“Lights. Camera. Action!” – Re Motion Picture Capital and standing for minority shareholders to bring unfair prejudice petitions
We all know that if you do something seriously wrong at work, you could be dismissed summarily for gross misconduct. But what about if, instead of doing something wrong, you simply fail to do something right; you fail to act? Can this amount to gross misconduct too?
In Adesokan v Sainsbury’s Supermarkets Limited, the Court of Appeal considered just this issue.
Mr Adesokan had been employed by Sainsbury’s for 26 years. At the time of his dismissal, he was a Regional Operations Managers, and was one of the company’s more senior individuals responsible for twenty stores.
At the time, Sainsbury’s operated what was known as a Talkback Procedure under which staff were required to give feedback, in confidence, about their working environment and relationships with their colleagues and managers. The idea behind this was to:
This, in turn, was expected to improve customer service and, ultimately, customer satisfaction.
For Sainsbury’s, this Procedure was critical—both in terms of staff strategy and culture. Levels of staff engagement could be assessed and the results fed into performance management and progression, targets, and decisions about pay and staff deployment. For Sainsbury’s it was of paramount importance that the integrity of the Procedure was preserved, to ensure that staff feedback was genuine and reflected a range of views.
A recipe for disaster
In June 2013, one of Sainsbury’s Human Resources Partners, a Mr Briner, sent an email to a handful of store managers operating within Mr Adesokan’s area. In that email, Mr Briner suggested that managers should “focus predominantly on getting [their] most enthusiastic colleagues to fill in the survey”. The point was: if these individuals were specifically targeted, the results of the Procedure could be manipulated. The keen and eager employees were the ones most likely to speak favourably about Sainsbury’s.
Upon becoming aware that this email had been sent, Mr Adesokan asked Mr Briner to “clarify what he meant with the store managers”. Mr Briner did not do this, nor did Mr Adesokan check whether he had done so. When Mr Adesokan discovered that Mr Briner had not done what he had told him to do, Mr Adesokan did nothing to remedy the issue.
Instead, Sainsbury’s CEO received an anonymous tip off about the email and ordered an investigation. Mr Adesokan was subject to disciplinary proceedings, and dismissed for gross misconduct.
But…surely this was all Mr Briner’s fault? After all, it was he who had sent the email. Mr Adesokan did not even know about it initially, and when he did discover what had happened, he expressly told Mr Briner to clarify what he meant. If anything, it was Mr Briner who was in the wrong in failing to follow Mr Adesokan’s reasonable management instruction…right? Mr Adesokan did not do anything himself.
Well, that was the problem.
Mr Adesokan’s contract of employment included a clause which stated that he could be dismissed without notice for gross misconduct. Examples of what could (or would) amount to gross misconduct were given in Sainsbury’s disciplinary policy. One such example was: “any […] serious breach of procedure or policy that leads to a loss of trust and confidence”. This reflects the implied term of trust and confidence which is read into every contract of employment.
The Judge who first heard the case decided that the issue was Mr Adesokan’s failure to act. In other words, it was his failure to take proper and adequate steps to remedy the damage (or risk of damage) caused by Mr Briner. It was simply not good enough to tell Mr Briner to correct his email. Mr Adesokan should have done more. He should have ensured that his instruction to Mr Briner was actually acted upon.
Although it was accepted that there was no conscious decision or dishonesty on Mr Adesokan’s part, it was held that his inaction was a breach of Sainsbury’s philosophy of achieving a desirable work environment. Further, he knew or ought to have known about the importance of the results from the Talkback Procedure. They were, after all, to be used in monitoring staff performance and might lead to the dismissal of some employees. In the Judge’s view, Mr Adesokan’s dismissal for negligent gross misconduct was therefore fair.
Mr Adeoskan appealed, arguing that the High Court had failed to take into account various mitigating circumstances. Principally, these were the fact that:
The Court of Appeal, in giving its decision, noted that gross misconduct is not limited to an incident which involves dishonesty or intentional wrongdoing. The conduct in question must be “of such a grave and weighty character as to amount to a breach of the confidential relationship between master and servant such as would render the servant unfit for continuance in the master’s employment”. The focus is, then, on the damage caused to the relationship between the parties. Gross negligence can be sufficient, in itself, to cause an irretrievable breakdown.
The Court of Appeal held that the High Court had been entitled to conclude as it did: Sainsbury’s summary dismissal of Mr Adesokan for gross misconduct on grounds of gross negligence was fair. Nonetheless it did go on to note that Judges ought not to leap to a conclusion of gross misconduct where there is no intentional decision on the part of the employee to fail to act. Negligence does not necessarily result in an automatic finding of gross misconduct. Each case turns on its facts.
So, what can we learn from this ruling?
Firstly, for misconduct to be regarded as gross misconduct justifying immediate dismissal, it must be very serious indeed. But, nonetheless, the warning is there: an employee’s failure to act as guardian of their employer’s philosophy could be regarded as sufficiently serious to warrant summary dismissal. Depending upon the facts, that dismissal could be fair.
Secondly, for employers, the important thing is to ensure that your employment documentation includes a non-exhaustive list of what may amount to gross misconduct. At least one of the examples should refer to dismissal in the event an employee is (in the employer’s reasonable opinion) negligent and incompetent in the performance of their duties. Whilst this will not guarantee the position, it may be helpful if a subsequent dismissal for gross negligence is challenged on grounds of fairness.
Thirdly, for employees, they would be wise to recognise that a failure to act (or a failure to act appropriately in all the circumstances) may amount to gross negligence, and that this may (in turn) warrant immediate dismissal. Also, avoid Mr Adesokan’s mistake: if you have given an instruction to someone, remember to chase it up. Make sure it has been acted upon. If it has not, escalate it. If you do not, you may well risk dismissal.
Skip to content Home About Us Insights Services Contact Accessibility