Inappropriate email sent by Leeds United director five years ago found to be breach of contract

The High Court has determined that Leeds United was entitled to summarily terminate the employment of their technical director when they discovered an inappropriate email containing pornographic images that he had sent to colleagues over five years earlier.  By terminating the employment contract on these grounds, Leeds United avoided paying around £200,000 of notice pay and other benefits.

23rd April 2015

Inappropriate email sent by Leeds United director five years ago found to be breach of contract

The High Court has determined that Leeds United was entitled to summarily terminate the employment of their technical director when they discovered an inappropriate email containing pornographic images that he had sent to colleagues over five years earlier.

By terminating the employment contract on these grounds, Leeds United avoided paying around £200,000 of notice pay and other benefits.

 

Background

When the technical director joined the club in 2006 he agreed his terms of employment in discussions with the club’s chairman.  His terms were never committed to writing but included an entitlement to a 12 month notice period.

Unbeknown to the individual, shortly before his dismissal the club had instructed a firm of forensic investigators to analyse the individual’s computer in an attempt to uncover any evidence of misconduct which would have allowed the club to dismiss him without notice to avoid the 12 month pay-out.

Around the same time, an internal restructure was taking place and the individual was given notice of redundancy, no evidence of misconduct having been discovered at that stage.

The next day, the investigators uncovered an email (sent over five years earlier) containing pornographic images.  The email had been sent by the individual using work email to a friend at another club and to his own personal account.

The club instigated a disciplinary hearing.  The individual did not attend the hearing, and was subsequently dismissed for gross misconduct without notice.  He appealed, but the dismissal was upheld.  Having lost out on the remainder of his 12 month notice pay, the individual sued for damages in the High Court.

It came to light during the court action that the email had also been sent to a junior, female employee at the club and to another of the individual’s friends.  The club relied on an existing legal rule which states that, if an employer learns of serious misconduct after a dismissal has taken place, it can still rely on this misconduct to justify the dismissal for the purposes of a wrongful dismissal claim for notice monies.  Therefore, the High Court allowed the club to rely on the conduct, taken as a whole, in justifying their decision to dismiss.

Findings of the High Court

The High Court dismissed the individual’s claim and held that his actions in sending the email were serious enough to amount to a breach of the implied term of trust and confidence by the individual.  It was held that this constituted a repudiatory breach of contract allowing the club to summarily dismiss him.

In reaching its decision, the court took into account the individual’s level of seniority at the club and the fact that the images went beyond harmless and inoffensive.  Interestingly, the court also considered that sending the images to a junior, female colleague could have caused offence and could have led to a harassment claim (even though, given the passage of time, it was clear that no such claim had arisen).

The court acknowledged that the club’s reputation was important and that this matter (and a harassment claim in particular) could have opened the club up to public and media attention which could have adversely affected its reputation.  The court also accepted the importance of sponsorship in the modern football game and that sponsors would be cautious about associating with a football club if that might risk damaging their own reputation.

A word of caution

The facts of this case are unusual in that Leeds United deliberately commissioned a ‘fishing exercise’ in order to find evidence of misconduct.  Given the level of compensation sought, the claim was brought in the High Court as a damages claim (relating to the notice monies only) rather than as an unfair dismissal claim in the employment tribunal (where compensation in respect of unfair dismissal claims would have been capped at around £75,000 and damages for breach of contract relating to the notice monies capped at £25,000).

If the individual had brought an unfair dismissal claim in the employment tribunal, the deliberate targeting by the club is likely to have raised the eyebrows of the tribunal panel when considering whether or not the dismissal was reasonable in all of the circumstances. This could potentially have led to the dismissal being found to be unfair.  In addition, the club would not have been able to rely on the evidence discovered after the dismissal in order to justify the fairness of the dismissal after the event.

Therefore, any employer seeking to undertake a similar exercise should proceed with caution.  Exercises of this nature could lead to unfair dismissal claims. Depending on the search methods applied, they could also create additional issues if the employee’s right to privacy is breached or the data protection principles are not complied with.