The claim
In the case of Glenn Cowie v Vesuvius Plc (and others), a senior executive of a global FTSE 250 engineering company has been awarded £3.2 million after winning an unfair dismissal, whistle blowing, victimisation and direct age discrimination claim.
Mr Cowie was employed at Vesuvius Plc for around 40 years. He was the company's Global Business Unit President and his annual salary was circa £315,000 although his overall package was significantly higher.
At the time of his dismissal, Mr Cowie was 58 years old and he alleged that Vesuvius had, "institutional and deep prejudices against older employees" and that Mr Andre, the CEO of the company was intent on getting rid of "older" employees and replacing them with staff under 45 years old. Despite this, Mr Cowie's replacement was 51 years old.
Mr Cowie alleged that in a meeting in February 2018, Mr Andre (the CEO) informed senior managers that, "these new millennials will never stop pushing until they have my job and you older guys have to get used to it" and at the same meeting, referred to Mr Cowie as an "old fossil" and said that he "did not know how to manage millennials".
In May 2018, the company started a policy encouraging managers not to recruit new candidates who were over 45 years old. Mr Andre communicated to his recruitment agent that he would prefer "a bright 40-year-old with a bit less experience...than an experienced 50 year old who will not really contribute to the overall group succession issue".
The Global Vice President of Finance was a witness in the hearing and stated that Mr Andre had said in several meetings in 2018 that the organisation needed to "get younger."
A series of conflicts arose between Mr Cowie and Mr Andre, leading to Mr Cowie being placed on garden leave on 02 September 2019 until his termination on 01 March 2020. Mr Cowie expressed within his witness statement that, "it is hard to describe fully the mental anguish that I suffered as a result of the company's treatment. It was severe and lasting. I had devoted 37 years of my life to the company. I lost confidence. I felt very low. In late 2019 I suffered deeply depressive and anxious periods that I had never had before."
Mr Cowie won his claims for unfair dismissal, age discrimination and victimisation.
Award
As well as reminding businesses that their employees need to be careful of the language they use in the workplace, this case shows just how expensive Tribunal claims can be for employers when they do not get it right given this is one of the largest Employment Tribunal awards in recent history.
As a result of winning Mr Cowie was able to claim for – a) financial losses and b) 'injury to feelings'.
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Financial losses:
As Mr Cowie was successful with his age discrimination and victimisation claim his financial losses were uncapped. Whereas, if he had only been successful with his unfair dismissal claim his financial losses would have been capped at the lower of 52 weeks' pay and the relevant statutory cap (which is currently £115,115 for dismissals after 6 April 2024). Winning his discrimination claims therefore hugely increased Mr Cowie's potential award.
Mr Cowie was awarded £1.38 million for net financial losses. The reason for this high award was because Mr Cowie's case was that had he been treated as a good leaver (rather than having been dismissed), he would have retired at age 63 and if he had not had the benefits of departing as a good leaver, he would have retired at 65. The Tribunal therefore had to assess the likelihood of this and thus what Mr Cowie should be awarded.
The Tribunal found there was a 15% chance that Mr Cowie would have retired as a good leaver on 30 April 2020, a 25% chance that he would have retired as a good leaver on 30 April 2023 and if he did not retire on either of those two dates he would have retired on 30 April 2024 as a good leaver. He was therefore awarded his basic salary for these time periods reduced by these percentages. His financial losses were reduced by a further 10% on the basis that his employment could have ended at any time without it being discriminatory and for reasons other than him being a good leaver.
In addition, to his basic salary the financial losses also included a bonus he would have received before he decided to retire, relocation costs (he had been required to relocate from the US to the UK prior to his dismissal), dividends and benefits.
ACAS uplift: where performance is said to be the reason for dismissal employees can claim an uplift of up to 25% on their financial losses where their employer unreasonably failed to follow the ACAS Code of Practice on Disciplinary and Grievance procedures. Similarly, employers can claim a 25% decrease on an employee's unreasonable failure to follow the ACAS Code of Practice on Disciplinary and Grievance procedures. As a result, Mr Cowie was awarded an additional £1,900 as the company failed to follow any form of disciplinary process and did not follow any grievance process after he raised a grievance.
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Injury to feelings:
injury to feelings awards can be made for successful discrimination claims. The level awarded relates to the impact of the discriminatory conduct on the individual. There is no exact science to how injury to feelings awards are calculated, but they are based on three bands. The bands are updated each April to take account of inflation. The current bands are:
- a lower band of £1,200 to £11,700 (for less serious cases);
- a middle band of £11,700 to £35,200 (for cases that do not merit an award in the upper band); and,
- an upper band of £35,200 to £58,700 (the most serious cases), with the most exceptional cases capable of exceeding £58,700.
The Tribunal assessed Mr Cowie's injury to feelings as being in the middle band and awarded him £20,000. He was also awarded interest at 8% from the date of his dismissal (1 August 2019) of £5,431.23.
When assessing the award for injury to feelings the Tribunal took into account what Mr Cowie had said in his witness statement about the impact on him. This included Mr Cowie suffering a "deeply depressive and anxious period" that he had never had before; requiring medical treatment for his heart and; being prescribed medication to help with his anxiety and sleep.
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