Appeal No. UKEAT/0531/11/KN
EMPLOYMENT APPEAL TRIBUNAL
FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8JX
At the Tribunal
On
11 July 2012
Before
HIS
HONOUR JUDGE McMULLEN QC
SIR ALISTAIR GRAHAM KBE
MR R LYONS
NETWORK
RAIL INFRASTRUCTURE LTD APPELLANT
MR
W M MOCKLER RESPONDENT
Transcript of Proceedings
JUDGMENT
SUMMARY
UNFAIR DISMISSAL – Reasonableness
of dismissal
The Employment Tribunal did not err in
finding the Respondent unfairly dismissed the Claimant for misconduct in
failing to observe trackside safety rules. The EAT would not interfere with
its findings: Fuller v London Borough of Brent [2011] IRLR 414,
Bowater v Northwest London Hospitals NHS Trust [2001] IRLR 331, Salford
Royal NHS Foundation Trust v Rolden [2010] IRLR 721, per Elias LJ, Gayle
v Sandwell & West Birmingham Hospitals NHS Trust [2011] EWCA Civ 924, per Mummery LJ, London Ambulance Service NHS Trust v Small [2009] IRLR 563, per Mummery LJ, Orr v Milton Keynes Council [2011] EWCA Civ 62, Oso v Newham University NHS Trust [2011] EWCA Civ 1425 and Henderson v LB Hackney [2011] EWCA Civ 1518. The
principles have most recently and authoritatively been rationalised in Arriva
Trains v Conant UKEAT2011 0043/11 at paras 23-34, in Crawford v Suffolk Mental Health Trust by Elias LJ [2012] EWCA 138 and Graham v DWP
[2012] EWCA Civ 903 applied.
The Employment Tribunal did not cite
the statute or any authority, so creating a risk of error, but it plainly
upheld the employer on BHS v Burchell, yet finding permissibly
that the decision to dismiss was outside the range of reasonable responses.
It gave no reasons for finding 50%
contribution: Greenwood v NWF Retail Ltd
UKEAT/0409/09. This is remitted to the same Employment Tribunal to take the
decision again and give reasons.
HIS HONOUR JUDGE McMULLEN QC
Introduction
1.
This is an appeal by the Respondent in those proceedings against the
judgment of an Employment Tribunal chaired by Employment Judge Kloss which sat
for a day and considered its judgment for a day in private and sent it to the
parties on 11 July 2011.
2.
The Claimant was represented by different counsel and today has the
advantage to be represented by Mr Bruce Henry of counsel, the Respondent
throughout has been represented by Ms Rebecca Thomas of counsel.
3.
The Claimant claimed he was unfairly dismissed by the Respondent, which
denied unfairness, and asserted it had dismissed him fairly having carried out
a fair procedure. It also contended that if it were found to have unfairly
dismissed him, the Claimant contributed to his own dismissal to the extent of
100% and it would not be just and equitable to make any award in his favour.
4.
The Tribunal upheld the Claimant’s claim but found that he was guilty of
contributory fault to the extent of 50%. A hearing is now awaited on remedy
and we understand from the Schedules of Loss exchanged that the figure, even
with the 50% reduction, is likely to exceed the statutory cap. The essential
issue was to determine the fairness of the dismissal. The Respondent appealed
and directions sending this to a full hearing were given by HHJ Peter Clark.
The legislation
5.
The relevant legislation which is not cited at all by the Employment
Tribunal is the Employment Rights Act 1996. Section 98 provides a reason for dismissal must be shown by the Respondent. It is not in dispute
that it was conduct. Fairness is determined by section 98(4) which provides as
follows:
“Where the employer has fulfilled the requirements of the
subsection (1), the determination of the question whether the dismissal was
fair or unfair (having regard to the reason show by the employer)
a) depends on whether in the circumstances (including the size
and resources of the employers undertaking) the employer acted reasonably or
unreasonably in treating it as a sufficient reason for dismissing the employee,
and
b) shall be determined in accordance with the equity and
substantial merits of the case."
6.
In the assessment of remedies, re-engagement and reinstatement are the
primary remedies and we understand that that claim is to be made at the
Employment Tribunal. Where there has been substantial contribution by conduct
to a dismissal that is a reason for reducing what is just and equitable by way
of compensation (section 123). It is common ground that such reduction of the
compensatory award would be on the basis of blame. Similar provisions apply for
the reduction of the basic award under section 122, although the language is
slightly different.
7.
As well as failing to mention any statute, the Tribunal cited no
authority.
The facts
8.
