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United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Imperial Graphic Products Ltd v Moore [1995] UKEAT 898_94_2410 (24 October 1995)
URL: http://www.bailii.org/uk/cases/UKEAT/1995/898_94_2410.html
Cite as: [1995] UKEAT 898_94_2410
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At the Tribunal
HIS HONOUR JUDGE J HULL QC
MR D G DAVIES
MISS A MACKIE OBE
JUDGMENT
Revised
APPEARANCES
For the Appellants MR R J CLEEVE
(Senior Personnel Consultant)
PPC Ltd
8 Buccleuch Close
Clitheroe
Lancashire
BB7 2EF
For the Respondent MR J PARKIN
(Of Counsel)
Messrs Ogden Lyles and Fox
Solicitors
32 Wellington Road
Eccles
Manchester
M30 ONP
JUDGE HULL QC: This is an appeal by Imperial Graphic Products Ltd., employers of Mr Alan Lawrence Moore who is aged 57. He was a Production Planner employed by the firm. He had been employed there since October 1967. He was a long- standing employee. He carried out various duties of a managerial sort and also skilled planning and so forth.
In the summer of 1993 the company, which had apparently been a prosperous, successful company in every way, quite suddenly was struck by a disaster. It had been thought that the profits were of the order of £1,000,000 per annum, and it was suddenly discovered that in fact, far from there being profits of that order, the company was making losses of that order. It was not a case of a slow downhill struggle, there was this sudden disaster. Things like that cannot happen without somebody being to blame. Either there has been dishonesty, (there is no suggestion of that all, as far as we know) or somebody has been very incompetent and neglectful in reporting and checking, studying the management accounts properly or drawing them up properly. That evidently was so, because not surprisingly after such a bombshell, the Managing Director and Financial Controller were dismissed. Not only that, but it was necessary to consider various redundancies.
It is out of that, that this application arose, because amongst those chosen for redundancy was Mr Moore. The redundancies were announced on 15 September and his employment ended very shortly thereafter, on 24 September 1993. In view of the way this appeal to us comes, the best thing to do is to go to the decision of the Tribunal, and I must refer to substantial parts of it.
Mr Moore complained that he had been unfairly selected for redundancy. He made his complaint to the Industrial Tribunal on 26 October. The employers in their answer of 17 December 1993 said that he had been dismissed for redundancy or some other substantial reason. The Industrial Tribunal sat at Manchester for two days under the Chairmanship of Mr Grazin with two industrial Members. Their decision was promulgated on 5 September 1994. They found that the dismissal had been unfair. There was unfairness in the selection, in the consultation, in failing to warn in due time - although they were satisfied that the decision to reduce numbers was taken in good faith. It was not up to them to say who was to blame for it or anything of that sort. There was no doubt that this was a serious situation and the company was not only entitled, but bound, to take it seriously. As is pointed out to us forcefully, if a company has no money then everybody may suddenly find themselves redundant. That was the situation which the Tribunal had to consider.
The Industrial Tribunal appear to us to have approached their task in a perfectly proper and sensible and thorough way. They set out the facts at considerable length. After setting out the matters which I have already referred to, they say that the company took advice from its Personnel Consultant. It was necessary, they said, for the company to arrive at criteria for selection of those who were to be made redundant. The criteria were:
1. Quality of work.
2. Quantity of work.
3. Capability to perform new job functions.
Those three were rated more highly; they were weighted.
