United Kingdom Employment Appeal Tribunal

BAILII case number: [1995] UKEAT 14_95_0211

Appeal No. EAT/14/95

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 2nd November 1995

Before

THE HONOURABLE MR JUSTICE MAURICE KAY

MR A C BLYGHTON

MRS R CHAPMAN

---

THE MINISTRY OF DEFENCE          APPELLANTS

MRS D J WHEELER          RESPONDENT

---

Transcript of Proceedings

JUDGMENT

Revised


 


---

APPEARANCES

For the Appellant

For the Respondents


 


MR JUSTICE MAURICE KAY: Mrs Wheeler was born on 19th March 1959. When she was aged seventeen she joined the Women's Royal Army Corps on a 22 year engagement. That was on 6th April 1976. In September 1977 she was promoted to lance corporal and in July 1979 to acting corporal. In February 1980 she had an unpleasant experience in the Army which caused her to give notice of intention to leave. However, she was persuaded by her commanding officer to reconsider her position. In May 1980 she was posted to Germany and her contentment with Army life returned. She was encouraged by being told that she was a high flyer and had good prospects. She later withdrew her notice of intention to leave. In November 1981 she married a fellow soldier. In 1984 she became an acting sergeant and was recommended for promotion to sergeant. However, she was discharged by reason of her pregnancy on 28th June 1985. Her first child was born on 3rd September 1985 and a second child followed on 23rd March 1987. At that time Mr and Mrs Wheeler were living at Brize Norton. From 1987 until 1990 they lived in Dortmund where Mr Wheeler was posted and from 1990 to 1992 they were in Munster. They then returned to England. Mrs Wheeler found that after her discharge from the Army in 1985 her special WRAC skills were not readily transferable to civilian life. She was not able to drive a car at that time. However she did undertake various short-term courses. She was ready to return to work by the end of 1985 and she signed on for unemployment benefit and registered with the Job Centre at Whitney. She could not find suitable employment. The Tribunal accepted that she made more applications than she can now specifically remember and also that local employers were reluctant to take on and train the wives of servicemen because of the likelihood of their leaving to follow their husbands on postings. The Tribunal accepted that Mrs Wheeler looked for jobs from the end of 1985 until the beginning of 1987 when she was due to give birth to her second child. When the family moved to Dortmund in May 1987 Mrs Wheeler thought she may be able to find a job there but this did not materialise. She made an enquiry about re-enlisting in the Army but was rebuffed. She enroled on an Open University course and made some money as a make-up representative. Other possible forms of employment were so low paid as to be worth less than a cost of a child minder. Following the move to Munster in 1990 Mrs Wheeler obtained full-time clerical employment.

Mrs Wheeler's claim was determined by the Industrial Tribunal at London (South) presided over by the same Regional Chairman as in Bristow and the case of Mrs Hunt. On this occasion the Tribunal assessed the chance of Mrs Wheeler having returned after maternity leave for her first child, if it had been available, as 100%. That assessment of a 100% chance was carried through to a point six months after the birth of the second child. However, the assessment of the chance of her returning to work at that stage was reduced to 85% and the chance she would have proceeded the complete 22 years service was assessed at 20%.

The Ministry of Defence seeks to raise seven points of appeal before us and Mrs Wheeler cross-appeals in relation to one matter.

(a) 100% chance of return assessment

The tribunal dealt with this in paragraph 36 of its decision in the following terms:

"It seems to us, taking into account Mrs Wheelers financial situation at the time of discharge; the fact that she had completed nine years on 5th April 1985 and was very near her promotion to Sergeant; the fact that she made efforts to discover whether she would be permitted to stay on and the fact that she was better looking for a job very shortly after the birth of the first child, there was no chance at all that t she would not have returned to the Army after taking maternity leave for that first child."

The submissions made by Mr McManus in respect of this ground are similar to those made in relation to the equivalent ground in the Hunt appeal. It is true that paragraph 36 contains no reference to the statistical evidence. However, it is apparent from paragraph 21 of the decision that the Tribunal did take account of the statistical evidence. It concluded:

"We bear in mind that statistics of that kind only take us some of the way because we have to consider the chance that this woman would have been amongst the persons who stayed."

Mr McManus suggests that this passage contains a clear error of law in that it is indicative of a "pool" approach. We disagree. In our judgment this passage indicates that the statistics were taken into account, that the Tribunal concluded that they only took it "some of the way"; and that the Tribunal proceeded to assess the chance on the basis of the whole of the evidence. In paragraph 35 the Tribunal stated:

"We have looked very carefully at what she actually did after discharge ... In making our assessment, we have also borne in mind all the circumstances including, particularly, the incentives Mrs Wheeler would have had for staying in, balanced against the incentives for leaving."

We are satisfied that, having regard to all the evidence in this case, it was open to the Tribunal to make this 100% assessment.

(b) The subsequent assessment of the chance of continuing in the Army at 100% and 85%

We refer again to the passages from the decision which we have just quoted. This was a case in which the Ministry of Defence mounted a vigorous attack on the integrity and truthfulness of Mrs Wheeler as a witness (paragraph 2 of the decision). The Tribunal was not impressed with that attack. It accepted most of her evidence. The evidence pointed to her being a high flyer with good prospects. Again, the fact that her employment pattern was interrupted following her discharge does not necessarily mean that it would have been so interrupted if there had been no discharge. In our judgment the assessment of all the evidence was careful and the Tribunal was entitled to assess the chances at 100% and 85%. The matter of the weight to be given to different parts of the evidence, including the statistical evidence, was a matter for the Tribunal. We do not consider its conclusions to have been perverse.

