United Kingdom Employment Appeal Tribunal

BAILII case number: [1994] UKEAT 231_93_1910

Appeal No. EAT/231/93

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 19 October 1994

Before

HIS HONOUR JUDGE J BULL QC

MR J H GALBRAITH CB

MR ERIC HAMMOND OBE

---

TILBURY DOUGLAS PLC          APPELLANTS

MR S ROBINSON          RESPONDENT

---

Transcript of Proceedings

JUDGMENT

Revised


 


---

APPEARANCES

For the Appellant MR I JONES

(Group Personnel Manager)

For the Respondent THE RESPONDENT IN PERSON


 


JUDGE BULL QC: This is an appeal by Tilbury Douglas Plc against a decision of the Industrial Tribunal sitting at Birmingham on 21 December 1992 by which it awarded £5,209 to Mr Stephen Robinson as compensation for unfair dismissal. The full reasons for that decision were sent to the parties on 8 February 1993.

We have been considerably assisted by the way in which both parties have fairly and without acrimony put their submissions to us and we would like to compliment them upon the way in which they have done this.

So far as the reasons are advanced by the Industrial Tribunal we recognize the considerable difficulty which any Tribunal faces in demonstrating the reasons for its decision without encrusting those deliberations with so many references to authority, whether Act of Parliament or decisions of the Superior Courts, that the thrust and reasoning of what they have decided becomes obscure. However, in a field such as this, reference to authority may be thought to be unavoidable. The leading authority upon the issues raised in this case is, of course, the case of Polkey v A E Dayton Services Ltd [1988] ICR 142.

Mr Robinson worked for a large firm as a business development accountant until he was made redundant on 31 December 1991. That redundancy arose from the agreed take-over by the Tilbury Group of Douglas Holdings. The Tilbury Group was thereafter renamed Tilbury Douglas Plc. It appears that there was a progressive closure of the works at Erdington, which had been the area in which Douglas Holdings had conducted their business. A number of people were affected and consultations took place before there were a number of redundancies in October, November, and December. So far as this case is concerned, Mr Robinson's position is unique in the sense that he was temporarily retained to ascertain if his services would be needed.

I do not proceed further into the details of the facts of this case for reasons which will become apparent at the end of this judgment. I refer to the case of Polkey and to the speech of Lord Bridge of Harwich at page 162. Lord Bridge there said:

"... an employer having prima facie grounds to dismiss for one of [the reasons set out in s.57 of the Employment Protection (Consolidation) Act 1978] will in the great majority of cases not act reasonably in treating the reason as a sufficient reason for dismissal unless and until he ha taken the steps, conveniently classified in most of the authorities as 'procedural,' which are necessary in the circumstances of the case to justify that course of action. ... in the case of redundancy, the employer will normally not act reasonably unless he warns and consults any employees affected or their representative, adopts a fair basis on which to select for redundancy and takes such steps as may be reasonable to avoid or minimise redundancy by redeployment within his own organisation. If an employer has failed to take the appropriate procedural steps in any particular case, the one question the industrial tribunal is not permitted to ask in applying the test of reasonableness posed by section 57(3) is the hypothetical question whether it would have made any difference to the outcome if the appropriate procedural steps had been taken. On the true construction of section 57(3) this question is simply irrelevant. It is quite a different matter if the tribunal is able to conclude that the employer himself, at the time of dismissal, acted reasonably in taking the view that, in the exceptional circumstances of the particular case, the procedural steps normally appropriate would have been futile, could not have altered the decision to dismiss and therefore could be dispensed with. In such a case the test of reasonableness under section 57(3) may be satisfied.

...

If it is held that taking the appropriate steps which the employer failed to take before dismissing the employee would not have affected the outcome, this will often lead to the result that the employee, though unfairly dismissed, will recover no compensation or, in the case of redundancy, no compensation in excess of his redundancy payment."

Lord Bridge then goes on to deal with the case of Earl v Slater & Wheeler (Airlyne) Ltd [1972] ICR 508 and the application of the principle in the case British Labour Pump [1979] ICR 347, which he said in his speech tended to distort the operation of the employment legislation in two important ways, and I quote from page 163:

"First, as was pointed out by Browne-Wilkinson J. in Sillifant's case, if the industrial tribunal, in considering whether the employer who has omitted to take the appropriate procedural steps acted reasonably or unreasonably in treating his reason as a sufficient reason for dismissal, poses for itself the hypothetical question whether the result would have been any different if the appropriate procedural steps had been taken, it can only answer that question on a balance of probabilities. Accordingly, applying the British Labour Pump principle, if the answer is that it probably would have made no difference, the employee's unfair dismissal claim fails. But if the likely effect of taking the appropriate procedural steps is only considered, as it should be, at the stage of assessing compensation, the position is quite different. In that situation, as Browne-Wilkinson J. put in Sillifant's case, at p. 96:

'There is no need for an "all or nothing" decision. If the industrial tribunal thinks there is a doubt whether or not the employee would have been dismissed, this element can be reflected by reducing the normal amount of compensation by a percentage representing the chance that the employee would still have lost his employment.'

The second consideration is perhaps of particular importance in redundancy cases. An industrial tribunal may conclude, as in the instant case, that the appropriate procedural steps would not have avoided the employee's dismissal as redundant."

We are with great reluctance forced to the view that upon the face of the reasons advanced by this Industrial Tribunal, it is nowhere apparent that there was consideration of the questions necessarily raised by the decision in the case of Polkey v A E Dayton Services Ltd and accordingly we are again with great reluctance force forced to the decision that they erred in law.

For these reasons, the result is that this appeal must be allowed and this matter remitted to a differently constituted Industrial Tribunal for a rehearing.