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A duty to mitigate

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A previous article has discussed unfair dismissal, a recent case Kelly v University of Southampton has emphasised the duty placed on the wronged employee to ensure that they mitigate their losses following such dismissal. As in all compensation claims, an employee who has been unfairly dismissed is under a duty to take reasonable steps to mitigate their loss. An employee cannot recover compensation for loss caused by the dismissal if such loss was avoidable. The loss would be considered avoidable if reasonable steps could be taken to avoid it. Dr Kelly was dismissed from her job in early 2005 over concerns that she was being employed illegally due to her immigration status. However, it was held by the Employment Appeal Tribunal (EAT) that this amounted to unfair dismissal as a criminal offence would not have been committed had she continued to work for the university. The Employment Tribunal (Tribunal) reconsidered the case and made two key findings. Firstly, that Dr Kelly had failed to mitigate her loss by failing to apply for either of two vacant posts in the university. Therefore, the Tribunal held that her award for loss of earnings should be limited to 30th June 2005 (the date upon which the Tribunal decided she would have been appointed to one of the posts had she taken the reasonable step of applying). And secondly, the Tribunal considered whether she failed to mitigate her loss by not applying for a number of vacant posts which the university had found at other universities. The Tribunal's finding on the first issue made this second issue academic (as her losses had already been limited to 30th June 2005), but it held that had her losses not already been limited they would have been limited to 31st January 2006 (the date at which she would have been appointed to a post with a similar salary at another university). On appeal, the EAT upheld the Tribunal's decision. Employees who think that they have been unfairly dismissed should therefore strive to ensure that they take all reasonable steps to minimise the loss caused by their employer's breach. The onus of showing that the claimant has failed to take reasonable steps to mitigate their loss rests on the party in breach, therefore employers facing a claim of unfair dismissal should ensure that they notify their former employee of their duty to mitigate their loss and retain any evidence of suitable alternative employment that they have made aware of. • For additional information please contact: Alexandra Dean of Gepp & Sons. The above is not legal advice; it is intended to provide information of general interest about current legal issues.