Warwick Legal Network

UK: Re-employment orders as a route to bypass unfair dismissal cap


In the recent case of Bradley Jones -v- JP Morgan Securities plc 3201630/2020, JP Morgan was ordered to re-employ a senior employee dismissed for gross misconduct following a finding that the termination amounted to unfair dismissal . Rather than seek compensation, the claimant had applied for reinstatement of employment and thereby sidestepped the unfair dismissal compensation cap.


Mr Jones was employed by JP Morgan as a Financial Analyst and Cash Equities Trader between 19 August 2011 and 31 January 2020 when he was dismissed for alleged gross misconduct relating to a series of trades on 6 January 2016. On that day Mr Jones had entered and deleted in quick succession two sell orders (‘the 2016 Sell Orders’) for shares in Logitech International.

JP Morgan’s surveillance systems immediately identified the 2016 Sell Orders as potential market abuse. On 20 January 2016 Mr Jones was interviewed by JP Morgan’s management about the 2016 Sell Orders. No further action was taken against Mr Jones at the time. However, on 9 December 2019 (almost four years later) Mr Jones was suspended and later invited to a disciplinary meeting in respect of the 2016 Sell Orders. On 31 January 2020 Mr Jones was summarily dismissed for alleged gross misconduct, because of the 2016 Sell Orders.

Mr Jones issued a claim against JP Morgan for unfair dismissal, arguing that the real reason for the dismissal was not the alleged gross misconduct but instead that JP Morgan had changed its approach to the 2016 Sell Orders following a 2019 Department of Justice investigation into the bank’s precious metals trading in the US. Since the investigation, JP Morgan had taken significant steps to improve its compliance procedures and Mr Jones was allegedly dismissed as part of the bank’s efforts to be seen to satisfy regulators.


The Employment Judge found no evidence of misconduct and held that JP Morgan had adopted an inconsistent approach to Mr Jones’s conduct and thereby acted unreasonably. The Judge noted that it was glaringly inconsistent for JP Morgan to exonerate Mr Jones in 2016 and then find him culpable 4 years later. In 2016, JP Morgan had held that Mr Jones’s conduct was not suspicious and did not warrant formal disciplinary action but then later decided, in January 2020, that the conduct in 2016 did merit dismissal for gross misconduct after all. Further, the Judge also concluded that the almost 4-year delay in bringing disciplinary proceedings against Mr Jones was manifestly unfair.

Remedies for unfair dismissal

In almost all unfair dismissal cases the remedy a successful claimant is awarded is financial compensation. The amount of compensation that can be awarded is capped at around £95,000 (April 2021 figures) except in certain limited circumstances – none of which applied in this case.

There are in fact two other remedies available for unfair dismissal but these are very rarely used, namely re-instatement and re-engagement (essentially orders for re-employment). Mr Jones, who earned significantly more than the unfair dismissal cap – in 2014 alone he reportedly earned more than £650,000 – applied for reinstatement. At the remedies hearing in December 2021, the Judge ordered that Mr Jones should in fact be re-engaged by JP Morgan and accordingly his employment must now be treated as having never been terminated. This means that not only is JP Morgan required to re-engage Mr Jones on his basic salary of £220,000 per year it must also pay to Mr Jones arrears of salary arising since 31 January 2020 when the bank dismissed him. In this case,

A re-employment order will not be suitable in all cases but we are likely to see more requests for these orders following the outcome of this case. Accordingly, employers should not be lulled into a false sense of security that the unfair dismissal cap will serve as a disincentive for high-earning employees to issue proceedings for unfair dismissal – this case has shown that uncapped compensation for unfair dismissal is possible through the backdoor with a re-employment order.


For further information, please contact:

Sara Kennedy , Legal Director

ebl miller rosenfalck, London

e: moc.rm-lbe@ydennek.aras

t: +44 (0)7875 299 438


#WLNadvocate #London #England #UK #law #lawfirm #legal #business #employmentlaw #companylaw

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