England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT
APPEAL TRIBUNAL
EAT/0193/04/DM

		Royal Courts of Justice Strand, London, WC2A 2LL
		27 July 2005

Lord Justice Maurice Kay :

1. This appeal is the latest but not the last chapter in a sorry saga. From March 1999 until December 2001 the appellant worked for the respondent company. The business of the company is the manufacture of agricultural machinery. It is controlled by three brothers – Robin, John and David Bunning. The appellant is the daughter of John Bunning. Other members of the Bunning family also work for the company. The appellant was employed as a welder/fitter and it is common ground that she was good at her job. When she commenced employment in the factory she was living nearby but in September 2001 she moved in with Mr Tom Fletcher and thereafter lived with him some 45 miles away from the factory. On 29 September 2001 she discovered that she was pregnant. On 5 December 2001 she sent a letter of resignation. In due course she made an application to an Employment Tribunal alleging that she was the victim of sex discrimination and that she had been unfairly dismissed. As to the latter allegation, her case was that her resignation, properly construed, was a constructive dismissal. Her application was first heard by an Employment Tribunal in Norwich in 2002. The Employment Tribunal found against her. However, she appealed to the Employment Appeal Tribunal and on 1 July 2003 her appeal was successful and an order was made for a rehearing before a differently constituted Employment Tribunal.
2. The second Employment Tribunal hearing took place in Shrewsbury in August 2003. In a reserved decision sent to the parties on 19 November 2003 the Employment Tribunal held that the company had discriminated against the appellant on the grounds of her pregnancy. However it rejected her unfair dismissal claim on the basis that her resignation had not amounted to a constructive dismissal. The Employment Tribunal adjourned the matter of remedy for the discrimination to a later date. The appellant again appealed to the Employment Appeal Tribunal. Following a hearing resulting in a reserved judgment delivered on 12 November 2004, the Employment Appeal Tribunal (Lord Johnston, Mrs M V Macarthur and Mr D Welsh) dismissed her appeal. As a result, she now appeals to this court pursuant to permission granted by Wall LJ on 10 February 2005.
3. The reason why I described the present appeal as not being the final stage in this convoluted procedural history is that, whatever the outcome, there remains the question of remedy in respect of the finding of discrimination which stands adjourned for a further hearing in the Employment Tribunal.
4. Although at various stages in the procedural history the appellant has been represented by solicitors and counsel, (indeed at the more recent hearing in the Employment Appeal Tribunal she was represented by leading counsel), at other stages she has been represented by her partner, Tom Fletcher. He represented her at the second Employment Tribunal hearing and also before Wall LJ. He has now conducted her case on the present appeal with the permission of the court. He is not a lawyer but he has some expertise in health and safety matters which, as will be seen, impinge upon the issues in the case. On behalf of the appellant, Mr Fletcher submits that the finding of discrimination ought to have been wider-ranging and that the Employment Tribunal was wrong to reject the allegation of constructive dismissal. It is now necessary to refer to more of the factual background.
5. On 30 September 2001, the day after she discovered that she was pregnant, the appellant and Mr Fletcher informed the appellant's parents. The appellant and Mr Fletcher said that her work arrangements would have to be changed in the light of the pregnancy. They considered that the workshop in which she customarily worked was not a safe working environment for a pregnant woman. Mr John Bunning did not feel able to commit himself before consulting his fellow directors. He told the appellant to notify the office of her pregnancy which she did on the following day when she told her aunt, Mrs Doreen Bunning (wife of Robin Bunning).
6. At this time and for some years previously the company had engaged a local firm, MSM, to act as consultants on health and safety matters. Doreen Bunning decided to enlist the assistance of Mr Errington of MSM to advise in relation to the appellant's condition. The appellant was suspended on full pay pending a decision which would be taken with the benefit of Mr Errington's advice. Mr Errington visited the factory on 8 October. He carried out an assessment which the Employment Tribunal held to be inadequate. The Tribunal said (at paragraph 31):

"Taken as a whole, we consider the risk assessment to be a superficial and cursory one, inadequate as a generic assessment of risk and bearing no indication that it paid any particular regard to the needs of a woman of child-bearing age."

