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
(Mr Justice Maurice Kay presiding)

		Royal Courts of Justice Strand London WC2 Wednesday, 31st July 2002

Wednesday, 31st July 2002

1. LORD JUSTICE PILL: This is an appeal by King's College Hospital NHS Trust ("the Trust") against a decision of the Employment Appeal Tribunal, Mr Justice Maurice Kay presiding, sent to the parties on 4th December 2001. The Appeal Tribunal allowed an appeal from a decision of an Employment Tribunal held at London South on 19th October 2001. On a preliminary point as to whether Mr Ahmed Hussain, the respondent, had a potential claim against the Trust under section 4 of the Race Relations Act 1976 ("the 1976 Act"), the Appeal Tribunal held that the respondent was entitled to pursue a claim under the section. The Appeal Tribunal also held that the respondent should be permitted to amend his claim "specifically to plead section 13 of the 1976 Act by reference to the facts upon which he already relies".
2. Section 4 of the 1976 Act provides:

"(1) It is unlawful for a person, in relation to employment by him at an establishment in Great Britain, to discriminate against another-

(a)in the arrangements he makes for the purpose of determining who should be offered that employment; or

(b)in the terms on which he offers him that employment; or

(c)by refusing or deliberately omitting to offer him that employment.

(2) It is unlawful for a person, in the case of a person employed by him at an establishment in Great Britain, to discriminate against that employee-

(a)in the terms of employment which he affords him; or

(b)in the way he affords him access to opportunities for promotion, transfer or training, or to any other benefits, facilities or services, or by refusing or deliberately omitting to afford him access to them; or

(c)by dismissing him, or subjecting him to any other detriment.

(3)... ."

3. Section 13 provides:

"(1) It is unlawful, in the case of an individual seeking or undergoing training which would help fit him for any employment, for any person who provides, or makes arrangements for the provision of, facilities for such training to discriminate against him-

(a)in the terms on which that person affords him access to any training course or other facilities concerned with such training; or

(b)by refusing or deliberately omitting to afford him such access; or

(c)by terminating his training; or

(d)by subjecting him to any detriment during the course of his training.

(2) Subsection (1) does not apply to-

(a)discrimination which is rendered unlawful by section 4(1) or (2) or section 17 or 18; or

(b)discrimination which would be rendered unlawful by any of those provisions but for the operation of any other provision of this Act."

4. I will consider the section 4 point first. It is that on which most reliance is placed by the respondent.
5. The respondent is Egyptian by origin. He came to the UK in 1991 and is a Fellow of the Royal College of Surgeons. He was employed by the Trust as a senior registrar in neurosurgery from July 1996 to February 2000. He then worked for another trust at the Atkinson Morley Hospital, but was not offered re-employment by the Trust in early 2001. His complaint, as refined following a pre-hearing discussion on 27th June 2001, was:

"That on 1st February 2001 [KCH] failed to consider [the Respondent] for one of the three vacant locum posts - 3 training posts in Neuro surgery:

An act of direct race discrimination, and

An act of victimisation - the protected act being [the Respondent's] complaint to the Post Graduate Dean in writing on 12 November 1999."

6. The case involves a question of some general importance upon the application of the 1976 Act under the scheme by which the postgraduate training of junior doctors is arranged in the United Kingdom. The Employment Tribunal's description of the scheme in their Extended Reasons was succinct:

"The scheme for the training of doctors on consultant level in the National Health Service Hospitals is regulated by the Secretary of State under a scheme commonly referred as to the `orange book', a guide to specialist registrar training. Hospitals would provide training facilities, and have training posts which take the form of fixed term employment contracts. Appointments to these posts are made by the Dean. In making these appointments he considers the views of a Specialist Training Committee for each area on which the employing hospitals are represented but he is not bound by their recommendations and has at least one occasion we heard about made an appointment against the wishes of King's College Hospital."

