NEWS

28 Mar 2022

Ian Rees Phillips secures maximum compensation and costs for claimant in 5-day Employment Tribunal

Ian Rees Phillips secured the maximum compensation and costs for claimant in 5-day Employment Tribunal trial against an “either dishonest or plainly incompetent” accountancy firm.

Ian recently represented the claimant in the case of Goburdhun v Stuart Harris Associates Ltd before the Watford Employment Tribunal, which was heard across 5 days spread out between December 2021 and February 2022. The claimant secured the maximum allowed compensation award permitted under legislation capping damages for unfair dismissal, and a substantial proportion of the claimant’s costs.

The claimant was an accountant at the respondent firm Stuart Harris Associates Ltd, and was instructed by the firm’s principal to prepare accounts for its clients’ self-assessment tax returns, and in doing so to use estimated figures for a large proportion of the expenditure reported, where those estimates were not supported by any proof or evidence and routinely copied from the year before, but with 5% (for inflation, whatever the actual inflation rate was) and £10 (to “rough it up a bit”, in the words of the principal) added, with the effect that its clients serially and consistently under-reported profit for taxation purposes. Once she realised that this practice was contrary to HMRC’s expectations and proper accounting practice, she refused to do so on advice from her regulator, the ACCA, and was then disciplined by the respondent with a final warning for insubordination. When her appeal against this and a grievance over her treatment was refused, she resigned and claimed constructive unfair dismissal in the Employment Tribunal.

Following a 5-day trial the Tribunal found that the respondent’s conduct meant that its clients were being advised to report self-employment profit to HMRC that was “not capable of being justified by objective evidence” and that this was “either dishonest or plainly incompetent”. Requiring the claimant to follow this practice was found to be likely seriously to damage the relationship of trust and confidence that should exist between employer and employee. All of the respondent’s various counter-arguments failed, and the claimant was awarded the maximum possible compensation under the statutory cap on unfair dismissal awards. In addition, Ian secured a significant award of costs to the claimant, which is a rare occurrence in the Tribunal.

The full reasons judgment can be found here

Ian is available for instruction on employment matters by both claimants and respondents, along with the rest of Six Pump Court’s Employment Team.