7. On 10 October Robin Bunning wrote to the appellant referring to and enclosing a copy of the risk assessment. He stated:

"There is no reason why you should not continue to do the type of welding work which you are already employed to do. There is therefore no question of your being suspended as a result of your pregnancy and your current period of permitted absence from work will end at the end of this week. We will expect you to attend for work as normal at your usual starting time on Monday … and to work normally unless circumstances change. You will see that checks need to be made of your health at four weekly intervals and a further review of the general arrangements will be made at the same time."

8. The Employment Tribunal considered the letter to have been written with "an inappropriately formal tone" and criticised the fact that it made no mention of an intention to brief the applicant on the risk assessment in relation to the control measures adopted – "such as they were" – or of an intention to take proper account of any concerns which she might then raise. On 11 October the appellant wrote expressing her concerns about the adequacy of the risk assessment and suggested that there should be a further assessment in her presence. She sought confirmation that she should remain off work until such time as matters were resolved. The appellant spoke to her father on 12 October but it was an unsatisfactory conversation which ended with her in a state of distress.
9. In the event, the appellant did not return to the workshop. The directors had second thoughts and indicated that she could return to work in the stores instead. She accepted this suggestion. Mr Errington was instructed to carry out a further risk assessment which resulted in a report on 2 November, a copy of which was sent to the appellant. It indicated that the risk of working in the stores was assessed at 'medium'. As to Mr Errington's second risk assessment the Employment Tribunal stated (at paragraph 39):

"Whilst work in the stores represented less hazardous work than in the workshop, the risk assessment prepared by Mr Errington followed a similarly cursory examination to that for the workshop."

10. It added (at paragraph 40):

"The assessment purports to identify only four hazards and then goes on to dispose of two of them as not arising. There is nothing to suggest that the fact of pregnancy was considered as a material factor and there is nothing about rest or breaks. The hazard of 'slips, trips and falls' is identified but no control measures for that hazard are identified. In the section in which the control measures were to be identified, the report makes only the comment that 'the area is generally well laid out with access and egress between storage facilities'. There is no mention of the fact that the duties would include use of a computer and VDU screen or, more significantly, of the fact that Ms Bunning would use a forklift truck. Doubtless Mr Errington was unaware of the use of the forklift but its omission reveals the cursory nature of the examination. Both in its conception and in the implementation of the control measures, the assessment was inadequate. Neither the applicant nor those managing her duties could have a clear notion, based on the risk assessment, of those duties she should do and those she should not or how her working day should be planned and managed so as to take account of her pregnancy."

11. The appellant worked in the stores from 5 November for about two weeks. The Employment Tribunal described that period as passing "without incident". The appellant raised no concerns about her work in the stores and the Employment Tribunal did not accept her evidence that she was simply tired of complaining.
12. On 20 November the appellant had a miscarriage. From that moment to this the appellant and Mr Fletcher have blamed the company for that profoundly distressing experience. On 27 November they wrote a joint letter setting out their concerns and asking for a meeting with the directors to address the question of the company's "role in the handling of the pregnancy". It sought a reply by 3 December. It proposed that the appellant should continue to receive full pay whilst absent as a result of the miscarriage although her contractual entitlement was to statutory sick pay only.
13. No reply had been received by 3 December. It seems that one of the directors was away at the time and, moreover, the others wanted to take legal advice before replying.
14. On 4 December the directors replied, declining the request for a meeting, defending their conduct and noting that the appellant had indicated her intention to return to work when she was able to do so. That letter does not impact upon the legal analysis because before she had received it the appellant wrote to the company on 5 December giving notice of her resignation. The relevant part of the letter was in these terms:

"I regard myself as having no choice but to resign in view of the treatment that I have received at the hands of company during the past few weeks, in particular now the failure to respond to or even acknowledge the concerns expressed in my letter by the date requested. It follows that I cannot work any longer in any environment, whatever that position of work may be, where the trust and confidence has entirely broken down as a result of the company's actions and attitude."

