Corporation & Business Law Case Study: Employee Laptop Loss Analysis

This case study analyzes a situation at ABC Limited, where an employee lost a laptop containing confidential company information. The study discusses the relevant employment laws in the United Kingdom, particularly the Employment Rights Act 1996, focusing on unfair dismissal and justifiable reasons for termination. It outlines the steps available to the HR directors, Richard and Ali, in addressing the situation, emphasizing the need for a fair and lawful process, including serving a notice, conducting an investigation, and providing the employee with an opportunity to present their case. The study also details the procedural steps for handling misconduct, including potential suspension and disciplinary hearings, while adhering to the terms of the employment contract. The study concludes by providing actions Richard and Ali must take to resolve the issue legally and ethically, balancing the company's interests with the employee's rights.

Running head: CORPORATION AND BUSINESS LAW
Corporation and Business Law
Name of the Student
Name of the University
Author Note

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Facts
The facts of the case involve ABC limited is a company based in London, formed by Richard
Smith and Mehmet Ali. The company is consists of a workforce of one hundred and fifty
employees, and the company has allowed its employees to continue working from anywhere.
They do not maintain any stringent policy of carrying out their work within the office
precincts. One of the employees of the company lost his laptop while returning home and he
has informed the HR about this event. The laptop, which has been lost contained certain
confidential pitches that were needed by the employee for delivering a presentation in front of
Richard and Ali that afternoon. The employee left the matter there with the HR, who
suggested him to do the same and did not undertake any other step in the furtherance of the
same. This incident has been informed to the HR directors Richard and Ali from where the
problem cropped up. Richard wanted a straightaway dismissal for the employee, while Ali
opined in retaining the employee because of the experience possessed by him.
Relevant Employment Laws
The laws relating to employment is in the United Kingdom is governed by the Employment
Rights Act 1996. In pursuance of section 94 of the Act, an employee is protected from a
dismissal, which has been effected unfairly. However, section 95 of the Employment Rights
Act 1996 mentions certain circumstances where the employer is justified to dismiss an
employee avoiding incurrence of any liability being the dismissal being an unfair one. The
circumstances can be enumerated as follows:
• In case the dismissal has been effected in pursuance to the termination of the employment
contract, based on which the employment has begun in the first place, by the employer.

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• In case the employment has been created under limited-term contract and the termination
of that contract took place because of limiting event and any renewal of the contract absent.
• In case the contract effecting the employment has been terminated by the employee
because of the misconduct extended by the employer and the situation points towards such a
termination.
The Act also contains provisions for circumstances under which the employee needs to be
dismissed. These circumstances are:
• In case the employee has been served with a notice in which the intention of the employer
to terminate that employee has been mentioned.
• The contract of employment has been terminated by the employee, the employee has
served the notice, before the expiry of the employer's notice.
However, in these cases, the reason for which the employment has been terminated needs to
be mentioned.
The Act also provides the employees with a protection against unfair dismissal by the
employer. It also provides for the instances where the dismissal amount to unfair dismissal.
Those instances are:
• When the employer dismisses the employee without furnishing any fair reason for such
dismissal.
• When the dismissal was not in compliance with the required procedure in which it was
supposed to be done.
• Where the reason provided for such dismissal is unfair.

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However, the employer in dismissing his employee must furnish the reason for which the
dismissal needs to be effected. A statement in writing providing particulars relating to the
reasons for the dismissal of the employee needs to be served upon the employee. The notice
of dismissal needs to be furnished to that effect to the employee. The employee must be
provided with a compensation for the dismissal. The amount of such a compensation will be
depending upon the circumstances of the situation.
Under the employment laws, prevalent in the United Kingdom, there are certain grounds on
which dismissals are rendered to be unfair. These grounds can be listed as follows:
• In case a dismissal is effected because of pregnancy and maternity related issues, it is
considered to be an unfair dismissal.
• In case a dismissal is influenced by family reasons, it will be considered to be an unfair
dismissal. Family reasons include paternity leave, parental leave, time off for dependants and
adoption leave.
• In case an employee is dismissed for acting as a representative for the employees, it will
be considered to be an unfair dismissal.
• In case the reason for the dismissal of an employee is his membership in the trade union
or his recognition in the trade union, then such a dismissal would be considered to be an
unfair one.
• A dismissal of a fixed-term employee without furnishing proper reason for such dismissal
will be considered to be an unfair dismissal.
• Any dismissal, which has been effected for a reason connected to payment and working
hours of the employee will be considered to be an unfair dismissal.

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An employer dismissing any of his employees under these grounds will be liable for the
commission of unfair dismissal. Unfair dismissal of an employee will render the employer to
be liable for payment of compensation to the employee and will impose a penalty upon the
employer. The same can be explained with the case of British Home Stores Ltd v Burchell
[1978] ICR 303. However, this Act protects employees who are employed for a continuous
period, preferably one year.
However, there are certain instances where dismissals effected would not be rendered unfair.
These grounds are:
• In case a dismissal has been effected by an employer for the reason of misconduct
committed by the employee, it will be considered to be a dismissal, which is fair.
• In case a dismissal is backed by the inability or insufficient qualifications of the employee
for the job, the employer will not be held liable for unfair dismissal.
• A dismissal owing to redundancy is also considered to be justified, and the same would
not amount to an unfair dismissal. Redundancy implies a condition where the work that the
employee was hired for to perform ceases to exist or has been reduced owing to a situation.
• In case an employment has been prohibited owing to statutory restriction or duty, the
employer is justified in dismissing the employee and the same will not be rendered to be an
unfair dismissal.
• A dismissal would not be considered to be an unfair one if the same has been effected
owing to a reason which justifies such a dismissal.
In case an employer has decided to dismiss an employee, he needs to effect the same
following a procedure, which is in conformity with the employment laws prevalent in the
United Kingdom. In this context as an HR the following steps I would suggest:

