The Claimants, who both worked for the Respondent, were dismissed after it was discovered that, on numerous occasions, one of them signed the other in and out of the building, in contravention of the Respondent's fire safety policy. They claimed in the ET that they had been unfairly dismissed, and the majority (lay members) held that the matters complained of amounted to misconduct rather than gross misconduct, but that the Claimants' conduct warranted a reduction in the basic and compensatory awards of one-third; the minority view (the EJ) was that the Claimants' actions constituted a serious breach of health and safety procedure, and so the dismissals were fair. The Respondent appealed on various grounds, including that the ET majority had erred in substituting their views for that of the reasonable employer.

The EAT held that the ET majority had erred in law by failing to apply the correct test when assessing the question of fairness under s 98(4) Employment Rights Act 1996 (ERA). It would not be appropriate for the EAT to substitute its view for that of the ET, since it was for the ET to determine the fairness of a dismissal for s 98(4) ERA purposes, and the case would be remitted to a fresh ET.