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Cite as: [1994] UKEAT 520_92_2604

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BAILII case number: [1994] UKEAT 520_92_2604

Appeal No. EAT/520/92

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 26 April 1994

Before

THE HONOURABLE MR JUSTICE MORISON

MR A C BLYGHTON

MRS M E SUNDERLAND JP

MR H S GREWAL APPELLANT

WALSALL METROPOLITAN BOROUGH COUNCIL RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised

APPEARANCES

For the Appellant MR R ALLEN

(OF COUNSEL)

Messrs Bruce Piper & Co

Solicitors

1 Mabledon Place

London WC1H 9AJ

For the Respondents MR P GREGORY

(OF COUNSEL)

Sheila M Bull

Director

Legal & Admin Services

The Civic Centre

Darwall Street

Walsall SW1 1TP

MR JUSTICE MORISON: Mr Harjinder Singh Grewal, whom I will refer to hereafter as "the Appellant", made a complaint against the Walsall Metropolitan Borough Council by whom he is employed, and I shall call them hereafter "the employers", of unlawful discrimination on the grounds of his race.

The essence of his complaint was that he was refused promotion to one of seventeen newly created posts of Repair Team Co-Ordinator (hereafter to be called RTC) on the grounds of race, he being black. He made a complaint to the Industrial Tribunal sitting at Birmingham and by a majority decision entered in the Register on 18 June 1992 his complaint was rejected. He appeals from that decision.

The factual background leading to the Appellant's complaint may be shortly stated. Following some ten years of employment with GKM in Wolverhampton, the Appellant joined the employers in July 1971 and from April 1982 he was employed by them as a Production Planner in their Direct Service Organisation which service the employers' substantial housing stock, with a workforce of some 600 people. The Appellant has a BA degree which he obtained in 1958 and since then has obtained a variety of qualifications such as the Certificate of the Institution of Management Services, a diploma from the Institute of Administrative Management and a certificate in computing and management information systems and industrial management from the Institution of Industrial Managers.

After 9 years of satisfactory service in his post which involved organising the site work of the various building trades from a central base, he applied for one of the new RTC positions. In 1991 the direct labour force was being re-organised so that it could compete with outside bidders when the work was put out for competitive tendering. Mr Christie joined the employers in 1990 as Building Works Manager and was responsible for carrying out the re-organisation. The new system involved decentralisation with autonomous locally based repair teams serving one of each of the 17 district housing offices. Each team would be led by an RTC who would be a budget holder and would be responsible for making decisions in the field with the housing officers in the district.

Mr Christie himself would be in overall charge of the 17 teams. There was also a need for two assistant repair team co-ordinators. The salary of an RTC was between £16,000 odd to £17,200 odd. The salary for an assistant RTC was about £15,000 and the salary of the Appellant at that time as a Production Planner was some £13,600 odd. Mr Christie was empowered to advertise, shortlist and then select the 17 RTC's from 62 applicants, of whom 36, including the Appellant, were interviewed. The advertisement for the new post required candidates to have previous supervisory/management experience gained within a multi-disciplined contracting or service organisation, be self-motivated with problem solving capabilities and enjoy team work and have a good standard of general education.

The Tribunal found as a fact that the work of an RTC

"would largely comprise the work the Appellant had been doing but with much greater accent on independence and responsibility".

With his university degree and other qualifications the appellant would have been expected to have satisfied any interview panel as to his ability to fulfil at least the first and third requirements stated in the advertisement. The nature of his work, as found by the Tribunal, as was well-known to Mr Christie, involved planning and co-ordinating the work of tradesmen, issuing jobs to them, liaising with other departments and reporting back on what had happened. Again it might have been thought that any fair assessment of his past performance would have led to the Appellant satisfying the second criterion specified in the advertisement.

The interviews took place over a period of about two to three weeks and each candidate was interviewed for about 1 hour. At each interview Mr Christie had with him an officer from the employers' Personnel Department whose primary duty was to ensure that their proper procedures including the employers' equal opportunities statement were observed. The Appellant was the third candidate to be interviewed. A marking system was devised by Mr Christie who also drew up the interview questions. Not all the questions were asked of each candidate which casts some doubt on the objective integrity of the assessment process. Some of the questions seemed to my lay colleagues to be in any event somewhat naive. The marking was in 9 categories, some being weighted higher than others. Half the total marks were for the first 4 categories which showed a wide spread in results - a range of 6 - 36. In the other 5 categories the spread was much less, 21 - 36.