7. The reference to "the orange book" is a reference to a 1996 document produced by the NHS Executive on behalf of the Department of Health. It is entitled "A guide to specialist registrar training" ("the guide"). On behalf of the Trust Mr Jeans QC has elaborated on that description, and in my judgment rightly so having regard to the general point to be decided.
8. The facts relevant to the issue upon section 4 are not in dispute. They appear in the statement of Mrs Ann Wood, General Manager for Cardiac and Neurosciences at the Trust, who gave evidence before the Employment Tribunal as well as in counsel's submission and the somewhat brief findings of fact of the Employment Tribunal. Those findings needed only to be brief, having regard to the approach of the parties to the point of statutory construction which had arisen, but it is appropriate to set out the facts in more detail, as they provide the context for the decision.
9. A Dean is mentioned by the Employment Tribunal in the paragraph that I have read. The Postgraduate Deanery is a body responsible for the training of junior doctors in the United Kingdom. It was created by the Secretary of State under powers which, it is agreed, were conferred on him by section 2 of the National Health Act 1977. The Dean arranges post-graduate placements with hospitals. King's College Hospital is an accredited post-graduate training provider for specialist neurological training. King's College Hospital is operated by the Trust. The training is in-post and the doctor's contracted employment is with the Trust, but the appointment is made by the Dean. The guide, at paragraph 12, provides that the training placement will be arranged by the Postgraduate Dean in consultation with employers. Doctors undergoing post-graduate specialist training do so with a view to obtaining a certificate of completion of specialist training. Mrs Wood states:

"The Trust, as the postgraduate training provider, would be consulted about the educational content of the training placement by the Deanery in respect of the individual trainee at a Specialist Training Committee (STC) but it is the Postgraduate Dean who gives the final approval of the training placement."

10. As described by Mr Jeans, the Specialist Training Committee includes representatives of medical colleges, hospitals, academic institutions, as well as the trainees themselves. The Committee is a forum for discussion of the progress of trainees and is able to make representations to the Dean about the placement of individual trainees.
11. Mrs Wood describes the events leading to the respondent's complaint:

"9.I understand that a Special Training Committee was convened on 30th June 2000 at which Mr Hussain's progress in this targeted training placement at Atkinson Morley Hospital was reviewed. There would be representatives from King's College Hospital NHS Trust on the STC.

10. At that meeting, Mr Hussain expressed a wish to move back to King's College Hospital ... for a further four months to complete his training. It has been minuted in the notes of meeting dated 19th July 2000 at page 3 that "the panel told Mr Hussain that King's College Hospital would not allow him to return and have expressed this firmly to the Committee."

11. ... . The Specialist Training Committee concluded that Mr Hussain was in need of further supervision and recommended a placement for intensified supervision/repeated experience at Hurstwood Park Hospital. Mr Hussain declined the offer of a placement at Hurstwood Park Hospital despite the recommendations of the Specialist Training Committee.

12.In February 2001, three locum for training ... posts became vacant at King's College Hospital."

12. The Employment Tribunal found at paragraph 6, consistent with that evidence, that:

"...King's did not want him back because of the disturbance he had caused there."

13. The Employment Tribunal also found, as also appears from their finding, that the Dean considered the views of the STC when appointments were made. In submissions on the respondent's behalf to the Employment Tribunal, which Mr Jeans accepted could be taken as a finding of fact for present purposes, it was stated that the Trust representatives "had through the Committee said to the Dean, `We do not want him here'".
14. It is accepted on behalf of the Trust for present purposes that the notes of the meeting of 19th July are to be taken as an accurate record of the proceedings at the meeting. It is accepted for present purposes that the respondent was not considered for the post which became available at King's College Hospital.
15. The Employment Tribunal set out in some detail the submissions of the parties, which were confined, subject to the question of section 13, to arguments as to the construction of section 4. On behalf of the Trust it was accepted that they had "the ear of the Dean". It was submitted that:

"They could not have been said to have had made his (the Dean's) decision for him or he slavishly to have followed what they said."

