At the Tribunal
HIS HONOUR JUDGE J BULL QC
MR J D DALY
MR R H PHIPPS
Transcript of Proceedings
JUDGMENT
Revised
APPEARANCES
For the Appellant MR B CARR
(of Counsel)
Messrs Rowley Ashworth
Solicitors
247 The Broadway
Wimbledon
London
SW19 1SE
For the Respondents MR C JEANS
(of Counsel)
Engineering Employers'
Federation
Broadway House
Tothill Street
London
SW1H 9NQ
JUDGE BULL QC: This is an appeal by Miss A J Holmes against the decision of the Industrial Tribunal sitting at Manchester, to whom she complained that she had been unfairly dismissed. The case was heard on 13 October 1992, and the Full Reasons were sent to the parties on 12 November 1992. Before the Industrial Tribunal the employers called no evidence.
Miss Holmes was employed by Lupton Brothers Limited as a semi-skilled engineer starting as a "pinner" but moving on to perform various semi-skilled engineering jobs. Whilst she was away from her employment because of an industrial accident, she received a letter from her employers dated 17 January 1992 containing this notification:
"Dear Alison
Unfortunately we have to inform you that, due to company re-organisation and a turndown in the textile market, we have no alternative but to make you redundant as from today - 17th January".
Thereafter, Miss Holmes appealed against that dismissal and an Appeal Hearing took place at which she was offered reinstatement upon the same terms as before, but was told that if she was to be reinstated another employee would have to be made redundant in her place. That offer, after consideration, she rejected.
The first issue for the Tribunal was whether the dismissal fell within the provisions of Section 58 of the Employment Protection (Consolidation) Act 1978. There were two matters which the Tribunal had to consider: first, whether taking time off to attend trade union courses in the case of this employee fell within the definition of trade union activities in Section 58 of the 1978 Act; and secondly, whether the Appellant, acting in her capacity as the only shop steward at the premises of the employers, in advising her colleagues to stop work because of the low temperatures at her workplace, was taking part in a trade union activity within the meaning of the Section.
Having reviewed the evidence, the Tribunal, at paragraph 5(b), came to the conclusion that:
"the matters described by the Applicant cannot properly be described as trade union activities".
The Tribunal went on to find that it was "satisfied that whatever the reason for her dismissal was, the Applicant was not dismissed by reason of her having taken part in trade union activities at an appropriate time".
We can deal shortly with the submission that the Tribunal adopted an extremely restrictive definition of trade union activities and that the decision as it applied to Miss Holmes was perverse. We do not consider it necessary to deal in detail with the evidence, save to say that in our judgment there was ample evidence before the Tribunal which justified both its findings of fact and its conclusions. The decision was one which a reasonable Tribunal properly directing itself could have reached upon the material before it.
The second issue before the Tribunal is set out in summary in paragraph 6(b) of their Reasons:
"Even if the Tribunal had found that there was a potentially fair reason for dismissal the Tribunal would have concluded that the decision to dismiss did not satisfy the provisions of Section 57(3). Procedurally the decision was fundamentally flawed. None of the actions to be expected of a reasonable employer were in evidence. There was no attempt at consultation, either with the Applicant or her trade union. The Applicant was off sick when a letter was sent notifying her of the dismissal. Had the Respondent tried to flout every principle of good industrial relations practice, it would be hard to imagine what else it could have omitted. The standard by which the Tribunal has to measure the decision taken by the Respondent is that of a reasonable employer and the Tribunal has concluded that in dismissing the Applicant the Respondent did fail to meet that standard".
We can only add that we wholly agree.
The last matter with which the Tribunal had to grapple was the issue of compensation. In paragraph 7 of the Reasons, the Tribunal recorded:
"In her application to the Tribunal, the Applicant sought reinstatement. However, at the hearing, the Applicant indicated that she was seeking compensation".
The helpful notes of evidence show that no evidence was called by the Respondent and that the only witness before the Tribunal was Miss Holmes. The relevant sections of her evidence as recorded in the notes are as follows:
"Offered job back on basis if taken back someone else would have to be made redundant but could not guarantee how long job would last. I refused offer".