4. Attendance record.
5. Time-keeping record.
6. Disciplinary record.
There is no reference there to length of service. That is a point of some importance later. Then they mention the Applicant's work at that time, which was in the Production Planning Department, where there were three people at his level and a supervisor, Mrs McCracken, who also worked as a Production Planner. They then set out the Applicant's long service with the company. He had been promoted to Manager and worked in that capacity between 1974 and 1980. Between 1980 and 1982 he was the Manager of the company Sales Office. He moved to his present position during 1992. That was the outline of the facts. They approached the question of how the redundancy was dealt with. They said that the assessment forms were supplied to the managers during the first week in September 1993 and the assessment was done by Mrs McCracken and a Dr Letherby:
"... who is a director of the company but whom the Tribunal did not hear from in these proceedings. The intention of the respondent was that both Dr Letherby and Mrs McCracken would carry out the assessments, that there would be a meeting between those persons and Mr Fox, who would act as auditor to ensure that both parties were acting fairly, and the result would be available following that tripartite meeting. The Tribunal knows that Mr Fox was happy with that system but without having heard evidence from Dr Letherby it is not possible to tell what his views were."
Mr Fox was the Production Works Manager and Dr Letherby was a Production and Technical Director. The Tribunal is criticised by Mr Cleeve for making that comment. They had not heard from Dr Letherby. It seems to us that since he was concerned with the assessments, it would be a legitimate comment that the Tribunal had not heard from him, and it was not possible to tell what his views were. That might or might not be important. It is of course for the employer to make up his mind how to carry out redundancies. It is for the employer to say how that is done and then, in due course, to tell the Industrial Tribunal, if the decision is challenged, how the result was arrived at. The evidence of Dr Letherby may or may not have been important.
"Mr Moore told the Tribunal that at no time during his 18 months working in the production planning department had Dr Letherby asked him any questions or sought any information from him. On the whole of the evidence the Tribunal is satisfied that the detailed knowledge that Dr Letherby had of the work carried out by Mr Moore and his colleagues in the production planning department was minimal, if it existed at all."...
They made a point of that. We do not think they can be criticised for looking at that point and deciding whether the matter was dealt with fairly and properly or not. They say that Mrs McCracken told the Tribunal that she carried out the assessments as fairly as possible. The result of the assessments was that Mr Moore came not merely bottom, but easily bottom in his department. So it was he on whom attention was concentrated.
They go through various matters and at paragraph 16 state:
"16. Within two working days of the decision having been reached, redundancies were announced on 15 September 1993. The respondent placed a works notice on a noticeboard and two different versions of that notice were produced to the Tribunal. That taken from the noticeboard by the applicant contained a fourth paragraph as follows:-
`There will be some immediate redundancies affecting those personnel with short service but longer-serving staff who have initially been selected to leave have been allowed to go home this morning on full pay to devote their full attention during the consultation period to suggesting alternatives.'
They say there was another version of that which was produced by the Respondent and they were not very impressed by that. They say in paragraph 18:
"... It may be that the difference in the document was partly caused by the haste with which this redundancy procedure was implemented. In that connection, although it was argued by Mr Cleeve on behalf of the respondent that there was urgency about such implementation, no evidence to that effect was called by the respondent. In particular, no attempt was made to talk to individual members of the workforce who had been provisionally selected for redundancy, including in particular the applicant, to warn him of impending redundancy and to seek his views before the announcement was made. It was suggested in argument by Mr Cleeve that doing so would inevitably lead to a substantial loss of production, but the experience of the two lay members of the Tribunal was that there was no reason whatsoever why discussions of that sort should not take place before the formal announcement was made."
This is criticised by Mr Cleeve before us, on the basis that this is evidence from the Tribunal itself. The Industrial Tribunal were putting themselves in the shoes of the employer and saying what they would have done: what the employers were doing, and whether that, in the view of the Tribunal, fell within the range of reasonable responses of a reasonable employer. It seems to us that there again Mr Cleeve is mistaken. If Mr Cleeve chose, as a consultant, to put forward his view to the Tribunal, the Tribunal were entitled to draw on their experience. They were probably as experienced as Mr Cleeve in industrial relations matters. They are there anyhow as the industrial jury and it was for them to say whether they accepted that submission or not. If it had been a matter of evidence from the company, showing exactly why, in the particular circumstances of this company, it would have led to disruption, loss of production and so on, that would have been different. The Tribunal would then have had to decide whether to accept that evidence or not. But it was not, it was simply a comment which was made to them.
