THE HONOURABLE MR JUSTICE UNDERHILL
INTRODUCTION
1.
The Claimant commenced employment with the Respondent trade union on 3
May 1999 as a Regional Organiser, working in the London and South East Region.
His immediate supervisor in that post was at the relevant times the Regional
Secretary, Jerry Swain. From 2008 onwards various matters arose relating to his
conduct which led to criticism of him, explicit or implied, from more senior
officials of the Union, including the General Secretary, Alan Ritchie. He in
turn raised a number of grievances.
2.
In June 2009 the Executive Council asked the Regional Secretary of the North
Western Region, George Guy, to investigate the relationship between the Union and a building firm called Hudson Contract Services Ltd (“Hudsons”). Part at least
of that relationship had been handled by the Claimant: we give more details
below. Mr Guy recommended a formal disciplinary investigation, and on 15
February 2010 he was asked to carry out such an investigation into four
officials, including the Claimant. In the Claimant’s case he found that there
was a case to answer in relation to a number of charges. A disciplinary
hearing was conducted on 15 and 16 December 2010, and on 26 January 2011 the
Claimant was summarily dismissed for gross misconduct. He took advantage of
the Union’s internal appeal procedures but his appeal was unsuccessful.
3.
It was and is the Claimant’s case that the senior officials of the
Union, and in particular Mr Alan Ritchie, both instigated the earlier
criticisms of him and procured his eventual dismissal in bad faith: he was a
political opponent of Mr Ritchie, having stood against him for election as
General Secretary both in 2004 and in 2009. He brought two sets of proceedings
against the Union. The first was brought while he was still employed: he
complained of various acts of “harassment”, alleging that they constituted
unlawful disciplinary action and/or unlawful detriments contrary to sections 64
and 146 of the Trade Union and Labour Relations (Consolidation) Act 1992:
we need not give the details here. In the second set of proceedings he claimed
for unfair dismissal, contrary not only to section 98 of the Employment
Rights Act 1996 but also to section 103A (the “whistleblower” provision)
and to section 152 of the 1992 Act (dismissal on grounds related to trade union
activities): as regards the latter, the relevant “activity” was standing for
election as General Secretary.
4.
The two sets of claims were heard together by an Employment Tribunal
sitting at London South, chaired by Employment Judge Hall-Smith. The claim was
heard in two tranches in June and July 2011. By a reserved Judgment and
written Reasons sent to the parties on 4 November 2011 the claims in the first
set of proceedings were dismissed. As regards the second set of proceedings,
the Claimant was held to have been unfairly dismissed, but only on the basis of
“ordinary” unfair dismissal: it was found that his dismissal was not on the
grounds of his trade union activities, and the claim under section 103A was
said not to have been pursued by him. The hearing did not consider any
detailed questions of remedy, but the Tribunal did decide that a reduction of
50% should be made for “contributory conduct” under sections 122 (2) and 123
(6) of the 1996 Act, and it also held that it was inappropriate to make any “Polkey
discount”.
5.
There was a remedy hearing on 15 December 2011. By a reserved judgment
sent to the parties on 27 February 2012 the Union was ordered to pay a basic
award in the sum of £3,040 (representing £6,080, subject to the 50%
reduction). The Tribunal made no compensatory award, but it made the basic findings
necessary for the purpose of computing such an award and requested the parties
to seek to agree a figure accordingly. The essential finding was that the
period in respect of which the Claimant should be compensated was limited to 74
weeks from his date of dismissal. That would produce a loss of just over
£30,000, subject to reduction for contributory conduct.
6.
The Union appealed against the finding of unfair dismissal, and also
against the decision that no Polkey discount was appropriate. On the
sift the appeal was allowed to proceed to a full hearing. The Claimant’s
Answer included a cross-appeal. On the sift HH Judge Richardson allowed only
some parts of the cross-appeal to proceed. These challenge: (a) the dismissal
of the claim for dismissal on the grounds of trade union activities (ground B);
(b) the failure to deal with the section 103A claim (ground D); and (c) the
reduction for contributory conduct (being part of ground A). Following the
remedy hearing, the Claimant appealed against a number of aspects of that
decision, but at a preliminary hearing before Cox J and members he was allowed
only to pursue ground 5 of his Notice of Appeal, which concerned the awards for
pension loss and for loss of the use of a car.
7.
What is therefore before us is the appeal and cross-appeal (so far as it
survived the sift) as regards what we will call the liability decision (though
strictly speaking the Polkey and contributory conduct issues go to
remedy) and the two limited and specific issues which we have indicated going
to the calculation of compensation.
8.
The Union was represented before us by Mr Andrew Hogarth QC, and the
Claimant by Mr Jody Atkinson. Mr Hogarth appeared in the Tribunal, but the
Claimant was at that stage unrepresented.
LIABILITY
THE FACTS
The Claimant’s Disputes with Mr Ritchie and the Union
9.
Although it is not necessary for the purpose of this appeal to delve
deeply into what has been a long-running series of disputes between the
Claimant and the Union, we should briefly identify the matters which he relied
on as protected disclosures. All followed his defeat in the election for
General Secretary in June 2009.
(1) In
December 2009 he made a complaint to the Certification Officer on the basis
that members of the Union who were in arrears with their subscriptions by more
than six months had not been accorded the right to vote. The outcome was not
known at the time of his dismissal, but in fact the Certification Officer in
March 2011 upheld the complaint and ordered that the election be re-run.
(2) In August
2010 he wrote to the Union’s auditors alleging that there were (deliberate)
irregularities in its finances. These appear to have related to affiliation
fees paid to the TUC, which were based on alleged membership figures of over
100,000. (As we understand it, this allegation was related to the first,
because the members said to have been wrongly included were those with more than
six months’ arrears: the Claimant’s point was that if they were excluded from
the right to vote it could not be right for them to be included for the purpose
of boosting the Union’s asserted membership for the purposes of the TUC.)
(3) In
December 2010, having been rebuffed by the auditors, he made what was
essentially the same complaint to the Metropolitan Police, saying that the Union’s alleged conduct constituted fraud.
10.
The Claimant and Mr Ritchie were not only political opponents. The
Tribunal found that there was “there was a long-standing background of
animosity” between the two of them: see Reasons para. 148. Elsewhere in its
Reasons (see para. 75) it referred to an article in the Union magazine written
by Mr Ritchie in which the Claimant’s views and conduct (albeit that he was not
named) were described as “fascist” and “vile”.
Mr Guy’s Investigation and the Disciplinary Proceedings
11.
The background to the case against the Claimant is the existence in the
construction industry of so-called “payroll companies” – that is, companies who
supply labour under arrangements the result of which is that the workers in
question are said not to qualify for employment protection. It is,
understandably, the policy of the Union to oppose such arrangements, and it
frequently challenges them in the context of employment tribunal proceedings.
12.
Another important piece of background is that the Union has historically
suffered from declining membership, with an associated decline in membership
income: see para. 15 of the Reasons. It is an important objective of officials
to recruit new members. One way in which this can be done is by negotiating
check-off arrangements with employers in the sector, who facilitate recruitment
and encourage union membership and who deduct membership subscriptions from employees’ wages and pay them over to the Union. But this carries the
potential for abuse. There is said to be a known practice – we need make no
finding as to how common it in fact is – whereby companies (particularly
companies like payroll companies whose activities would normally attract unwelcome
attention) make bogus agreements with officials of the Union under which
phantom employees are recruited as members and their subscriptions paid to the
Union by the company, purportedly by way of check-off, on the understanding
that the Union will create no trouble for the company. Where such an
arrangement is made there may be no direct pecuniary benefit to the officials
in question, but they benefit from the kudos of having increased membership and
subscription income; and the arrangements can properly be described as corrupt.
13.
The essence of the allegations that led to Mr Guy’s investigations was
that Hudsons was a payroll company, with no or virtually no employees of its
own, but that officials of the Northern Region and of the London and South East
Region had entered into corrupt arrangements with it of the kind described
above. What Mr Guy ascertained in his original investigation was that the
Claimant and Mr Swain had gone to see Hudsons in November 2007 to discuss union
membership and to try to secure a check-off agreement. The Claimant had met
them again, this time on his own, in February 2008; and according to him they
had on that occasion agreed to conclude a check-off agreement. Then, or very
shortly afterwards, a director of Hudsons had supplied the Claimant with fifty
applications for membership using the Union’s standard forms which had
purportedly been completed by employees of the company. He had passed those on
to a member of staff at the Union’s head office, Barry Ingleton, for processing.
