United Kingdom Employment Appeal Tribunal

BAILII case number: [1994] UKEAT 652_93_1712

Appeal No. EAT 652/93

I N T E R N A L

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 17 December 1994

Before

HIS HONOUR JUDGE J HULL, QC

MR A C BLYGHTON

MRS R CHAPMAN

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MR D WILLIAMS          APPELLANT

BIRMINGHAM CITY COUNCIL          RESPONDENTS

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Transcript of Proceedings

JUDGMENT

Revised


 


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APPEARANCES

For the Appellant MR R DE MELLO

(of Counsel)

Messrs Tyndallwoods

1st Floor

Albany House

Hurst Street

Birmingham B5 4BD

For the Respondents MR J R McMANUS

(of Counsel)

Solicitor

Birmingham City Council

11-14 Cannon Street

Birmingham B2 5EN


 


JUDGE HULL, QC: In this case Mr Williams who is now a gentleman of 53, was at all material times a senior administrator with Birmingham City Council. His employment began on 16 August 1976 as an assistant director in the administrative division. In 1983, his responsibilities were changed: he became assistant director in the supplies and support services division and then on 1 February 1988 he became the head of administrative services in the management services division. That was as a result of some restructuring. He remained in that post for more than three years and in May 1991, as the Tribunal found, he made an application for early retirement in April 1992, that being the appropriate date for tax purposes. He asked whether he could in addition take voluntary redundancy in the sense that he would receive a redundancy payment. Birmingham City Council had of course a scheme under which payments were made in respect of early retirement or in respect of redundancy.

He was told, not once but repeatedly, that redundancy was not, so to speak, an addition to early retirement. If he took early retirement, there might be all sorts of benefits available to him, but voluntary redundancy was not something which could be added on. Therefore he agreed to ask for early retirement. It was agreed that he should be credited with an extra five years' service, which of course was financially very advantageous for him.

Although there was, as I say, this agreement between the parties on all essential matters, the mechanism required him formally to be dismissed. And so he was dismissed. He had been offered the alternative, which remained opened to him until his dismissal took effect, of accepting another appointment with similar responsibilities, though not identical, referred to as P07. He said no, he would take his early retirement and his employment finally ended on 30 September 1992 as a result of the Dismissal Notice. That was the situation in law, although it is perfectly apparent that the reality was that there was throughout here mutual agreement. The parties were agreed on all important details. To be commonsensical about it, Mr Williams had reached something of a block in his career. He had made no progress in rising to more senior tasks. He was already a fairly senior man and that is a very natural and familiar situation in which employer and employee may discuss questions such as early retirement or of course redundancy if that is appropriate.

Then having been dismissed on that basis (that is to say, that there was an agreement for early retirement), Mr. Williams said: well, he would like the question of a redundancy payment to be reconsidered. Of course it was in flagrant disregard of what had been agreed, but he applied to the Industrial Tribunal. It appears that there are two different things here; the redundancy payment which would have been paid under the scheme, if one had been agreed, might perhaps have been much more generous than the statutory provisions, but he was now applying for a statutory redundancy payment under the provisions of the Employment Protection (Consolidation) Act, 1978, and therefore it is the provisions of the statute which have to be considered. It appears to us (we have not heard about this) that it may very well be that if he were to establish that he were in truth, for statutory purposes, redundant, that might have profound contractual effects; we do not know. As to those contractual effects, it was pointed out by Mr Blyghton that the rights under the Scheme were presumably contractual rather than statutory and it might very well be that if the application for a redundancy payment had succeeded, there would have been effects in contract arising out of the agreement between the parties, but of that we say nothing.

So he applied to the Industrial Tribunal. The Industrial Tribunal (the matter not being compromised) sat to try it on 30 April 1993 at Birmingham under the Chairmanship of Mr Owen, with two industrial members. Their decision starts at page 3 of our Bundle and it is a remarkably frank document, if I may put it like that, because the members and the Chairman eventually being at one (this was a unanimous decision) charted in effect the discussion which had taken place between them. The two members were adamant that the reality of this situation was that there was a mutual termination by agreement (whether you call it a resignation by agreement or not). The Industrial Members perfectly understood that the underlying basis of this was an agreement, whether a happy agreement or an unhappy agreement. The Chairman made it clear that if parties, whatever their agreement, go through the form of a dismissal and that is intended to have serious legal consequences, then of course the Tribunal had to consider the matter on the basis of dismissal.

