United Kingdom Employment Appeal Tribunal

BAILII case number: [1995] UKEAT 489_94_2804

Appeal No. EAT/489/94

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 28th April 1995

THE HONOURABLE MR JUSTICE MORISON

MR A C BLYGHTON

MISS J W COLLERSON

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W A GOOLD (PEARMAK) LTD          APPELLANTS

(1) MR J C MCCONNELL AND (2) MR R RICHMOND          RESPONDENTS

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Transcript of Proceedings

JUDGMENT

Revised


 


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APPEARANCES

For the Appellants MR K J O'DONOVAN

(of Counsel)

Messrs Haden Stretton Slater Miller

Solicitors

Leicester Buildings

Bridge Street

Walsall

WS1 1EL

For the Respondents MR T KIBLING

(of Counsel)

Beatrice Lebow

Solicitor

139 Harringay Road

London N15 3HP


 


MR JUSTICE MORISON: The former employers, and we will call them the "Employers" in this judgment, appeal against a unaminous decision of an Industrial Tribunal held at Leeds, which, after a three day hearing upheld complaints of unfair dismissal brought against them by the two respondents to this appeal, whom we shall call the "Employees".

The facts relating to this matter may be shortly stated and we take them from the written decision of the Tribunal which was sent to the parties on 28th March 1994. The Employers are engaged in the business of the wholesale distribution of watch attachments and jewellery sundries. Both applicants were salesmen employed on a salary and commission basis. Until 1992 the method of selling was very much directed to individual retail outlets, but due to re-organisation on the retail side, sales became focused more on centralised buying units. The company's stock control and administration declined with the ill-health of the managing director, and in July 1992 a new broom, Mr Maloney, was appointed with a brief to re-organise and improve an ailing business. Due to the changes referred to, both Employees found their take-home pay dropping and this caused them concern. They asked their manager to do something about it, but nothing was done, and by the time of Mr Maloney's appointment, they had become frustrated and dissatisfied.

One of the Employees met Mr Maloney shortly after his appointment, and asked for some action to be taken over the problem. He was given a negative response, and told that the problems were for him to resolve and not for the chairman, to whom the Employee had requested to speak. After taking legal advice, the Employees solicitors wrote a letter dated 12th August which said that they were instructed to make a claim of constructive dismissal against the Employers, unless they were prepared to make acceptable proposals, including the devising of a formula designed to ensure a level of earnings which their clients had enjoyed in the past.

The parties met after the letter, and Mr Maloney said that the Employee would have to wait. Later at a further meeting, Mr Maloney said, that he might be able to offer a salary increase of £2,000.00 but that was still well short of the £5,000.00 deficit, or thereabouts, the Employees were experiencing. The two men parted on bad terms.

At a sales meeting the following day, that is 4th September, Mr Maloney said he would do his utmost to solve the problem; however, nothing could be done immediately. Having taken further advice, the two Employees decided to press for action, and to press for an interview with the Chairman. But they were told by the Chairman's secretary that such an appointment had to be made through Mr Maloney. And they both resigned the following day, saying that they had been constructively dismissed.

The Industrial Tribunal asked itself the right question at paragraph 14, namely, and I quote:

"Whether the [Employers] were in such serious breach of their obligations under the contracts of employment as to entitle the [Employees} to leave as they did."

They noted that neither man was provided with a written statement of the terms and conditions of his employment, which would have specified the method of pursuing a grievance. In his written statement, which was admitted in evidence, the Employers' Chairman said it was well known to see any employee who has a grievance or other problem. As the Tribunal noted, the Employees tried to speak to the Chairman, but were rebuffed. The Tribunal were of the view that any grievance procedure should have incorporated within it some kind of time limit, so as to ensure that grievances were nipped in the bud. In the absence of any grievance procedure in the contract of employment, the Employees' grievances, instead of being considered and dealt with promptly, were allowed to fester in an atmosphere of prevarication and indecision. The Industrial Tribunal concluded, and I quote:

"We think that this failure by the [Employers} amounted to a breach of contract."

They noted that the legal representative acting on behalf of the Employers accepted that the failure to provide and implement a grievance procedure could amount to a breach of contract. They then considered, whether the breach was sufficiently serious to justify the employees walking out. They concluded that it was and that the Employees acted reasonably in walking out. And at that time the Employees justifiably felt that there was no reasonable prospect of them being able to earn the level of remuneration that they had enjoyed in the past.

