Zen Internet v Stobart: Key lessons on capability dismissals and the Polkey principle
26 November 2025
The decision in Zen Internet v Stobart provides further clarity on the approach to capability dismissals, senior-executive procedures and the correct application of the Polkey principle.
Mr Stobart, the Chief Executive of Zen Internet, was dismissed on capability grounds after concerns arose about his performance. No formal procedure was followed prior to the dismissal. The employment tribunal accepted that capability was the genuine reason for dismissal but found the dismissal procedurally unfair. Applying Polkey, it concluded that a fair process would still have led to dismissal within approximately two months of the date on which notice was in fact given, allowing sufficient time for a meeting, a decision and an appeal. Compensation was therefore limited to losses covering that short period.
Zen appealed, arguing in particular that the tribunal had wrongly confined its Polkey assessment to the period following the dismissal itself. The Employment Appeal Tribunal upheld the appeal on this point. It held that the tribunal had erred in taking the dismissal date as the starting point and in asking only how much additional time would have been required from that moment for a fair process to result in the same outcome. The correct approach required the tribunal to consider the position from the time at which the employer’s concerns crystallised, which in this case was more than three weeks before notice was given. By ignoring this earlier period, the tribunal had artificially constrained the analysis of when a fair dismissal would likely have occurred. The matter was therefore remitted for reconsideration.
A second ground of appeal concerned the argument that, given Mr Stobart’s seniority, following a procedure would have been futile, such that dismissal could fairly have taken place immediately. The EAT rejected this contention. Although there are exceptional cases in which an employee’s seniority or the nature of the role may justify a truncated process, this was not one of them. The tribunal had been entitled to conclude that a fair procedure should still have been followedand that the employer could not rely on seniority alone to dispense with standard procedural safeguards.
The judgment underlines several points of practical importance. Employers must take care to situate Polkey analyses within the full timeline of emerging concerns, rather than anchoring the assessment to the dismissal date. Seniority does not displace the requirement for a procedurally fair process, and cases where consultation or an opportunity to respond can be bypassed remain rare.
For senior executives and employers alike, the decision reinforces the need for transparency, early communication of concerns and adherence to fair procedures even at the highest organisational levels.
If you need advice on handling capability concerns or ensuring your dismissal procedures are legally robust, contact our Employment team at Backhouse Jones.
This article was written by Gabrielle Scriven.