In cross-examination the notes record:
"Dismissal - Offered reinstatement no conditions on me. Back pay would not have made any difference. No threat to me.
I did accept it was a genuine offer - I rejected the offer".
In re-examination:
"Reinstatement offer was ungracious. Someone else would be redundant".
IN REPLY TO QUESTIONS FROM THE CHAIRMAN
"Work had been declining".
"Employer could have thought that they needed fewer people. Offer was ungracious".
The Tribunal's finding on mitigation of loss is recorded in paragraph 8(c) of their Reasons:
"The Tribunal is guided by the decision of the Employment Appeal Tribunal in the case of Sweetlove v Waltham Forest Area Health Authority [1979] IRLR 195 when it was held that an employee who unreasonably refuses an offer of full reinstatement has failed to mitigate the loss suffered and is thereby not entitled to a compensatory award. The Applicant's only reason for refusing the offer made by the Respondent was that it was made ungraciously. This, in the view of the Tribunal, is not a reasonable ground for refusal of the offer and accordingly, the Tribunal makes no compensatory award".
The decision of the Tribunal was sent to the parties on 12 November 1992 and by letter dated 18 November 1992, Miss Holmes requested a review of that decision. The concluding paragraph of that letter was in these terms:
"After the case had been presented the Tribunal retired to consider its decision. The Chairman brought it to the Applicant's attention in a cursory fashion her right to seek reinstatement or re-engagement making a comment, that in her evidence she had refused reinstatement what was her view now. She indicated that she was seeking compensation. The Chairman then went on as contained in paragraph 8 of the Tribunal's findings. The Applicant was neither asked nor given any chance to answer the Tribunal's finding that she had failed to mitigate her losses. If asked she would have answered that she had acquired new employment and as required by the Rules concerning the duty of a person to mitigate his losses as applied to damages recoverable under the common law of England and Wales or Scotland as the case may be. The Applicant had under those rules mitigated her losses. After the Chairman's deliberation the Applicant's representative asked if he could make a statement. This was refused".
This application for a review was refused upon the grounds that it had no reasonable
prospect of success. This ground was amplified in the reasons in this form:
"The further reason put forward by the Applicant for returning the Respondent's offer of reinstatement was a reason which she could have put forward at the hearing. Although the Applicant was not asked specifically about mitigation of loss, she was asked by the Respondent's representative and by the Tribunal why she had rejected the offer and could have put forward the reason she now gives".
Whilst we accept that procedure is essentially a matter for the Industrial Tribunals, we adopt the reasoning of Wood J. in Ferguson v Gateway Trading Centre Limited [1991] ICR 658 at 668E:
"........ bearing in mind the identities of those appearing before those Tribunals, whether in person or as representatives, it seems to us that it might be helpful for all concerned, if before final submissions are made the Chairman were to re-define the issues which had emerged. It may be helpful if, where people are appearing in person, that is done in writing and perhaps typed out; that is a matter for them. However we would hope that if this course were adopted it would minimise the possibility of misunderstandings which are undoubtedly arising".
In this case, although we accept that the employee was asked why she had rejected the offer of reinstatement, we consider that there was an error in failing to ask her specifically about mitigation, for those matters outlined in the letter of 18 November 1992 might well have been elicited had she been so asked.
Further, the finding at paragraph 8(c) that the only reason for the employee refusing the offer made by the employer was that it was made ungraciously, seems to us to have failed to take into consideration all the surrounding circumstances, and in particular that were the employee to accept reinstatement the inevitable consequence in her view would be to make redundant another worker at that same place of employment. The reaction of an employee to any offer which is made must depend upon the circumstances in which that offer was made, the attitude of the employers, and indeed upon all the surrounding circumstances: see Fyfe v Scientific Furnishings Limited [1989] ICR 648 at 652H. Had the Tribunal considered all the factors recorded in the notes of evidence to which reference has already been made, in our judgment the Tribunal might very well have come to a different conclusion.
We are driven to the conclusion that the Tribunal erred in law in failing to give the employee the opportunity to call evidence and to make submissions upon the issue of mitigation. We therefore remit this matter to the Tribunal for reconsideration of the compensatory award.