The Claimant had been employed as a track worker for 23 years when on 4
August 2010 he was spotted by an employee of the Respondent beside a track with
a group of workers. He had been previously been off for 11 months and had just
come back to work. He needed a Track Safety Certificate (PTS) and some
retraining and because he had not done that, he was asked to work as a driver for
a group of track workers whose supervisor was Chris Taylor. The observation of
the Claimant was that he was not wearing a hard hat and that led to an
investigation. The charges against him were that he did not have a hard hat
when in the proximity of a track, which is within ten feet of it; he did not
have a valid PTS certificate while he was in that vicinity; and he had failed
to set up a safe system of work as required by the rules for he was a lone
worker, in other words not part of the group. Thus three specific charges under
the safety regime were weighed against him.
9.
At a disciplinary hearing, Mr Turner-Hague upheld each of the three
allegations and dismissed him. Mr Turner-Hague noted that there had been a
false statement initially made the Claimant as to what he was doing by the
track, but that was retracted during the hearing and the Tribunal found that it
did not form part of the decision to dismiss him.
10.
In fairness, the notes which were provided by the Judge at the direction
of the EAT indicate he was not dismissed for his lie but Mr Turner-Hague did
consider that during the disciplinary proceeding. That, of course, is right
since the retraction of it was at that hearing, but the Tribunal’s finding was
that it did not form part of the decision to dismiss and that seems to be
grounded in the note we have seen.
11.
Mr David Hulme heard the appeal, the Claimant again being represented by
his union, RMT. The Tribunal noted correctly that the ground of appeal was the
severity of the punishment. Breaches seem to have been admitted but the
sanction was too severe. The Tribunal went on to find that the Claimant was in
breach of the safety rules in not wearing a hat. He was not aware of the
suspension of his PTS until after the relevant event. He reasonably believed it
was still valid and that he was not part of Mr Taylor’s team, since he was not
working there as a track worker but simply as the delivery driver.
12.
The Tribunal found that the Respondent carried out a reasonable
investigation and followed a reasonable procedure; no further investigations
might reasonably have been undertaken. With those findings in the forefront of
its mind, it turned then to what appears to be an analysis of fairness under
section 98(4) and it said:
“13. The Tribunal is conscious of the rule that it must not
substitute its own decision for that of the manager but only determine whether
the decision to dismiss fell within a range of reasonable management
responses. However, in this case, the Tribunal finds that the decision to
dismiss was outside that range for the following reasons. First, the Tribunal
finds that the claimant was not aware that his PTS certificate had been
suspended until the investigation yet that was given as one of the principal
reasons for the dismissal. Secondly, the claimant was not standing near a
fully operational line and the risks were minimal. Thirdly, the Tribunal finds
it difficult to see how the claimant could be classified as a lone worker. He
was working as a driver for the team. Fourthly, in cross-examination both Mr
Turner-Hague and Mr Hulme justified the difference between the treatment of Mr
Taylor and the claimant as partly because Mr Taylor had owned up to the lie
shortly after the investigation started whereas the claimant had only done so
later. The lie formed no part of the decision to dismiss the claimant,
therefore there was an inconsistency. Mr Taylor was in charge of the operation
and should have told the claimant to return to his van and reported him. They
were both in breach of the safety rules, but only the claimant was dismissed.
Finally, the claimant had an unblemished record of 23 years’ service and this
was a dismissal for a first offence.”
13.
Nevertheless, it went on to consider the Respondent’s written contention
in its response as to contribution and said this:
“14. The Tribunal therefore finds that the dismissal was unfair
but that the claimant by his conduct contributed to his own dismissal by 50%.”
14.
That can be supplemented by the words found in the Judgment itself, the
Claimant “was guilty of contributory fault”. On that basis, the hearing was
adjourned so that there could be remedy hearing.
The Respondent’s case
15.
On behalf of the Respondent, it is contended that the decision of
the Tribunal is perverse and it has erred in law in that it has substituted its
view for that of the Respondent. It has erred by failing to consider the
material which was before the Respondent and whether or not in the light of
that material it was reasonable to dismiss him. The
Tribunal have failed to consider the matter in light of the evidence that was
before the Respondent at the time of dismissal. The Tribunal accepted that the
Respondent had conducted a reasonable investigation (para 12(9)) and by virtue
of accepting that the reason for dismissal was conduct seem to have accepted
that there was a genuine belief that the Claimant’s guilt (para 12(8). However
they have failed to directly address the question of whether that belief was
formed on reasonable grounds and instead have made primary findings of fact on
the matters which formed the basis of the disciplinary charges. Further in Securicor
Ltd v Smith [1986] IRLR 305 (at para 34) the Court of Appeal confirmed
that in a case where two employees were dismissed arising from the same
incident where one employee was successful on appeal and one was not then the
question was whether the appeal panel’s decision was so irrational that no
employer could reasonably have accepted it.
16.
Ms Thomas acknowledges the very substantial corpus of Court of Appeal
authority now running to at least 15 cases in the last three years where
conduct dismissals have been considered. She acknowledges the point which we
have elicited from them that broadly speaking finding facts is for the Tribunal
and with the correct self direction it is unlikely that the Tribunal will be
held to have misapplied the direction.
