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	United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Telelift (UK) Ltd v. Cherrington [2001] UKEAT 937_00_0911 (9 November 2001) URL: http://www.bailii.org/uk/cases/UKEAT/2001/937_00_0911.html Cite as: [2001] UKEAT 937_00_0911, [2001] UKEAT 937__911

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APPEARANCES

 

For the Appellants	MISS J McCAFFERTY (of Counsel) Instructed by: Ms T Dolan Messrs Eversheds Solicitors 115 Colmore Row Birmingham B3 3AL
For the Respondent	MR B CARR (of Counsel) Instructed by: Ms Caroline Bates Messrs Rowley Ashworth Solicitors Wimbledon London SW19 1SE


 


JUDGE A WILKIE QC

1. This is an appeal by Telelift (UK) Ltd against a Decision of the Employment Tribunal sitting at Southampton on 25 May last year in which the Tribunal, having unanimously decided that the Appellant unfairly dismissed, Mr Cherrington, ordered Telelift to pay him a compensatory award of £36,981 and a basic award of £6,555.
2. The Appellants were represented at the Tribunal hearing by Mr Phillips, their Managing Director. A Notice of Appeal was lodged against the Tribunal Decision, dated 19 July. It spans seven pages and appears to be a letter which is taken from an earlier application for a review, but nonetheless, serves as a Notice of Appeal.
3. The appeal at that stage was both against the Decision of unfair dismissal, as well as certain elements in the compensatory award. There is nothing in that Notice of Appeal to suggest, even by implication, that the Appellant was seeking to raise what is colloquially known as a Polkey argument - that is to say that the Tribunal should have engaged in an exercise to try to decide what the outcome might have been, had a fair procedure been adopted in what the Tribunal had accepted was a redundancy situation.
4. The appeal came before a different panel of this Tribunal for a preliminary hearing on 20 March this year. Once again, Mr Phillips represented the Appellant. The Tribunal concluded that the grounds of appeal, insofar as they attacked the finding of unfair dismissal, contained no reasonably arguable case and therefore dismissed the appeal as to unfair dismissal.
5. In paragraph 9 of the preliminary hearing Decision they expressed some concern about the issue of compensation. They indicated that they were surprised that greater consideration was not given by the Tribunal as to whether an employee who was sixty two would necessarily inexorably continue to work to sixty five, either at his wish or alternatively in the light of the company continuing to wish to employ him to that length of time.
6. They then went on to say that there was no consideration that to compensate someone for three years payment ahead is to accelerate the benefits they thereby receive. They went on to say that they were somewhat concerned whether the Tribunal had in fact confused the net payments of Mr Cherrington and gross payments. It was Mr Phillips' contention that any monies already received would have to have been paid net, as that is a requirement of tax law in the construction industry, save and except if there is an exemption certificate.
7. They also thought there was an arguable case on the question of expenses, an element of which was included in the compensatory award. Accordingly, they gave leave for issues on compensation to proceed to a full hearing before this Tribunal.
8. Following that Decision on 22 January of this year, the Appellants submitted amended grounds of appeal in which they raised specific arguments. The first concerned what was headed "Loss of Income" which appears to be the argument based on, amongst things, whether the payments received by Mr Cherrington, or to be received by Mr Cherrington should have been treated as net or gross.
9. There was a heading in respect of "Tax Free Subsistence Allowance" and concerning "Expectation of Employment". There is, once again, nothing in that section which in our judgment, whether expressly or implicitly, raises the Polkey point, indeed the concluding submission was that to allow loss of income for a three year period was excessive and an error of judgment and that a maximum of one year should be allowed. That is inconsistent with any suggestion that there is a Polkey point where the argument is whether, within a very short space of time, given the opportunity to carry through a proper procedure, there would have been, inevitably, a fair dismissal in which case the compensation would be reduced to a matter of weeks, or there would be have been the loss of a chance, in which case the overall figure would have been reduced by a proportion. The fact that the argument was that one year's loss of earning at most should have been awarded, is plainly to do with the question of the likelihood that someone aged sixty two would have continued in the same employment through until they were sixty five.
10. There is also some reference to interest on compensation, which we assume is a reference to a discount for accelerated payment. The Appellants, perhaps unduly late in the day, sought legal assistance for the purposes of conducting this appeal and we have had the benefit, on both sides, of legal argument, Mr Carr for the Respondent to the appeal, and Miss McCafferty for the Appellants, and we are greatly indebted to both of them, both for their Skeleton Arguments and the diligence of their research and the clarity of their submissions.