When Mr Ingleton examined the forms it was clear that they were highly
suspect. Most of the boxes were left blank. Although names and addresses were
given, the addresses were skeletal and unconvincing (street numbers being
multiples of 100 – e.g. “500 Ford Road, Orpington” or “600 Lagoon Road,
Orpington”), and the signatures were mere squiggles which looked very similar
to one another. Mr Ingleton had not processed them and returned them to the
Claimant. As part of his investigation Mr Guy conducted further checks which
confirmed that the names and addresses were bogus. In addition, however, Mr
Guy identified 23 application forms submitted subsequently by the Claimant for Hudsons’ employees which had been processed. These too were highly suspect and
were judged by him to be fictitious. On a visit to Hudsons Mr Guy established
that the forms had all been completed by one member of their office staff –
allegedly on the basis of names provided by one of their clients – and that appropriate
“subscriptions” had been paid.
14.
Mr Guy also established that Hudsons had for some weeks in late 2008 and
early 2009 displayed the UCATT logo on its stationery and website, thereby conveying that it had some association with, or endorsement from, the Union. The logo had in due course been removed: Hudsons said that that was done following
a phone call from the Claimant.
15.
The officials into whom Mr Guy was asked to carry out a disciplinary
investigation were Mr Swain and the Claimant, together with the Regional
Secretary and Regional Organiser of the Nothern Region, John Scott and Dave
Short. They were notified of specific “potential allegations”. All save the
Claimant met Mr Guy and answered his questions. The Claimant did not do so.
Mr Guy in his report describes a litany of missed meetings and unanswered
correspondence over a period of six months. It is the Claimant’s case that these
difficulties were largely because he had been ill. In the end Mr Guy
recommended no proceedings against Mr Short and Mr Scott: the facts in their
cases were less suspicious, and there was no equivalent to the large number of
fictitious forms submitted to the London and South East Region. As regards Mr
Swain, Mr Guy found no case to answer on the specific allegations, but he
recommended disciplinary action nonetheless on the ground of his “inaction”.
As regards the Claimant he found a case to answer on six out of the seven
allegations. Mr Ritchie duly wrote to the Claimant formally notifying him that
there would be a disciplinary hearing: we give details of the charges below.
16.
The disciplinary hearing was fixed for 15 and 16 December 2010, though
it seems that the original intention was that part at least of the second day
would be devoted to hearing the charge against Mr Swain. The panel consisted
of nine members of the Union’s Executive Council, chaired by Mr Thompson: it is
not clear, but it does not matter, whether this represented all the members of
the Council or whether they were hearing the case in their capacity as such.
Mr Ritchie presented the case against the Claimant on behalf of the Union. A note was taken on behalf of the Union: a copy is in our bundle. Although the
note reads like a verbatim transcript we do not think it can be, because it
does not seem long enough to account for the time taken by the hearing, and it
seeks likely that there is an element of condensation. But there has been no
challenge to its substantial accuracy. A Ms King accompanied the Claimant for
most of the first day: she also took some notes, but we do not have them.
17.
The hearing commenced, according to the note, at 10:30 a.m. on the first
day. The Claimant made an application for it to be adjourned. That
application was refused. Mr Ritchie then outlined the charges against the
Claimant, as follows:
“1. In early 2008, Mr Dooley
attempted to submit 50 membership forms to the Union in respect of members
employed by or contracted to Hudson Contract Services Limited. These
applications were false as they related to non-existent members at fictitious
addresses.
2. In December 2008, Mr
Dooley submitted 23 membership application forms for individuals who were
allegedly employed by or contracted to Hudson Contract Services Limited. On
checking, it was found that the names of the alleged members and/or their
addresses were fictitious.
3. Mr Dooley entered into
arrangements with Hudson Contract Services Limited which directly contradicted
the Union’s policies on representation of members, dealing with employers.
4. Mr Dooley requested that
Hudson Contracts Services Limited remove the UCATT logo from their website,
without informing the Union of this.
5. Mr Dooley misled the Union about his relationship with Hudson Contract Services Limited.
6. In all circumstances, Mr
Dooley acted fraudulently and/or with dishonesty, thereby breaching the bond of
trust and confidence that exists between employer and employee and by his
actions/omissions, brought the Union into disrepute.”
18.
Those charges correspond in substance to those on which Mr Guy had found
a case to answer, though there is some re-wording. Charges (1) to (3) are
essentially self-explanatory, though the element of dishonesty is only made
explicit at (6), which is not in truth a separate charge but an overall
characterisation of the earlier charges. As we understand it, the criticism in
charge (4) is not so much that the Claimant did not tell the Union that he had
asked Hudsons to remove the logo from their website but that he did not report
that they had been using it in the first place. (We should note for
completeness that Mr Guy had investigated whether the Claimant had initially
authorised the use of the logo; but this was the allegation which he had recommended
should not form the subject of a charge.) As for (5), this is unclear as
expressed, but when read with Mr Guy’s report it appears that the criticism is
that the Claimant was wholly unforthcoming to Mr Guy when he was asked about
Hudsons in the original investigation.
19.
The remainder of the morning of the first day was spent in the
questioning of the Claimant by Mr Ritchie. In the afternoon Mr Guy was
questioned by the Claimant about his investigation. The questioning lasted
until after 9 p.m. It resumed the next morning. After Mr Ritchie had himself asked
some questions of Mr Guy, he and then the Claimant each made closing
statements. Mr Thompson then told him that the panel would adjourn to
deliberate and would give a decision as soon as possible. Apparently some of
the day was still left at that stage, but the Tribunal found that the panel wanted
to deal with the charge against Mr Swain - though we were told that in the
event this did not prove possible since Mr Swain successfully argued that a
hearing in his case would be premature.
20.
Both in its findings of fact and in the reasons which it gave for its
finding of unfair dismissal the Tribunal was critical of the length of the
hearing on the first day. Unfortunately, however, its findings about why it went
on so long are rather sketchy. At para. 109 of the Reasons, in the course of
its narrative, it describes the hearing as having lasted “for about 15 hours,
from 10 a.m. until 21:15 p.m. on the first day”. The total of 15 hours is
self-evidently wrong, since from 10 a.m. to 9:15 p.m. is 11¼ hours – and in
fact, as we have said, the hearing seems from the official note to have started
at 10:30 a.m. It also appears from that official note that there was a break
between the morning and afternoon sessions, no doubt for lunch – there could
hardly not have been – but it does not reveal, and the Tribunal makes no
finding, whether there were any other breaks. In the same paragraph the
Tribunal says that “there was some force in the Claimant’s evidence” that some
of the panel members, some of whom had travelled a considerable distance to get
to the hearing, were tired and showed signs of falling asleep during it: at
paragraph 145, in the section giving its conclusion (which we set out fully
below), that becomes a positive finding. At paragraph 146 it states:
“The
Claimant and two members of the panel had requested that the proceedings should
be halted but such requests were denied by the Chairman.”
That must be taken as a finding of fact, but it is unsatisfactory
that we have no details of the incident: it is not referred to at all in the
narrative section, and there is no record of it in the official note. At
paragraph 110 the Tribunal says:
“We accepted the Claimant’s
evidence that he was badgered throughout the hearing and that because of
tiredness and his mental state at the time he found it difficult to keep up and
that consequently he felt that he was unable to properly defend himself.”
This is on the face of it a surprising finding, since during the
entirety of the second session of the first day – which is the part which the
Tribunal believed had been unduly prolonged – it was the Claimant who was doing
the questioning, and it is hard to see how he could in those circumstances have
been “badgered”. The Tribunal gives no further details of what it was referring
to. The official note reveals no interventions by the panel which could fairly
attract that description. Mr Thompson is recorded as having made a couple of interventions
– in one of which he observed that “we have been here for a long time” – but on
the face of it the time was simply taken in debate between the Claimant and Mr
Guy. Mr Hogarth submitted that the reason why the session took so long was
that the Claimant was asking what were in substance the same questions over and
over again, and there does appear to be some support for that in the official
note.