15. The company accepted the appellant's resignation, her employment forthwith came to an end and she commenced proceedings in the Employment Tribunal on 14 December 2001.

The Findings of the Employment Tribunal

16. Dealing first with the issue of discrimination, the Employment Tribunal held that the company had set too much store by its policy that all, including family members, should be treated equally. It failed to recognise that there are occasions when different treatment becomes a duty. The case of a pregnant woman was a prime example. She had to be treated differently when it came to a matter of risk assessment. It was conceded by the company that it had failed to comply with its obligations under Regulation 16 of the Management of Health and Safety at Work Regulations 1999. The Employment Tribunal stated (at paragraph 50):

"Not only were the two assessments inadequate but, in order that the measures proposed by Mr Errington should properly be brought into effect, it was necessary that the applicant be briefed upon those measures and directed as to the means by which concerns should be brought forward. That should have afforded an opportunity to ensure that the measures were specific to the individual circumstances of the applicant but, for whatever reason, that was not done, either in relation to the workshop or the stores. Thus, there was a detriment; it arose from a failure by the respondent to conform to its obligations under the Regulations and it was directly related to the fact of pregnancy."

17. It continued (paragraph 51):

"It was a serious mistake to insist upon a return to work in the workshop when it had not been adequately demonstrated that it was safe to do so and when proper measures were not in place. Had it maintained that stance and had the applicant resigned or been given notice of dismissal, the probability must be that the respondent would have been defenceless against the present claims. That is not what happened. The parties agreed a way forward … It has not been shown that working in the stores did create a risk in addition to the level of risk to be expected outside the workplace … Ms Bunning entered voluntarily into the new position"

18. The Employment Tribunal then turned to the issue of constructive dismissal. In an earlier passage it had directed itself as to the appropriate test referring to Western Excavating (ECC) Ltd v Sharpe [1978] ICR 221 in which Lord Denning MR stated (at p.226):

"If the employer is guilty of conduct which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any further performance. If he does so, then he terminates the contract by reason of the employer's conduct. He is constructively dismissed."

19. The Employment Tribunal observed that the breaches relied upon by the appellant were of the implied term of trust and confidence and of the obligation, imported under the Regulations, to carry out a proper risk assessment. It was mildly critical of the company for not responding earlier to the letter of 27 November but concluded that the omission so to do did not amount to a breach of any express or implied duty. Its further findings upon which it rejected the allegation of unfair dismissal are to be found in the following passages (at paragraphs 55-57):

"As the letter of 27 November makes plain, the concerns of the applicant about the inadequacy of the risk assessment are confined to that related to the workshop. As we have found, those concerns were well founded. The evidence, however, suggests that nothing occurred in the period during which Ms Bunning was working in the stores that she perceived to be a breach of any fundamental obligation towards her …

By her witness statement, Ms Bunning suggests that, having given the respondent three days in which to respond and it having failed to do so –

'I had to conclude that the directors had no further interest in taking me seriously. After much thought I had decided that I had given the company enough chances to change and do the right thing and I therefore sadly resigned by letter dated 5 December 2001 …'

Earlier, she had identified what she described as the principal reasons for resigning and those were the way she had been treated over health and safety issues after announcing her pregnancy and the failure to respond to the letter of 27 November.

