Stigma Damages

[Thanks to Alfred Weiss of Zenith Chambers for providing this case summary]

The EAT (Cox J) has handed down its decision in Brown v Careham Hall, which is authority for the proposition that stigma damages will only be awarded where the employee's difficulty in finding new employment is attributable to the dismissal.

Brown was a care home worker automatically unfairly dismissed during her notice period amid allegations that she was rough with the residents. She claimed that her employer had torpedoed her new job by giving her an unfavourable reference. The tribunal concluded that even if she had not been unfairly dismissed, her employer would still have given her an unfavourable reference. It could not therefore be said that the difficulties she experienced in obtaining new employment were because of the unfair dismissal. Those difficulties were due to the reference and so could not sound in compensation under section 123 ERA 1996. The EAT also held that as the tribunal found that there had been a significant and serious breach of the now defunct statutory procedures, an uplift of 30% to 50% pursuant to section 31 EA 2002 was appropriate. However, where within that range the uplift was to fall was entirely a matter of fact for the tribunal and the EAT declined to interfere with the uplift of 30% awarded.