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Mitigation of Loss

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If an unfairly dismissed whistleblower doesn’t apply for any jobs before a remedy hearing because of concerns that she will be stigmatised by future employers, is that a reasonable failure to mitigate losses?

No, held the EAT in Hilco Capital Ltd v Harrington, at least not without evidence to support those concerns.

At the remedy hearing, the tribunal did not reduce the compensatory award for an unreasonable failure to mitigate losses, accepting the Claimant’s concerns that job-seeking was pointless as she would be stigmatised by future employers as a whistleblower.

Mindful that such cases are ultimately fact-sensitive, the EAT applied principles from Abbey National plc v Chagger holding that the tribunal was wrong to simply accept the Claimant’s concerns without evidence to support them. The Claimant’s failure to look or apply for any jobs at all meant that the Respondent had discharged the initial burden on it to show an unreasonable failure to mitigate loss. The tribunal then had to decide if, in light of any explanations put forward by the Claimant and its own findings, that failure to apply for jobs was an unreasonable failure to mitigate losses. The case was remitted to the tribunal for further findings.

Thanks to Ed McFarlane for preparing this case summary.