The Claimant, who was a Team Leader working in recycling, tested positive for cannabis as part of a random drugs test. He was dismissed following a disciplinary hearing on the basis that he was under the influence of drugs which affected his performance. An appeal was unsuccessful. The ET held that the Claimant was unfairly dismissed because, among other matters, the Respondent paid no or insufficient regard to mitigating factors, it was not the Claimant's job to drive a van, there was no impairment of the Claimant's performance at work and the dismissing manager had obtained evidence about the treatment of comparable cases from an HR employee who was not wholly objective. The EJ also criticised the reliability of the test result. The EJ went on to find that there should be no reduction to compensation (i) based on Polkey v AE Dayton Services Ltd [1988] ICR 142 or (ii) owing to contributory conduct under s122(2) and s123(6) of the Employment Rights Act 1996. The Respondent appealed.

The EAT allowed the appeal in relation to the unfair dismissal decision, therefore rendering the other grounds otiose (although the EAT did deal with them also). The ET had wrongly substituted its own findings in deciding that the cannabis did not affect the Claimant's performance and it was not his job to drive a van, rather than focussing on the reasonableness of the employer's belief about these matters. While the Tribunal was entitled to have regard to the failure of the Respondent to have regard to mitigating factors, it also substituted its own judgment in criticising the reliability of the drugs test in considering that the information about comparators was tainted by the lack of objectivity of the source. On the question of the Polkey deduction, the Tribunal's reason that the involvement of the HR employee "went to overall fairness but not to a consideration of a Polkey reduction" could not be reconciled with principles on Polkey summarised in Software 2000 Limited v Andrews [2007] ICR 825. The Tribunal also erred in relation to contributory conduct, by reasoning that the Claimant would not have been dismissed if the Respondent had acted in accordance with its own policies. First, there is no causation test in s122(2), on the basic award. Second, s123(6) requires a tribunal to examine the actual conduct of the Claimant and ask itself if that conduct caused or contributed to the dismissal, and not to answer the different question of whether a claimant would have been dismissed if the Respondent acted reasonably, fairly or in accordance with its own policies.