Mock Employment Tribunal - What is a Polkey deduction and how does contributory fault work?

We are coming back on one very intelligent query by an attendee at our Mock Employment Tribunal event on what is meant by a Polkey deduction mentioned by the Judge. So here it is, as well as how it differs from contributory fault. Polkey Deduction In our mock tribunal, you may recall the Judge asked the Defendant’s representative if they wished to rely on thePolkey argument if the dismissal was held to be unfair. The Judge said if so, this would have to be considered at subsequent remedy hearing. This principle is name after the House of Lords decision in Polkey v AE Dayton Services Ltd [1987] IRLR 503. In this case, the House of Lords stated that the compensatory award may be reduced or limited to reflect the chance that the claimant would have been dismissed in any event and that the employer's procedural errors accordingly made no difference to the outcome. This does not mean that an unfair dismissal is rendered fair, but it does allow the tribunal to make a realistic assessment of loss according to what might have occurred in the future. Effectively it means that compensation is limited because doing everything right would have led to the same outcome, - just after a little more delay. It may be expressed as a percentage reduction (up to 100% in some cases) or as a cap on future loss. If the argument were to be successful at the subsequent remedy hearing, then Mr Hindes’s compensatory award may have been reduced, to reflect the fact that certain procedural steps that had not been taken by the employer in implementing a redundancy dismissal would not have made a difference to the decision to dismiss. He would have been dismissed anyway – albeit a little later. Contributory fault This is where an employee’s conduct may lead to a reduction in the amount awarded by an employment tribunal for unfair dismissal because the claimant effectively contributed in some way to his dismissal. This can be in the following circumstances: • Where the employee's action(s) caused, or contributed, to any extent, to the dismissal, the compensatory award shall be reduced by such proportion as is just and equitable (section 123(6), ERA 1996). • Where the employee's conduct before the dismissal (or notice of dismissal, where given) was such that it would be just and equitable to reduce the basic award to any extent, it shall be reduced to that extent (section 122(2), ERA 1996). A reduction for contributory fault can affect the basic award and/or the compensatory award, and may result in no award or a percentage reduction in award. The tribunal must look at the claimant's conduct in isolation and not be influenced by its assessment of the respondent's conduct. In the mock tribunal case involving Mr Hindes, his compensation was reduced by 33% due to his contributory fault in failing to follow the stock and banking procedures, as well as walking out of the initial disciplinary hearing. Questions welcome!