They say in paragraph 19:
"The respondent decided that rather than talk to individual members of the staff who would be affected, it would talk to all members of staff within the support section and tell those who it proposed to select for redundancy of that decision. Notwithstanding the length of service of the applicant, Mr Fox did not feel a need to discuss the potential redundancy with the applicant at any stage prior to 15 September."...
Then they referred to the meeting on 15 September:
"Mr Moore was told that he was selected for redundancy and a letter was sent to him, signed by Mrs McCracken but clearly drafted by the respondent's personnel consultants, on that date. The letter suggested that there would be a consultation period ending on 24 September (less than 2 weeks from that date) and that a meeting would take place to discuss the position that Mr Moore found himself in at 10.00 a.m. on Wednesday 22 September. The respondent then changed that meeting to 3.00 pm on Wednesday 22 September. That date was not convenient to the applicant and in the event the meeting took place on Monday 20 September. No note of that meeting was produced to the Tribunal, save an aide memoire prepared by Mr Fox. That refers to Mr Moore having asked for details of his pension payments, having requested an ex gratia payment (which was refused), his disappointment that jobs had been lost because of mismanagement by the two directors who had been dismissed and Mr Moore's statement that he believed he was a manager rather than a clerk.
21. There was nothing to indicate that any alternative position with the company was discussed and indeed Mr Fox accepted that he did not see fit to explain about any other job including that of sales supervisor."
Then the Tribunal directed themselves quite correctly about Section 57 of the Employment Protection (Consolidation) Act 1978. They say in paragraph 24:
"The only issue between the parties was whether the respondent acted reasonably within the provisions of Section 57(3) of that Act."...
They were referred to Williams v Compair Maxam [1982] IRLR83, the well-known case. They said that they did not accept that all that was said there was applicable to the case they were considering because:
"... standards have changed over the last 14 years and ... there are subsequent decisions to the effect that those guidelines [in that case] should not be rigidly followed, it is clear that they can only apply where there is a large unionised workforce carrying out work that is essentially of the same nature. It is not therefore possible to use the guidelines as, effectively, a shopping list."
We emphatically agree with that. These guidelines which have been laid down in various important cases for the guidance of employers, employees, industrial tribunals and so on, are not principles of law, they must of course vary with varying conditions, not only in time but in the circumstances of the particular enterprise concerned.
It is essential for Industrial Tribunals to look at the facts of the case before them and not slavishly to follow guidelines, whether of this or of any other sort, even where they are contained in codes approved by Parliament. The mere fact that words of guidance have fallen from eminent judges, even in the House of Lords, does not mean that these are principles of law. They are not. The Tribunal has on each occasion to address its mind to the case in front of it and apply the guidelines, if it decides it is right to do so, in the way which it considers proper in any particular case. Needless to say, if they depart completely from the accepted practice, they will be expected to say why they do so. They say in paragraph 26:
"The Tribunal takes the view that the use of selection criteria is not only the most appropriate method of selecting for redundancy but the one that was proper to be used in these circumstances. However, if selection criteria are to be used it is important that they should at all times be objective criteria and that they should be applied objectively. The Tribunal does not believe that the criteria used by the respondent in this case were objective nor does it believe that they were applied objectively.
27. Dealing with the first of those matters, the Tribunal takes the view that at least two of the three weighted factors are entirely subjective, namely quality of work and "Ability to retrain/perform any suitable new Job Functions, as measured against the Job Description". That latter phrase is a quotation from the respondent's procedure document dated 6 September 1993 signed by Mr Fox. The second of the three weighted factors, quantity of work, is capable of being measured objectively. In the view of the Tribunal it is quite impossible to measure quality of work and ability to retrain etc objectively. If an assessment of that sort is to be carried out by the immediate supervisor of three employees, it is quite impossible, in the view of this Tribunal, to approach that task objectively so that what might, perhaps, be a pre-determined decision could not affect the marking."...