11. The main point run by Miss McCafferty before us, has been the Polkey point. She acknowledges that it was not a point raised below and with the exception of a suggestion that there is perhaps some implicit reference to it in the amended Notice of Appeal, it is the case that it does not appear in either the original or the amended Notice of Appeal. It was not a matter considered by this Tribunal at the preliminary hearing. She acknowledges that, in those circumstances, it is only in exceptional cases that we can permit a new argument to be raised on appeal which was not addressed to the Tribunal below, even if the failure to do so was on the basis of the lack of professional expertise of experience of the representative.
12. The Decision of the Tribunal was, indeed, that there was a redundancy situation, but that nonetheless, the dismissal of Mr Cherrington was unfair. The circumstances were that Mr Cherrington had been employed by the Respondent as an Installation and Maintenance Manager. He had worked for them for nineteen years. In the autumn of 1999, the Respondent was taken over by Swisslog Telelift and the Managing Director, Mr Phillips, was required to consider ways of saving money, and one of them was by way of redundancy amongst his engineering staff.
13. On 11 October 1999, Mr Cherrington was informed by Mr Phillips of the takeover and he enquired whether that might affect job security. Notwithstanding the fact that the issue of redundancy was being actively considered by Mr Phillips, he was found by the Tribunal to have been told by Mr Phillips that there would be no problem. On 26 November, Mr Cherrington attended a meeting with Mr Phillips to discuss the security of his position and the engineers who were employed by the Respondent under his management. Again he was reassured by Mr Phillips that the engineering jobs were safe, as was his job, as their manager. To put it at its most charitable, this seems to have been disingenuous in the extreme.
14. At some point between 26 November and 17 December, Mr Phillips did decide to make Mr Cherrington redundant, however he decided not to inform Mr Cherrington until after Christmas. Upon returning after Christmas, Mr Phillips became aware that Mr Cherrington's immediate subordinate, a Mr Quick, had given in his notice. Mr Phillips needed to retain one or other, of Mr Quick or Mr Cherrington, and therefore he delayed announcing to Mr Cherrington his redundancy until the position with Mr Quick was resolved. The Tribunal made explicit findings of fact that although Mr Cherrington was not enthusiastic about accepting day to day responsibility for certain matters governed by Mr Quick, he would have done so had he been informed that the effective option was redundancy, and would have undergone the necessary training to enable him properly to perform the work which was heretofore performed by Mr Quick. Mr Phillips did not bother himself with any of this, rather he acted to retain Mr Quick in employment, notwithstanding his resignation, by means of offering Mr Quick increased remuneration. As a consequence, Mr Quick withdrew his resignation and Mr Cherrington was dismissed by reason of redundancy, his managerial functions now being performed by Mr Quick.
15. The Tribunal, though accepting that there was a redundancy situation, concluded that the dismissal was unfair. There was a wholesale failure to adopt anything like a fair procedure and, as we have indicated, the procedure, if that what it was, adopted was characterised by secrecy, subterfuge and disingenuousness on the part of the Respondent's Managing Director. As Mr Carr indicated in his Skeleton Argument, it is hard to see how much more unfair the redundancy dismissal could have been.
16. We have been referred to a series of authorities of the Employment Appeal Tribunal, sitting respectively in Scotland and in England on the question whether an Employment Tribunal is always under an obligation where there is an unfair redundancy to raise for itself the Polkey question. Miss McCafferty is unable to say that there is always such an obligation. She says, however, that where the Tribunal accept that the position held by an employee has disappeared, but the dismissal is unfair for procedural reasons, and the Tribunal proceed to assess compensation on the basis that the dismissal would not have taken place, but that the employee would have remained in employment for the remainder of his working life, it is either a manifest error of law or a failure to reveal the proper reasoning behind their conclusion for the Tribunal to fail to consider Polkey, even where it has not been referred to in argument before it. She says that this is so in this particular case, notwithstanding the fact that as a matter of general principle, that may not be the case.
17. It seems to us that simply cannot be right in this case. The Tribunal had carefully set out the facts and had made its findings of the manifest failures on the part of management. We have been referred to a number of cases, but in particular to the Court of Session decision in the case of King v Eaton Ltd [1998] ILRA 686 in which it is pointed out that there is a world of difference between a finding of unfairness, where it is manifest that there has been a blip in a procedure, where it is not a difficult exercise of speculation for a Tribunal to consider what might have happened had the blip not occurred, and, at the other end of the scale, where there has simply been a wholesale failure to adopt anything like a procedure, let alone a fair one, where a Polkey exercise would be re-inventing the world as it ought to have been, or embarking on a sea of speculation, which is an utterly unrealistic exercise to expect a Tribunal to embark upon, whether invited to do so, as it was in the King v Eaton Ltd case, or not invited to do so, as is the case here.
