EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
Lord Eassie Lady Paton Lord Kingarth	[2012] CSIH 28 XA64/11 OPINION OF THE COURT delivered by LORD EASSIE in Appeal by ANDREW SNEDDON Appellant; against CARR-GOMM SCOTLAND LIMITED Respondents: _______

Appellant: McGuire; Morton Fraser LLP

Respondents: Hay; Law at Work Limited

20 March 2012

Introductory

[1] In January 2003 the appellant commenced employment with the respondents as a support worker with the job of providing support to vulnerable adults as part of the respondents' business of providing social care services. On 11 February 2009 the appellant's contract of employment was terminated on grounds of misconduct and an appeal within the respondents' internal organisation was unsuccessful. The appellant thereupon presented a claim to the Employment Tribunal - "the ET" - complaining that he had been unfairly dismissed. Following a hearing extending over three days the ET upheld the complaint of unfair dismissal and awarded the appellant compensation, subject to a deduction to reflect what the ET considered to be the appellant's contribution to the circumstances of his dismissal. The employer, the present respondents, then appealed to the Employment Appeal Tribunal - "the EAT" - against inter alia the finding of unfair dismissal. In its decision of 3 March 2011 the EAT allowed the respondents' appeal and substituted a finding that the dismissal was fair. The appellant now seeks to appeal to this Court against that decision of the EAT. Parties were agreed that the Court should also consider the merits of the appeal, if persuaded that leave (which had been refused by the EAT on 4 May 2011) should be granted.

The salient facts

[2] The evidence tendered to the ET and the facts found by it are set out by the ET at length in its judgment of 27 April 2010. Much of that is rehearsed by the EAT in its judgment. However, for the purposes of this appeal, the salient facts are, in our view, as follows.

[3] The event precipitating the dismissal of the appellant was a communication to one of the appellant's fellow support workers by her friend, Ms Struthers. That friend lived in a flat in the same building as a vulnerable adult - JS - to whom care services were provided by the respondents. JS required 24 hour provision of care, which entailed among other things that a support worker sleep overnight in the flat occupied by JS. The support worker of whom Ms Struthers was a friend relayed in turn the information supplied by Ms Struthers to her operations manager, Mr Kirkbride, who then instructed a subordinate, a Mr Fullerton, to see Ms Struthers. Mr Fullerton spoke with Ms Struthers and made some brief notes of that conversation.

[4] What was recounted by the neighbour, Ms Struthers, related to events said to have occurred overnight between 22 and 23 November 2008 and consisted essentially in an allegation that she had heard some shouting coming from the flat occupied by JS. The material respecting that allegation which was before the employer when deciding to dismiss the appellant consisted of the short notes made by Mr Fullerton. The terms of those notes are recorded by the ET at paragraphs 35 and 36 of its decision. Mr Fullerton noted the words said to have been shouted as "Sit down, lie down, don't move" and he noted further "shouting, bullying, aggressive - just not nice". The notes further recorded that Ms Struthers "heard this before - similar voice" and "knows when he sounds aggressive when speaking to J"; and " tends to shout bullying". It was further noted "time before was concerned and should have said something - noughted stomach (sic)". From the respondents' records it was apparent that the appellant had provided the overnight support on the night of 22/23 November 2008. The appellant has throughout denied having shouted at JS or spoken inappropriately to him while providing that overnight support. Thereafter, by way of further investigation regard was had in the first place to the contemporary documentary evidence in the form of handover reports and the like. Details of these are set out by the ET in its judgment at paragraphs 49 and 50. Put shortly, nothing whatever in those contemporaneous records gave any support for the notion that anything untoward might have occurred in the night of 22/23 November 2008. In general, the support client, JS, was recorded on and after 23 November as having been in good form and relaxed; he offered nothing suggestive of any complaint.

[5] In the second place, Mr Fullerton also obtained from five other members of the appellant's care team statements in answer to four questions, namely whether they had any concerns about their colleagues' practice; whether they felt any colleague intimidated JS; whether JS had raised any issues about colleagues; and whether they were aware of any complaints regarding JS support from neighbours or others (ET judgment, paragraph 40).