17.
Nevertheless, she contends this Tribunal erred in law in all of the
aspects cited in paragraph 13. She contends that the Claimant ought to have
been aware of the PTS certificate, that the line was fully operational, there
were risks there and the comparison with Mr Taylor, the supervisor, is inapt
because of his approach to his lie. Mr Taylor was disciplined but received a
final warning. The decision should be set aside and that we should ourselves
substitute our Judgment for that of the Employment Tribunal’s and find the
Claimant was fairly dismissed.
18.
If we are against her on this, she invites us to consider contribution -
this is in two parts. The first is a reasons challenge; there are no reasons
given and on that basis the Tribunal has erred. The remedy for that, she
accepts, would be for this to go back to the same tribunal for reasons to be
given. But she also has a systemic attack on the decision which is that
whatever the reasons, 50% is too low.
The Claimant’s case
19.
As to the reasons; Mr Henry accepts there are no reasons, but urges us
to hold that the reasons are exigible from the findings. These include
criticisms of the Claimant that he was in breach of the rules and this coupled
with the word “guilty” in the Judgment indicate the Tribunal knew about
blameworthy conduct. Mr Henry does not seek to unseat the finding of
contribution in itself, nor the finding of 50%, but does resist the matter
being decided by us if we were in favour of Ms Thomas, and would seek to
maintain the position as it is.
20.
As to liability, Mr Henry contends that the approach in all cases of
conduct is to rely upon BHS v Burchell [1978] IRLR 379, and to
decide whether the Tribunal has found that the tests in Burchell
have been satisfied, there being a neutral burden in stages 2 and 3, and then
to stand back and look at the band of reasonable responses. The findings by
the Tribunal in paragraph 13 all go to what the Claimant said in his claim form
and are referable to his original appeal, which was that the penalty for the
breaches was too severe and dismissal of him in the circumstances was unfair.
The legal principles
21.
The legal principles to be applied in this case emerge from the cases
which we have reflected upon with counsel. They are most recently the Judgment
of the Court of Appeal in Graham v The Secretary of State for Work and
Pensions [2012] EWCA Civ 903 and the holding by Aikens LJ in the
following terms:
“45. AT the heart of this appeal are the two opposing
allegations that the two tribunals, first the ET and then EAT, wrongly
substituted their own views of the facts, particularly in relation to what we
have called Allegation One, instead of evaluating the facts as found by the
dismissing officer of the employer. That is the substance of Grounds 2 and 3
of the Grounds of Appeal, viz that the EAT retried the case on the facts and
that a misleading document was introduce at the EAT stage to define
“acquaintance” or “acquaintanceship” and Mr Gott’s argument that the EAT was
entitled to do what it did because the ET had itself been guilty of
“substitution”. The decision of this court in London Ambulance Service NHS
Trust v Small [2009] IRLR 563 (at [41]-[43]) restated the well-established
rule that an ET is not entitled to substitute its own findings of fact for
those of the employer or its investigating or dismissing officer, except in
very exception circumstances, discussed in the Orr case at [79]-[80].
Equally, the EAT is not entitled to substitute its own findings for those of
the ET unless the latter are perverse.
46. In these circumstances, it seems to me that this court
should start by asking the questions that should be asked when an employee is
alleged to have committed misconduct and is dismissed for that reason. As
already noted, there is no dispute that the DWP dismissed Mrs Graham for what
it regarded as her gross misconduct in the way she dealt with the case of Mr
Moss. There can be no dispute that this is a “valid” reason within section
98(1)(b) of ERA. An ET that is considering whether the dismissal of an
employee accused of misconduct was fair then has to ask itself three
questions. On the first - did the employer carry out reasonable investigation
- the answer in this case is obviously yes, it did. On the second - did the
employer believe that the employee was guilty of the misconduct complained of -
the answer, to my mind at least, is also obviously yes. Mr Glover clearly
believed that Mrs Graham was guilty of misconduct in relation to what he
described as the five allegations and we called the four. The “Decision” in
the “Allegations of Misconduct” document demonstrates that fact.”
22.
As is plain from that Judgment a wealth of authorities lies behind it
including the majority of Judgment of Mummery LJ in Fuller v London
Borough of Brent [2011] IRLR 414, Bowater v Northwest London
Hospitals NHS Trust [2001] IRLR 331, Salford Royal NHS Foundation
Trust v Rolden [2010] IRLR 721, per Elias LJ, Gayle v Sandwell
& West Birmingham Hospitals NHS Trust [2011] EWCA Civ 924, per
Mummery LJ, London Ambulance Service NHS Trust v Small [2009] IRLR 563, per Mummery LJ, Orr v Milton Keynes Council [2011] EWCA Civ 62, Oso v Newham University NHS Trust [2011] EWCA Civ 1425
and in Henderson v LB Hackney [2011] EWCA Civ 1518. The
principles have most recently and authoritatively been rationalised in Arriva
Trains v Conant UKEAT2011 0043/11 at paras 23-34, in Crawford v Suffolk Mental Health Trust by Elias LJ [2012] EWCA 138.