18. It is our judgment that the facts in this case fall very much on the end of the factual spectrum which would have made it utterly unrealistic for any Tribunal, whether asked or not, to have embarked on such a sea of speculation, and there is certainly no error of law or necessary failure to indicate the reasons for its decision in the Decision of this Tribunal in holding both that there was a redundancy situation and that the decision to dismiss Mr Cherrington was unfair, but nonetheless to hold that had he not been so dismissed, the likelihood was that he would have remained in employment with the Respondents. That essentially deals with the main point of Miss McCafferty's appeal.
19. The other points raised concern the question whether it was erroneous or perverse of the Tribunal to conclude that Mr Cherrington would have remained in employment with the Respondents for a further three years. Once again, in our judgment, there is nothing in this point. The evidence before the Tribunal, which it accepted, was not only that Mr Cherrington was anxious to remain in employment with his employer, but that he had been loyally employed by them for nineteen years; he was prepared to be flexible and be retrained to do, in particular, Mr Quick's job if Mr Quick had no longer been there to do it, and that at the age of sixty two, unsurprisingly, the job market was very tight and there was no basis whatever to suggest that he would have been looking for opportunities elsewhere. In the light of that, and given that the period of employment involved was a mere three years, we can see nothing wrong in the Decision of the Tribunal in that respect.
20. Of the remaining points, the point of accelerated payment is accepted by Miss McCafferty as being a novel point raised on appeal and not raised below. She accepts that there are no exceptional circumstances to enable us to hear it. She seeks to introduce it on the back of the other, the main points - the Polkey point and the three years point - essentially on the basis that if we found in her favour on that, then the matter would have to go back to the Tribunal for a fresh assessment, and they might as well assess everything.
21. Having decided against her on the two main points, consistent with that argument, we decide that she is not entitled to raise that new argument before us. Even if it were a point of substance, we can see nothing wrong with the approach that the Tribunal took, bearing in mind, once again, that the period concerned was a short one - namely three years.
22. The next point concerns the addition to the Applicant's loss of a sum which he was contractually entitled to receive by way of a daily subsistence payment when he worked away from his base, but not overnight, the sum being £11 a day. That was something which he put in his IT1 as being part of his remuneration. Miss McCafferty accepts that it was not raised as a point before the Tribunal that it should not be part of his remuneration at all. From the way in which the Notice of Appeal was drawn up, and the application for a review, it appears that the point that was being made was that "Well, he was on holiday sometime" and therefore it was wrong to have awarded him £11 a day for the full period without having any regard to any holiday period, during which he would not have been working away from home. In our judgment it is a trivial point and one which does not merit consideration, it not having been raised below.
23. As for the other point, namely the question whether the Tribunal erred in assessing Mr Cherrington's post-termination earnings and likely earnings on a gross rather than a net basis, even if it were the case that there were some evidence before the Tribunal that Mr Cherrington did not at that time have the necessary certification to enable him, as a construction industry subcontractor, to receive payments gross rather than net, it appears that it was never argued that the sum that he did receive for work of electrical installation, and the business that he was doing as a self-employed electrical contractor, would be subcontract work, attracting that special regime.
24. The point, therefore, is a novel one and it depends on us accepting as accurate, an assertion that he must have been employed as a subcontractor under this regime. There was no evidence before the Tribunal about that. If they had sought to argue that, they should have raised it then with evidence to support it. We are not prepared to act on a bare assertion from appellants put forward in this way and therefore, in our judgment, there is nothing in this point of the appeal either.
25. Therefore, taking the points of appeal individually and together, we can find no errors of law in the Tribunal's Decision; we can find no inadequacy in the reasoning supporting the Tribunal's Decision so as to accede to Miss McCafferty's extremely able and ingenious submissions, and therefore we dismiss this appeal.