There, speaking strictly for myself, if those passages stood alone, there would be grounds for misgiving, as to whether the Tribunal were approaching the task in the right way. First of all, it looks as though the Tribunal are indeed suggesting that they would not have adopted such criteria. Secondly, in saying that they could not be applied objectively, if that is a complete generalisation, that would not be the experience of a great many people; but they were entitled, we think, if their view was that in the circumstances of this case that was the position, to take that view. We think, going forward, that that is or may be the correct view of what the Tribunal say. They say:
"... No attempt was made by the respondent either to implement objective criteria of that sort or to use the criteria that they did implement in any objective form.
28. The Tribunal noted the entire absence from the list of criteria of "length of service" but the respondent's answer to that was that length of service was not important in determining the question of selection because it did not relate to how competent or otherwise any particular employee was. Whilst that may be true, it looks at the decision that the respondent had to make entirely from the point of view of the respondent. It does not take account of the interests of the applicant in retaining his position. It seems to the Tribunal, therefore, that it fails the test of equity which is specifically contained within the provisions of Section 57(3)."...
That is criticised by Mr Cleeve. It appears to us to be an entirely proper direction by the Tribunal to themselves. Looking at all the circumstances of the case, as the Tribunal is required to do, means that you look at it from both sides. Fairness and equity means looking at something from both sides. The Tribunal were entitled, in our view, to underline the importance of length of service, so that the employers would, in good faith, pay attention to the length of service of an employee who was to be made redundant, in considering how to treat him. They go on to talk about consultation, having dealt with the criteria. They say:
"30. ... There is, however, another factor, namely the question of consultation. It is the view of the lay members of this Tribunal, with which the Chairman concurs, that a reasonable employer in this situation would have allowed a period of consultation of at least one month. There are certain circumstances, where for example there is evidence of substantial financial pressures such as would cause a receiver to be appointed otherwise, which might allow for a shorter consultation period. In this case, the overall period, in working days, between 15 September and 24 September, excluding 15 September when the applicant was sent home, was no more than seven days. To allow a period of only seven days for consultation after a period of employment of twenty six years is, in the view of this Tribunal, one that no reasonable employer could adopt in circumstances of this sort... That is all the more important because the respondent accepted that Mr Moore was still somewhat shocked at the meeting on 20 September. He did not raise his potential appointment to certain other positions. The Tribunal believes that if that meeting had taken place say two or three weeks after the initial announcement had been made rather than three working days after the announcement, the position might well have been different and matters that were postulated by Mr Moore at this hearing might well have been raised with the respondent at that time and allowed a different decision to be made."
Mr Cleeve says there is no evidence to support that conclusion, but it was an inference which we think they were entitled to draw from the evidence which they set out:
"31. Finally, the Tribunal considered whether appropriate efforts had been made to find alternative employment, particularly having regard to the length of service of the applicant. It follows from our previous findings that Mr Fox in particular, as the senior person from whom we heard, did not consider that it was necessary to raise any suggestions with Mr Moore. We do not believe that any reasonable employer would have taken that view. Any reasonable employer of this size, faced with an employee with twenty six years' service and having to consider redundancy on a compulsory basis by comparison to an employee with three months' service, [that is one of the others in the same job] would have taken every possible step over a period of weeks, if not months, to find alternative employment. This respondent took an entirely different view and that is not one which we find any reasonable employer could have taken.
32. Accordingly, we find that the respondent acted unreasonably, having failed to take account of equity and the substantial merits of the case in treating the redundancy of the applicant as a sufficient reason for this dismissal. The dismissal is therefore unfair."