21.
The Claimant was asked at the end of the hearing, according to the note,
whether he accepted that he had had a fair hearing and he agreed that he had.
Too much weight must not be placed on that, since an employee in such a
situation may reasonably be reluctant to antagonise the decision-makers by
complaining of unfairness; but it should nevertheless be noted that he did not
complain of the length of the previous day’s hearing.
22.
The panel was not able to meet again to deliberate until 20 January 2011,
which appears to have been the date of the next scheduled Executive Council
meeting. Two of the nine members were absent. As to this, the Tribunal found
as follows:
“114 … One of the absent
members Mr Dennis Doody apparently had travel problems in getting to London and
the other member Mr Jim Gamble was apparently away. Two members of the
Executive Council asked for these proceedings to be adjourned in their
absence.
115 The Tribunal considered
a postponement of the hearing to ensure that all members of the panel were
present would have been wholly reasonable. However Mr Thompson stated that it
had been difficult enough to fix a date when all members of the Executive
Council could be present and that the council was effectively quorate in the
absence of Mr Doody and Mr Gamble. …”
The decision was taken to proceed. The Tribunal’s finding, at
paragraph 115 of the Reasons, is as follows:
“According
to Mr Thompson the Claimant was found guilty on all charges, in relation to
some the council was unanimous and in relation to others, which were not
identified to the Tribunal, the vote was 5:2 in favour of the Claimant’s guilt.
The Executive Council decided to summarily dismiss the Claimant for gross
misconduct by a majority. One member of the Council in the minority voted for
a final written warning.”
Mr Gamble, one of the members who was not present, subsequently wrote to Mr Ritchie complaining that the decision had been taken in his absence on holiday. He said that he had had no notice that the question was to be discussed at
the January meeting. Mr Gamble gave evidence to the Tribunal, quoted in the
Reasons, in which he said that he would not have voted for the Claimant’s
dismissal and that he believed that there was a chance that he could have
persuaded the majority to his position.
23.
On 26 January 2011 (wrongly recorded by the Tribunal as 20 January) Mr
Ritchie wrote the Claimant as follows:
“Disciplinary
Hearing – Outcome
Following the disciplinary
hearing on 15th and 16th December 2010, the Executive
Council of the union met on 20th January 2011 to consider the
outcome.
Having reviewed the evidence and
considered the documentation, the Executive Council decided that you were
guilty on all counts. They have taken the decision to dismiss you for gross
misconduct.
The Executive Council decided
that you had submitted what you knew to be false membership forms to the union.
Those membership forms contained fictitious names and/or addresses. This was
done in relation to Hudson Contract Services, a payroll company, whose aims and
interests are directly contrary to those of the union. This means that you
produced information, which could have rendered the union’s membership figures
inaccurate, gave the Union the impression that you were recruiting more members
than was actually the case and may have placed the union into a difficult and
potentially embarrassing position with regard to a payroll company.
As you are dismissed for gross
misconduct, you are not entitled to notice or pay in lieu of notice. Your
employment with this Union terminates as from today’s date, 26th
January 2011.
…
You have the right to appeal this
decision. To exercise this right you must do so within seven days of today’s
date.
The appeal will be heard by the
Union’s Special Appeals body, which will consist of an independent Chair and
two members of the Union’s General Council (but not the member for London South East Region).”
It will be noted that, although the letter says the Claimant had
been found guilty on all counts, the only allegations specifically referred to
are (1)-(3), though the allegation of dishonesty at (6) is clearly included.
It is reasonable to infer that the decisive questions for the panel were the
fact of entering into a relationship with Hudsons, being (it believed) a
payroll company, and the knowing submission of fictitious forms.
24.
The Claimant took up the offer of an appeal. It was heard on 23 May
2011 before an appeal panel consisting of an independent chairman, Mr Tony
Dubbins, and two members of the General Council of the Union. Mr Thompson
presented the Union’s case. The Claimant had a representative accompanying
him. There is a full note of the appeal hearing. Mr Dubbins made it clear
that the hearing “is not designed to be a re-hearing of the original case” but
rather “to assess the evidence made available to the Executive Council and the
decision that they have made”. The Claimant’s stated grounds of appeal were
described as being that “the procedure relating to the charges of Gross
Misconduct were not followed” and “that this decision was reached not for the
reasons given but for other reasons”. The particular points made under those
two headings appear to have been fairly diffuse, but we need not seek to
analyse them in detail here (though we note that no complaint was made about
the length of the last day’s hearing or that the Claimant had been “badgered”).
The appeal was dismissed. The letter dated 26 May 2011 notifying the Claimant
of the outcome reads, so far as relevant, as follows:
“The Appeal Panel endorsed the
Executive Council’s decision that you were dismissed for no other reason than
for submitting what you knew to be fictitious membership application forms.
The Appeal Panel also considered
your contention that the proper procedures were not followed by the Executive
Council. Having taken due note of the documents you had submitted and the
personal presentation you made, the Appeal Panel decided that there were no
grounds for your Appeal to be upheld.”
25.
In the event the charge against Mr Swain was not pursued. The Tribunal
makes no finding as to why this was.
THE TRIBUNAL’S REASONS
26.
Paragraphs 1-11 of the Reasons are introductory. At paragraphs 12–124
the Tribunal sets out its findings of fact: these of course covered the facts
relevant to the unlawful detriment claim, with which we are not concerned, as
well as those relating to the Claimant’s dismissal, which we have sufficiently
summarised above.
27.
At paragraph 125 of the Reasons the Tribunal refers to written
submissions which had been lodged by both parties: it seems that these were
documents submitted in opening and that the closing submissions were oral. At
paragraphs 126–133 the Tribunal summarises the relevant law. We need note only
that it refers to and summarises the effect of the well-known decision of this
Tribunal in British Home Stores Ltd v Burchell [1980] ICR 303n.
28.
The Tribunal’s dispositive reasoning starts at paragraph 134.
Paragraphs 135-140 are concerned with the claim of unlawful detriment. The
reasoning relating to unfair dismissal is at paragraphs 141–161. In view of
the points which we will have to consider, we see no alternative to setting
these out in full:
“141. The Claimant
contended that the reason for his dismissal was his trade union activities.
The Claimant did not pursue his complaint under section 103A of the Employment
Rights Act 1996, namely that he had been dismissed on grounds of making a
protected disclosure to the Certification Officer and to the union’s auditors
and to the police. The Claimant’s complaint to the police was essentially one
of fraud in circumstances where the union should not have paid an affiliation
fee based on 130,000 members but should have limited their affiliation fee to
one based upon membership of those who were not in arrears of union dues of
more than 26 weeks.
142.
In relation to the Certification
Officer the Claimant’s approach appeared to have been inconsistent with his
complaint to the union’s auditors and to the police and was founded upon his
contention that the union had 130,000 members and that they were all entitled
to vote. The Respondent accepted that the Certification Officer had ordered
the 2009 election to be re-run.
143.
Although the Claimant did not
pursue his allegations of dismissal on grounds of making protection disclosures
at the hearing, we concluded that such disclosures were not connected to the
reasons for his dismissal and that accordingly he had not been dismissed on
such grounds.
144.
The Tribunal considered that there
were wholly justifiable grounds for the Respondent to undertake an
investigation into the Claimant’s conduct in circumstances where the Claimant
had received a significant number of membership application forms for the union
which were not genuine in the sense that the signature on each was almost
identical, that they were undated and that they failed to indicate the status
of the individual namely whether the applicant was trade or was craft,
classification relevant for the determination of the appropriate amount due to
the union from the applicant. The Respondent’s grounds for investigating the
Claimant were on grounds of his conduct and not on grounds connected to his
union activities or membership. It was unfortunate that the Claimant himself
failed to contribute to the investigatory process undertaken by Mr Guy.
145.
The Tribunal did have concerns
about the procedure adopted by the Respondent at the disciplinary hearing. We
noted that on the first day of the hearing the proceedings continued until 9.15
p.m. and we accepted the evidence of the Claimant that the panel members who
had come from all over the UK were falling asleep.
146.
The charges against the Claimant
were serious and we considered that a reasonable employer would have allowed
sufficient hearing time rather than risking the very real possibility that the
disciplinary process could be compromised by what the Tribunal considered was
an unreasonably prolonged hearing on the first day. The Claimant and two
members of the panel had requested that the proceedings should be halted but
such requests were denied by the Chairman.