The case for the employers was put in their Notice of Appearance (the IT3 as it is called). They agreed that the applicant was dismissed and the reason, says the form, was:

"In order to take early retirement"

and then when one looks at the expanded case which they put in box 8, they set out the matters which I have referred to and they say:

"...The reason for dismissal falls within Section 57(1)(b) of the Employment Protection (Consolidation) Act 1978.

The Applicant was not made redundant within the meaning of Section 81 of the said Act."

So that was their case: the reason that he had been dismissed was his option for early retirement which required that step to be taken.

We refer to the Decision. The Tribunal set out:

"...2 There is little conflict in the evidence. The only conflict is in the interpretation of documents and events and it is necessary for the tribunal to find a series of primary facts before moving to find substantive facts and to deal with the submissions made by the respective representatives..."

They set out the primary facts; I do not need to refer to those at length. They refer to the Council's policy; a policy for redeployment, a policy which offers voluntary redundancy, a move to other employment or early retirement if over 50 years of age, and then they go on to state more fully the facts which I have already referred to. They record that the applicant had elected for early retirement and they record the extra five years which were given for the purposes of early retirement. After that they say that, agreement having been reached, he was dismissed in "the interests of the efficiency of the service" it was put.

They record that even after his dismissal, he was offered another post (I have referred to that) and they said the post was available: he would not accept that. They refer to that new post as "PO7" for convenience, and then they go on from those primary facts to find the substantive facts. They say that the post which he was occupying at the time of his early retirement had become substantive, which was of some importance (it was not a mere temporary post).

"...The applicant initiated early retirement. It was his initiative that triggered the Council's response. He could have called a halt to it at any time right up until the day that he left. We are told by the City that to get the extra five years on the pension, they had to dismiss him in the interest of the efficiency of the service in order to take early retirement under the Local Government Superannuation Regulations of 1986 and although they initially in the pleadings claimed that this was a mutual termination they had to agree there was in law a dismissal..."

So that of course is on the basis of the amended Notice of Appearance. Then they record as follows:

"...They claim the dismissal was for some other substantial reason within Section 57(2) namely the applicant's application for early retirement. The members of this tribunal were both adamant in our discussions that the dismissal in their view was a technicality and the whole exercise had been one of mutual termination between the applicant and the respondent. The Chairman has explained the difficulties arising from the City having formally dismissed the applicant. The members counter that by saying the horse comes before the cart and the horse is a redundancy situation for which a voluntary redundancy is requested and it is from then on that early retirement can be coupled with it and that the applicant had indeed put the cart before the horse. He has applied for early retirement and then tacked on at the end of it a claim for a redundancy payment. In the members' view the dismissal was a highly technical dismissal to enable the applicant to receive his 5 years extra pension and that the dismissal was some other substantial reason within Section 57(2) and the application in their view must fail and the members' view is full of good sound common sense and has much to commend it..."

And then they go on to see what the legal position is as opposed to the common sense situation.

The Chairman does not consider that the matter can be left as suggested by the members without the Tribunal going into a full investigation as to the question of redundancy; and here the Tribunal must consider the retirement and redundancy programmes and the Tribunal do that in their decision and they refer to the provisions.

Paragraph 1 of the package, they say, says that redundancy payments may be made to employees in the following circumstances:

(1) If there has been a reduction in the number of jobs.

(2) If the employer asks for redundancy in preference to retraining and/or development.

(3) If the department agrees that efficiency of the service will not be reduced by voluntary redundancy..."

And then they cite from Section 81(2)(b) of the Act 1978:

"...An employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to:- "The fact that the requirements of that business for employees to carry out work of a particular kind or for employees to carry out work of a particular kind in the place where he was so employed have ceased or diminished or are expected to cease or diminish"..."

