Last reviewed 17 October 2018

Suspension in the workplace in relation to disciplinary investigations is a serious step which should not be undertaken lightly. Engin Mustafa, lecturer in employment law at Kingston University, examines various aspects of the law regarding suspension and illustrates each aspect with reference to relevant case examples. He outlines the law on suspension in the workplace in relation to disciplinary investigations and provides the legal precedence that underpins the key questions that HR practitioners face.

When to suspend

The Acas Code of Practice 1 (2015) informs employers that when seeking to establish the facts of a case there may be some instances where “… a period of suspension with pay is considered necessary…” (paragraph 8).

The Code does not, however, state what circumstances make it necessary nor when suspension would be appropriate. For guidance on this, we need to look at the Acas guide on Discipline and Grievances at Work (2017). By way of example, the guide identifies such instances where suspension is necessary while investigation takes place. These are:

  • where relationships have broken down

  • in gross misconduct cases

  • where there are risks to employee’s or the company’s property or responsibilities to other parties

  • where there are reasonable grounds for concern that evidence has been tampered with, destroyed, or witnesses pressurised before the meeting.

Informing the employee

In McClory v Post Office [1992] the contract of employment contained the following clause: “In the event of misconduct or where there is a need for inquiries to be made into alleged misconduct you may be suspended from your employment, either with or without pay”. The employee claimed that it was implied in the contract that any suspension of an employee should only follow once the employee had received full information from the employer as to the reason for the suspension.

David Neuberger QC (sitting as a deputy High Court judge) held that such a term was not implied and gave illustrations of potential examples where it would be inappropriate to inform the employee of why they had been suspended. Such cases include where it is alleged that threats have been made or that the police have divulged information to the employer in confidence pending police investigation. There was also no implied term that there should be a balancing of interests between the employer and the employee when exercising the power to suspend.

However, there was an implied term that the employer must exercise the right to suspend and continue with suspension on reasonable grounds.

Authority to suspend

Hanley v Pease and Partners Limited [1915] provides precedence that an employer does not have the power to suspend an employee as part of the disciplinary process unless this is expressly conferred in the contract of employment.

The case of D & J McKenzie Ltd v G Smith [1976] stated that: “An employer is not entitled unilaterally to suspend his employee unless there is some provision — express or implied — in the contract of employment permitting him to do so”.

Therefore, a contractual power must exist to suspend and although this can be implied, or based on custom and practice, given the seriousness of the action, it is preferable to have this as an express term.

In Gogay v Hertfordshire County Council [2000], the Court of Appeal needed to determine if Hertfordshire County Council had acted reasonably when suspending a care worker pending an investigation which subsequently revealed there was no case to answer.

In this case, the Court at paragraph 59 of the judgment said of the local authority’s “knee-jerk” action of suspension, that it had breached “… its implied obligation not, without reasonable and proper cause, to act in a way which seriously damaged the relationship of confidence and trust between them”.

It was suggested that other alternative actions to suspension could have been contemplated, eg a short period of leave or a transfer to other duties.

Ms Gogay was awarded damages both for her loss of earnings and her psychiatric illness caused by her suspension.

Milne v Link Asset and Security Co Ltd [2005] held that “The suspension of an employee did not automatically mean that an employer had acted in breach of the implied duty of trust and confidence. In order to determine whether a suspension constituted a breach of the implied duty of trust and confidence, it was necessary to consider the surrounding circumstances in which that suspension had been imposed”.

In Crawford and Another v Suffolk Mental Health Partnership NHS Trust [2012] where nurses were accused of using inappropriate methods of patient restraint, Elias LJ at paragraph 71 stated: “This case raises a matter which causes me some concern. It appears to be the almost automatic response of many employers to allegations of this kind to suspend the employees concerned, and to forbid them from contacting anyone, as soon as a complaint is made, and quite irrespective of the likelihood of the complaint being established”. Elias LJ went on to reiterate the views of Hale LJ in Gogay v Hertfordshire County Council [2000] that suspension is not automatically justified even when evidence supports an investigation.

Elias LJ also commented on the negative psychological impact of suspension even if an employee is cleared of any charges.

The seriousness with which the courts treat suspension has been demonstrated in their intervening to lift this. In Mezey v South West London and St George's Mental Health NHS Trust [2007] the Court of Appeal demonstrated that it has powers to grant injunctive relief to an employee and stay suspension of employment. Sedley LJ said at paragraph 18 “There seems to me to be no reason of principle why the court should be without power, if in all the other circumstances it judges it right to do so, to stay a suspension just as it may stay a dismissal. Each is capable of being a breach of contract, the one no doubt more fundamental than the other, and each is capable of not being fully compensable in damages”.

