Tribunal ruling illustrates how an employer’s position on providing a regulatory reference could influence the outcome of a tribunal order to re-engage an employee who has been unfairly dismissed.
The tribunal did not consider what would happen if the respondent fails to comply with the tribunal’s order for re-engagement.
In Bradley Jones (claimant) v JP Morgan Securities plc (respondent), case Number: 3201630/2020 V heard at the London East Hearing Centre, UK, before Judge S. Knight, an employment tribunal (ET) ordered a bank to re-engage a trader it had unfairly dismissed and to pay him more than £1.5 million (HK$11 million) in lost salary and benefits for the period between dismissal and re-engagement. The tribunal held that the claimant had been unfairly dismissed for alleged gross misconduct: it found that the employer did not have a genuine belief in misconduct having occurred and that the procedure adopted was also unfair. This finding did not change the employer’s position that it would provide a regulatory reference stating that it did not consider the claimant to be a fit and proper person. The claimant sought a reinstatement or re-engagement order.
Jones was a financial analyst and cash equities trader employed by JP Morgan (JPM). JPM dismissed him on 31 January 2020, alleging gross misconduct following an incident of suspected "spoofing" that had occurred in 2016. Spoofing is a form of market manipulation, where a trader makes a bid or offer with the sole intention of cancelling it before execution, in order to create a misleading impression about the demand or supply of a particular commodity. It is a criminal offence and a breach of regulatory rules. Jones was alleged to have engaged in spoofing in one afternoon in 2016.
JPM had investigated the alleged incident at the time but decided that it did not warrant disciplinary action. Following the introduction of a new spoofing policy and an internal Market Conduct Review in 2019, JPM decided to re-investigate the alleged incident. Following a short disciplinary procedure, where Jones said he could not remember details of the relevant trades, he was dismissed for gross misconduct and brought a claim for unfair dismissal in the ET.
The ET found that the true reason for dismissal was not misconduct and the dismissal was unfair. JPM did not have a genuine belief in Jones' misconduct in January 2020. It had not carried out a reasonable investigation, given its size, and the dismissal would have been unfair on procedural grounds even if JPM had had a potentially fair reason to dismiss Jones.
A remedies hearing took place subsequently. Jones sought reinstatement or re-engagement, in addition to compensation for lost earnings. He contended that he would not get a job elsewhere because, among other reasons, JPM had said it would provide a regulatory reference stating that it did not consider him to be a fit and proper person to perform the role.
JPM argued that Jones did not want to be reinstated or re-engaged and that it was simply a way to maximise his compensation by side-stepping the cap on unfair dismissal compensation. JPM also argued that it was not practical for Jones to be reinstated due to the fact there had been redundancies in his team. Furthermore, when he had been dismissed, JPM had not sought to replace him, with his work being absorbed by the wider team. Jones identified a suitable role with an associated employer in Hong Kong, indicating that he was willing to relocate. The new role was comparable to the role from which he had been dismissed and he would be working in a new team.
The ET found that if re-engagement was not awarded, Jones would not be able to work in a regulated role in the financial services sector in the UK due to the negative regulatory reference provided by JPM. Given that JPM is a global organisation with more than 250,000 employees, re-engagement would work. On this basis, the ET decided that the re-engagement order was the only way that Jones' unfair dismissal could be "made right" and so it ordered re-engagement to the Hong Kong role within three months. The ET also awarded Jones over £1.5 million in compensation for lost earnings, including his base salary, incentive compensation, and a fixed award.
This case is interesting because it deals with the implications of a bank stating that it would provide a negative regulatory reference, even though the ET had found that the dismissal was unfair and the reason given for it was untrue. Because the respondent had indicated that it would provide an adverse regulatory reference for the trader, despite the finding of unfair dismissal, it would mean that Jones would not be able to find a similar job in the UK. The employment tribunal therefore ordered the respondent to re-engage the trader at an associated employer in Hong Kong.
The ET judgment will have international reach so it is significant for global businesses. The ET decided to make a re-engagement order that is seeking to bind a Hong Kong-based JPM entity. If JPM fails to comply with the re-engagement order, there are likely to be practical difficulties in enforcing the order. The fact that the ET was willing to countenance requiring an international business to re-engage an individual in an overseas company is an interesting move, and one that should be watched by organisations with international clout.
Finally, the case highlights the perils of re-opening a previously concluded investigation where a decision was made not to take disciplinary action, even if that might be desirable to appease a regulator.
Takeaways for employers and HR practitioners
Despite Jones' win at the ET, he may find he has difficulties if he leaves JPM because there is nothing to prevent JPM from issuing a negative regulatory reference in the future. Furthermore, there is no way of appealing against the decision that an individual lacks fitness and propriety. This may be something that regulators will need to address, given the issues this case has highlighted.
JPM may decide to appeal the ET's decision, given the significant compensation awarded, so there may be more useful commentary on this case in the future.
撰文：Daisy Watson，Womble Bond Dickinson (UK) LLP律師; Jo Martin，Womble Bond Dickinson (UK) LLP合夥人; 及Karen Plumbley-Jones，Womble Bond Dickinson (UK) LLP執業律師
在英國東倫敦審裁中心由S. Knight法官審理的Bradley Jones（索償人）訴JP Morgan Securities plc（答辯人）一案中（案件編號：3201630/2020 V），僱傭審裁處（employment tribunal）判令一家銀行再次聘用一名被其不公平解僱的交易員，並向該交易員支付超過150萬英鎊（1100萬港元），以賠償其於解僱至再次聘用期間的薪酬和福利損失。審裁處認為，索償人因被指稱涉及嚴重不當行為而被不公平解僱，然而僱主對其相信發生的不當行為並無實證，所採取的程序也不公平。此裁定並無改變僱主在監管參考中訂明索償人不是合適及適當人選的立場。 索償人尋求判令其復職或獲再次聘用。
Jones（下稱鍾斯）是JP Morgan（JPM）聘用的金融分析員和股票交易員。JPM於 2020 年 1 月 31 日解僱鍾斯，指稱他在 2016 年涉嫌「炒作」，構成嚴重不當行為。炒作是一種造市手法，交易員開價買入或沽出，唯一目的是在成交前取消交易，從而對某一商品的需求或供應造成虛假市況。 這是一種刑事罪行，並違反監管規則。鍾斯被指稱在 2016 年某日下午從事炒作。
僱傭審裁處認為，由於JPM提供負面監管參考，如果不再次聘用鍾斯，鍾斯將無法在英國金融界獲得受監管認可的職位。鑑於JPM是一家擁有超過 25萬名員工的全球機構，再次聘用有關僱員實屬可行。據此，僱傭審裁處裁定再次聘用是「糾正」不公平解僱鍾斯的唯一方法，並頒令在三個月內在香港予以再次聘用。僱傭審裁處還授予鍾斯超過 150 萬英鎊的收入損失補償，其中包括他的基本薪酬、獎金和固定獎賞。