Real estate agency wins wrongful dismissal suit brought by bankrupt employee
Anyone working in financial services will be aware of the requirement for persons performing regulated functions to be “fit and suitable”. Clearly this is going to include strong personal finances and demonstrable honesty and integrity. The EAT ruled that a real estate agent who was fired for going bankrupt and failing to notify his employer was being fired fairly.
Mr Pubbi was employed as a financial consultant by Your Move, a real estate agent which also offered mortgages and other insurance products. Your Move was an appointed representative for First Complete Limited, which was authorized by the FCA. He fell into financial difficulties while on unpaid sick leave. He did not inform his employer of his bankruptcy and since they were regulated by the FCA they took it very seriously and fired him for gross misconduct. Mr Pubbi argued that this was unfair as he was not under a contractual obligation to inform them and it was not mentioned in the company handbook. The EAT decided that, despite this lack of an express obligation on its part, “he knew, or should have understood, that he (his employer) would regard his bankruptcy as a serious matter and would have expected him to disclose it, and that he deliberately did not”. The bankruptcy called into question his financial strength and his failure to disclose it to his employer called into question his honesty. Therefore, the dismissal for gross misconduct was fair.
While some might say that it is obviously reasonable for a regulated employer to impose a high sanction on an employee who behaves in this way even in the absence of express contractual provisions, the situation may not have been equally clear to an unregulated employer or an employee in another type of role. As such, this case is a salutary reminder of the sensitivity of any employer to make express provisions in contracts and policies to avoid ambiguity and uncertainty about an employee’s obligations of conduct. But especially if the employer wants to impose an equivalent standard of “fitness and propriety” on employees in addition to those specifically required to meet such a standard.
An employment tribunal has found Your Move did not unfairly fire a former financial consultant after he failed to file for bankruptcy.