[6] Despite the apparent generality of those questions, it is evident from the terms of the responses, which the ET sets out paragraphs 41ff, that those to whom the questions were addressed were aware that the subject of the inquiry was the appellant. Three of the care team provided responses indicating that they had no concerns and that no concerns had been indicated to them by anyone else. A fourth member suggested that the appellant had appeared to be "too authoritative as though they (sic) think JS is a wean" but also stated "there has been nothing out of the ordinary. JS has not spoken to me about anything which has concerned me". The fifth member of the care team, Linda Mauchline, referred to a conversation between her, JS and the appellant which had apparently taken place on 17 November 2008 when the three of them had been walking to a bus stop. Ms Mauchline's report of the conversation is set out by the ET at paragraph 44 of its judgment. The appellant's version of that conversation is set out at paragraph 52. The criticism made against the appellant respecting this conversation is essentially that in its course he used, as an adjective, the word "fucking". The appellant accepted that he had done so but explained, inter alia, that the same adjective had been deployed by both Linda Mauchline and JS in the course of the conversation. It was nowhere suggested that the conversation in question involved any shouting at or intimidation of JS. The appellant explained to Mr Fullerton that he had been "mood-matching".

[7] It was not in dispute that the appellant's inappropriate and unacceptable choice of language in the conversation of 17 November 2008 would not in itself justify dismissal. The allegation stemming from Ms Struthers of possible misconduct on the night of 22/23 November 2008 was therefore essential to any justification of the dismissal of the appellant.

The ET decision

[8] In reaching its decision the ET carefully and fully set out the test which it required to apply. While it was, in the event, not disputed by counsel for the respondents that the ET had instructed itself correctly as to the appropriate test it is convenient to repeat the ET's own exposition:

"129. The Tribunal throughout was mindful of the fact that it must not substitute its own decision for that of the employer. Rather it must decide whether the employer's response fell within the range or band of reasonable responses open to a reasonable employer in the circumstances of the case (Iceland Frozen Foods Ltd v Jones (1982) 1RLR 439). The Tribunal bore in mind throughout what this test means in practice. In a given set of circumstances one employer may decide that dismissal is the appropriate response while another employer may decide in the same circumstances that a lesser penalty is appropriate. Both of these decisions may be responses which fall within the band of reasonable responses in the circumstances of the case.

130. The Court of Appeal has also established that the 'range of reasonable responses' test applies both to the decision to dismiss and to the procedure by which that decision is reached - Sainsbury Supermarkets Ltd v Hitt (2003) 1RLR 23.

131. In this case the respondents dismissed for misconduct which is a potentially fair reason for dismissal under Section 98(2)(b) of ERA.

132. The Tribunal therefore bore in mind the test set down by the EAT in British Home Stores Ltd v Burchell (1978) 1RLR 379 with regard to the approach to be taken in considering the terms of what is now Section 98(4) ERA:

'What the Tribunal have to decide every time is, broadly expressed, whether the employer who discharged the employee on the grounds of the misconduct in question (usually, but not necessarily, dishonest conduct) entertained a reasonable suspicion amounting to a belief in the guilt of the employee of that misconduct at that time. That is really stating shortly and compendiously what is in fact more than one element. First of all there must be established by the employer the fact of that belief; that the employer did believe it. Secondly, that the employer had in his mind reasonable grounds upon which to sustain that belief and thirdly, we think, that the employer at the stage at which he formed that belief on those grounds, at any rate at the final stage at which he formed that belief on those grounds, had carried out as much investigation into the matter as was reasonable in all the circumstances of the case. It is the employer who manages to discharge the onus of demonstrating those 3 matters, we think, who must not be examined further. It is not relevant, as we think, that the Tribunal would itself have shared that view in those circumstances'.

133. The Tribunal also reminded themselves that the reasonableness tests contained in Section 98(4) must still be applied and the employer must consider whether that particular conduct warranted dismissal.

134. The Tribunal also bore in mind the extent to which an employer can rely on allegations made by a third party when reaching a decision to dismiss. This was considered in Henderson v Granville Tours Ltd (1982) 1RLR 494 where the EAT found it unreasonable to dismiss on customers' complaints alone, no matter how truthful and reliable the complainants might be. Further investigation is needed, even by small firms, before reasonable belief in the misconduct is established.

135. The Tribunal also bore in mind that in considering whether or not an investigation into alleged misconduct is reasonable the relevant question was whether it was an investigation that fell within the range of reasonable responses that a reasonable employer might have adopted".

[9] For reasons which the ET goes on to explain, it came to the conclusion that, as respects the central allegations concerning events on the night of 22/23 November 2008 the case for the employer had failed as respects the third branch - investigation - set out in British Home Stores Ltd v Burchell in the passage quoted by the Tribunal. The conclusion of the ET on that aspect is set out in paragraphs 143 and 144 of its judgment:

"143. The evidence from the neighbour was the primary source of evidence. A reasonable employer would wish to be as certain as possible of the factual evidence able to be provided by that individual. The steps taken by the respondents did not meet that test. This was not to substantiate the neighbour's concerns 'beyond reasonable doubt' but simply to make it as reliable as it could be faced with the claimant's denial and surrounding circumstances which would indicate no concern by JS or any of the Care Team that any bullying or verbal abuse had taken place.

