Employer entitled to dismiss consultant who didn’t disclose bankruptcy   

An Employment Tribunal has ruled that an estate agent was entitled to dismiss a financial consultant for failing to disclose his bankruptcy, despite the absence of an express policy requiring such disclosure.    

Joanne Stronach Director and Head of Employment & HR reports on this recent case.

Mr K Pubbi was employed as a financial consultant by Your-Move.co.uk, an estate agency which also arranges mortgages and offers various insurance products.    

Pubbi took an extended period of unpaid sick leave, which caused him financial difficulties and ultimately led him to declare bankruptcy.    

He did not inform Your-Move of his bankruptcy, but it was discovered by a member of the HR team when carrying out a Google search.    

One of Pubbi’s clients terminated his authorisation to carry out work on its behalf with immediate effect on the basis that he was not a ‘fit and proper person’ to do so and his failure to disclose contravened the Financial Conduct Authority Handbook.    

Following an investigation and disciplinary hearing, Your-Move dismissed Pubbi for gross misconduct on the basis that he had failed to notify it that he had been declared bankrupt and failed to be able to carry out his role due to his loss of authorisation with his client.    

Pubbi contended that the FCA Handbook requirement to disclose bankruptcy did not apply to him because he worked in Your-Move’s estate agency division.    

However, Your-Move upheld the dismissal on appeal, concluding that it set its standards higher than that required by the FCA rules and guidance. Pubbi claimed unfair dismissal.     

The Employment Tribunal ruled in favour of Your-Move, finding that the principal reason for dismissal was Pubbi’s failure to disclose his bankruptcy, which amounted to misconduct.    

The Employment Appeal Tribunal upheld that decision. It was not decisive that there was no express contractual provision requiring disclosure. Your-Move was entitled to think that Pubbi ought to have appreciated that he would be expected to disclose something of that sort.    

For more information about the issues raised in this article or any aspect of employment law please contact Joanne on 01228 516666 or click here to send her an email.