A Fair Deal at Work

For many years the damages available to an employee in a wrongful dismissal action have been somewhat limited. A conservative approach to the question of measure of damages has prevailed and the recoverable heads of damage have been restricted. In particular, damages for injury to feelings and reputation have not been available. The House of Lords decision in Malik v BCCI [1998] AC 20, where the plaintiffs were held to be entitled to compensation for the damage the dismissals caused to future employment prospects, has resulted in a significant change in the law. The decision in Malik comes at a time when the law of the employment contract is undergoing significant change. Perhaps the most notable instance of this has been the emergence of the implied obligation of mutual trust and confidence; that obligation being central to the plaintiffs case in Malik. Against that background this article considers whether further reform of the damages available in a wrongful dismissal action might usefully take place. It is argued that, for reasons of public policy, the law should aim to compensate fully an employee who has been wrongfully dismissed. This would involve a radical re-thinking on the approach to measure of damages. It would also require a change in the position on compensation for injury to feelings