Bloody-Minded: Anger and the Reduction of an Award

Mr Nelson worked for the BBC in the Caribbean. When the Corporation wound down the service in 1974 it offered him other work, and he refused every version of it. The Court of Appeal held the redundancy dismissal unfair, because there was work he could have done, then cut his compensation to nothing: his conduct had been perverse, or foolish, or, in Brandon LJ’s word, bloody minded.

Nelson v British Broadcasting Corporation (No 2) [1980] ICR 110 supplies the three-stage test for contributory fault now applied under section 123(6) of the Employment Rights Act 1996. The blameworthy conduct it found was Mr Nelson’s refusal to be reasonable about a wrong the court accepted he had suffered.

Four provisions, rarely read together, reduce or refuse a remedy by reference to what a claimant did about the wrong or why the claimant spoke: sections 123(6) and 123(6A) of the 1996 Act, section 27(3) of the Equality Act 2010, and section 116(1)(c) on reinstatement.

Subsection (6) and subsection (6A)

Section 123(6) is the familiar one. Where the tribunal finds that the dismissal was “to any extent caused or contributed to by any action of the complainant”, it shall reduce the compensatory award by such proportion as it considers just and equitable. The conduct must be culpable or blameworthy, meaning perverse, unreasonable or foolish, whether or not it also breached the contract; it must have caused or contributed to the dismissal; and the reduction must be just and equitable. There is no floor: Mr Nelson recovered nothing.

Directly beneath it sits section 123(6A), inserted by section 18(4) of the Enterprise and Regulatory Reform Act 2013 with effect from 25 June 2013. Where the reason for dismissal was a protected disclosure and it appears to the tribunal that the disclosure “was not made in good faith”, the tribunal may reduce any award by no more than 25%. Section 49(6A) does the same for detriment claims.

That amendment is usually described as the removal of the good faith requirement, which understates it. Before 2013, good faith was a condition of protection. In Street v Derbyshire Unemployed Workers' Centre [2004] EWCA Civ 964 the Court of Appeal held that a disclosure made for a dominant or predominant ulterior purpose was not made in good faith at all, and Mrs Street’s purpose was personal antagonism towards a colleague. She lost outright. Parliament did not stop caring about her motive in 2013. It moved the motive out of the gateway and into the remedy, where it now yields a reduction of up to a quarter rather than the loss of the claim.

So the two adjacent subsections divide the ground between them. Subsection (6) asks what the claimant did. Subsection (6A) asks why the claimant spoke. The first has no cap and reached zero in Nelson; the second stops at 25%.

Bad faith under the Equality Act

Victimisation runs differently. Section 27(3) of the Equality Act 2010 provides that giving false evidence or information, or making a false allegation, “is not a protected act if the evidence or information is given, or the allegation is made, in bad faith”. No discount, and no discretion: the act simply falls outside section 27(2), and the claim fails at the first element.

The reach of that is narrower than respondents tend to plead. Section 27(3) bites only where the evidence, information or allegation is false. A true allegation made in a rage, or made for reasons that have little to do with equality and a great deal to do with a grudge, remains a protected act. Bad faith on its own does nothing.

At the other end of a claim the same pattern holds. In Omilaju v Waltham Forest LBC [2004] EWCA Civ 1493 the Court of Appeal held that a last straw need not itself be a breach of contract, but it must contribute something to the breach of trust and confidence, and an entirely innocuous act cannot qualify however it struck the employee. The employee’s sense that this was the final blow is not the fact that decides it.

Whether the statute is penalising anger

Is the statute penalising anger, or merely declining to reward it?

A deduction under section 123(6) requires culpable or blameworthy conduct on the claimant’s part, and the tribunal is not asked whether the anger was warranted before it makes one. Mr Nelson had been unfairly dismissed. The Corporation could have found him work and did not. His award still went to nothing, on the strength of how he had behaved about a wrong the court accepted he had suffered.

The remedy that is offered and not given

Section 112(2) obliges the tribunal, on every successful unfair dismissal claim, to explain what orders may be made under section 113 and to ask the claimant whether they want one. Reinstatement is the first remedy the statute contemplates, and compensation under section 112(4) is what happens when no order is made.

Section 116(1) then sets out what the tribunal takes into account: whether the claimant wishes to be reinstated, whether reinstatement is practicable for the employer, and, where the claimant “caused or contributed to some extent to the dismissal”, whether it would be just to order it. Contributory conduct appears here for a second time, no longer reducing a sum but barring a return. Section 116(3) repeats the structure for re-engagement.

Kelly v PGA European Tour [2021] EWCA Civ 559 fixes the meaning of practicable. It requires more than possibility: the order must be capable of being carried into effect with success. Re-engagement is not practicable where the employer genuinely and rationally believes that the employee cannot perform the role, or that the employee’s conduct has broken down trust and confidence. What matters is the employer’s view, tested by the tribunal for genuineness and rational foundation — the employer cannot simply assert a breakdown and be done with it.

The statute therefore makes return the primary remedy, obliges the tribunal to offer it to every claimant who wins, and then treats the collapse of the relationship as the reason to refuse it. Reinstatement and re-engagement are ordered in a very small fraction of successful claims, and have been for as long as anyone has counted: Dickens, Hart, Jones and Weekes were already calling re-employment “the lost remedy” in the Industrial Law Journal in 1981.

Nussbaum’s distinction, in statutory form

Martha Nussbaum’s Anger and Forgiveness (2016), from her John Locke Lectures, takes anger to contain two things. The first is the judgment that a serious wrong has been done. The second is a wish that the wrongdoer suffer for it, and that wish she thinks is either magical, because the wrongdoer’s suffering restores nothing, or else it is really about relative status, in which case it has stopped being about the wrong. What survives the argument is what she calls Transition-Anger, “whose entire content is: ‘How outrageous! This should not happen again.’”

The remedies provisions draw a line in the same place. Compensation runs to the loss the dismissal caused and to the loss still to come; the reductions run to what the claimant did about the wrong and why the claimant spoke. Nothing in the Act asks a tribunal to consider whether the outrage was justified, because on the statutory scheme that question was answered by the liability judgment and does nothing further.

I have told claimants to take the temperature out of a grievance letter, which is advice about how the document will read to a tribunal in two years and also, unavoidably, advice about how to feel.

Nussbaum is writing about what a wronged person has reason to do. Sections 123 and 116 attach consequences to conduct in a forum the claimant did not choose to enter, applied by a tribunal to which nothing was done.

Practical points

For claimants, the two reductions are not equivalent and respondents will run both. The good faith reduction is capped at 25% and requires a finding about the purpose of the disclosure. Contributory fault has no cap. Where a disclosure is entangled with a personal dispute, the second is the greater exposure.

Street turns on dominant or predominant purpose, not on the presence of ill-feeling. A claimant who is furious and right keeps the protection. Plead the purpose, and be specific about it, because the finding the tribunal has to make is about what the disclosure was for.

Under section 27(3), check whether the allegation was in fact false before conceding anything. Respondents routinely plead bad faith as though it were freestanding.

On remedy, raise section 116 properly or lose it. Where contribution is alleged, section 116(1)(c) is live and belongs in the claimant’s remedy submissions rather than in the respondent’s. And Kelly cuts both ways: an employer resisting reinstatement has to produce the belief and show it is genuine and rational, which is a heavier task than the sentence usually offered at the end of a remedies hearing.

Mr Nelson was unfairly dismissed and recovered nothing, on the strength of how he took it. Section 123(6) has not been amended since.

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