The importance of knowing how to argue mitigation of loss

Mitigation of loss is an issue not often considered by those faced with an employment tribunal namely because few of us want to contemplate losing a tribunal and having to pay an award. Mitigation of loss in this context refers to the duty on the claimant to take reasonable steps to find a new job once they've been dismissed. This is because a compensatory award is intended to do just that, compensate and is not intended as a punishment. If the claimant has not made reasonable efforts to find a job, the compensation will be reduced to reflect the tribunal's view of what would have happened if the claimant had mitigated his or her loss. That of course can be a hard determination to make because the tribunal is into the world of might have beens. This case looks at just such an assessment. Incidentally if an employer wants to make this argument it is for the employer to prove! In this case, the Claimant, Dr Colleen Kelly, had been employed by the University of Southampton as a senior lecturer in its School of Biological Sciences from 1 January 2001. She was summarily dismissed with effect from 8 January 2005 in circumstances which the Employment Appeal Tribunal was subsequently to hold had made her dismissal both wrongful and unfair. Those circumstances involved work permits and immigration rights and the university's mistaken belief that they were illegally employing Dr Kelly once her work permit had run out. When her case was reconsidered by a differently constituted Employment Tribunal, she was found to have failed to take reasonable steps to mitigate her loss. Dr Kelly appealed. The tribunal found that Dr Kelly was an academic in the field of biological sciences of great experience and considerable distinction. Before her employment had come to an end, the possibility of recruiting additional members of staff to the School of Biological Sciences had been considered. The Tribunal made no findings about when the decision to advertise those posts had been made, but the Tribunal found that interviews for the posts were held at the end of March 2005 for one of them and at the end of April 2005 for the other. The tribunal went on to find: "We are … entirely satisfied that, given the circumstances of obtaining in February and March 2005, any reasonable and rational person in [Dr Kelly's] position would have made application for one or both of the vacancies and would have been appointed. In his evidence in chief, Professor Shepherd said he was surprised that Dr Kelly decided not to apply for either of the vacancies and so are we. If she had been acting in the way any reasonable person in her position would have done in the circumstances she would have applied and, what is more, she would have been appointed." And further: "We were told that the appointments were to take effect immediately. Since all the information necessary to effect an appointment would have been in the hands of the university, administrative procedures would have been brief and she could have been appointed by mid May. Nevertheless taking account of possible administrative delays, we have taken a date at the end of June as being the date upon which she would have been appointed." Dr Kelly argued that it was not open to the Tribunal to find that she would have been appointed to one of the vacant posts had she applied for them. The Tribunal's finding to the contrary is said to have been perverse. The only evidence on the topic came from a Professor Shepherd, and that was that Dr Kelly was eminently suitable and qualified to apply for the post, not that she was likely to be appointed to one of them. The EAT stated: "Ultimately, therefore, the question was whether, in the light of everything which the Tribunal knew of the history of Dr Kelly's employment with the university, the circumstances of her dismissal, and her qualifications and suitability for the posts, she would have been offered them, even if she could only be considered for them in open competition, with perhaps many other candidates. The Tribunal expressed itself robustly, perhaps more robustly than might have been appropriate, when it said that she would have been "extremely likely" or "overwhelmingly likely" to have been offered one or other of the posts, or indeed when the Tribunal said that she would have been offered them. But the fact is that she was qualified for the posts, she had worked for the university in a similar post for 4 years, and she had only lost that post in circumstances which hardly reflected adversely on her at all. All those were facts which in our judgment the Tribunal could have reasonably relied upon to reach the conclusion that Dr Kelly would have been offered, or at least was extremely likely or overwhelmingly likely to have been offered, the posts had she applied for them in open competition with others. That assessment was a matter for the Tribunal's judgment. The fact that there was no direct evidence that she would have been appointed to either of the posts, or any direct evidence from Professor Shepherd about whether he thought that she would have been appointed to them, did not in our judgment undermine the Tribunal's findings." It should be remembered that this potential limitation of the award only applies to the compensatory element and not the basic award. The tribunals have also been reluctant to set too high a standard of what is reasonably required of a claimant to seek employment. Nevertheless it is a useful tactic for a Respondent employer to keep a record of all those jobs they feel the claimant could have been applying for since their dismissal. Usually the employer will have an old CV or application form which will help the employer in deciding what jobs could be applied for.