We are satisfied those were the reasons for the decision. But we are not persuaded that Ms Bunning was justified in resigning when she did for those reasons. With the withdrawal of the insistence that Ms Bunning return to work in the workshop, much of the force of her concerns about the safety of that option dropped away. There was no longer an obligation upon the respondent to take proper steps to ensure that it was safe for her to work there when there was no remaining intention that she should do so. We have expressed our concerns about the adequacy of the risk assessment carried out for the stores but we have rejected the assertion of Ms Bunning that she was misled by the respondent over the level of risk in that position. She did not have, or express, concerns about the safety of that post and the failure of the respondent to ensure that an adequate assessment of the risk in the stores was made, had no influence upon her decision to resign. By accepting the offer to work in the stores, Ms Bunning was acknowledging that a viable basis existed upon which the employment could continue and she was waiving past breaches."

20. It is not necessary to refer in detail to the judgment of the Employment Appeal Tribunal. Suffice it to say that it found no legal error on the part of the Employment Tribunal. The task of this court is to revisit the decision of the Employment Tribunal to ascertain whether it was vitiated by legal error. In the absence of an error of law, neither the Employment Appeal Tribunal nor this Court has any power to interfere. It is therefore necessary to consider whether the Employment Tribunal fell into material legal error when dealing with either discrimination or constructive dismissal.

Discrimination

21. I have referred to the Management of Health & Safety at Work Regulations 1999. It is now necessary to set out some of their provisions. By Regulation 3(1) every employer is under a duty to make a suitable and sufficient assessment of the risks to the health and safety of his employees to which they are exposed whilst they are at work for the purpose of identifying the measures he needs to take to comply with the requirements and prohibitions imposed upon him by or under the relevant statutory provisions. Regulation 16, which is headed "Risk Assessment in Respect of New or Expectant Mothers", states:

"(1) Where –

(a) the persons working in an undertaking include women of a child-bearing age; and

( b) the work is of a kind which could involve risk, by reason of her condition, to the health and safety of a new or expectant mother, or to that of her baby, from any processes or working conditions, or physical, biological or chemical agents …

the assessment required by Regulation 3(1) shall also include an assessment of such risk.

(2) Where, in the case of an individual employee, the taking of any other action the employer is required to take under the relevant statutory provisions would not avoid the risk referred to in paragraph (1), the employer shall, if it is reasonable to do so, and would avoid such risks, alter her working conditions or hours of work.

(3) If it is not reasonable to alter the working conditions or hours of work, or if it would not avoid such risk, the employer shall, subject to section 67 of the 1996 Act, suspend the employee from work for so long as is necessary to avoid such a risk.

(4) In paragraphs (1) to (3) references to risk, in relation to risk from any infectious or contagious disease, are references to a level of risk at work which is in addition to the level to which a new or expectant mother may be expected to be exposed outside the workplace."

22. It is then provided by Regulation 18(1) that nothing in Regulation 16(2) or (3) shall require the employer to take any action in relation to an employee until she has notified the employer in writing that she is pregnant, has given birth within the previous 6 months, or is breastfeeding.
23. The decision of the Employment Tribunal on discrimination is founded upon the obligations imposed upon the company by the Regulations. There is no doubt that the Employment Tribunal found breaches at each stage. In his submissions to this Court, Mr Fletcher has referred to a number of other statutory provisions but it is not clear to me that they were all before the Employment Tribunal or, if they were, that they add anything. At one point it seemed that the case for the appellant on this appeal was that the finding of discrimination was inappropriately confined to the inadequate risk assessment in respect of the workshop. However, that cannot be right. The decision of the Employment Tribunal clearly embraced breaches of the Regulations at both stages, together with corresponding detriments sufficient to give rise to findings of discrimination in line with the approach illustrated by, for example, Day v T Pickles Farms Ltd [1999] IRLR 217 and Hardman v Mallon [2002] IRLR 517.
24. As the hearing before us developed, it became apparent that there is in fact nothing between the parties on the issue of discrimination. They may, indeed do, hold divergent views on what compensatable loss flows from the findings of discrimination, but that is a matter for the remedies hearing in the Employment Tribunal. Mr Collins conceded without inhibition that at that hearing the appellant will not be shut out from proving, if she can, that there was a causal link between the discrimination and the miscarriage. On the other hand, he makes it clear that it will be the case for the company that neither that sad event nor anything else amenable to substantial compensation was attributable to the discrimination.
25. In these circumstances, I cannot discern anything in the dispute between the parties in relation to discrimination which presently requires resolution by this Court. If this aspect of the appeal has achieved anything it is that the parties have a clearer understanding of the several issues which will arise at the remedies hearing.