16. The Employment Tribunal's conclusions were brief:

"We are satisfied that section 4 does not apply to the facts of this case. Whilst the Respondents had an input into that decision it went no further than that. The decision was taken by the Dean and section 13 would cover that position. There is no lacuna in the law which we have to seek to cover by a wide interpretation of Section 4."

17. On appeal the Appeal Tribunal took a different view:

"13. ... . Before the Employment Tribunal the evidence disclosed that there can be cases (at least one was found) in which the Postgraduate Dean in fact foists an employee upon a reluctant employer. It may be significant that only one such example was found. It seems to us that on the facts as found, both overtly and reading between the lines, as one would expect, it is normal for a Postgraduate Dean at the very least to be influenced by and to give considerable weight to representations that emanate from within the training hospitals.

14. We have come to the conclusion that this unique form of arrangement ought not to be dismembered in the schematic way for which KCH contend. Regard must be given to the reality of the situation. We do not, of course, say that a Postgraduate Dean is no more than a cipher, doing the bidding of whatever Consultants and Managers may suggest to him, but we do infer from the facts found (and as a matter of common sense) that, generally speaking, if faced with strong representations against an applicant from within a particular institution, there would be no foisting and the Postgraduate Dean would not seek to place a person accordingly. There may be, and no doubt are, occasional exceptions but they would be just that, exceptions."

18. The Appeal Tribunal's conclusion on section 4 was:

"16.In all these circumstances we have come to the conclusion that the Employment Tribunal reached a legally erroneous decision when it concluded that the [Respondent] was not entitled to pursue his claim against KCH under section 4."

19. On behalf of the Trust Mr Jeans first takes procedural points. The Appeal Tribunal have re-characterised the complaint, he submits, which had been put as a failure to consider the respondents for three posts, and that is converted to a complaint that the Trust had exercised influence on a third party, the Dean. Second, it is submitted that the Appeal Tribunal had made findings of fact which went beyond the findings of the Employment Tribunal and thereby erred in law.
20. I do not see merit in either submission. The preliminary point to be determined unfortunately was not precisely identified but, as treated by the Employment Tribunal, it emerges from their decision. At paragraph 1 they stated:

"The [Trust] in their Notice of Appearance stated that they had no power to refuse to accept him. The appointment was made by the postgraduate Dean at the South Thames Deanery an agent of the Secretary of State. The [Respondent] was therefore not entitled to bring these proceedings against them and therefore this Originating Application should be dismissed."

21. The Employment Tribunal accepted that submission, stating at paragraph 18 (already cited) "the decision was taken by the Dean". The submissions of counsel for the Trust before the Employment Tribunal, Mrs Millin, were directed to that point. In his further particulars, which he was required to supply before the hearing, the respondent had plainly relied on the events of the summer of 2000, in particular King's (and therefore the Trust's) representations to the STC, to establish his case. Had the Trust wished to take other points, that the section 4 application was out of time or that it was the events of early 2000 which were in issue, they could have done so. But they did not take them before the Employment Tribunal had announced its decision and given oral reasons for judgment.
22. Moreover, in my judgment, there can be no criticism of the Appeal Tribunal for considering, as they did, the relative roles of the Trust and the Dean, and, second, doing so on the basis of the evidence before the Employment Tribunal. A consideration of the roles of the Trust and of the Dean obviously involved a consideration of the events of the summer 2000. The Employment Tribunal themselves considered them, as invited to do so by the parties, and so did the Appeal Tribunal. The suggestion that the Appeal Tribunal were confined to a consideration of events in the early part of 2000 which were not even the subject of submissions before the Employment Tribunal is, in my judgment, untenable.
23. As to the alleged extension of findings of fact, the Employment Tribunal had held that the Trust "had an input into that decision". The Appeal Tribunal were, in my judgment, entitled to fill out that succinct finding in a commonsense way, on the basis of evidence which was before the Employment Tribunal and on the basis of the Employment Tribunal's findings already mentioned. The question of the construction of section 4 merited a fuller consideration of the evidence than the Employment Tribunal had expressly given it.
24. In my judgment this appeal turns on issues as to the construction of section 4(1)(a) and (c) (both of which subparagraphs were argued before the Employment Tribunal) and the application of the section to the facts found or which can fairly be inferred. Mr Jeans submits that the word arrangements in subsection (1)(a) covers the procedures followed, such as interview practices, when making appointments. The present complaint is not about arrangements but about the decision taken pursuant to the arrangements. The Trust, as prospective employers, were not responsible for the arrangements, which were the arrangements of the Secretary of State under the scheme he had set up. It is also submitted that, had a broad construction of the subparagraph been intended, words such as "acts" would have been used rather than the word "arrangements".
25. Mr Jeans refers to the decision of the House of Lords in Nagarajan v London Regional Transport [2000] 1 AC 501. One of the points in that case turned on the construction of the word "arrangements" in section 4(1)(a). The Employment Tribunal had held that an interview panel properly set up by the employer had been influenced by improper considerations in that an interview was conducted in a discriminatory manner, either racially or by way of victimisation. It was unanimously held that section 4(1)(a) was satisfied if the arrangements made operated so as to discriminate. In relation to section 4(1)(a) Lord Nicholls of Birkenhead stated at page 513 H:

