02 MAR 2015
Obscene emails and repudiatory breach of contract
Solicitor, Veale Wasbrough Vizards
Can an employer actively seek evidence of gross misconduct to justify dismissing an employee during their notice period? Can an employer rely on misconduct it discovers post-dismissal to defend a claim for breach of contract?
The answer to both of these questions, as the case of Williams v Leeds United Football Club illustrates, is yes.
Mr Williams had been Technical Director of Leeds United for seven years when he was dismissed by reason of redundancy. Mr Williams was given 12 months' notice, a period during which he would earn approximately £200,000.
For commercial and financial reasons the club had also instructed forensic investigators to search for instances of gross misconduct by both Mr Williams and other senior members of staff who had also been or would be dismissed. The day after Mr Williams was given notice of redundancy, the investigators alerted the club to an email that Mr Williams had received in his work email account some five and a half years earlier which included an obscene and pornographic powerpoint attachment. Mr Williams forwarded the email to a friend working for Newcastle United Football Club, again from his work email account.
Having discovered this incident, the club invited Mr Williams to a disciplinary hearing. He did not attend that meeting and was summarily dismissed exactly one week into his 12 month notice period.
Following Mr Williams' summary dismissal, it was further discovered that he had forwarded the obscene email to two more recipients - one, a friend at Tottenham Hotspur Football Club, the other a female receptionist at Leeds United. On both occasions Mr Williams used his work email account.
Mr Williams claimed wrongful termination and sought various contractually owed payments including unpaid salary, unpaid pension contributions and damages for loss of other contractual benefits for the remainder of his 12 month notice period together with a statutory redundancy payment.
The club argued that Mr Williams' conduct amounted to a breach of the implied term of trust and confidence entitling them to dismiss him without notice. Mr Williams countered that if his conduct did amount to a breach of the implied term of trust and confidence, it was not sufficiently serious to be repudiatory and to therefore justify summary dismissal.
Article continues below...
High Court decision
The High Court held that Mr Williams' conduct was a breach of the implied term of trust and confidence for the following reasons:
(1) He held a very senior management position at the club.
(2) The images forwarded were obscene and pornographic.
(3) Sending obscene and pornographic images to a junior female employee (especially by a senior manager) may have left the club vulnerable to a claim for harassment.
(4) The club's reputation was important for securing and retaining sponsors and supporters, the club could be easily identified with the emails sent and the media would have been interested in this incident had it come to light, all of which left the club's reputation exposed.
The High Court also held that the conduct was sufficiently serious to amount to a repudiation of contract entitling the club to summarily dismiss Mr Williams. In fact the High Court considered that the email to the receptionist alone would have sufficed.
Mr Williams had sought to argue that he had not received the club's internet and email policy however the High Court was unimpressed by this, finding that it should have been obvious, especially to a senior manager, that the email system should not be used to send obscene images.
The Claimant also argued that the club had decided, prior to his redundancy dismissal, not to pay his notice and to actively seek evidence justifying summary dismissal. He alleged that they already knew of the emails and had waived any right to rely on them to dismiss. The High Court found that the club did not wish to pay notice and were looking for reasons not to do so but held that neither fact prevented the club from relying on the repudiatory breach of contract once discovered and that the club may rely on additional conduct even where that conduct came to light after dismissal. It was also found that the club were not aware of the emails prior to the work of the forensic investigators.
It is clearly not best practice to embark upon fishing exercises in an attempt to avoid long and costly notice periods. Notice periods should be contractually agreed, proportionate to the role and for a sufficient period to meet the employer's objectives, and safeguard the employer's concerns.
Where allegations of misconduct are made, these should be investigated reasonably and employers should conduct a fair procedure in accordance with their disciplinary procedures and taking into account the ACAS Code of Practice on Disciplinary and Grievance Procedures.
As regards employee misuse of the internet and email systems, employers should take a preventative approach by having a clear and thorough IT Acceptable Use policy and ensuring that the consequences of misuse are understood.