23.
The question of contribution under section 123 is to reflect blameworthy
conduct and the Tribunal is to assess it on a percentage basis if it is
assessing compensation, and if it is making a percentage decision that will be
relevant to the remedies of reinstatement and re-engagement when sought.
24.
It is a fundamental principle of the administration of justice that
reasons be given for a decision so that the parties can understand why they
have won and lost.
Discussion and conclusions
Liability
25.
We prefer the argument of Mr Henry on the substantive point and have
decided to dismiss the appeal. The clear message of the massy caseload we have
looked at is that when a Tribunal has directed itself on the law and founds the
facts, it will rarely be the right of an Appellant court to intervene. In this
case, we uphold the Respondent’s contention, as did the Employment Tribunal,
that safety is paramount, equipment is provided, it must be worn by those who
are exposed, and exposing others, to danger. The Claimant did not wear his hard
hat. The fact that he may have been wearing other bits of protective equipment
is neither here nor there; the Respondent is entitled to enforce its rules.
The Claimant did not have a valid PTS certificate and he had not made a safe
system of work as required by the rules.
26.
But the point about is that they go to the establishment of the
framework under BHS v Burchell. As Ms Thomas addressed us, it
appeared that she was criticising the Tribunal in respect of favourable
findings under Burchell. The analysis of this very short
Judgment is that the Tribunal had in mind, although it did not say so, three
stages in Burchell for it found the reason given by the
Respondent, reasonable investigation and a reasonable procedure. Thus, the requirement
in a misconduct case to determine whether standards in the three stages in Burchell
have been met was met in this case. The question then, as most recently adumbrated
in Graham, is whether the dismissal fell within a band of
reasonable responses.
27.
In this case, there is a band of reasonable responses. The comparator Mr
Taylor was not sacked for his part in the breach of the safety rules. The
point about the finding of the Tribunal and the breach of the safety regime is
that when one stands back to determine whether the sanction falls within the
band of reasonable responses, one is looking at the extent of the breach. We
accept Mr Henry’s example: Mr Mockler may have been wearing a hard hat but
taking it off to apply insect repellent or suntan cream and he would be in
breach of the rule, but that would not justify a dismissal as being within the
band of responses.
28.
So, the first stage is always to find by way of BHS v Burchell
whether the employer had reason to believe there were infractions and secondly,
to decide what the response is. That is the proper responsibility of the
Employment Tribunal. Here it has given four reasons why the breaches found in
the safety regime would not justify the summary dismissal of the Claimant.
Those are matters for the Tribunal applying its experience of workplace
relations and the standard of the reasonable employer. We hold the Tribunal
did do just that.
29.
As to comparators, the proper approach is to look at section 98(4) which
by its invocation of “equity and the substantial merits” caters for fair
dealing by an employer of employees in the same circumstances. We decided this
in a compromised appeal CFS v Bashir UKEAT/0057/12 para 3, but
now apply it in a contested appeal. There is no difference between unreasonably
and irrationally. The case was properly regarded as one of inconsistent treatment
with Mr Taylor’s.
30.
A Tribunal will be at risk if it does not cite the statute or the
relevant authorities but here we can understand in this simple misconduct case
what its thinking was.
Contribution
31.
That, however, cannot be said in respect of the contribution point. Mr
Henry says there are three possible findings which would go to blameworthy
conduct. They may indeed, but we cannot say what they are, the Tribunal must
do that. Until it does, we cannot say that its decision is correct or, more likely,
we have to side with Ms Thomas and say that the decision on 50% cannot stand in
the light of the jejune reasoning. It may be that when the Tribunal, as we
direct, meets to consider what its reason is for the finding of contribution (that
finding being intact, as not being challenged by Mr Henry) it will give its
reasons and it will then assess what percentage in the light of those reasons
should be affixed. It will be open to it to reach any conclusion upon that but
we daresay that it will be unlikely to go below its initial finding of 50%.
32.
Those are matters for the Tribunal and at that stage; whatever reasons
are given will be open to consideration by the parties. The Respondent may be
unhappy if the figure stays the same, but if the reasons are robust and not
subject to appeal as a question of law, at least it will know what those
reasons are. If they are challengeable, no doubt Network Rail will receive
advice upon that.
33.
So the appeal is allowed in part insofar as the challenge to the contribution
point will be remitted to the same Employment Tribunal for it to give reasons
and to make a fresh decision in the light of the reasons which it puts forward.
