United Kingdom Employment Appeal Tribunal

BAILII case number: [1995] UKEAT 864_93_1301

Appeal No. EAT/864/93

I N T E R N A L

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 13 January 1995

Before

HIS HONOUR JUDGE D M LEVY QC

MR S M SPRINGER MBE

MRS M E SUNDERLAND JP

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MR N LAW          APPELLANT

GASKING BROTHERS          RESPONDENTS

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Transcript of Proceedings

JUDGMENT

Revised


 


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APPEARANCES

For the Appellant MISS G MIDDLETON

(Of Counsel)

Messrs Gorna & Co

Solicitors

Virginia House

Cheapside

King Street

Manchester

M2 4NB

For the Respondents MISS C WILLIAMS

(Of Counsel)

Messrs Emmerson

Brown & Brown

Solicitors

20 Castle Street

Dover

Kent

CT16 1PW


 


JUDGE LEVY QC: This is an appeal from a Decision of an Industrial Tribunal held at Ashford on 23 August 1993. The background facts are set out in the Decision of the Industrial Tribunal which was sent to the parties on 9 September 1993.

At all material times the Respondent firm carried on the business of providing double glazing. There were two sides of the business. One was the making of glassware and the other was the building associated with it. The Appellant was employed by the firm from 1984. The founder of the firm died in 1992. From then on, it was run by his widow and a Mrs Karen Mills, their daughter, who gave evidence to the Tribunal. I turn to paragraphs 4 onwards of the facts as found by the Tribunal:

"4 The business had been losing money since 1990 to such a point that in 1992 it lost £31,000.00 in that year. There were 8 employees of the business including Mrs Mills and her mother Mrs Gasking (there was some discussion here as to whether that 8 should have been 9)".

5 In January 1992 the accountant for the company said that the company (throughout the Decision the Tribunal refers to the firm as if it were a company) would be losing £500.00 per week and that they had to make cuts. To that end her father had sold his expensive car, sold his pension and his insurance policies and taken a second mortgage on the house and given up the second premises that the business operated from and sold building materials.

6 It was decided that they could not keep both the two foremen: the applicant who was in charge of the glassware side and a Mr Hobbs, who was in charge of the building side.

7 At the end of February 1993 Mrs Mills and her mother discussed the matter between them and decided that (and these words matter) of the two foremen they would give notice to the applicant and dismiss him by reason of redundancy. They accordingly summoned him at 8 a.m. on Monday 1 March 1993 and gave him a letter explaining the terms of his redundancy and he was asked to clear his desk and leave by 9 a.m. that morning".

They also gave him a letter dated 1 March 1993.

"Dear Mr Law

I regret to inform you that the company finds it necessary to terminate your employment due to redundancy effective from 1st March 1993.

This action does not reflect lack of performance or effort on your part, even the most optimistic forecast of potential business in the current recession clearly indicates that we should no longer try to support or justify the present staff structure and overheads [and then a very important sentence]. We have given careful thought to the possibility of re-assignment, but it is clear that redundancy is an unavoidable factor throughout the organisation".

And then the letter went into facts and figures. Dismissed as he was for redundancy according to the firm, the Appellant made an application to the Industrial Tribunal dated 5 February 1993 for compensation. This appears to have been amended by an application from his solicitors dated 27 May 1993 and an averment claiming inter alia that he had not been dismissed for redundancy. A Notice of Appearance was put in on 7 June. It is important to note the first reason gven by the firm to show why the Appellant's claim was to be resisted. Paragraph 8 of the Notice of Appearance comments:

"8 The employment was terminated because of redundancy due to less work requirement due to decline in company business particularly on the Glazing Side (Mr Law's main function). The possibility of re-assignment was carefully considered but it was and remains clear that redundancy is an unavoidable fact throughout the company. ....".

The Industrial Tribunal dismissed the Appellant's claim. A Notice of Appeal dated 21 October 1993 was filed shortly after the Full Reasons had been promulgated. It was answered by the Respondents on 23 November 1993 and shortly after that, a letter was written by this Tribunal to the solicitors to the Appellant and to the Respondent which included a postscript stating that the Chairman's notes of the evidence at the Industrial Tribunal would not be required when the appeal was heard.

Neither party responded to the content of that postscript regarding the Chairman's Notes until about a month ago, that is some 14 months after they had been told that nothing would be done about obtaining them. Thus we do not have any notes of evidence at this hearing. We do not in any way criticise the Appellant for this absence, but the unfortunate fact is that during the hearing of the appeal there has been some division between the parties as to what was and was not said below. In the absence of notes of evidence we cannot, of course, go behind what we find in the Decision and we cannot go into what was, or may have been, said below when there is controversy about it.

I return to the Reasons in the Decision.

"8 The Tribunal accepted there was a redundancy situation (and that, of course, answers the point made by the Appellant that he was dismissed for some other reason) and that the business, in the shape of Mrs Mills and her mother, worked out all the options available to them (emphasis added). However, the economics dictated that they should reduce the management from two supervisors to one and they chose to keep the one who was the longest-serving and best able to deal with the tasks of the company.