"... Writ large, this makes discrimination unlawful in the arrangements the employer makes for the purpose of determining who should be offered employment by him."

26. Lord Nicholls added at page 514 A-B:

"When these provisions are put together [in section 4(1) and other provisions], the effect is that on a complaint against an employer under section 4(1)(a) it matters not that different employees were involved at different stages, one employee acting in a racially discriminating or victimising fashion and the other not. The acts of both are treated as done by the ... employer. So if the employee who operated the employer's interviewing arrangements did so in a discriminatory manner, either racially or by way of victimisation, section 4(1)(a) is satisfied even though the employee who set up the arrangements acted in a wholly non-discriminatory fashion."

27. Lord Nicholls added at 514 D:

"On this point I must therefore part company with the Court of Appeal. It is immaterial that the employees of London Regional Transport who conducted the interview with the applicant in a discriminatory fashion had not themselves set up the interviewing arrangements. London Regional Transport, through the discriminatory employees, operated in a discriminatory way the arrangements London Regional Transport, acting through a non-discriminatory employee, made for the purpose of deciding who should be offered the job."

28. Lord Steyn at page 523 C cited (with approval) the statement of Browne-Wilkinson J in Brennan v J. H. Dewhurst Ltd [1984] ICR 52 in relation to the wording of section 6(1)(a) of the Sex Discrimination Act 1975, which is in the same terms as section 4(1)(a) of the 1976 Act:

"... the provisions of section 6(1)(a) are satisfied if the arrangements made for the purpose of determining who should be offered that employment operate so as to discriminate against a woman, even though they were not made with the purpose of so discriminating."

29. Mr Jeans relies on the statement of Lord Nicholls at 513 F that:

"The solution to this difficulty lies in keeping in mind two points. First, section 4 is focused exclusively on the employer. The `person' referred to in the opening words of subsection (1) and (2) of section 4 is the employer and no one else."