147.
The Tribunal concluded that the
Respondent had failed to act as a reasonable employer in its conduct of the
disciplinary hearing. We considered there was some force in the Claimant’s
contentions that he was badgered throughout the hearing and that because of
tiredness and his mental state at the time that he found it difficult to keep
up and that he felt he was unable to properly defend himself. The Tribunal
also considered that a reasonable employer would not have involved Mr Ritchie
the General Secretary of the union in the process in circumstances where the
animosity between the Claimant and Mr Ritchie had been ongoing for some years.
148.
Mr Ritchie presented the
Respondent’s case against the Claimant, and it was well known that there was a
long standing background of animosity between Mr Ritchie and the Claimant. The
involvement of Mr Ritchie in the process against whom the Claimant had made a
number of allegations, seriously undermined any contention on the part of the
Respondent that the disciplinary hearing was balanced in its approach to the
Claimant. Mr Ritchie who had had close involvement in the issues involving the
Claimant did not attend the Tribunal hearing and was not called as a witness.
149.
The Tribunal noted that the
Claimant was asked why he had not established the nature of Hudsons as a
company. Although there was a dispute on the evidence between the number of
times the Claimant’s line manager Jerry Swain, had accompanied the Claimant to
meetings with Hudsons. Jerry Swain was the Claimant’s line manager and
accordingly there could have been no reasonable grounds for the Respondent
treating Jerry Swain’s involvement with Hudsons as less serious than that of
the Claimant.
150.
The Tribunal further concluded
that no reasonable employer would have continued with the decision making
process in relation to the Claimant in the absence of two of the EC members on
20 January 2011. Two members had requested that the proceedings should be
deferred but it was by a majority of five to two that it was decided to go
ahead and reach a conclusion on the outcome of the disciplinary hearing. Our
concerns about the process were reflected in Mr Gamble’s letter to Mr Ritchie
in February 2011, in which he stated that he did not believe the Claimant had
received a fair hearing. We again reproduce the contents of Mr Gamble’s
letter:
“It
came to my attention on returning from my holiday that a vote had taken place
at the date of the January Executive Council meeting to dismiss Michael Dooley
case.
At no
time was I informed that the disciplinary panel would be reconvened, in fact
the Executive Council agenda I received made no mention that the disciplinary
issue as an agenda item. I have since discovered I was not the only panel not
in attendance at the vote which is in direct contrast of the original
instructions given that all Executive Council members must be in attendance at
all stages of het disciplinary panel meetings. It is with great regret that I
have to write the statements that I strongly support my union but my conscience
tells me that every employee deserves a fair hearing and wholeheartedly I do
not believe this to be the case with Michael Dooley.”
151.
The panel was not unanimous in its
decision to dismiss the Claimant summarily for gross misconduct in that one
member of the Executive Council present voted for a final written warning.
152.
The Tribunal concluded that the
absence of the two members at the hearing fundamentally flawed the process. In
his evidence Mr Gamble said that he would like to have thought that people did
not have closed minds and that there was a possibility of convincing them.
153.
We concluded for the above reasons
that the disciplinary process leading to the Claimant’s dismissal was
substantively unfair and accordingly unreasonable within the meaning of section
98 (4) of the 1996 Act. Further we considered that there was some
inconsistency involved in the Respondent’s approach to Mr Jerry Swain’s
involvement with Hudsons and the Claimant’s involvement. Mr Jerry Swain was
the Claimant’s line manager and he was not disciplined.
154.
We concluded that this was not a
case where it would have been appropriate to make a Polkey reduction on
the basis of the percentage chance of the Claimant being dismissed had the
process not been substantively unfair, as we found.
155.
Although we concluded that the
disciplinary process adopted by the Respondent was unreasonable within the
meaning of section 98 (4) of the 1996 Act and that in consequence the Claimant
was unfairly dismissed by the Respondent, we found that the Claimant had
nevertheless contributed to his dismissal. The Claimant had been closely
involved with a significant number of application forms which were clearly
false, having regard to the fact that were incomplete and the signatures
appeared to be very similar. The Claimant accepted that the forms were
defective and we found that it was reasonable for the Respondent to have
investigated the circumstances.
156.
It was never suggested that the
Claimant was himself responsible for making any entries on the forms and in
relation to the 50 application forms provided in February 2008 the Claimant returned
them to Hudsons. As the Claimant pointed out in his submissions that at the
time copies must have been taken of the application forms but that no action
had been taken at that stage.
157.
In relation to the 23 application
forms provided in June 2008 by Hudsons, we accepted the Claimant’s evidence
that he did not himself process the application forms, and that they were taken
from him by Mr Ingleton, the Office Manager.
158.
We consider that the most serious
allegation against the Claimant was in relation to the application forms.
However the Claimant was not responsible for completing them or making the
entries on them and in relation to the Claimant’s involvement with Hudsons he had been accompanied by his line manager on the majority of occasions.
159.
We do not consider that a
reasonable employer, without more, would have concluded that the Claimant had
acted fraudulently and/or dishonestly. Nevertheless we conclude that there was
conduct on the part of the Claimant in relation to the forms, which were demonstrably
fictitious, which contributed to his dismissal. We also conclude that the
Claimant’s conduct by his failure to cooperate with Mr Guy’s disciplinary
investigation as blameworthy. We assess the Claimant’s contribution to his
dismissal at 50%.
160.
In circumstances of the Claimant’s
involvement with Hudsons and the fictitious application forms, we have
concluded that there were justifiable grounds for the disciplinary process. We
did not conclude on the evidence that the Claimant had been dismissed on grounds
relating to his union membership or trade union activities. The Claimant had
been subjected to the disciplinary process as an employee of the union.
161.
It is the unanimous judgment of
the Tribunal that the Claimant was unfairly dismissed by the Respondent within
the meaning of section 98 (4) of the Employment Rights Act 1996 and that the
Claimant contributed to his unfair dismissal to the extent of 50%.”
29.
The structure of that reasoning is at first sight commendably clear and
systematic, dealing first with the reason for the dismissal (paragraphs 141-3);
then with the reasonableness of dismissing for that reason (paragraphs
144-153); then with matters going to remedy – Polkey (paragraph 154) and
“contributory conduct” (paragraphs 155-9); and concluding with a short summary
(paragraphs 160-1). But on closer examination the position is rather less
straightforward.
30.
The principal problem is about the reason why the Tribunal believed that
the Union had acted unreasonably in dismissing the Claimant for misconduct. At
first it seems, as we have said above, that the answer is to be found in paragraphs
144-152, which constitute the “above reason” referred to in paragraph 153, for
finding that the Union failed the test under section 98 (4). Those reasons are
several and quite diverse, but they can be analysed as follows:
(1) It was
unfair that the first day of the disciplinary hearing should have been so
prolonged – paragraphs 145-146.
(2) The
Claimant was unfairly “badgered” throughout the hearing – first part of
paragraph 147.
(3) Mr
Ritchie’s role in presenting the case against the Claimant undermined the
impartiality of the hearing because of their long history of mutual animosity –
second part of paragraph 147 and paragraph 148.
(4) If the
Claimant was at fault in not discovering that Hudsons was a payroll company, so
equally was Mr Swain – paragraph 149. It is not clear exactly what point is
being made here. It could be a point about inconsistency of treatment as
between the two of them, but that appears to be treated separately – see (6)
below; or the point could be that the alleged failure could not really be
culpable (or seriously so) if Mr Swain, who was the Claimant’s manager, was
equally guilty of it.
(5) It was
unfair for the decision to be taken by only seven of the nine members comprising
the original panel – paragraphs 150-152.
(6) The
failure to discipline Mr Swain represented a serious inconsistency – paragraph
153. The positioning of this point suggests that it was something of a
makeweight in the Tribunal’s thinking.
We should note at this stage that the Tribunal’s statement at
paragraph 153 that for those reasons “the disciplinary process … was substantively unfair” seems to us, with respect, rather confusing. Points (1)-(3) and (5) are
essentially concerned with procedural fairness, which in normal usage is
distinguished from “substantive” unfairness. The confusion might seem purely
verbal, but in fact, as appears below, the correct characterisation does have
consequences.
