24.03.15 Reasonable Investigation - Shrestha v Genesis Housing Association Ltd

A recent employment appeal tribunal hearing in the case, Shrestha v Genesis Housing Association Ltd [2015], demonstrates the limit to the obligation placed upon an employer in proving the fraudulent claiming of expenses by an employee.

The claimant was dismissed for gross misconduct after he was found to have over-claimed mileage expenses fraudulently. His claims for unfair dismissal and wrongful dismissal were dismissed by an Employment Tribunal and his appeal to the EAT was also dismissed.

The employee Rajendra Shrestha was dismissed for gross misconduct following an investigation into his mileage claims prompted by an audit that had revealed that his claims were significantly in excess of various route planners recommended mileage for the relevant journey. He explained these discrepancies were caused by diversions due to roadworks, one-way systems and parking difficulties.

The Court of Appeal considered if the employer was required to examine each individual explanation and journey as part of the investigation. It concluded that it did not, given that some mileage claimed was almost double that detailed by the AA and RAC. It also concluded that the disciplinary hearing had given the employee the opportunity to put forward all of his defence and therefore, the Court concluded that the Employment Tribunal had directed itself correctly. It was considered that the actions taken by the employer by way of investigation and the reasons for no further investigation were acceptable to reach the conclusion that a reasonable investigation had been carried out.

The Court of Appeal dismissed the appeal, specifically rejecting the argument that, if an employee raises several lines of defence, the employer must investigate each of them.

View the full case law here.