Duggan M [2003] states: “… there is no power on the part of an employer to suspend an employee in order to ‘think matters over’” (Pirie & Hunter v Crawford [529/78, EAT]), again restricting the times where suspension can be used by employers.

Suspension as a neutral act

Mezey v South West London and St George's Mental Health NHS Trust [2007] also clearly rebuts the notion that suspension is “a neutral act preserving the employment relationship”. In his judgment, Sedley LJ at paragraph 12 stated “… at least in relation to the employment of a qualified professional in a function which is as much a vocation as a job. Suspension changes the status quo from work to no work, and it inevitably casts a shadow over the employee's competence. Of course this does not mean that it cannot be done, but it is not a neutral act”.

In the recent case of Agoreyo v London Borough of Lambeth [2017], the appellant, a teacher, used force on children who were difficult to control. She was suspended in relation to the degree of force used. On the same day that she received notification of her suspension she resigned. The High Court considered that the suspension of a teacher amounted to a repudiatory breach of the implied term of trust and confidence, concluding that the county court had erred in holding that the London Borough of Lambeth was “bound” to suspend. Her so-called “resignation” had amounted to a constructive dismissal.

Although Ms Agoreyo’s suspension letter quoted at paragraph 20 of the judgment contained the sentence: “The suspension is a neutral action and is not a disciplinary sanction. The purpose of the suspension is to allow the investigation to be conducted fairly”, the view of the court was that suspension was not a neutral act and endorsed the view in Mezey v South West London and St George's Mental Health NHS Trust [2007].

The law is clear following Mezey v South West London and St George's Mental Health NHS Trust [2007] that suspension is not a “neutral” act, as it casts a shadow over the employee's competence. All other options should be considered before suspending, as was made clear by the Court of Appeal in Gogay v Hertfordshire County Council [2000]. Suspension should not be a “knee-jerk” reaction and alternatives should be considered.

In East Berkshire Health Authority v Matadeen [1992] the EAT judgment identified that: “Suspension is undoubtedly a stigma, an indication that the employee is under suspicion and it seems to them that good industrial practice does not require suspension in every case. It would be extremely unwise, save in obvious cases, to draw any inference or conclusion from the suspension or a lack of suspension”. This case again reiterates the negativity attached to suspension but also that, whether it takes place or not, suspension should not be used to infer how serious the alleged misconduct may be.

Pay and suspension

As previously noted Code of Practice 1 identifies that it may be necessary to suspend with pay. The Discipline and Grievances at Work: The Acas Guide (August 2017) — indicates that exceptionally, suspension can be without pay and that this must be provided for in the contract of employment. The guidance qualifies this: “Special consideration should be given before imposing disciplinary suspension without pay. It must be allowed for in the worker’s contract of employment, and no suspension should exceed the maximum period set out in the contract. It must not be unreasonably prolonged since it would then be open to the worker to take action for breach of contract or resign and claim constructive dismissal” (paragraph 7).

The respective cases of Devonald v Rosser & Sons [1906] and Hanley v Pease and Partners Limited [1915] provide the precedence for an employee being entitled to wages for a period of suspension; this entitlement extends to a period of notice required to terminate the contract of employment.

The case of Minnevitch v Café de Paris (Londres) Ltd [1936] qualifies the above where an employer had an implied right to suspend without pay where circumstances arose that were beyond the employer’s control. In this case a cabaret was closed for six days after the death of King George V; resulting in musicians not being paid as they did not perform. The court held that the closure of the business was reasonable for two days, but the musicians were entitled to be paid for the other four days of closure.

An employer therefore needs to provide clearly in the contract of employment if they wish to suspend without pay.

In TM Jones v British Rail Hovercraft Ltd [1974], Mr Jones was the subject of a precautionary suspension pending a police investigation regarding a charge of theft. This was without pay. He claimed that this constituted dismissal. This was rejected by the tribunal stating: “That the suspension without pay was for an indefinite period could not be said to have transformed its effect into a dismissal. It is quite reasonable for an employer to take precautionary steps to protect his property in case there is any substance in the allegations under investigation, while on the other hand avoiding prejudging issues”.

In Batty v BSB Holdings (Cudworth) Ltd [2002], the Court of Appeal held that if there is an express term that remuneration will be withheld, there is no obligation to pay the suspended employees if they are not ready and willing to work.

