue in the appeal the matter would have been remitted to the tribunal. (3) The tribunal was not required to consider whether the less favourable treatment was on racial grounds. At the first stage, the tribunal was only concerned with whether on the facts it had found it could conclude that a difference of treatment was on racial grounds, Igen v Wong (2005) EWCA Civ 142 , (2005) 3 All ER 812 and Network Rail Infrastructure Ltd v Griffiths-Henry (2006) IRLR 865 applied. (4) If L succeeded in proving that its decision to dismiss D had not been tainted by race, as the tribunal had found, then the fact that L may have treated another employee of a different race leniently was irrelevant. (5) The findings of the tribunal that the decision to dismiss was substantively reasonable, procedurally reasonable and within the band of decisions reasonably open to the employer were determinative of the case.

Appeal allowed.