30. Mr Jeans accepts that if the employer does make the arrangements, he may be liable if those arrangements are operated in a discriminatory manner by his employees. The submission is that it follows from Lord Nicholl's statement that liability can attach only if the arrangements are made by the employer.
31. Under the scheme for post-graduate training of doctors in the United Kingdom it is submitted that the arrangements are those not of the Trust but of the Secretary of State. it is the Secretary of State who has created the scheme whereby a Specialist Training Committee conducts deliberations, advises the Postgraduate Dean and the Postgraduate Dean makes appointments.
32. I am not able to construe the word "arrangements" as meaning only the overall scheme created by the Secretary of State in this case. The Trust are the employers. They make an input into the scheme whereby it is determined which doctor or doctors to be employed by them are appointed. They make arrangements for that purpose. The arrangements include appointing employees to the STC, by those employees taking part in the deliberations of the STC and making representations to the STC which representations will be considered by the Dean when making appointments. These arrangements of the employer in my judgment come within the scope of arrangements by an employer for the purposes of section 4(1)(a). If that is correct Nagarajan establishes that the acts of employees are to be treated as those of the employer. In my judgment the speeches in Nagarajan also demonstrate that a broad view is to be taken of the word "arrangements" in section 4(1)(a). The word should not be construed as covering only broad or umbrella schemes, such as that set out by the Secretary of State in this case. It covers arrangements made by the prospective employer as its input into the overall scheme.
33. That appointments to the STC were made by the Trust and representation was made by them to the STC is not in issue in the present appeal. I reach that conclusion regardless of whether there may be an alternative remedy under section 4 against the Secretary of State. If there is such a remedy, it would involve, as Mr Jeans accepts, liability on the Secretary of State for the conduct of employees of the Trust and of other bodies represented on the STC.
34. I do not consider that the respondent can rely on section 4(1)(c). Mr Hartman submits that the conduct of the Trust amounts, if true, to a deliberate omission to offer the respondent employment. In my judgment a party cannot refuse to offer a person employment or deliberately omit to offer a person employment when it is not within the power of that party to offer the employment. Under the scheme in operation it was not within the power of the Trust to make such an offer.
35. If section 4(1)(a) applies, as in my judgment it does, section 13 cannot apply by reason of the provisions of section 13(2). It is not therefore necessary on my finding to determine the section 13 point which raises the right to an amendment. I do, however, express a view on it, though I have to say that I am far from persuaded by Mr Hartman that if the respondent fails on section 4, section 13 can provide a remedy for the respondent against the Trust. It may, however, be arguable that, as against the Trust, it may be possible to construct a case in relation to section 13 on the basis that the respondent is undergoing training, though I express no favourable view to that effect.
36. Mr Jeans accepts that the respondent would have been entitled to argue section 13 before the Employment Tribunal on the basis of his originating application. Moreover, he accepts that the allegations of fact had not changed significantly. There was, however, a pre-hearing discussion at which, when confronted with the point, a trainee solicitors appearing for the respondent expressly disavowed reliance on section 13 and stated that the case would be confined to section 4. No application to withdraw that concession was made until the substantive hearing before the Employment Tribunal on the 19th October 2001. In their decision on whether an amendment to include a section 13 allegation should be allowed, the Employment Tribunal placed great weight on that point, stating that "the respondent really cannot change his stance in litigation without limit" (paragraph 12).
37. The Appeal Tribunal found that the Employment Tribunal were wrong in principle in failing to permit the amendment. The Employment Tribunal had failed to do the required balancing exercise and the Appeal Tribunal stated:

"We take the view that they may well have been over-influenced by time limits and virtually uninfluenced by the fact that the basic allegations had remained unchanged throughout."

38. It may be that the trainee solicitor who appeared on the earlier occasion had misunderstood the time limit question, though I make no finding as to that.
39. In my judgment the Employment Tribunal were entitled to make the decision they did, given the broad discretion available to them. That discretion was properly exercised in this case and is sufficiently explained in the Extended Reasons. They were entitled to place great weight in the circumstances on the disavowal of the section 13 claim, in the absence of any application until the hearing itself to withdraw that disavowal. The Trust approached the hearing on the basis of the disavowal.
40. It follows, in relation to the order of the Employment Tribunal, that I would dismiss the appeal against the order permitting the appellant to proceed by reference to section 4 of the 1976 Act. I would allow the appeal against their finding permitting an amendment to plead section 13 of the 1976 Act.
41. LORD JUSTICE ROBERT WALKER: I agree.
42. SIR MARTIN NOURSE: I also agree.
Order: As above. The respondent should have three quarters of his costs. Permission to Appeal to the House of Lords refused.