PLEASE NOTE: Information in this article is correct at the time of publication, please contact DFA Law for current advice on older articles.
Two care home managers are to have their cases reheard by the Employment Tribunal (ET) after the Employment Appeal Tribunal (EAT) ruled that not every piece of information held by an employer is confidential and it is not necessarily gross misconduct for an employee to make plans to set up a rival venture during the course of his or her employment (Khan & Another v Landsker Child Care Ltd.).
Mr Khan and Mr Hemming had worked for Landsker Child Care Ltd., which owns and operates five children’s care homes in South Wales, for eight and seven years respectively when they were dismissed in June 2010 for gross misconduct. Their alleged gross misconduct was described as planning to set up in business in competition with their employer and using the company’s resources to do so.
Their employer had found an email that appeared to show that the two men intended to set up a rival company, for which they had already produced a business plan. They claimed that the business plan was not a serious proposal and should not have been considered an imminent threat to their employer.
Mr Khan and Mr Hemming brought claims for unfair dismissal, arguing that there was no evidence that they had misused their employer’s resources or information. Their claims were dismissed by the ET last year, but the two men took their case to the EAT, insisting that their actions did not constitute gross misconduct.
The EAT has now ruled that the ET did not fully consider whether the men’s actions had amounted to gross misconduct and ordered that the matter be looked at again.
Mr Justice Wilkie said, “It is not in itself gross misconduct for an employee to make preparations for a future business to be conducted after his employment with his current employer has terminated, nor is it necessarily the case that every piece of information that the employer has…is properly to be regarded as confidential information.”
In this case, the ET’s decision contained no evidence that it had addressed the question which the EAT considered necessary to inform a decision as to whether what the employer genuinely believed to be conduct warranting dismissal, after the reasonable investigation it had undertaken, did, as a matter of law, constitute gross misconduct so as to entitle it fairly to dismiss Mr Khan and Mr Hemming. This question was whether the men had genuinely made use of confidential material in preparing their business plan or had merely made use of information which persons in their position and with their experience would be bound to acquire.
The case was remitted to the same ET for rehearing.