The Claimant resigned from the Respondent business after the company withheld bonus payments that were due to him, suggesting that this was a straightforward case of constructive unfair dismissal. The Respondent subsequently discovered information that led it to allege that the Claimant had been guilty of serious misconduct, namely setting up a rival business with a colleague and the "theft" of confidential information. The ET concluded that the Claimant was guilty of misconduct, and apparently jumped from finding the facts in respect of the Claimant's misconduct to making a nil award of compensation without adequately explaining the steps that it took to reach that conclusion. On the perversity point, the Claimant queried whether it had been open to the ET to make a finding of theft in the absence of any evidence that confidential information had actually been taken from the Respondent.

The EAT dismissed the perversity point. However, it found that the ET failed to properly identify the issues relating to compensation which arose in respect of the basic award and the compensatory award and, consequently, it did not set out how and why it had reduced the basic award and compensatory award to nil.