Dismiss, upset and breach - just don’t suspend : the false dawn of damages for future losses. A case note on Edwards v Chesterfield Royal Hospital NHS Foundation Trust [2011] UKSC 58, [2012] 2 AC 22

On 14 December 2011 the Supreme Court handed down its judgment regarding the extent to which damages awards in instances of dismissal can take into account future losses, see Edwards v Chesterfield Royal Hospital NHS Foundation Trust [2011] UKSC 58, [2012] 2 AC 22. The Court of Appeal ([2010] EWCA Civ 571) had held there was no principle of law why damages could not include future losses where an employer had breached the contract by not following contractual disciplinary and dismissal procedures. The question considered by the Court of Appeal was whether the status quo of restricting such awards to a statutory maximum (following the ACAS Code) and/or to the contractual notice period plus reasonable period of time for the procedures to be completed, was applicable. Alternatively, the Court of Appeal could move away from this traditional purely-contractual approach and enable damages to take into account those future losses associated with an unfair / wrongful dismissal. This was the approach taken. The Supreme Court, reversing the Court of Appeal, decided to follow the former, traditional approach. As such, its decision has broad implications for employers who flout contractual disciplinary and dismissal procedures, and it has further implications for employers who choose to suspend individuals rather than to dismiss them. Indeed, the case confirms that it may likely be more certain and financially beneficial for employers to choose to dismiss an individual rather than to potentially invoke greater costs and damages awards by choosing to suspend.