Mutual termination after theft caught on camera: misconduct, not redundancy
Two process operators with 16 years' service who signed a mutual termination agreement after being caught stealing copper were not entitled to redundancy payments, the tribunal ruled.
2 min read · Last updated 18 May 2026
Case details
- #theft-of-copper
- #mutual-termination
- #redundancy-payment
- #out-of-time
- #gross-misconduct
Key facts
- Both claimants were employed as Process Operators for 16 years.
- In May 2021, video evidence showed the claimants removing copper from a reel and placing it in bags, later loading them into a car.
- On 1 June 2021, the claimants were given the choice of signing a mutual termination agreement or being dismissed for gross misconduct and reported to the police.
- The claimants signed the mutual termination agreement and their employment ended that day.
- The respondent entered creditors voluntary liquidation in October 2021.
Timeline
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Respondent purchased Nottingham Cables Limited
ATAG Cables & Tapes Ltd purchased Nottingham Cables Ltd, a cable manufacturer. The previous owner, Mr Burrows, was retained as a consultant.
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Trackers identified visits to scrapyard
Trackers on a company vehicle showed Mr Burrows had twice visited a local scrapyard, leading to an internal investigation into theft of copper.
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Mr Burrows admitted to removing copper
Mr Burrows admitted that copper was being removed in small amounts and the proceeds shared among the workforce. The respondent allowed him to continue working but ordered him to stop the theft.
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Camera fitted in factory
A camera was installed in the factory for insurance purposes.
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Copper bags found hidden
Mr Wilson reported finding several 25kg bags of copper hidden behind a machine. Video footage showed the claimants removing copper from a reel and placing it in bags, later loading them into Mr Burrows' car.
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Claimants signed mutual termination agreements
The claimants were given the choice of signing a mutual termination agreement or being dismissed for gross misconduct and reported to the police. They signed the agreement and their employment ended.
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Second claimant started work with Cable and Taping UK Limited
The second claimant began working for Cable and Taping UK Limited on a subcontract for the respondent's only remaining contract. He left on 10 June 2021.
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Respondent entered creditors voluntary liquidation
ATAG Cables & Tapes Ltd entered creditors voluntary liquidation.
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Preliminary hearing on time limits
Employment Judge Varnam struck out most claims as out of time, except the first claimant's claim for unpaid wages on 1 June 2021.
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Final hearing on redundancy claims
Employment Judge Cansick heard the claimants' statutory redundancy payment claims over two days.
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Judgment dismissing redundancy claims
The tribunal dismissed the redundancy claims, finding the reason for dismissal was misconduct, not redundancy. The first claimant's wage claim was upheld by agreement for £90.60.
The legal issue
The tribunal had to decide whether the claimants were dismissed by reason of redundancy (entitling them to a statutory redundancy payment) or by reason of misconduct, which would disentitle them.
The outcome
The tribunal dismissed the claimants' claims for statutory redundancy payments.
Key reasons:
- The claimants were caught on video removing copper from a reel and placing it in bags, later loading them into a car.
- They were given the choice of signing a mutual termination agreement or being dismissed for gross misconduct and reported to the police.
- The tribunal concluded that the reason for dismissal was misconduct, not redundancy, so no redundancy payment was due.
The first claimant's claim for unpaid wages on the final day was upheld by agreement for £90.60.
Lessons & takeaways
- If you are caught committing gross misconduct, signing a mutual termination agreement does not automatically entitle you to a redundancy payment.
- The reason for dismissal is key: if it is misconduct, you lose entitlement to statutory redundancy pay, even after long service.
- Employment tribunal claims must be brought within strict time limits (usually three months minus one day from the dismissal date) or they will be struck out.
- If your employer is in liquidation, pursuing claims can be more difficult, but you can still bring a claim against the company.
When a 'mutual' termination is really a dismissal for misconduct
Two process operators with 16 years' service were caught on video removing copper from a reel and placing it in bags, later loading them into a car. When confronted, they were given a stark choice: sign a mutual termination agreement or be dismissed for gross misconduct and reported to the police. They signed, and their employment ended immediately.
Later, they claimed they were entitled to statutory redundancy payments, arguing that the real reason for their dismissal was redundancy. But the tribunal disagreed. The evidence showed that the employer had clear grounds to believe they had stolen copper, and the mutual termination agreement was effectively a dismissal for misconduct. The reason for dismissal was not redundancy, so no redundancy payment was due.
What the employer did right
The employer had installed cameras for insurance purposes and had previously investigated theft of copper. When the video evidence emerged, they acted swiftly. Offering a choice between a mutual termination and a gross misconduct dismissal is a common approach, but it does not change the underlying reason for the dismissal. The tribunal accepted that the employer genuinely believed the claimants had committed theft, and that belief was reasonable based on the video footage.
Why this matters for similar claims
This case highlights that a mutual termination agreement does not automatically convert a misconduct dismissal into a redundancy. Employees who sign such agreements should understand that they are still being dismissed for the underlying conduct, and that this will affect their entitlement to redundancy payments. It also reinforces the importance of bringing claims within the strict time limits: most of the claimants' other claims were struck out as out of time.
For employees facing similar situations, the key takeaway is that the reason for dismissal is determined by the facts, not the label. If you have been caught committing misconduct, signing a 'mutual' agreement will not give you a right to redundancy pay.
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