9 However, they presented the applicant with a fait accompli on the Monday morning, having grossly failed to warn the applicant of the possibility of his redundancy or to consult with him in any way.

10 However the Tribunal are satisfied that such consultation would not have affected the outcome of the situation and they considered the case of Polkey v Dayton Ltd. The Tribunal accordingly awarded the applicant as follows ....".

The nub of the complaint made by Miss Middleton in the Notice of Appeal, in her skeleton argument and the oral submissions that she has made before us is that the Tribunal failed to consider the obligation of the employer to widen the net of deciding on a redundancy other than between one of the two foremen. In that regard, Miss Middleton referred us to the case of Thomas and Betts Manufacturing Limited v Harding [1980] IRLR 255, CA, and particularly to paragraph 9 of Eveleigh LJ who gave the first judgment when he said:

" .... I would reject the contention put forward in this case that the employer is under no obligation, as a matter of law, to look elsewhere among his employees, other than those employed in similar positions ....".

Miss Middleton submitted that what the company should have done, if redundancies there had to be, was to extend its net from two to eight employees and if that had been done, it is possible that the Appellant would not have lost his job. She says to us that there was evidence (and this is something about which we do not know, because we not do have the notes of evidence) that the Appellant was willing to take a drop in wages. If, so it is argued, he was to take a drop in wages then there could have been what is colloquially called "bumping" and someone other than him could have been dismissed. We note that in the case to which we have been referred, Browne LJ supporting the judgment of Eveleigh LJ said:

"In this appeal Mr Boswood has made a valiant attempt, in my view, to dress up as a question of law what is, in the end, essentially a question of fact. I entirely agree with what my Lord has said as the unfortunate development in this field of the law of a vast body of case law. As I understand it, when this legislation was originally introduced the Industrial Tribunals were intended to be quick commonsense Tribunals which would deal with matters without technicalities. What has happened is that there has been already a vast accretion of case law and it has become a highly technical legal subject".

It is not at all clear to us that there was only a class of two from which the firm made a selection for redundancy. It is stated twice in the documents before the Tribunal and once in the Full Reasons that the firm considered "all the options available to them". That includes not only the class of two being considered. Furthermore, we have no doubt at all that the Industrial Tribunal had firmly in its mind, as they are bound to do under the provisions of Section 57(3) of the Employment Protection (Consolidation) Act 1978, all the circumstances of the case, including the size and administrative resources of the employer's undertaking.

The Tribunal was dealing with a small firm which found itself operating in hard times. The founding member had died the year before. The firm was being run by his widow and daughter. We are not satisfied that the point that Miss Middleton made was a good one, although we could understand from reading the judgment how she was able to flush out the point in her Notice of Appeal and in her submissions.

She further submitted that, if there was a class greater than two, having regard to the decision of the Employment Appeal Tribunal in Red Bank Manufacturing Co Ltd v Meadows [1992] IRLR 209, there should have been the two-part test which is set out in that case and that the Tribunal should have gone into that two-part test to decide whether, if the proper procedure had been followed by the firm, would it have resulted in an offer of employment to the Appellant, and further to consider other questions which the decision suggests the Tribunal should have asked and answered. In this context, Miss Middleton made complaint that the Tribunal had not fully set out the findings of fact on which it made its decision.

This is a case where the findings of fact are rather longer than some which all of us have read, but rather less long than others that we have read. We agree with Miss Middleton that the Tribunal could have put a little more into the findings of fact in their judgment, but we are satisfied that the Tribunal had everything in mind, which they needed to have in mind, when they said in paragraph 10 of the Decision that "the Tribunal are satisfied that any such consultation would not have affected the outcome of the situation", and we are also satisfied that, they properly considered the case of Polkey v Dayton Ltd, which is very well known, notwithstanding, as we were told, it was cited only by name, but not read to the Tribunal.

In these circumstances, we are not satisfied that there was a perverse decision in any way in the findings by this Tribunal, and in that respect both counsel in this case have referred us to Williams v Compair Maxim Ltd and Others [1982] ICR 156. We very much have in mind, the passage of Browne-Wilkinson J. giving the judgment of the Employment Appeal Tribunal at page 167(F):

" .... in future cases before this appeal tribunal there should be no attempt to say that an industrial tribunal which did not have regard to or give effect to one of these factors [to which it referred to above] has misdirected itself in law. Only in cases such as the present where a genuine case for perversity on the grounds that the decision flies in the face of commonly accepted standards of fairness can be made out, are these factors directly relevant. They are relevant only as showing the knowledge of industrial relations which the industrial jury is to be assumed as having brought to bear on the case they had to decide".

We are satisfied that, in this case, the Tribunal had well in mind the factors to which we have eluded in this judgment, that there was no perversity in the findings and that, although there was the unfairness in the fact that there was no consultation and of course, there should have been consultation, even with a firm as small as this, then the lack of consultation was not such as to affect the decision to which either the firm or the Industrial Tribunal came.

While paying tribute therefore, to the articulate and well presented argument of Miss Middleton, this appeal must be dismissed.