(c) Misdirection on mitigation

Paragraph 26 of the decision contains a passage in substantially the same terms as paragraph 20 of the decision in Hunt. The Ministry of Defence again seek leave to include an additional ground of appeal by reference to it. In spite of objection we have seen fit to grant leave. The issue raised is precisely the same as in Hunt. Once again, we do not consider the point advanced on behalf of the Ministry of Defence to be well-founded. In our judgment this was not a case of the Tribunal making a gender based assumption but of the Tribunal using its experience to come to the conclusion that at the material time it was common for employers to make a gender based assumption. There is nothing in this ground of appeal.

(d) Perversity in relation to mitigation

We have already summarised the evidence concerning Mrs Wheeler's employment pattern following her discharge. It is true that in relation to a relatively short period soon after her discharge (paragraph 12 of the decision). Mrs Wheeler accepted in cross-examination that there was time a range of available clerical jobs in the Oxford area, a 20 to 30 minute bus ride away from the RAF base where she and her husband were living. There was no further evidence about these jobs or about salaries. Returning to the question of mitigation in paragraph 43 of its decision, the Tribunal stated:

"In this case the Secretary of State has adduced no evidence on the basis of which we can arrive at any figure by which Mrs Wheeler's damages should be reduced to reflect a failure to mitigate her loss. However, we have regard to the Gardiner-Hill case ... and therefore, although Mrs Wheeler may have failed to make sufficient effort to mitigate her loss, we make no finding about it."

Once again, the Ministry of Defence contends that the Tribunal ought to have used its own experience to fill in the gaps in the evidence. Having regard to the totality of the evidence, the burden of proof in respect of an alleged failure to mitigate and the passage in the Gardiner-Hill case to which we have referred earlier in this judgment, we are satisfied that it was not perverse of the Tribunal to decline to use its experience to fill in gaps in the evidence concerning employment opportunities and salaries in Oxford and elsewhere 10 years ago. In our judgment the Tribunal was entitled to come the decision it reached on the issue of mitigation.

(e) Double counting

In paragraph 46 of the Decision the Tribunal expressed its award to be 100% of lost earnings up to a date six months after the birth of the second child. It then refers to 85% of earnings up to the end of September 1987 "(six months after the birth of the second child)". It is obvious that the first of these two references to "the second child" was erroneous and inadvertent. It should have been a reference to the first child. This point is conceded by Miss Simler on behalf of Mrs Wheeler. By itself, this would have been a matter for requesting a review of the Tribunal decision rather than pursuing an appeal. However, it has come to us as a part of a much wider appeal and on this point the appeal succeeds.

(f) Cumulative chances

In paragraph 46 of the Decision the Tribunal sets out the principles to be applied to the calculation of compensation. It refers to a period of 100% of Army earnings, followed by a period of 85% of such earnings, and a subsequent period of 20% of those earnings. Mr McManus submits that this amounts to a misdirection in law by failing to assess Mrs Wheeler's chance of completion from six months after the birth of the second child to the end of 22 years by multiplying percentage chances cumulatively. He submits that the Tribunal ought to have awarded the respondent 17% of her lost earnings for that final period, viz 85% of 20%. Miss Simler seeks to deal with this submission by contending that there is no error of law or misdirection. She submits that the Tribunal made an overall assessment of the relevant chances and made findings of fact which justify the final figures of 85% and 20%. In our judgment, it is clear from the wording of paragraph 46 that the Tribunal was contemplating the application of different percentage figures at different stages but to the same base earnings figure. There is nothing on the face of the decision to suggest that the Tribunal was giving discounted figures which took into account the effect of cumulative chances. In our judgment the submission on behalf of the Ministry of Defence on this issue is correct and its appeal on this point will be allowed. The consequences are purely arithmetical and do not necessitate a remission to the Industrial Tribunal.

(g) Misdirection on calculation

We referred in our general observations at the beginning of this judgment to the dispute as to the calculation process in a case where the Tribunal has to take into account mitigation earnings and the assessment of a chance of completing service which is less that 100%. This is an important legal point and we have sought to analyze the authorities and declare our view of the law in that earlier passage when dealing the Derwent Coaches case and its application in Bristow. In the present appeal the Ministry of Defence seeks leave to amend its Notice of Appeal so as to raise this issue in relation to Mrs Wheeler's case. Notwithstanding objection, we grant leave for that amendment. However, it will be apparent from the earlier passage in this judgment that our conclusion is that the submission made on behalf of the Ministry of Defence is incorrect and that we respectfully differ from the view that was taken by this Appeal Tribunal in Bristow. In the circumstances this ground of appeal fails.

(h) Pension loss

Mrs Wheeler raises a point by way of cross-appeal relating to the Tribunal's findings in respect of pension loss. Having decided that loss of pension rights should be calculated in accordance with the Industrial Tribunal's booklet "Compensation for Loss of Pension Rights", the Tribunal asserted that the basis of an employers' contribution of 21% of final salary was appropriate. The submission made on behalf of Mrs Wheeler is that the 21% figure should be enhanced by an additional factor to compensate Mrs Wheeler for the fact that 21% per annum had not actually been invested in a fund for the period between the date of discharge and the date of hearing. Apparently the Ministry of Defence has conceded in a number of other cases that it is appropriate to apply an enhancement factor to the contribution rate. Mr McManus was instructed to make a similar concession here. He does not seek to resist Mrs Wheeler's cross-appeal and agreement has been reached to include an enhancement factor of 1.096282. Accordingly the cross-appeal is allowed, the said enhancement figure is to be added to the finding in paragraph 40 of the Decision and no remission to the Tribunal is necessary.

It follows from the foregoing that the Ministry's appeals under paragraph (a), (b), (c), (d), and (g) are dismissed. Its appeals in relation to paragraphs (e) and (f) are allowed and the cross-appeal in relation to pension loss is allowed.