Uplifts to Awards

The EAT, sitting in Scotland, has handed down a controversial decision on uplifts to the compensatory award (McKindless Group v McLaughlin).

The employer admitted breach of the statutory dismissal proceedings, and defended on quantum only. The tribunal awarded a 50% uplift. Overturning this, and substituting a 10% uplift, the EAT stated that:

• a tribunal cannot award more than a 10% uplift in the absence of evidence on the reason(s) for breach of the statutory dismissal procedure (para. 13); and,
• a tribunal is not entitled to take into account the way in which the employer subsequently conducted the litigation (para. 26)

Both of these conclusions are open to question. As to the first, if correct, it would mean an employer who deliberately flouts the procedures and then takes no part in the proceedings could not be subjected to more than a 10% uplift, whereas a well-meaning but ignorant employer who tries to explain his error could be subject to a greater award. The approach is also not reflected in the practice of tribunals (certainly, in my experience) up and down the country.

As to the second conclusion, this does not flow from the wording of the statute. Certainly, a breach of the statutory procedures is the trigger for an uplift, but nothing in s31 of the 2002 Act confines the tribunal to the degree of, or motive for, breach of the procedures when assessing what level of uplift is 'just and equitable'.