P claimed that because of the (humiliating) manner in which he was sacked, his professional development and mental health were damaged. He argued that the manner of his dismissal breached the term of mutual trust and confidence. HL rejected this, saying that Parliament only intended limited compensation for being dismissed unfairly (whether on unfair substantive grounds or in an unfair procedure), and it would be to circumvent parliamentary legislation to imply a common law duty of mutual trust and confidence to the dismissal procedure. For the same reason a tort-based claim was also rejected. NB This means that while unfair suspension can lead to a claim for breach of the mutual obligation (see Gogay), unfair dismissal procedure cannot.
Lord Hoffmann: Common law implied terms have been instrumental in revolutionising how we treat employment law (not merely in same way as rest of contract law), but cannot be used to circumvent parliamentary intention/legislation. In other scenarios (i.e. for breach of a term not in the context of dismissal) injured feelings, mental distress, and damage to reputation can be compensated (just not here).
Lord Steyn (dissenting): The statutory remedy for unfair dismissal is inadequate, e.g. where job prospects are seriously harmed. He said that just because parliament provided some rights to employees does not mean that other rights cannot be implied where there is no contradiction between the two.