Where misconduct is suspected, then the EAT’s decision in British Home Stores Ltd v Burchell [1978] IRLR 379, makes it clear that any resulting dismissal will only be considered fair if the employer can show that it genuinely believed that the employee committed misconduct and that belief was based on reasonable grounds, after carrying out as much investigation as was reasonable in all the circumstances of the case. The Court of Appeal’s decision in Sainsburys Supermarkets Ltd v Hitt [2003] IRLR 23, clarifies that the range of reasonable responses test applies as much to the question of whether the investigation into the suspected misconduct was reasonable in all the circumstances as it does to the reasonableness of the decision to dismiss.

In Shrestha v Genesis Housing Association Ltd, Shrestha's mileage claims over a three-month period were compared with the distances for the same journeys calculated on the AA’s route finder and were almost twice the mileage figures shown by the AA. The RAC service figures showed hardly any difference. S attended a disciplinary hearing conducted by Mr East. S's explanation for the mileage differences were: (i) difficulty in parking; (ii) one-way road systems; and (iii) road works causing closures or diversions. East considered all three and in the same order: (i) S had made the same journey several times and would, over time, get to know where to park; (ii) the AA calculates their recommended mileage including one-way roads; and (iii) road closures could be an explanation in respect of some journeys, however, it was not plausible for this to explain why every single journey was greater than the recommended mileage. East felt that the explanation simply did not stack up and S was dismissed for gross misconduct, i.e. over-claiming mileage in a fraudulent manner.

A tribunal rejected S’s unfair dismissal claim. It found that given the evidence overall, it was not reasonable to re-create each and every journey, as argued by S, and in any event it would not have been possible to do so. Therefore, the investigation was within the range of reasonable range of responses as no further steps were needed other than those that had been taken to validate the appropriate journey times. The Court of Appeal agreed, holding that to say that each line of defence must be investigated unless it is manifestly false or unarguable is to adopt too narrow an approach. The investigation should be looked at as a whole when assessing reasonableness. Whether and to what extent it is necessary to carry out specific inquiry into any explanation depends on the circumstances as a whole.

In re-iterating the principle established in the Sainsburys case as it impacts on the third limb of the Burchell test, the Court of Appeal have confirmed that the objective standard of the reasonable employer does not require them to carry out yet further investigations where the evidence already available justifies reaching a conclusion that any explanation is improbable, or as in this case, just doesn’t ‘stack up’. However, employers must be prepared to show that this is the case.

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