The employees' marks may be set out in tabular form showing his marks, the number of interviewees who had the same or better marks and the number who had less in relation to each of the two sections and we now set out in tabular form with the headings as follows:

The Employee The Same Better Worse

Section A

1-4 6 3 32 None

Section B

5-9 28 7 23 5

TOTAL 34 1 30 4

The highest score was 69 and the 17th candidate, namely the least successful to be appointed scored 55.

The first of the 4 categories comprising Section A was "Previous supervisory/ management experience within multi-disciplined contracting or service organisation" namely the first requirement in the advertisement. The employee, unlike any other candidate, had scored nil. The Tribunal were right to have difficulty in understanding this mark having regard to the Appellant's job and the length of his service. The explanation that the Tribunal put forward for this is to be found in the last sentence of paragraph 7 of the decision (page 10 of the bundle):

"Evidently the marking was for future promise rather than current abilities, and much less on past history, despite the wording, and based much more on the interview than on the application, but we all find this nil mark hard to understand".

The next category was "Previous experience of managing trading accounts, budgets, performance levels". He scored 3, along with 19 other candidates and that mark was better than 8 other candidates who scored nil. Of the 8 who scored more heavily 6 scored 6 and 2 scored 9. The explanation for this mark was that the employee, according to Mr Christie, did not understand the concepts of profit and loss accounts and says he kept referring to the size of the workforce during questioning, which was not relevant. The Tribunal comment:

"Previous experience as such does not seem to have mattered."

We assume that this comment was made on the basis that had past experience mattered, the record of the employee would have demanded a better mark and position by comparison with the others.

As to the third category, is was: "Ability to work as part of a team". Again the employee scored nil as did one other candidate. 12 scored 3, 8 scored 6 and 14 scored 9. The Tribunal's comment was

"The employee had been working well enough in his department for 10 years but again no doubt Mr Christie was looking to the future where conditions would be different."

As to the fourth category in section A, that is "Ability to be self-motivated and to solve problems" the employee scored 3 as did 9 others. 3 scored nil, 9 scored 6 and 14 scored 9. The Tribunal point out that candidates were asked "What problems they had solved last week" to which the employee gave the honest answer "none", as his work was programmed.

In relation to the 5 matters in Section B, the headings were respectively: Standard of Education; Clean driving licence; Ability to provide out of hours cover; Previous experience in recruitment/training and Knowledge of health and safety policies/legislation. As to Education, 5 candidates of whom the employee was one, scored the highest mark, namely 8, 29 candidates scored 6, 2 scored less than 6. As the Tribunal observe, the employee's degree:

"did not help him much.

It was decided in advance that the RTC post was not an academic one, but it is remarkable how little importance was attached to formal education and qualifications for principal officer posts".

Furthermore, a glazier, who was one of the candidates, scored 6, although he left "educational qualifications" blank on his application form. The last candidate to be successful who scored 55 marks overall also scored 6 for education on the strength of a carpentry and joinery course at a technical college. It appears that this was one of the matters which the Tribunal found hard to explain (paragraph 14).

In relation to clean driving licences all candidates scored 12. In relation to Out of hours cover all but one candidate scored 6. For previous experience in recruitment and training the employee scored nil although most other candidates scored 4 or 6. One of the other (successful) candidates was a production planner, like the Appellant, but he had been doing the job for only 2 years and was paid slightly less. He scored 4, although he had had no more recruitment and training experience than the employee. Further, in relation to health and safety knowledge, the Appellant scored 2, the lowest mark whereas that particular successful candidate scored 8 (full marks) although they had both been on the same course together. Again it would appear that the Tribunal concluded that "all this seems hard to explain".

In the light of these points the Tribunal's general conclusion was as follows:

"15. It seems surprising that Mr Grewal, with his experience and qualifications, did not rank at least in the upper half of the 36 interviewed for a job which largely comprised the work he had been doing satisfactorily for 9 years, and a number of features of what happened attract comment."

The issue between the parties on this appeal is what inferences the Tribunal should then have drawn as to the reason for the employee's failure to be promoted. It has been argued with force by Counsel appearing on behalf of the employers as follows. Firstly, that the Tribunal apparently directed themselves correctly to the decision of King v Great Britain China Centre [1992] ICR 516. Secondly, that they looked for the basic reason as to why he was not appointed which was the poor scoring that he was awarded following his interviews. Thirdly, they correctly did not stop there but looked behind them to the reasons for those scores. Fourthly, they then ask themselves "Are there any criticisms of the scores" and fifthly, they ask themselves in effect the question "Should we infer that by reason of the criticisms, we can infer that he was the victim of unconscious racial discrimination and they said the majority of the Tribunal concluded "no".