And then they set out the statutory presumption in favour of redundancy in Section 91(2) and they go on to say:

"...It is necessary for us therefore to find certain facts relating to the disappearance of the words "Head of Administrative Services" to the words "Principal Officer, Information and Members Services"

(a) We have carefully studied the job descriptions of both jobs and we have considered the evidence given by both parties as to what has disappeared, what has been included and what are the general principles of the exercise of the two posts. There are changes on the perimeter. some aspects of the job have disappeared, other aspects of the new job have appeared but we are all entirely satisfied that the total operation is one of "administration". The applicant has been at a senior level over many years in an administrative position carrying out administrative functions. We find that the basic job is still there. We find that there has been no staff redundancies whatsoever and there has been no money used to finance other posts. The basic job of administration is still there. The applicant has said that another officer by the name of Ronna in another department received a voluntary redundancy payment as well as early retirement. The respondents have satisfied us from their evidence that the entire post of the said lady disappeared and that the monies of that post were used to finance other posts. An entirely different situation to that of the present applicant. Further we accept the respondent's evidence in preference to the applicant when it comes to considering the job responsibilities of Job A and Job B and we accept their evidence that though there may be a few peripheral changes the main core of the applicant's job remained, there was no reduction needed in manpower, there was no reduction in the need of the services required and there was a redistribution of duties which there was some new duties and some old duties disappears off the perimeters of the job. But basically the job of the applicant was one of administration at a high level and at a high level the administrative job was still there.

In our decision the respondents have rebutted the presumption of redundancy and satisfied us that the reason for the dismissal was some other substantial reason, namely the applicant applied for and was granted early retirement and that the dismissal was not "wholly or mainly attributable to redundancy" which is the criteria for the applicant being redundant and so able to claim a redundancy payment.

7 The members are now doubly satisfied that their original view was correct. The Chairman is satisfied all matters of both law and fact have been discussed. The result is that we are unanimous this application fails and the request for a redundancy payment is refused."

That, therefore, appears to be a decision purely on the facts. The Industrial Tribunal have decided that neither under the scheme operated by the authority, nor of course (which was their direct business) the statutory provisions, was there a redundancy. The statutory presumption was rebutted and the true reason for the redundancy was the agreement between the parties under which the applicant was dismissed on the basis that he had agreed to early retirement. There was no redundancy.

Mr de Mello, who appeared for the applicant both before the Industrial Tribunal and here, said that the Industrial Tribunal had failed to give sufficient grounds for their finding that the redundancy presumption was rebutted. He pointed us to various parts of the evidence and he said in particular that here there was an admission by the Council that there were changes in the job. They were said to be peripheral changes. True, the Industrial Tribunal said that they accepted the evidence of the Council where it differed from that of the applicant, but they should have gone on to say that they considered the peripheral matters, and set them out (perhaps shortly) and said "we have considered all those" and that, said Mr. De Mello, would have been enough; but by showing that they were simply concentrating on the main points of difference between the jobs and saying there were no substantial differences, they were not doing their job.

We do not accept that submission. It appears to us that by ignoring peripheral matters the Industrial Tribunal were doing precisely what they are supposed to do. It is not their task to set out every single point in the evidence and say what they made of it; it is their task, as Mr de Mello told us himself, to show the parties why, as the case may be, they have won or lost. They do that by looking at the essence of the material matters, the most important matters. They do not consider matters on the periphery unless they think it useful to do so and they certainly do not have any duty to do so. We think there is nothing in that criticism, we think it amounts to precisely what is described in various cases as going through the decision with a fine toothcomb, or trying to find some phrase or something on which a criticism can be suspended, and we do not think there is any such criticism made out here.

Mr de Mello made a very sophisticated point. He said "It is wrong in law for the Industrial Tribunal to rely on the application for early retirement, because that is in defiance of Section 140 of the Act" which is one of, perhaps, the main anti-avoidance provisions. Under Section 140 of the Act of 1978:

"...any provision in an agreement (whether a contract of employment or not) shall be void in so far as it purports-

(a) to exclude or limit the operation of any provision of this Act or;

(b) to preclude any person from presenting a complaint to, or bringing any proceedings under this Act before, an industrial tribunal..."

