England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM AN EMPLOYMENT APPEAL TRIBUNAL
(His Honour Judge Peter Clark)

		Royal Courts of Justice Strand London WC2 Wednesday, 3rd October 2001

Wednesday, 3rd October 2001

1. LORD JUSTICE PETER GIBSON: There are two applications for permission to appeal from a single interlocutory decision of the EAT by which the EAT dismissed the applicants' appeal from a decision of an Employment Tribunal. By that decision the Tribunal refused to allow the joinder of a further respondent.
2. The applicants are Wayne Seabridge and Paul Gater, who claim to be disabled within the meaning of the Disability Discrimination Act 1995. Whether they are disabled within the meaning of the Act has yet to be determined.
3. On 12th April 1999 they commenced work as trainee joiners under a national training scheme working on a building site. The main contractor was Wimpey. The sub-contractors included A R Trowers ("Trowers") and a firm called Pete & Steve. The first part of their training was six weeks' school-based training and after six weeks they were assigned to Pete & Steve whom they understood to be employed by Trowers. They were dismissed on 14th June 1999 for leaving the site early on several occasions.
4. Each went to the Stoke-on-Trent CAB a lady from which acted as his representative in applying on 14th September 1999 to the Tribunal, complaining of disability discrimination and/or unfair dismissal. As I understand their complaint, it rests on an allegation that they were dismissed unfairly because they were dismissed for a reason relating to their disability. In their IT1s they named no less than four respondents as having been their employers: (1) Construction Projects Training Ltd ("CPT"); (2) Trowers; (3) Wimpey Homes; and (4) Pete & Steve. Proceedings against the third and fourth respondents have been discontinued. It appears that Trowers accept that they were the employers.
5. The mother of Mr Seabridge wrote to CPT before proceedings commenced and on 28th July 1999 CPT replied, saying:

"As you may remember we met on the 18 June 1999 ... where we discussed the training aspects of your Son's time at the Moss Green Site.

It was explained then that we did not or have not ever employed your Son, we are a College based training organisation.

I have no access to your Son's contract of employment or any input into his employment apart from his skill training."

6. Despite this, CPT, as I have said, was named as a respondent. In its IT3 CPT stated that it resisted the applications on the basis that the applicants were national trainees with employed status, having contracts for service with their employers, Trowers. CPT asked for a preliminary hearing to establish whether there was a case for it to answer.
7. Under Part II of the Disability Discrimination Act relating to employment no proceedings can be brought against an employer with fewer than 15 employees (see section 7). Yet remarkably no consideration appears to have been given to this elementary point until it was taken by the Tribunal itself at the outset of the preliminary hearing on 2nd October 2000. At that hearing the applicants were represented by a Mr Bealey from the CAB. In response to the Tribunal's point, CPT through its counsel told the Tribunal that CPT was wholly owned by South Birmingham College ("the college") though a discrete legal entity, that CPT had no employees but the college had about 500, that those who worked for CPT were in effect on a type of secondment from the college and that the applicants were not employed by the college at which they were merely students. By an application dated 12th October 2000 Mr Bealey formally applied to add the college on the basis, as he put it, that it was just and equitable to do so because CPT was wholly owned by the college and had no employees.
8. The Tribunal in its extended reasons promulgated on 16th October 2000 said that at the hearing the applicants had made two applications. One was for an adjournment. That was initially refused. The other was to join the college as a respondent. That too was refused, the Tribunal saying that it had considered whether it was just and equitable to join the college but that it considered that it was not for two reasons. One was that the proceedings had been in existence for over a year and the attempt to join the college was out of time. The other was that the fact that CPT was owned by the college did not make the college an employer. The Tribunal then proposed to hear evidence from a CPT witness, but on a renewed application by the applicants for an adjournment, because the witness had provided no witness statement, the Tribunal very properly agreed to an adjournment.
9. The applicants then appealed to the EAT against the Tribunal's refusal to join the college. At the preliminary ex parte hearing the appeal on that point was dismissed. The EAT considered the two matters taken into account by the Tribunal, that is to say delay and the absence of a cause of action against the college. The EAT said that the Tribunal had not elevated the applicant's delay to be the decisive factor and the real question was whether the applicants had mistakenly identified the wrong person as the proper respondent. The EAT held that there was no real evidence that any nexus existed between the applicants and the college to render the college potentially liable to the applicants as an employer under the Act. It noted that Mr Bealey, who appeared before the EAT, had accepted that from a time before proceedings commenced the applicants and their advisers were aware of the relationship between CPT and the college, but nevertheless no steps were taken to join the college as respondents until the section 7 point was taken by the Tribunal. The EAT said that the factual question whether CPT was the employer of the applicants remained to be determined by the Tribunal, but the EAT concluded that it was not persuaded that the applicants could advance any different case to show that they were employed not simply by Trowers but also by the college as opposed to CPT. The EAT therefore refused to interfere with the Tribunal's exercise of discretion.
10. On this application, the applicants have put in a skeleton argument from Mr Bealey. They have asked that I should deal with this application in their absence. I have considered all the papers, and this judgment therefore represents my conclusions on all the material which has been put up before me. The grounds for appeal set out in the Appellant's Notice are:

(1)the EAT applied the wrong test for an application to change the name of the respondent in an Employment Tribunal case;

(2)the EAT wrongly refused to allow the college to be added as respondent despite the fact that,

(i)the college employed the person responsible for dismissing the applicants;

(ii)CPT was a department of the college;

(iii)CPT did not inform the applicants of its status until the Tribunal hearing on the 2nd October 2000.

