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Compensatory Award

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[Thanks to Paul Lewis of St John's Chambers for preparing this case summary]

The EAT has handed down its decision in Saunders v OCS Group, which is authority for the proposition that in deciding whether to make a compensatory award following an unfair dismissal, a Tribunal must (a) dentify what loss the employee has suffered at the time of dismissal, and then (b) decide whether that loss is attributable to the action taken by the employer.

The Claimant, an airport worker, was unfairly dismissed for gross misconduct and had his licence to work at the airport withdrawn immediately. The Tribunal made a nil compensatory award on the basis that, having lost his licence, the Claimanthad no prospect of working beyond the date of his dismissal, and therefore had suffered no loss of wages.

The EAT held that the Tribunal failed to identify correctly the Claimant's loss at the time of dismissal, namely his right to be dismissed in accordance with the terms of his contract. Furthermore, despite finding the dismissal unfair, the Tribunal failed to consider the 'what if' Polkey scenario in deciding to make a nil compensatory award.