31.
However, the reasonably clear picture of the Tribunal’s thinking apparent
from those paragraphs is muddied by the statement in paragraph 159 that a
reasonable employer could not on the evidence available have found the Claimant
to have acted fraudulently or dishonestly. Although that is said in the
context of the issue of contributory conduct, it seems on its face to be a
reason for holding the dismissal to have been unfair, and a more fundamental
and comprehensive reason than any of those itemised above. There is no doubt,
as we say at paragraph 23 above, that the reason for dismissal given in the
Union’s letter of 26 January is indeed that the Claimant had acted dishonestly;
yet if the Tribunal meant what it said at paragraph 159 there was no reasonable
basis on which the Union could have reached that conclusion.
32. With some hesitation we have come to the conclusion that it
would not be right, despite its apparent literal meaning, to treat paragraph
159 as part of the Tribunal’s reasoning on the liability issue. The Reasons
are, as we have said, carefully structured, and it seems clear that the finding
in question was directed specifically and only to the issue of contributory
conduct. What we think the Tribunal must have been intending to do was to
reject the argument that, if for any reason the dismissal was held to have been
unfair, there should be a reduction of 100% because the Claimant was plainly
guilty of dishonesty. It is true that it applied the wrong test in reaching
that conclusion, because the relevant question was not what the Union could reasonably have decided but what, on the Tribunal’s own findings, the facts
were. But that does not affect the fact that the Tribunal was not at this
point addressing the issue of unfair dismissal, on which its decision must, we
think, stand or fall by the reasoning in paragraphs 144-153.
THE UNION’S APPEAL ON LIABILITY
33.
The Union’s grounds of appeal are pleaded under five heads, which we
take in turn.
Ground (1): “Failure to Make a Clear Finding on the Employer’s
Primary Allegation”
34.
The pleaded point is that the Tribunal never made a finding as to
whether the Claimant was in fact guilty of entering into a corrupt arrangement
with Hudsons. The Union had, it is said, made that allegation in its written
opening, and it should have been adjudicated on.
35.
We should note by way of preliminary that the Union’s written opening
before the Tribunal, which we have seen, does not appear clearly to allege that
the Claimant was guilty of the misconduct alleged. It is trite law that it did
not have to do so in order to defend the fairness of the dismissal: it had only
to show that it had reasonable grounds for believing that the Claimant was
guilty. The particular passage relied on in Mr Hogarth’s opening goes no
further than to explain the charge and why it was important.
36.
When we put this to Mr Hogarth he submitted that the issue required to
be determined because if the Claimant was in fact guilty the Tribunal could,
and should, even if it had found procedural unfairness, have made a 100%
reduction for contributory conduct. That is not the way that the appeal was
originally pleaded, since the only express challenge is to the finding of
unfair dismissal and there is no ground of appeal asserting that the reduction
of 50% for contributory conduct was inadequate. Nor was the point taken in the
Union’s Answer to the Claimant’s cross-appeal on contribution. We do not
believe that we should allow it to be taken now.
37.
In his skeleton argument Mr Hogarth made a rather different point,
albeit under the same heading, namely that the Tribunal never actually makes a
finding as to what the reason for the dismissal was. Paragraphs 141-3 reject
the Claimant’s case on the reason without addressing the Union’s. That is a
fair observation. However, it seems to us reasonably clear, if the following
paragraphs are taken as a whole, that the Tribunal accepted that the principal
reason for the Claimant’s dismissal was as set out in the dismissal letter. It
went on to find that it was not reasonable to dismiss him for that reason, but
that is another matter.
Ground (2): Perversity
38.
As expressed in the Notice of Appeal this appears to be a challenge to
what the Tribunal says in the course of its factual narrative about the forms
emanating from Hudsons and submitted by the Claimant. The Tribunal is said to
have under-stated the problems with the forms and to have at least implicitly
left open the possibility of innocent error, which is said not to be a
realistic finding on the evidence. The underlying point, as Mr Hogarth made
clear, is that on the evidence the Tribunal was bound to find that the Claimant
was guilty of the misconduct alleged. That submission is vitiated by the same
defect as ground (1): the Tribunal was not concerned, on the issue of
liability, with whether the Claimant was guilty or not.
Ground (3): Substitution/Failure to Apply Burchell/Inadequate
Reasons
39.
This ground is addressed to paragraph 159 of the Tribunal’s Reasons, in
which the Tribunal says, in effect, that it was not open to the Union on the evidence before it to conclude that the Claimant had acted dishonestly. That
conclusion is said (a) to be wholly unreasoned and (b) to involve the Tribunal
impermissibly substituting its own view for the Union’s, since the evidence of
the forms was unquestionably capable of justifying the conclusion that the
Claimant had acted dishonestly, even if the Tribunal might not have reached the
same conclusion. It might fairly be said that this is a perversity submission
in disguise, as are many “substitution” challenges; but that does not
necessarily mean that it is ill-founded.
40.
Even if those criticisms are well founded (as we think they may be – see
paragraph 41 below), our conclusion about the Tribunal’s reasoning at paragraph
32 above means that they do not assist on the question of unfair dismissal:
paragraph 159 of the Reasons is concerned with contributory conduct, not
fairness.
41.
We think it right to say, however, that we regard the conclusion in the
first sentence of paragraph 159 of the Reasons, whether material to the issue
of unfair dismissal or not, as highly questionable. In the immediately
following sentence the Tribunal accepted that the Claimant was open to serious
criticism in how he dealt with the forms, which it described as “demonstrably
fictitious”: having read Mr Guy’s reports and seen the forms themselves, we
would agree. That being so, there must have been at least a serious case to
answer that the Claimant had acted dishonestly in submitting them. Of course,
he might have been acting carelessly rather than dishonestly, and that seems to
have been what the Tribunal thought. But its finding at paragraph 159 means
that his case that he was a fool rather than a knave was so obviously correct
that no reasonable employer could have found otherwise. That is a strong
finding, and we cannot detect in the preceding paragraphs any clear basis for
it. At paragraph 158 it is said that he did not complete the forms himself;
but that was never the case against him, which was, rather, that he submitted
them to the Union knowing or believing them to be bogus. It is also said that
he was accompanied on his visit to Hudsons by Mr Swain; but it is not clear how
that is relevant to this issue.
Ground 4: “Procedural Grounds for Unfairness”
42.
It is only under this head that the Union challenges the Tribunal’s
actual reasons, as we have held them to be, for finding the Claimant’s
dismissal unfair, i.e. those summarised at paragraph 30 above. The heading
given is “Procedural Grounds for Unfairness”, but, as already observed, not all the aspects of the reasoning which are challenged are in truth procedural. The
Union’s grounds of challenge are pleaded under four heads, which we take in
turn.
(a) The involvement of Mr Ritchie
43.
The pleading here is rather ill-focused, but the point straightforwardly
put in Mr Hogarth’s skeleton argument is that the Tribunal’s criticism ignores
the fact that Mr Ritchie was prosecuting the case and not adjudicating on it.
44.
We see force in this criticism. The Tribunal does not spell out why the
involvement of Mr Ritchie made the hearing “unbalanced”. If his personal
animosity had led him to prosecute the case unfairly in some specific respect –
say, by withholding important evidence or by offensive questioning – that might
be a ground of appeal in its own right (though the ultimate question would be
whether the unfairness had impacted on the panel, as the decision takers); but
nothing of that kind is alleged. It is possible that the Tribunal may have
thought, though it does not say so, that the panel may have been influenced,
consciously or unconsciously, by a desire to accommodate the known wishes of
the General Secretary of the Union, to whom they will have been used to
deferring as, in some sense, their leader; and that that tendency would be
reinforced by his prosecuting the case in person. But we do not think that
unfairness of that character can simply be assumed. In the absence of at least some indication to the contrary, one would hope and expect that a panel of
senior union representatives would decide a case according to the evidence that
they heard without regard to the views of the General Secretary, whether
prosecuting the case or not. In the absence of any finding impugning the
impartiality of the panel, this basis for finding the dismissal unfair cannot
stand.
(b) The absence of two members of the panel
45.