144. Thus the Tribunal considered that the investigation conducted by the respondents failed to meet the test of a reasonable employer in the failure to return to the neighbour and seek further and better particulars of her position beyond the note taken of the conversation with her at R94 [Mr Fullerton's note]. That may have included from a reasonable employer's point of view enquiring with any other neighbour or person in the block if support could be given or light shed on the concerns expressed by Pearl Struthers".

[10] For completeness we also set out the whole terms of the conclusions - headed "decision"- of the ET as set out by it at paragraph 174 of its judgment:

"174. The decision of the Tribunal was that the dismissal was unfair because:-

1. There were insufficient grounds for the respondent to sustain their belief that the claimant had verbally abused and bullied JS on 22/23 November 2008 as they had not carried out as much investigation into the matter as was reasonable in all the circumstances of the case. A reasonable employer would have wished more from the neighbour.

2. In the absence of that charge the incident on 17 November 2008 was insufficient for a reasonable employer to have dismissed on its own even if it was as described by the respondent as the claimant swearing 'at' JS. The fact that the incident was not deemed sufficiently serious to be even mentioned by Linda Mauchline to Carrie-Scott or anyone else at the time belied it being categorised as gross misconduct.

3. The incident on 17 November 2008 was misdescribed as the claimant using 'foul and abusive language directed at a Service User'. The evidence did not establish that description.

4. The explanation of the claimant on the Note of the Joint Review of 12 August 2008 was given no credence without any enquiry of Carrie-Scott as to whether that explanation had veracity.

5. Even if the dismissing executive could take a decision to dismiss without hearing from the claimant no evidence was available from her as to how she weighed the evidence in coming to a reasonable belief in the guilt of the claimant either on the incident of 22/23 November 2008 or 17 November 2008.

6. The Appeal Panel in their deliberation took account of matters not before the disciplinary panel, apparently not taken into account by Lucy Wren or put to the claimant as matters forming part of their consideration. They conducted no further enquiry to address the concerns at 1-6 above. They appeared to consider that the claimant had been 'mood matching' in respect of the incident on 20 November 2008 against 'clear instruction' when (a) that was not the claimant's position in respect of that incident and (b) if they thought he was 'mood matching' they made no enquiry to ascertain if this in fact had been a feature of past training.

7. The respondent did not consider the events of the 22/23 November 2008 to be on their own sufficient to dismiss. Thus it would be outwith the range of reasonable responses to dismiss for that reason according to the respondents had it not been for the further incident of 17 November 2008. As stated the Tribunal did not consider that the evidence of the events of 17 November 2008 stood up to the assertion that the claimant had been abusive to a service user. They did not think that swearing had been 'directed at the Service User'. It was acknowledged that a swear word had been used but not in an abusive way and thus the strength that the respondents found in the combination of the two incidents did not appear to exist. Thus dismissal would be outwith the range of reasonable responses of a reasonable employer".

The EAT decision

[11] When the matter came before the EAT it addressed the first and essential ground of the decision of the ET, namely that a reasonable employer would have first returned to the neighbour, Ms Struthers, and sought from her a fuller explanation of the nature of and basis for her allegation and the general circumstances, in paragraph 45 of its decision:

"45. We turn first to the Tribunal's conclusion that the Respondent did not have 'sufficient grounds' for their belief that the incident complained of by Ms Struthers took place. We accept the submission that, on the findings in fact, that was not a conclusion that was open to the Tribunal. They considered there was no corroborative evidence. That is, we accept, not correct. The evidence regarding the way that the Claimant had conducted himself on 17 November and about his general approach to JS as being too authoritative pointed to the Claimant having a propensity to behave in that way and was, accordingly, circumstantial evidence on which the Respondent could properly rely - they did so. The Tribunal considered that it could not be accepted because Ms Struthers could have been re-interviewed. However, what she said on 24 November, very shortly after the incident, was clear. She identified the Claimant as being the subject of her concern. She gave a clear description of aggressive bullying and shouting directed at JS. It had concerned her sufficiently to make contact with an employee of the Respondent about it. So far as JS's lack of complaint was concerned, that could readily be explained by reference to his own vulnerability. Mr Fullerton had not expressed any doubts about Ms Struthers' credibility and reliability. The case of Henderson does not, contrary to the Tribunal's reading of it, support the proposition that the mere fact of a report of misconduct having come from a third party means that it has to be treated with caution. The Henderson decision is readily understandable - there were other eye witnesses who may have had direct evidence to give regarding the conduct complained of. That was not the position here. It cannot be said that it was unreasonable of the Respondent not to revert to Ms Struthers and interview her again".