However, what if the employee is willing to work? The following case provides guidance to the law. In Bird v British Celanese Limited [1945], Scott LJ in his judgment said: “The clause operates in accordance with its terms; the whole contract is suspended, in the sense that the operation of the mutual obligations of both parties is suspended; the workman ceases to be under any present duty to work, and the employer ceases to be under any consequential duty to pay”.

Thus, the position in relation to suspension where an express term exists in relation to this taking place — with or without pay — is that the obligations and rights of employees and employers are frozen; therefore the right to payment is also frozen.

Suspension without pay, unless in the absence of such an express term, would be a repudiatory breach of contract and potentially a claim for constructive dismissal.

Bosworth v Angus Jowett & Co Ltd [1977] provides an interesting dimension. Here, Mr Bosworth (a sales director) had an implied term that he had a right to work. By denying him this he was unable to contribute to the company’s profitability upon which his bonus would be based and potentially could damage his reputation. Therefore, though he was being paid and treated as though still employed for the remaining four months of his contract, failure to provide work constituted dismissal. Therefore, when dealing with senior managers it is worth considering such potential obligations.

Financial loss as a result of suspension

In the House of Lords case of Eastwood v Magnox Electric plc [2004] Lord Nicholls stated at paragraph 29: “Exceptionally, financial loss may flow directly from the employer's failure to act fairly when taking steps leading to dismissal. Financial loss flowing from suspension is an instance. Another instance is cases such as those now before the House, when an employee suffers financial loss from psychiatric or other illness caused by his pre-dismissal unfair treatment. In such cases the employee has a common law cause of action which precedes, and is independent of, his subsequent dismissal”.

Therefore, employees can potentially seek to claim financial losses resulting from unfair treatment pre-dismissal which encompasses suspension. This would not necessarily be restricted to financial loss as a result of illness but could extend to loss resulting from reputational damage.

Concluding guidance

Allegations need to be very serious to justify suspension. The impact of suspension should be carefully considered and alternatives sought. Employers should only use suspension with reasonable and proper cause. It should be made clear that suspension is not a disciplinary sanction.

The right to suspend needs to be given in the contract of employment. Ideally, this should be through an express contractual term. Normally, this will be with full pay unless a provision in the contract clearly provides for it to be without pay.

The courts do not view suspension as a neutral act. The absence of a colleague following suspension will inevitably lead to speculation from others. Suspension is a serious step and can undermine mutual trust and confidence in the employment relationship. Therefore, employers should seek to maintain confidentiality to avoid reputational damage for the individual. Similarly, employers should be mindful of the impact that suspension can have on the employee’s wellbeing.

The employee does not need to be informed as to why they are being suspended, but failing to inform them without good reason may potentially undermine the employee/employer relationship. Employees should be informed of the likely duration and revisions to this time period where possible. The duration of the suspension should be as brief as possible and kept under review.

The options open to a suspended employee who wishes to challenge suspension are to:

  • seek injunctive relief to stay a suspension

  • resign claiming constructive dismissal as a result of the employer breaching the implied term of trust and confidence.

Note 1: The scope of this article does not extend to suspension on medical/maternity grounds or suspension as a disciplinary sanction.

Note 2: This article is provided for general purposes only. It does not constitute legal or other professional advice. Appropriate legal advice should be sought for specific circumstances and before action is taken.

List of cases

McClory v Post Office [1992] ICR 758

Hanley v Pease and Partners Limited [1915] 1 KB 698

D & J McKenzie Ltd (appellants) v G Smith (respondent) [1976] IRLR 345

Gogay v Hertfordshire County Council [2000], Lexis Citation 3231 All England Official Transcripts (1997–2008)

Milne v Link Asset and Security Company Ltd [2005] All ER (D) 143 (Sep)

Crawford v Suffolk Mental Health Partnership NHS Trust [2012] EWCA Civ 138

Mezey v South West London and St George's Mental Health NHS Trust [2007] EWCA Civ 106 CA

Agoreyo v London Borough of Lambeth [2017] EWHC 2019 (QB)

East Berkshire Health Authority v Matadeen [1992] ICR 723

Devonald v Rosser & Sons [1906] 2 KB 728

Minnevitch v Café de Paris (Londres) Limited [1936] 1 All ER 884

TM Jones v British Rail Hovercraft Ltd [1974] IRLR 279

Batty v BSB Holdings (Cudworth) Ltd [2002] EWCA Civ 648, [2002] All ER (D) 390 (May)

Bird v British Celanese Limited [1945] K.B. 336

Bosworth v Angus Jowett & Co Ltd [1977] IRLR 374

Eastwood and another v Magnox Electric plc; McCabe v Cornwall County Council and others [2004]