Mr Hogarth submitted that it was perverse of the Tribunal to criticise
the panel for proceeding to a decision in the absence of two of the nine who
had participated in the hearing. He relied on evidence apparently given by Mr
Thompson (though not recorded in the Reasons) to the effect that if the vote
had been close he would have adjourned to a hearing when all could be present,
but that it was not; and he submitted that that was enough to ensure fairness.
46.
We have not found this point entirely straightforward. We were not
referred to any authority. Our own researches have identified the following
passage in Harris Disciplinary and Regulatory Proceedings (6th
ed), at para. 9.65:
“If
the hearing of a case has to be adjourned, the composition of the committee at
the adjourned hearing should normally be the same as that of the original
tribunal. If the continued participation of a tribunal member at an adjourned
hearing is not possible, for example, because of illness or death, there is no
reason why, consistent with the rules of the particular tribunal, the hearing
should not proceed in his absence, provided only that the tribunal remains
quorate.”
A footnote refers to a statement by the Divisional Court that, in
the analogous situation in the magistrates’ court, the parties should be consulted
before any decision is made: see R v East Dereham Magistrates Court
[1996] COD 196. In Dally v General Medical Council (unreported,
14.9.87) the Privy Council dismissed an objection on the basis that the
original panel of nine which had begun the hearing had dwindled to five by the
end. Lord Goff said:
“[Counsel]
complained of the fact that four
of the nine members of the Committee at the start of the hearing did not
complete the hearing. It appears that the inquiry began on 9th December 1986.
Of the ten members of the Committee invited to attend, one was ill and took no
part, and another withdrew either at or shortly after the commencement of the
hearing for the same reason. When the hearing was resumed in the New Year, on
26th January 1987, two of the members of the Committee who had previously
attended had not been re-elected and so had ceased to be members of the
Committee; and, of the six who remained one immediately withdrew in protest
against a ruling on an issue relating to confidentiality. The remaining five
members completed the hearing, the Committee being quorate throughout the inquiry.
There is no suggestion that any member of the Committee who withdrew after the
inquiry had begun took any part in the deliberations of the Committee. The only
suggestion is that those members of the Committee who made the final decision
may have had their minds and opinions affected by views previously expressed by
the members who had withdrawn. Their Lordships can however see no substance in
this objection.”
47.
Neither the discussion in Harris nor the decision of the Privy
Council are specifically concerned with unfair dismissal, but there is no
reason why the principles of procedural fairness should be different as between
disciplinary proceedings in the employment and regulatory contexts. It seems
to us right in principle both (a) that an employee facing a hearing before a
disciplinary panel has a legitimate expectation that, other things being equal,
the composition of the panel will remain the same from start to finish and (b)
that there may nevertheless be circumstances where it is fair to proceed with
reduced numbers – Dally illustrates, though not exhaustively, a
number of examples of good reasons why the size of a panel may reduce. Where
the expectation that the whole panel will be involved throughout is
disappointed, that may – we do not say that it inevitably will – justify a
finding of serious procedural unfairness sufficient to vitiate the fairness of
the dismissal. In deciding whether that is the case it will be relevant to
consider both the reason why one or more panel-members have dropped out and the
real or reasonably perceived prejudice to the employee.
48.
Although the Tribunal did not approach the issue explicitly in that way,
it seems to us that in substance it did so. As for the reasons why the
decision was taken in the absence of two members, it seems to have been common
ground that Mr Doody had travel difficulties. It might, other things being
equal, have been justifiable to proceed in his absence; but he was not the only
absentee. As regards Mr Gamble, the Tribunal appears to have accepted his
statement that he had no prior notice that the Claimant’s case was to be
considered at the meeting on 20 January 2011. It is true that he was on
holiday on that date, so that it might be said that even if he had been given
notice he could not have attended; but even if he was not able or willing to
break his holiday in order to attend he could have made representations asking
for the discussion to be postponed. The Tribunal does not expressly consider
the difficulty of re-convening within a reasonable time; but it can, we think,
be inferred that it did not accept that it was impossible, and given that only
a month had passed since the hearing we see nothing wrong in that. As to
prejudice, the Tribunal knew from Mr Gamble’s evidence that he would have
argued strongly against the Claimant’s dismissal. Strictly speaking that fact
by itself is probably immaterial: the fairness of the decision to go ahead in
his absence must be judged on what was known at the time, and it is not clear
to what extent he (or indeed Mr Doody) had already shown his hand in the
earlier hearing. But it is clear from the fact that even in his absence there were divided views about whether to proceed (see paragraphs 114-5 of the Reasons)
that this was not seen by all members as an open-and-shut case; and in those
circumstances the Tribunal was in our view entitled to take into account that
there might, even without hindsight, be real prejudice to the Claimant in the
case proceeding in the absence of two of the nine members.
49.
On balance therefore, and even though the Reasons are not as full on the
point as they might be, we believe that the Tribunal was entitled to find that
it was unfair of the panel to proceed to a decision on 20 January in the
absence of Mr Gamble and Mr Doody.
(c) The length of the first day of the hearing
50.
Although it is only expressly the finding about the length of the first
day which is challenged in the Notice of Appeal we understood the challenge to
cover also the related finding that the Claimant was “badgered”. As developed
in Mr Hogarth’s oral submissions the essential points are those made at
paragraph 20 above. As there appears, we find the Tribunal’s finding
inadequately explained. While we can well understand its view that it was
undesirable for a hearing to last so long, we cannot accept that the length of
the hearing could be sufficient by itself to render the decision to dismiss
unfair. However, the Tribunal also found that some panel members “were falling
asleep”. If there was an explicit finding that a member or members had
actually been asleep for any appreciable period, the Tribunal would
unquestionably have been entitled to make a finding of procedural unfairness.
This rather vaguer formulation is unsatisfactory: if it did no more than
reflect, in colourful language, the Claimant’s perception that the members were
getting tired that might be another matter. Reading the findings as a whole,
however, we can see no sufficient basis for rejecting the Tribunal’s conclusion
that the length of the first day, and its consequences for the alertness of all
those present (including the Claimant), constituted a real unfairness.
(d) Mr Swain
51.
As noted above, the significance that the Tribunal attached to the
different treatment of Mr Swain is not entirely clear. The Union understands
the principal point being made to be about inconsistency. Its point is that the charges against the Claimant and Mr Swain
were different in an important respect. All that could be said against Mr
Swain was that he had failed on the occasion of his joint visit to Hudsons with
the Claimant to appreciate that they were a payroll company; but the Claimant
had continued to deal with them thereafter on his own and the case that he must
have realised their true nature was stronger – and, more to the point still –
he had dealt with the bogus forms, whereas there was no suggestion that Mr
Swain had. Mr Hogarth reminded us of the guidance in Hadjioannou v Coral
Casinos Ltd [1981] IRLR 352 to the effect that in “disparity” cases
like must only be compared with like.
52.
In our view this submission is well founded. We do not in fact know why
the charges against Mr Swain were eventually not pursued; but even if a
considered decision was made to acquit him, we do not see how that could render
the decision in the Claimant’s case unfair. The difference in the nature of
the charges between them was indeed fundamental.
Conclusions on ground (4)
53.
For the reasons given above, some of the reasons given by the Tribunal
for finding the Claimant’s dismissal to have been unfair are in our view
unsustainable. However, we can see no error of law in its conclusion that it
was unfair to proceed in the absence of Mr Gamble and Mr Doody or, on balance,
with its criticism of the length of the first day’s hearing. The question then arises
whether the Tribunal would have made a finding of unfair dismissal if these had
been the only criticisms. In our view it is clear on a fair reading of the
Reasons as a whole that it would have done: we note in particular the final
sentence of paragraph 152. It is also our view that such a finding would have
been open to it.
54.
It follows that we uphold the finding that the Claimant’s original
dismissal was unfair, but on a more limited basis than the Tribunal. That is,
however, not the same as upholding the finding of unfair dismissal, because of
the question of the internal appeal, which we consider next.
Ground 5: Ignoring the Appeal
55.
It is well established that in principle a fairly conducted appeal may
“cure” procedural defects in an initial hearing: see Taylor
v OCS Group Ltd [2006] ICR 1602. Although the Tribunal referred to the
appeal hearing in its factual findings, there is no consideration anywhere in
the Reasons of its relevance to the question of unfair dismissal. Mr Hogarth
submitted that that was a plain error of law. Procedural unfairnesses of the
kind on which the Tribunal mainly relied are peculiarly apt to be cured by an
appeal.