Accordingly it was submitted to us based on law to which we do not need to refer, that this Court is not to interfere with a decision of an Industrial Tribunal merely because it might disagree with its conclusions unless it is able to say that the decision of the Industrial Tribunal was wrong in law, including that it was perverse. It was submitted to us that there was no material before us on which we could conclude that their decision was perverse.

On the other hand, it has been argued by Counsel on behalf of the Appellant that the reasoning of the majority of the Industrial Tribunal, set out in paragraph 15 of the decision, is, in effect, perverse; that the crucial finding on which the majority base their decision was this:

"The criteria he [Mr Christie] used were evenly applied as far as can be seen and he had his reasons for them."

Counsel on behalf of the Appellant submits to us that that finding by the majority was completely inconsistent with the previous comments which they had made earlier on in their decision, to which we have already referred in this judgment. It would not appear that the criteria had been evenly applied; on the face of it employees were not all asked the same question and furthermore, there were a number of odd conclusions which were drawn from the marking as applied by Mr Christie. Accordingly, it was submitted, on behalf of the Appellant, that that finding was perverse and if that was correct, that effectively destroyed the basis of the reasoning of the majority in the Industrial Tribunal. It was submitted to us accordingly, on behalf of the Appellant, that this was a case in which we ourselves could and should draw the necessary inference and reach a conclusion of unlawful discrimination against the Appellant by his employers, the Respondents.

We have carefully considered these submissions. It seems to us that the Tribunal did indeed mention the case of King. There, Neill LJ, giving the judgment of the Court, gave clear guidance to Industrial Tribunals as to the approach which they should adopt. We need not set out those principles here, but with great respect to the Learned Lord Justice, we do think that his fourth point is perhaps most felicitously expressed. He says that:

"a finding of discrimination and a finding of a difference in race will often point to the possibility of racial discrimination."

Discrimination is defined in Section 1 of the act to mean treating someone less favourably than he otherwise would have done on the grounds of race. By using the expression "a finding of discrimination" he clearly must have meant "a finding of less favourable treatment" thus giving effect to Mr Sedley's submission recorded in the first sentence at page 526C of the report.

Although we were invited by Counsel for the Appellant to note phrases such as "credible alternative explanation", "satisfactory explanation", "innocent explanation", we approach this appeal by simply adopting the approach of the Court of Appeal in the King case.

In our judgment we are entitled to conclude that the reasoning of the majority of the Industrial Tribunal was indeed perverse for the reasons advanced by Counsel on behalf of the Appellant. It seems to us that what was set out as their reasons in that paragraph does not amount to a credible explanation for the fact that the Appellant scored so badly. However, we ourselves are reluctant to draw an inference of discrimination because whilst the absence of a credible explanation will usually lead to an inference of unlawful discrimination, it must be for the Tribunal of fact to draw it having regard to the approach laid down in King. Therefore, whilst we are satisfied that the reasoning of the majority does not bear analysis, we consider that the appropriate course will be for the case to be remitted back for a re-hearing before another differently constituted Tribunal.

We would simply like to emphasise the need for Tribunals to be prepared to draw inferences against the employer, where, as here, the non-promotion appears not to be capable of objective justification. It is unlikely that in any case there will be direct evidence of discrimination. Tribunals should recognise the existence of subconscious discrimination as they did here, often in circumstances in which the person concerned transfers, so to speak, his own prejudices on to third parties, for example by saying or thinking "whilst I have no prejudice, I know that others do and I do not believe this black person will be accepted by others in the team".

The Appellant was the only black person to have been interviewed. He was ranked in a way which caused the Tribunal surprise. Whilst the absence of a credible explanation will not inevitably lead to a finding of unlawful conduct, Tribunals should not be reluctant to grasp the nettle and draw the inference from the primary facts where appropriate. We hasten to say that none of the comments that we have made should be treated by the new Tribunal at any rehearing as any kind of indication as to the way that they decide the matter. It is open for them to decide this case as they see fit, based on the evidence before them and applying their minds properly to the tests laid down for them in the King case as interpreted by us in this judgment.

Accordingly to that extent we allow the appeal and order that this matter be reheard before a different Tribunal.