11. I say at once that in concentrating on alleged errors by the EAT the applicants have overlooked the repeated statements in this court that on what would be a second-tier appeal this court is more concerned with whether the Tribunal was correct in its decision than with whether the EAT was correct: see, for example, Mensah v Hertfordshire NHS Trust [1998] IRLR 531 at page 533-34, paragraph 13.
12. On the first ground the characterisation of the application as one for the change of name of the respondent is in my view simply wrong. The applicants are applying to add a quite different person as respondent despite their scattergun approach of listing four respondents in their IT1, and that, as I have noted, did not include the college. In his skeleton argument Mr Bealey said that the Tribunal failed to apply the test of whether it was just and equitable to allow the decision of the college as a respondent because there was no evidence of any consideration of the justice and equity of the application. But the Tribunal said expressly that it did not consider it just and equitable to allow the joinder and for that it gave the two reasons to which I have already referred. There is no real prospect of success for an appeal on that point.
13. The main point which Mr Bealey took was that it was wrong in any event to apply a test of whether it was just and equitable to add the college as a respondent. That is a bold argument given that that was the basis on which he had applied for the joinder of the college. The right test, Mr Bealey said, was that laid down in Cocking v Sandhurst (Stationer) Ltd [1974] ICR 650 and Milestone School of English Ltd v Leakey [1982] IRLR 3. Neither case would appear to have been cited to the Tribunal by Mr Bealey.
14. In Cocking a complaint of unfair dismissal was brought by an employee against a company as his employer. The company said in its IT3 that it was not the employer but the parent company was. The employee was only three weeks out of time when he sought to bring proceedings against the parent company. The Tribunal refused to allow the employee to substitute the parent company for the company against which proceedings had been brought in time. The National Industrial Relations Court allowed the employee's appeal. Sir John Donaldson, giving the judgment of the court, gave guidance to tribunals on applications to add or substitute a respondent. He said this at page 657:

"(6) In deciding whether or not to exercise their discretion to allow an amendment which will add or substitute a new party, the tribunal should only do so if they are satisfied that the mistake sought to be corrected was a genuine mistake and was not misleading or such as to cause reasonable doubt as to the identity of the person intending to claim or, as the case may be, to be claimed against. (7) In deciding whether or not to exercise their discretion to allow an amendment, the tribunal should in every case have regard to all the circumstances of the case. In particular they should consider any injustice or hardship which may be caused to any of the parties, including those proposed to be added, if the proposed amendment were allowed or, as the case may be, refused."

15. In Leakey the employee was employed at a school until he was dismissed. He joined the school as respondent and complained of unfair dismissal. A settlement with the school was agreed but the agreed sum was never paid. Through no fault of the employee, the true identity of the employer, trading as a school, was unclear. The employee applied for the restoration of the case so that the agreement could be set aside and two further respondents could be joined as the entities trading as the school. The Tribunal allowed the application and this court dismissed an appeal from that decision. Mr Bealey suggests that that case is indistinguishable from the present. That, in my view, is hopeless. Leakey turned on whether the Tribunal had jurisdiction to deal with the claim notwithstanding the settlement agreement. The highly unusual facts of that case are quite different from those in the present case where there has always been an acknowledged employer in existence.
16. Mr Bealey says that the Tribunal erred in law in not applying the test laid down by Sir John Donaldson in Cocking. I cannot agree. Tribunals must decide cases on the material put before them by the parties. So far as I can see no facts were advanced to the Tribunal to show that there had been a genuine mistake. Indeed the desire to join the college smacks of opportunism, arising, as that point did, only when it was realised that success on an application under the Act could not succeed against a person claimed to be an employer but not having the requisite number of employees. The Tribunal had a discretion whether or not to allow the college to be joined. The Tribunal was entitled to attach weight to the two points it took on delay and the absence of evidence to suggest that the college was the employer.
17. On delay, as the EAT pointed out, the applicants were aware of the relationship between CPT and the college even before proceedings commenced but nevertheless did not join the college. There is no evidence in any event that the college was the employer of the applicants. The applicants have produced no contractual document, no pay slip or any other documentary evidence in support of their claim that it was. Mr Bealey asserts that Mr Bowden, whose status as an employee of the college and not of CPT was not known by the applicants until the 2nd October 2000, played the central part in the dismissal. True it is that in a report on the dismissal Mr Bowden said:

"Monday 14th June Tony Trowers phoned to inform me that both Paul and Wayne were absent from work. Tony and I discussed the options and it was decided that both Paul and Wayne were to be dismissed."

18. But in the next sentence Mr Bowden said:

"I feel that taking into account the numerous times that Paul and Wayne were warned about their attendance, time keeping and attitude, that the decision by Trowers was acceptable."

19. That is unequivocal evidence that it was Trowers' decision, not Mr Bowden's, though he apparently concurred with that decision. In any event, as the EAT pointed out, when an employee of one company is on secondment to another company that employee acts on behalf of the latter company and does not thereby cause or create an employment relationship between his employer and the second company. Accordingly, it seems to me plain that there was no material on which the Tribunal could conclude that the college was the true employer of the applicants. In the light of that it would have been futile to allow the joinder of the college. In my judgment the Tribunal was therefore plainly entitled to refuse the joinder.
20. An appeal has no real prospect of success, nor is there any other compelling reason why the appeal should be allowed to go ahead. Accordingly I must refuse this application.
Order: Application refused.