56.
It might have been better if the Tribunal had dealt explicitly in its
reasoning with the relevance or otherwise of the appeal (though we do not know
how much emphasis was placed on it in Mr Hogarth’s closing submissions). But
we can understand its failure to do so, given that it had found a substantive ground of unfairness – namely the difference in the treatment of Mr Swain. We,
however, have held that that finding was not open to it and that, although the
Tribunal was entitled to find the initial dismissal decision unfair, that was
only on procedural grounds. The question of whether that procedural unfairness
could be cured by appeal does accordingly now arise. That is not a question
which we think needs to be remitted to the Tribunal. In our view it is clear
that an appeal hearing of the kind which the Chairman explicitly said that this
was – see paragraph 24 above – could not put right the fundamental unfairness,
as the Tribunal found it to be, of two of the nine members of the panel being
excluded at the essential decision-making stage and perhaps also of the length
of the first day’s hearing.
Conclusion on Liability
57.
We accordingly uphold the finding of unfair dismissal, albeit, as we
have said, on a more limited basis than found by the Tribunal.
THE UNION’S APPEAL ON THE POLKEY QUESTION
58.
At paragraph 154 of the Reasons the Tribunal said simply that it was not
“appropriate to make a reduction in the Claimant’s award to reflect the chance
he would have been dismissed even if the hearing had been fair” – i.e., in the
jargon, a Polkey reduction. That was evidently on the basis that it had
found substantive unfairness. As noted above, many of its criticisms of the Union were in fact procedural rather than substantive; but the criticism based on Mr
Swain’s involvement was indeed substantive, and accordingly it was right to
take the course it did. However, we have found that the only sustainable basis
for its decision is that there were one or more procedural flaws. That being
so, it is indeed necessary to decide what was the chance of the Claimant being
fairly dismissed if a fair procedure had been adopted.
59.
The normal consequence of such a decision would be that the case had to
be remitted to the Tribunal to determine the Polkey question, which
involves an essentially factual assessment. Our strong inclination if possible
would be to remit the case to the same tribunal. If it is remitted to a fresh
tribunal it will be necessary for the parties to adduce again those parts of
the evidence that are relevant to the chance that the Claimant would have been
fairly dismissed if Mr Gamble and Mr Doody had been involved in the decision
(and if the first day had not been so prolonged): that means (at least) the
evidence of Mr Guy’s investigations and of the Claimant’s responses at the
disciplinary hearing, together with the evidence of Mr Thompson and Mr Gamble
(or indeed any other panel members who might be called). Further, the answer
to the Polkey question is in principle relevant to the reduction for contributory
conduct: see Rao v Civil Aviation Authority [1994] ICR 495, esp.
per Sir Thomas Bingham MR at p. 502C. That being so, if the former is remitted
the latter will in principle have to be reconsidered also. However,
notwithstanding those disadvantages, both counsel were agreed that any remittal
should be to a different tribunal. That is not binding on us, but we are bound
to give it weight, and we have come to the reluctant conclusion that it would
not be fair to the parties or indeed the Tribunal to ask it to consider the Polkey
and contribution issues on a basis which involved it putting out of its mind
the firm, but – as we have held – erroneous, conclusion which it reached first
time round: we note in particular its belief that the dismissal was substantively unfair, because of the treatment of Mr Swain, and its findings in paragraph 159 of
the Reasons.
60.
We have anxiously considered whether we can avoid that unsatisfactory
result by deciding the question ourselves. This Tribunal has recently been
more willing to decide issues that could be said to involve questions of fact or
assessment in order to avoid what Jacob LJ in Bournemouth University v Buckland [2010] ICR 908 described as “ping pong”: see para.
58 (p. 920). But with the best will in the world we do not think that we are
in a position ourselves fairly to decide the linked issues of the Polkey
reduction and contributory conduct. We can, however, help to minimise the risk
of any further problems by spelling out as clearly as possible the basis on
which the Tribunal should proceed, as follows:
(1)
It should proceed on the basis that the reason for the Claimant’s
dismissal was as set out in the dismissal letter (see paragraphs 23 and 37
above), but that it was unfair only on the basis that we have upheld.
(2)
The first issue for it, as we have said, is to assess the chance that
a fair decision to dismiss would have been made if the members had been alert
throughout the hearing and (which is probably the point that matters) if Mr
Gamble and Mr Doody had participated in the subsequent meeting. (The Tribunal
must of course assume that that hypothetical consideration by the full panel
would have been fair. That means that even if there was reason to fear that Mr
Ritchie’s involvement put some pressure on the panel members the Tribunal
should proceed on the basis that they were able to disregard that pressure.)
(3)
Obviously a central question in that assessment will be how strong the
case against the Claimant as presented in Mr Guy’s reports, and his answer to
it as presented and tested at the hearing, was: in principle, the stronger the
case the greater the likelihood that the result would have been the same. For
the avoidance of doubt, the Tribunal will not be bound by the (apparent) view
of the previous Tribunal that no reasonable employer could have found the Claimant
to have acted dishonestly.
(4)
Only once it has reached a decision on that question should the
Tribunal proceed to the logically distinct question of what reduction should be
made for contributory conduct (see Rao above). That will involve
considering essentially the same evidence, but the focus will be not on what
the panel would have done but on the Tribunal’s own assessment of the
Claimant’s conduct. It should approach that task afresh, based on its own
assessment of the evidence which it hears. However, we do not believe that it
would be just to allow it to impose a reduction for contributory conduct (on
top, that is, of any “Polkey discount”) of more than 50%, since – as
pointed out at paragraph 36 above – the Union has never appealed against the
50% figure, and it would be wrong to allow it to challenge it by a side-wind.
THE CLAIMANT’S
CROSS-APPEAL: TRADE UNION ACTIVITIES
61.
Under head B of the cross-appeal contained in his Respondent’s Answer
the Claimant challenges the Tribunal’s dismissal of his claim that he was
dismissed for taking part in trade union activities within the meaning of
section 152 of the 1992 Act. Mr Atkinson accepted that even if the appeal on
this point were successful it would have no financial consequences, because the
Tribunal’s findings at the remedy hearing meant that the value of his claim
would in any event be below the cap for claims of “ordinary” unfair dismissal.
But he said that the issue was important to the Claimant as a matter of
principle, and we accept that he was entitled to have it determined.
62.
The first point pleaded is that the Tribunal nowhere directly addresses
the question of the reason for the Claimant’s dismissal. Mr Hogarth had made
the same point for a different purpose – see paragraph 37 above – but, as we
did in that connection, we reject it. In our view the Tribunal’s finding at
paragraph 144 of the Reasons that there were “wholly justifiable grounds for
the Respondent to undertake an investigation into the Claimant’s conduct” was,
in context, evidently intended as a finding that the principal reason for the
dismissal which was the final result of that investigation was the panel’s
belief that he was guilty of the misconduct with which he was charged. The
Claimant pleads that the reason for the investigation and the reason for the
eventual decision are not necessarily the same. That is no doubt correct in
theory; but they would normally be the same, and it is plain that the Tribunal
believed that that was the case here.
63.
The Claimant’s second point is a mix of a perversity and “inadequate
reasons” argument. A number of points are identified which it is said were
indications that the principal reason for his dismissal was Mr Ritchie’s
animosity against him, and it is said that these were sufficiently compelling
to require either a finding of a “section 152 reason” or in any event an
explanation why not. We do not propose to go through these facts individually.
They do not seem to us to come close to raising a prima facie case of
discrimination. Most are concerned with emphasising Mr Ritchie’s animosity
against the Claimant: there is said, for example, to have been evidence from Mr
Short, unrecorded in the Reasons, that it was common knowledge that Mr Ritchie
was “out to get” the Claimant. But the Tribunal was well aware of that, and it
does not advance matters. Mr Ritchie was not the decision-maker as regards the
dismissal. Nor was it even he who recommended the bringing of disciplinary
charges: that was Mr Guy. The point is that, as the Tribunal found, the
Claimant’s conduct in connection with Hudsons plainly required investigation,
and Mr Guy’s report justified the bringing of charges. Even if the matters
relied on by the Claimant raise a suspicion that some of the panel members may
have shared Mr Ritchie’s animus against the Claimant (for which no direct
evidence is cited), and that that animus was because of his having stood for election
as General Secretary (which need not have been the case – the Claimant may not
have been an easy colleague), section 152 requires that the proscribed factor
be the principal reason for the dismissal. It should be noted that
where an employee is dismissed for legitimate reasons, that is not necessarily
vitiated by the fact that the decision-taker may have other, and bad, reasons
for welcoming the dismissal: see ASLEF v Brady [2006] IRLR 576, per
Elias J at para 78.
