In Holmes v Qinetiq, Holmes, who is disabled, worked as a security guard.  He was dismissed on grounds of ill health because he was no longer capable of doing his job. He had had a number of extensive absences as a result of pain he experienced in his back, legs and hips. The employer conceded that the dismissal was unfair because it failed to obtain an up-to-date medical report about Holmes’ ability to provide reliable attendance at work after undergoing an operation that effectively resolved the pain he had been experiencing prior to surgery. 

When the employment tribunal (ET) was determining compensation it refused to uplift the award by 25% as allowed for under S.207A(2) of the Trade Union and Labour Relations (Consolidation) Act 1992 where the employer has not followed the ACAS Code of Practice on Disciplinary and Grievance Procedures. The ET decided the uplift did not apply because the reason for dismissal was incapability due to ill health and no disciplinary procedure was involved.

Holmes appealed. His principal argument was that if Parliament intended dismissal for capability or ill health reasons to be outside the scope of the Code it would have excluded those expressly just as it did dismissals for redundancy and non-renewal of fixed term contracts on their expiry.

The EAT rejected the appeal. Paragraph 1 of the Acas Code in particular, and the subsequent paragraphs, demonstrate that the Code is intended to apply to any situation in which an employee faces a complaint or allegation that may lead to a disciplinary situation or to disciplinary action. Disciplinary action should only be invoked where there is some sort of blameworthy conduct or poor performance alleged against an employee that requires correction or punishment. 

Where an employee is absent through illness or ill health leading to dismissal, disciplinary action cannot be invoked because the employee is not blameworthy and therefore the Code does not apply. The position is different where the ill health leads to a failure to comply with sickness absence procedures or an allegation that the ill health is not genuine. But even then disciplinary action should only be invoked to deal with the employee’s misconduct and not any incapability due to ill health. No disciplinary procedure was invoked in this case as the only reason Holmes could not perform his role was because of ill health.  That meant the employer was not required to follow the ACAS Code. Therefore, the ET was correct to refuse to award any uplift in compensation.

While the EAT’s ruling confirms that the Acas Code does not apply to dismissals which are purely because an employee is incapable of fulfilling his or her role due to ill health, nevertheless, a fair dismissal in such circumstances requires that a ‘reasonable’ procedure is followed given all the circumstances of the case. Case law has set out the steps which need to be followed and these are reflected in Appendix 4 of the Acas Guide – Discipline and grievances at work. Particular care needs to be taken where the employee is disabled.

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