Unfair dismissal

26. It is apparent from the passages from the decision of the Employment Tribunal which I set out in paragraph 19, above, that it found that the appellant had not been constructively dismissed and that, by taking the position in the stores, she had waived "past breaches". The question which now arises is whether there was any error of law which afflicted those findings.
27. To establish constructive dismissal it has to be proved that the employee terminated the contract

"… in circumstances in which he is entitled to terminate it without notice by reason of the employer's conduct." (Employment Rights Act 1996, s.95(1)(c)).

The Employment Tribunal correctly identified that the test is the contractual one propounded by Lord Denning MR in Western Excavating (ECC) v Sharp (above, paragraph 18). It also observed that there must be a causal link between the employer's breach and the resignation. This accords with a long line of authority. For example, in Walker v Josiah Wedgwood & Sons Ltd [1978] ICR 744, Arnold J said (at p.751):

"… it is at least requisite that the employee should leave because of the breach of the employer's relevant duty to him, and that this should demonstrably be the case."

Or, as it is put in Harvey on Industrial Relations and Employment Law, Vol 1, [403]:

"He must leave in response to the breach and for no other reason."

28. The Employment Tribunal clearly considered that if the appellant had resigned as a response to the first inadequate risk assessment and the initial instruction to return to the workshop, a finding of constructive dismissal would have been probable. However, "that is not what happened". At this point the Tribunal made crucial findings of fact. The appellant willingly went to work in the stores and "nothing occurred in the period during which [she] was working in the stores that she perceived to be a breach of any fundamental obligation towards her." Moreover, "with the withdrawal of the insistence that [she] return to work in the workshop, much of the force of her concerns about the safety of that option dropped away … She did not have, or express, concerns about the safety of that post and the failure of the respondent to ensure that an adequate assessment of the risk in the stores was made, had no influence upon her decision to resign".
29. Properly analysed, therefore, the findings of the Tribunal were that (1) there had been a fundamental breach at or about 10-12 October; (2) it was waived or the contract was affirmed by the taking of the job in the stores; (3) the risk assessment in relation to the stores and the decision to employ the appellant there involved further breaches but, whether or not they were fundamental, they were not treated as such by the appellant; (4) her eventual resignation was caused by the earlier events (now the subject of waiver or affirmation), coupled with the explicable failure to respond to the letter of 27 November within the stipulated time; (5) the latter failure did not justify termination, either by itself or on a "last straw" basis.
30. In my judgment, this was a permissible approach on the part of the Employment Tribunal. It is well known that the Employment Appeal Tribunal will not interfere with such findings unless they amount to a conclusion which no reasonable tribunal could reach: Pedersen v Camden LBC [1981] ICR 674 CA. I am unable to say that that demanding test has been satisfied.

Conclusion

31. It follows from what I have said that I am unpersuaded that the Employment Tribunal fell into any material error of law in relation to discrimination or unfair dismissal. I would therefore dismiss the appeal and remit the case to the Employment Tribunal, with the suggestion that it should assist all concerned if it is first listed for a directions hearing. I would also recommend to the parties that, before that stage is reached, they should give serious consideration to resolving the remainder of their dispute by negotiation, if necessary supported by mediation. The case has already resulted in two full hearings in the Employment Tribunal, two appeals to the Employment Appeal Tribunal and two hearings in this Court in connection with the present appeal. It must be taking a considerable toll, in both personal and financial terms, in a dispute which, although employment-based, is essentially one between members of the same family.

Lord Justice Latham:

32. I agree.

Lord Justice Brooke:

33. I also agree.