So if the agreement had been relied on for saying "Ah, he excluded his statutory right to apply to an Industrial Tribunal", then on the face of it, that would be a contention which could not be maintained and the Industrial Tribunal (if they had to adjudicate on that contention) would have said "Well, under Section 140 it appears that that provision of your agreement is one which is, on the face of it, void".

But of course that is not the reality of the situation. The City Council never did tell the Industrial Tribunal that they had no jurisdiction because of the agreement between the parties. They said that "the agreement between us is the reason that he was dismissed. It was agreed that he should be dismissed, which was greatly to his advantage, and so he was. So far from saying your have no jurisdiction to consider whether there was a redundancy situation and whether he is entitled to a redundancy payment, we say there was not and we ask you to adjudicate on that, just as the applicant did". It seems to us that that is a completely false point in terms of logic and the mere fact that the parties have reached agreement on various matters is something proper to be laid before the Industrial Tribunal; it is part of the essential facts of the case. It may or may not, of course, be vital; here it was vital because the parties had reached an agreement under which a Notice of Dismissal was to be given.

The majority of the Industrial Tribunal (the industrial members evidently) reached the view that the essence of the matter was a consensual parting; they were certainly entitled to do that, but then under the guidance of the Chairman they had to look at the legal form in which it was put and decide the questions which arose in law, so we find that point entirely without merit and we reject that submission.

We refer to the provisions Section 82(5) of the Employment Protection (Consolidation) Act, 1978, which do not arise directly; but they do provide that if there has been an offer of suitable employment which has been rejected by the employee, he cannot then complain that he is being made redundant. Mr Blyghton referred to the undoubted offer of the job which was referred to as "PO7" and all that Mr de Mello could say to that was "Well, that was not one of the points which was taken by the employers". Indeed, as a comment, one would say there were a good many points here which could have been taken by the employers which were not taken. They could, amongst other things, have made a good deal of the fact that this entire arrangement was precisely that it would not be a voluntary redundancy and that it was wholly inconsistent with that. They put all that on one side, no doubt because of the provisions of Section 140.

Then Mr de Mello said "the majority were not entitled to find that there was a mutual termination". We think on a fair view of this decision which was unusually frank in setting out the debate which occurred between the industrial members and their Chairman, they were perfectly entitled to take the view that the reality which underlaid the dismissal was a consensual agreement. Why on earth should they not take that view? At the end it seems to us, on a fair reading, they concurred with the Chairman in finding that there was a dismissal (having said what the underlying reality was) and that it was not for redundancy. So we reject that submission too. We think that so far from the members not being entitled to do what they did, they well entitled to do so. It might possibly be said by some that it would have been discreet not to mention that fact, but they did mention it, and set out very frankly what the reality was, and we think there is no error of law shown there.

Then finally (having taken us through his Skeleton), Mr de Mello said to us "Well, the Tribunal should have considered whether this dismissal was fair or not". It appeared to us that that was a completely misconceived argument; the complaint was not of unfair dismissal; it was a complaint for a redundancy payment. It did not say that he had been unfairly selected for redundancy. Perhaps in the face of the undoubted history of the matter, not even Mr Williams could have averred through his Counsel that he had been unfairly selected in the circumstances.

So having considered these various criticisms, it appears to us, having heard everything that Mr de Mello has to say (he has put it very shortly to us, but has explained his points with clarity if we may say so), there simply is nothing in law in this Appeal whatever. Sofar from it being a perverse decision, as Mr de Mello suggested, it appears to us to be a decision which is amply supported by those parts of the evidence which Mr de Mello particularly referred us to. It was for the Tribunal to say what they made of the evidence and what inferences they drew from it; we cannot find any errors in their logical processes of thought, or in the way in which they applied the law, and therefore we have to say that no point of law being shown to us, we must dismiss the Appeal without even calling on Mr McManus.

The Appellant will pay £1,000.00, which is the sum which we assess, towards the costs of the Respondents of the Appeal.