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• The first thing that an employer is required to proceed with is to furnish the employee
with a notice regarding the same. The same can be illustrated with the case of Gisda Cyf v
Barratt [2010] UKSC 41 .
• The notice, thus submitted needs to mention the reason owing to which the dismissal has
been initiated.
• The person upon whom the notice for dismissal has been served, needs to be provided
with a chance of presenting his side. The same can be explained with the case of Iceland
Frozen Foods Ltd v Jones [1982] IRLR 439 .
• After taking notice of the reasons provided by the employee, the employer has the option
of either dismissing the employee or retaining him after considering the reasons provided by
the employee. The same can be explained with the case of Ford v Warwickshire CC [1983] .
• An appeal by the employee must be allowed against the formal decision.
Section 10 of the Employment Relations Act 1999, required the employees to be
accompanied at disciplinary or grievance hearings. The individual accompanying the
employee can be either a fellow employee or a trade union.
In case a dismissal has been initiated for the reason of a misconduct performed by the
employee, the following procedure needs to be followed:
• An investigation examining the performance of the misconduct, its degree and the
expectations that are connected to the employee must be carried out.
• The employee must be consulted with discussing the instance.
• A training and support of other kinds need to be considered.
• A review of periods and a setting of new targets need to be effected.

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• A fair amount of warnings needs to be provided to the employee.
• Alternatives other than dismissal needs to be considered before arriving at the decision of
the dismissal.
• The employee must be provided with the right to appeal.
In case a misconduct has occurred on the part of the employee and the instance has been
brought to the notice of the employer, the employer has the option of considering suspension.
The suspension must be followed by an investigation. In pursuance to the investigation, the
employer must collect evidence regarding the same. A disciplinary meeting needs to be held
regarding the same and a reasonable notice of such a notice needs to be served upon the
employee. The decision arrived at may result in a warning to the employee, a dismissal of the
employee or any other decision as deems fit in the given circumstances.
The procedure of dismissal must also be effected in conformity with the terms of the
employment contract, which has been entered into at the time of initiating the employment.
Steps Available to Richard and Ali
In this case, the company allowed its employees to work from anywhere, even from outside
the office premises. This conferred the employees with a right to carry confidential
information outside the office precincts for working. However, the employees carrying the
information or any property belonging to the company needs to exercise a reasonable care in
handling them. They are incurred with the right to protect the information or properties
belonging to the company both during the office premises and outside the office precincts.
However, the employee has lost the laptop containing confidential information to be
presented to the HR directors Richard and Ali. This has made the information exposed to the
risk of being leaked that might cause harm to the company if used by some other individual.

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Again, the same has been communicated by the employee to the HR of the company. This
points towards the carelessness of the employee regarding the protection of the information.
The communication of the same to the HR, however, proves the good faith of the employee.
It points towards his lack of intention to cause harm to the company. In such a situation,
• The first thing that the company should do is to serve a notice upon the employee.
• The notice needs to contain the reason of such a notice.
• The employee must be provided with a chance to present his side.
• An investigation must be effected examining the conduct in question.
• The employer must be given a fair chance to present his side.
• Evidences needs to be collected regarding the same.
• A disciplinary hearing can be held against the employee.
• The employee against whom such a hearing has been arranged, needs to be accompanied
in the same.
• The employee can be accompanied either by a trade union or by a fellow employee.
• The hearing may provide the company with an option of either the dismissal of the
employee or extending a warning to him.
• The employee must be given a chance to prefer an appeal against the same.
Steps Richard and Ali must Take
Richard
Richard wanted to dismiss the employee straight away. In that context, Richard should serve
a notice upon the employee. He should hear the side of the employee and his view on the

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same. The Richard must be made aware of all the legal and HR policies regarding the same.
In this present situation, the employee has been negligent in taking good care of the
information accessible to him on behalf of the company. This made the dismissal of the
employee to be considered. However, the negligent act has been committed by the employee
for the first time. The employee was not of the intention to lose the information. Moreover,
the employee has a considerable amount of experience, which is of significant value to the
company. This demands the company to retain the employee owing to the value he adds to
the company. Again, Richard cannot dismiss the employee as the same does not amount to
gross misconduct on the part of the employee.
Ali
Ali wanted to retain the employee owing to his experience. In the present situation, Ali
should serve a notice upon the employee and investigate the matter carefully. Ali should be
aware of all the legal and HR policies regarding the same. The employee has been negligent
in taking good care of the information accessible to him on behalf of the company. Ali must
verify whether the conduct of the employee is not a reckless one. In this case, the conduct of
the employee was not a reckless one. Owing to this the employee needs to be retained.
However, the employee must be served with a fair notice regarding the negligent conduct that
he has committed and needs to be prohibited from doing the same in the future.
How to deal with the employee
The employer must retain the employee while serving him with a fair warning about the
negligent act that he has committed and suggest him to refrain from the same in the future.

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Reference
British Home Stores Ltd v Burchell [1978] ICR 303
Ford v Warwickshire CC [1983]
Gisda Cyf v Barratt [2010] UKSC 41.
Iceland Frozen Foods Ltd v Jones [1982] IRLR 439
The Employment Rights Act 1996