Submissions

[12] Counsel for the appellant began his argument in support of the appeal by drawing attention to the decision in Salford Royal NHS Foundation Trust v Roldan [2010] EWCA Civ.522; [2010] IRLR 721. Under reference in particular to paragraphs 13 and 51 respectively of the judgment of Elias LJ, with whom the other members of the Bench agreed, counsel pointed to (a) the need for a reasonable employer to make a fair and careful investigation of any allegation of misconduct which, as in the present case, might adversely affect the employee's professional reputation and his ability to continue to work in his chosen field and (b) the very high hurdle which had to be surmounted before an appellate employment tribunal might interfere with a decision of a first instance employment tribunal which had correctly appreciated and directed itself in accordance with the principles in British Home Stores Ltd v Burchell. Counsel then went on to submit, in summary, that the criticism accepted by the EAT that the ET had ignored the tests in British Home Stores v Burchell and adopted a "substitution mindset" was unfounded. It was clear that the ET had considered what further investigation of the allegation relating to 22/23 November a reasonable employer would have carried out. Given the absence of support for bullying and shouting in such other investigations as the employer had actually carried out, it was clearly open to the ET to reach the view that a reasonable employer would have taken the investigation further in the general lines indicated by the ET. Insofar as in paragraph 45 of its decision the EAT might have appeared to take the view that the ET had decided matters on the basis of a lack of corroboration, that was a misreading of the basis of the ET decision. Moreover the EAT had not accorded the required measure of respect for the role of the ET as a first instance tribunal; the ET had not adopted a "substitutional mindset"; rather it was the EAT itself which had adopted such a mindset.

[13] In response counsel for the respondents focused on the decision of the ET and the criticisms which he submitted might be made of it. He accepted that the ET had fully and correctly directed itself as to the law, particularly as that was set out in British Homes Stores v Burchell. However, he submitted, the ET had not brought to bear the requisite standard of objectivity since it (a) had immersed itself too deeply in examining the employer's investigatory procedures; (b) had substituted its own analysis of the facts before the employer and (c) had failed to consider whether the notes of what the neighbour, Ms Struthers, had reportedly said to Mr Fullerton and Ms Mauchline's evidence relating to the conversation on 17 November 2008 might yet have allowed a reasonable employer to find misconduct established. Since, he submitted, the ET had thus, in the end, formed its own judgment, the EAT had reached a correct result in reversing the ET.

Discussion

[14] In approaching the submissions made in this appeal we note first that, as was accepted by counsel for the respondents, the ET correctly directed itself as to the law and tests which it had to apply. That being so, what was said by Elias LJ at paragraph 51 of his judgment in Salford Royal NHS Foundation Trust v Roldan is, in our view, apposite:

"...it is not disputed that the Tribunal properly directed themselves in accordance with the principles established in Burchell v British Home Stores [sic], as further explained in a case of this kind by A v B. In these circumstances, save at least where there is a proper basis for saying that the Tribunal simply failed to follow their own self-direction, the EAT should not interfere with that decision unless there is no proper evidential basis for it, or unless their conclusion is perverse. That is a very high hurdle. In Yeboah v Crofton [2002] IRLR 634, Mummery LJ said that this would require an 'overwhelming case' that the decision was one which no reasonable tribunal, properly appreciating the law and the evidence, could have made".

Secondly, as already indicated, it is not and was not in dispute that in the absence of a proper basis upon which an employer might reasonably conclude that the allegation of misconduct on the night of 22/23 November 2008 was well founded, the conversation on 17 November 2008 would not justify dismissal. Accordingly the focus, or at least a central element, of the ET's decision that the dismissal was unfair is thus related to the adequacy of the employer's investigation of the allegation respecting the night of 22/23 November 2008.

[15] In deciding whether the third branch of the British Home Stores Ltd v Burchell test - sufficiency of investigation - might or might not be adequate when judged by the standard of the reasonable employer, the ET necessarily had to examine and consider the nature and extent of the investigations carried out by the respondents and the content and reliability of what those investigations had revealed before it could reach a view on whether the reasonable employer would have regarded the investigatory process as sufficient in matters such as extent and reliability or as calling for further steps. That is what the ET, in our view rightly, did and in doing so we do not consider that they can properly be criticised for having immersed themselves in an examination of the investigatory process.