It is said on the Employers behalf that the Tribunal erred in that it failed to specify what term of the contract was alleged to have been broken. In an able and succinct argument Mr O'Donovan pointed out to us that it is wrong that a party to an Industrial Tribunal who loses should not fully understand the basis on which he has done so. He says in addition, that there is a suspicion from the wording of the Decision of the Industrial Tribunal that they have fallen into the trap of assuming that everything that an employer should reasonably do for his employees is contractual. Further, the Employees waived any breach by remaining at work between the date of the sales meeting and the date when they left. In effect, it is said that after the assurance by Mr Maloney that he would attend to the matter in due time, without making time of the essence or some other kind of indication, the Employees should either have walked off then and there or had lost the right to do so.

On behalf of the Employees it is submitted that the questions whether there has been a breach of contract and whether such a breach is fundamental are essentially questions of fact for the Industrial Tribunal and we referred in his skeleton argument to the two authorities Woods v m W Car Services (Peterborough) Ltd [1982] ICR 693 CA applying Pedersen v Camden London Borough Council [1981] ICR 674 both decisions of the Court of Appeal. The question whether there has been acquiescence is also a pure question of fact.

It seems to us quite clear that the breach of contract identified by the Industrial Tribunal related to the way the Employees' grievances were dealt with. Their process of reasoning was that Parliament requires employers to provide their employees with written particulars of their employment in compliance with the statutory requirements. Section 3(1) of the Employment Protection (Consolidation) Act 1978 (as amended) provides that the written statement required under Section 1 of the Act shall include a note specifying by description or otherwise to whom and in what manner the employee may apply, either if he is dissatisfied with any disciplinary decision or if has any other grievance, and an explanation of any further steps in the grievance procedure. It is clear therefore, that Parliament considered that good industrial relations requires employers to provide their employees with a method of dealing with grievances in a proper and timeous fashion. This is also consistent, of course, with the Codes of Practice. That being so, the Industrial Tribunal were entitled, in our judgment, to conclude that there was an implied term in the contract of employment that the Employers would reasonably and promptly afford a reasonable opportunity to their employees to obtain redress of any grievance they may have. It was in our judgment rightly conceded at the Industrial Tribunal that such could be a breach of contract.

Further, it seems to us that the right to obtain redress against a grievance is fundamental for very obvious reasons. The working environment may well lead to employees experiencing difficulties, whether because of the physical conditions under which they are required to work, or because of a breakdown in human relationships, which can readily occur when people of different backgrounds and sensitivities are required to work together, often under pressure. There may well be difficulties arising out of the way that authority and control is exercised, sometimes by people who themselves have insufficient experience and training to exercise such power wisely.

It is of course regrettable, in this case, that the Employers have failed to comply with their statutory obligations, or to appreciate the need to provide a specific mechanism whereby a genuine sense of grievance can be ventilated and redressed. Instead, the Employees, in this case, were fobbed off, and Mr Maloney plainly felt his authority was threatened by the Employees wishing to speak to the Chairman. The provision of a sensible grievance procedure would cost nothing and may well have avoided this litigation.

Suffice it to say, we are of the view that the Appeal raises no real arguable point of law. Whilst it is true that, in terms, the Industrial Tribunal have not set out the breach of contract on which they place reliance, it does seem to us very clear, from the terms of paragraph 15 through to the beginning of paragraph 18, that they were of the view that there was an implied term of the sort to which we have already made reference.

Accordingly, whilst we understand the point which is made by Mr O'Donovan, we do not think that it has any force in the circumstances of this case.

Secondly, we do not think that it is arguable that there has been acquiescence by the Employees in the breach, so as to deprive them of the right to accept the repudiation by their delay between 4th and 29th September 1994. The breach, that is the failure to provide or operate a proper procedure, was a continuing breach and it was simply a question of their frustration building up over a period of time, until the ultimate event occurred which was an indication from the Chairman's secretary that they could not go to the Chairman without recourse to Mr Maloney.

Accordingly we consider that the Industrial Tribunal were entitled to reach the conclusions which they did on the evidence before them, and that they have not misdirected themselves in any way.

Accordingly, despite, as I say, able and succinct arguments on both sides, this Appeal is dismissed.