64.
We accordingly dismiss this head of the cross-appeal (“ground (B)”).
THE CLAIMANT’S CROSS-APPEAL: THE SECTION 103A CLAIM
65.
There is no doubt that the Claimant originally pleaded a claim that the
principal reason for his dismissal was that he had made the protected
disclosures identified at paragraph 9 above and that his claim was thus
automatically unfair by reason of section 103A of the 1996 Act; or that that
claim was one of the issues identified at the case management discussion which
preceded the hearing. That claim was of course logically inconsistent with the
claim under section 152 of the 1992 Act – you can only have one “principal” reason
– but no doubt the Claimant was entitled to pursue both as alternatives. Like
the section 152 claim, the claim under section 103A has now no financial
advantages for the Claimant; but he would, again, be entitled to pursue it as a
matter of principle.
66.
As will have been observed, the Tribunal at paragraph 141 of the Reasons
recites that “the Claimant did not pursue his complaint under section 103A”. He
says in his cross-appeal that that is simply not the case and that the Tribunal
must have misunderstood him. He never said anything that could have been
interpreted as an abandonment of the claim.
67.
The Employment Judge was asked for his comments on this point. He said
that, having checked his notes, he could confirm that the Claimant focused his
case at the hearing “entirely” – so far as unfair dismissal was concerned – “on
grounds of trade union activities”, and he points out that in his written
submissions the Claimant had posed the question “what was the reason for
dismissal?” and answered it: “I allege the reason for my dismissal was my trade
union activities. R contends it was my conduct.”
68.
In our view the Judge’s observations dispose of this ground of appeal. However,
we would note that even if the Claimant should not be treated as having abandoned
this head of claim the Tribunal, at paragraph 143 of the Reasons, said in terms
that even if it had been pursued it would have rejected it because the grounds
for his dismissal were not connected with the disclosures; and that is repeated
at paragraph 160. That is a finding of fact, based on the very detailed
findings about the reason for the dismissal made in the following paragraphs
(albeit, as discussed above, imperfectly expressed); and it is unassailable.
THE CLAIMANT’S CROSS-APPEAL: CONTRIBUTORY CONDUCT
69.
As appears at paragraph 159 of the Reasons, the Tribunal’s finding that
the basic and compensatory awards should be reduced by 50% was based on (a)
“conduct on [his] part in relation to the forms, which were demonstrably
fictitious” and (b) his failure to co-operate with Mr Guy’s investigation. Under
head A in the cross-appeal (so far as it survives the sift) the Claimant
asserts, as to the former, that any finding that he was at fault in his conduct
in relation to the forms was perverse, particularly given the Tribunal’s
express statement that there was no basis for a finding of dishonesty; and, as
to the latter, that the Tribunal should have found that any non-co-operation on
his part was because of ill-health and could not justify a finding of fault.
70.
Our decision that the issue of contributory conduct must be remitted to
the Tribunal as a necessary corollary of the remittal of the Polkey
issue means that we need not, and indeed should not, decide whether those
criticisms are ill-founded. We would only observe that on the facts disclosed
by Mr Guy’s investigation it is very hard to see how it could be said to be
perverse for a tribunal to make a finding that the Claimant was at fault. As
regards his non-co-operation with Mr Guy, the contention that this was the
result of ill-health requires to be carefully assessed against the available
evidence.
REMEDY
71.
Only two points were allowed to proceed on the Claimant’s remedy appeal.
We take them in turn.
PENSION LOSS
72.
The Tribunal dealt with the Claimant’s pension loss at paragraphs 23-25
of its remedy decision. It did not refer to the well-known guidance on
calculating pension loss given by a panel of Employment Judges with the
assistance of the Government Actuary or the helpful summary in Harvey on
Industrial Relations and Employment Law at paras. DI 2602-2625; and it is,
with respect, a little difficult to understand what approach it was intending
to take. But we need not attempt to analyse its reasoning because it was
common ground before us that it was wrong and that the exercise needs to be
done afresh. To save costs, we will remit that task also to the tribunal which
will be considering the Polkey and contributory conduct issues. It
should hear the issue de novo and must be provided with the necessary
evidential material, specifically about the Union’s pension scheme, to enable
it to do so; but it will be bound by the finding in the original remedy
decision that the Claimant’s employment would not in any event have continued
beyond 30 June 2012 (and of course any amount will be liable to whatever Polkey
discount and/or reduction for contributory fault the Tribunal will have decided
on).
CAR ALLOWANCE
73.
The Claimant was provided by the Union with a car, which he was allowed
to use for private purposes. In his schedule of loss he claimed £3,000 p.a. as
the value of this benefit: we were told that this was based on figures from the
AA. The Tribunal states at paragraph 21 of its Reasons on remedy issue that:
“In cross examination the
Claimant accepted that the net value of the car benefit was £2,000 per annum.
Accordingly the Tribunal concluded that it was just and equitable to award the
Claimant loss of car benefit from the date of his dismissal until 30 June 2012,
subject of course to the 50% deduction.”
74.
The Claimant says that he never made the concession recorded by the
Tribunal and he should have been awarded the full £3,000. We do not believe
that the Tribunal would have said what it did unless the Claimant had indeed
made that concession, and there is a clear basis for it, namely that the
figures in the Claimant’s schedule were gross, and a 1/3rd reduction
would represent a rough-and-ready after-tax equivalent. We dismiss the appeal
on this point.
SUMMARY AND CONCLUSION
75.
We dismiss the appeal against the finding of unfair dismissal; but
because we believe that that finding is only justified on procedural grounds we
remit the case to a different Tribunal for determination of the related issues
of a Polkey discount and a reduction for contributory conduct, on the
bases set out above. We dismiss the cross-appeal. We allow the appeal against
the remedy decision to the extent only that we remit the calculation of the
Claimant’s claim for pension loss to the same Tribunal as will be hearing the
remitted liability issues.
76.
Without in any way wishing to pre-judge the conclusions to which the
Tribunal might come on the remitted issues, the findings which remain in place
mean that the outcome on those issues may make only a small difference, and
maybe even no difference at all, to the position as it stands at present. The
parties should consider carefully whether the pursuit of the remitted issues is
really worthwhile and whether they cannot reach a sensible compromise now.
NOTE
(1) A draft of this judgment was
circulated to counsel in the usual way inviting suggestions for the correction
of typographical or other obvious errors. Mr Hogarth submitted a nil return.
We received nothing from Mr Atkinson, but we were sent a ten-page note from Mr
Dooley himself taking issue with what we had said in a number of passages.
This should not have happened: while there is no objection to the
pre-circulated draft being shown by counsel (or a solicitor advocate) to his or
her client, we regard the sending of the requisite return to the Tribunal as the
obligation of the advocate. It should not be delegated to the client, who will
not understand the limits of the exercise. But there may have been particular
reasons for what happened in this case and we are not to be taken as criticising
either Mr Atkinson or Mr Dooley.
(2) We have nevertheless thought
it right to consider Mr Dooley’s comments. In the light of them, we have made
corrections on a small number of factual points where it was clear that the draft
did not accurately reflect the Tribunal’s findings or the uncontentious
documents. None of them affects our reasoning or the outcome in any way. We
are grateful to him for drawing these to our attention. The remainder of his
comments sought changes which went beyond the scope of this kind of exercise.
If we had believed that any of these further errors alleged by Mr Dooley were
capable of affecting the overall reasoning of our judgment or the outcome, or
might – as he appears to fear – prejudice any subsequent hearing, it might have
been appropriate for us to consider using our power of review; but we are
satisfied that that is not the case.
(3) We have, exceptionally,
appended this note because of the unusual circumstances of the present case.
Normally the process of correction of errors is a routine matter not requiring
any comment.