[16] The ET was, in our opinion, entitled to come to the conclusion that such additional investigation as had been carried out did not provide any clear support for what had been noted by Mr Fullerton respecting the allegation made by the neighbour, Ms Struthers, regarding the night of 22/23 November. There was nothing in the contemporaneous records suggestive of anything untoward having occurred. Indeed, JS was reported as being in good form and relaxed; he made no complaint. The statements proffered by four of the other members of the care team demonstrated no support for the allegation of misconduct by shouting. Further, in our view the ET was entitled to consider that a reasonable employer would not regard the conversation of 17 November 2008, even in the terms reported by Linda Mauchline, as providing any real assistance respecting what may or may not have happened on the night of 22/23 November, those allegations being of a different character. In these circumstances, the finding of the ET at paragraph 143 that the primary evidence of the crucial, and strongly contested, allegation of shouting and bullying on that night was that of the neighbour cannot be impugned. That being so, the ET was understandably conscious that all that was before the officer of the respondents who took the decision to dismiss respecting that allegation was the brief notes of the conversation taken by Mr Fullerton. In those circumstances we consider that nothing has been said which renders the conclusion of the ET that a reasonable employer would have gone back to the neighbour to explore matters more fully and double check on the detail, the reliability and the credibility of Ms Struther's account, rather than rely only on notes of a conversation taken at a preliminary stage, a conclusion which it was not open to the ET to reach.

[17] Counsel for the respondents did not seek - in our view rightly - to support the views expressed by the EAT in paragraph 45 of its decision respecting corroboration. Progressing further in that paragraph, the EAT then refers to the terms of "what she [Ms Struthers] said on 24 November, very shortly after the incident, [as being] clear". However, as was rightly remarked in argument before us, while what was noted might, in a sense, be clear in some general thrust, the notes lacked any detail and were in that respect far from clear. Given the employee's consistent denial of the allegation and the consequences for him were he to be dismissed, the accuracy of what was noted and the reliability by the maker of the allegation assumed considerable importance. We thus find force in the criticism of that aspect of the expression of view by the EAT. It is further to be observed that in the same paragraph of its decision the EAT speculates, as respects the absence of any complaint by JS, by saying "that could readily be explained by reference to his own vulnerability". While that suggestion had indeed been made by one witness before the ET, the suggestion was rejected by the ET which made a finding to essentially contrary effect - see paragraph 138, third bullet point of the ET's judgment.

[18] Those particular difficulties in paragraph 45 of the EAT judgment apart, the question whether in all the circumstances the reasonable employer would regard the investigations carried out as adequate is essentially one for the assessment of the ET, as a specialist, first instance tribunal. Answering that question involves an area of assessment or appreciation. Despite the skill with which counsel for the respondents advanced his submissions, we are not persuaded that there has been demonstrated any proper basis upon which an appellate tribunal could interfere with the decision reached by the ET on the central issue whether a reasonable employer would consider that, without further more detailed inquiry of Ms Struthers and possibly other neighbours, there were sufficient grounds for believing that the appellant had been guilty of misconduct by shouting at and bullying JS on the night of 22/23 November 2008.

[19] Counsel for the respondents also advanced criticisms of the manner in which the ET had dealt with the conversation on 17 November 2008, but given our conclusion that the ET was entitled to reach the view which it did respecting the employer's investigation of the allegations respecting the night of 22/23 November, it is unnecessary for us to examine and express a view on those other criticisms.

Decision

[20] In these circumstances we consider that the appeal is well-founded. Accordingly we shall grant leave to appeal; allow the appeal; and restore the finding of the ET that the dismissal was unfair. No question or dispute was raised concerning the amount of contribution. However, in their appeal to the EAT the respondents raised an issue respecting the ET's calculation of quantum, it being contended that the ET should have left out of account the patrimonial results stemming from the difficulty encountered by the appellant in obtaining employment because of the adverse information now contained in his "enhanced disclosure" that being, it is said, not a matter which was the responsibility of the employer. The EAT did not express a concluded view on that issue and in these circumstances both parties considered that the case would require to return to the EAT in order that it decide that aspect of the respondents' appeal to it. We shall therefore allow the appeal but return the case to the EAT for it to determine that particular aspect of the ET's assessment of quantum.