The recent case of Dafiaghor-Olomu v Community Integrated Care  EAT 84 is a good demonstration of the rough justice that is occasionally dispensed by the Employment Tribunal system.
It is well known that the amount of compensation that an employer can be ordered to pay for a straightforward unfair dismissal claim is subject to a statutory maximum amount of 52 weeks’ pay (commonly referred to as the “statutory cap”). In Dafiaghor-Olomu v Community Integrated Care, Mrs Dafiaghor-Olomu won her unfair dismissal claim against her employer. At the remedies hearing, the tribunal awarded her £46,153.55 in compensation and the employer paid this amount in full. The claimant successfully appealed the outcome of the remedies hearing and her award was subsequently increased to £128,961.59 following a second remedies hearing. The claimant appealed again to the EAT in respect of the remedy.
The key question for the EAT to determine was how the statutory cap should be applied in this unusual scenario in light of the earlier payment of £46,153.55. In particular, the EAT had to decide whether:
- The employer should be given credit for the earlier payment of £46,153.55 before the statutory cap was applied leaving the employer with an outstanding balance to pay of £74,200 (the statutory cap at the time of dismissal); or
- The statutory cap should be applied to the total award first, and then the employer given credit for the earlier payment of £46,153.55, leaving the employer with an outstanding balance to pay of £28,046.45.