There they have repeatedly invoked the criterion of the reasonable employer with the band of responses, and said that this conduct falls outside what they think, in all the circumstances, is any behaviour which such a reasonable employer could properly indulge. Of course, it has to be recognised that there is a range of behaviour. If the employer is to show that he acted reasonably in treating the situation as a cause for dismissal, he has to show in respect of each of those made redundant, if required to do so, that he attended to other matters which are generally considered necessary for fairness. He must show that he has selected the employees in a proper and fair way, with proper criteria. He must show that he warned them so far as reasonably practicable. He must show that he consulted with them, in a meaningful and humane way. Consultation is a two-way business. It means listening to what the employee says. There are many cases in which an employee may know more than an employer does about particular aspects of the job and is able, if he has a sensible conversation with the employer's representatives, and time to think about what he is going to say, to suggest ways in which redundancy can be ameliorated or perhaps altogether avoided.
Those are the arguments of Mr Cleeve. The question is not whether one can pull out particular phrases or sentences, suggesting that those show that the Tribunal was adopting a wrong approach, it is being suggested that this Tribunal put themselves in the shoes of the employer and thus acted improperly. What one has to do is to read the decision as a whole. We have come to the conclusion, having read the decision more than once, and thought about it as carefully as we can, that it is not established that the Tribunal slipped into this trap. It seems to us that taking it as a whole, this decision is one which is exceedingly careful; which shows that the Tribunal did not presume to tell the employers how they should have proceeded but, on the contrary, was saying that in various ways which were laid before them, the employers acted as no reasonable employer should have done, if he was to behave fairly and reasonably.
Mr Cleeve pressed us more than once with the contention that there was no authority for some of the propositions which were set out by the Tribunal. The authority is in the words of the statute. It is true that the courts in a great many cases and this Tribunal, perhaps in too many cases, have inevitably tried to give guidance in the way that we have mentioned, in going into the circumstances of particular cases. None of that can possibly alter the words of the statute. In each case the Industrial Tribunal has to decide whether the employer has acted reasonably, which means fairly and justly. They should never be deterred from looking at the facts of a particular case, and deciding what is reasonable and fair in a particular case, by what has been said in other cases. They must apply themselves in accordance with what the statute requires. It appears to us that that is exactly what this Tribunal did. Mr Cleeve made certain further points, perhaps of lesser importance. He complains that their decision in places went against the evidence, or that there was no evidence to support particular findings that they made.
Such contentions cannot possibly succeed before us, as matters of law, unless we can see what the evidence was. We are told that Mr Cleeve in fact did not apply for the Chairman's Notes of Evidence and in those circumstances we cannot act on anecdotal accounts of what was said or what was not said. It would be quite unfair to do so. Nor can we look at documents which were the subject of evidence without looking at the evidence, unless the documents are accepted by the other side as fully embodying the point which is to be made. We are told by Mr Cleeve, and accept, that he, having omitted to ask for the Notes of Evidence earlier, wrote to this Tribunal and it was refused. It is not up to us to say what Mr Cleeve should have done in that situation. He might very well have appealed against that refusal, and said he wished to be heard by this Tribunal on that matter. He did not do those things. However that may be, the Notes of Evidence are not before us, and we cannot accede to submissions that there was no evidence to support a particular finding, or that the decision is perverse, as was suggested to us, flying in the face of reason, or that it is contrary to the evidence in various places.
Having considered the whole of the matter, we are all satisfied that there has been no error of law shown here and we say that with great assurance, because the Industrial Members have addressed their minds to the views which were expressed by the Industrial Tribunal in this case and, insofar as it is open to us to say so, there appears to us to be nothing exceptional about any of those views. We think that the substance of this is that the Industrial Tribunal reached a conclusion which was well within their powers and discretion to reach, and that no unlawful aspect of their decision is shown to us. We can only entertain an appeal if there is an error of law and we are satisfied that there is no error of law here, despite all that has been said to us on behalf of the Appellants. Therefore the appeal must be dismissed.
We none of us think that this falls within Rule 34 of our Rules. We do not think this was unnecessary, vexatious or anything of that sort, unreasonable in the technical sense, so in the circumstances we have no power to award costs. We of course leave aside what we would have done had it been in our discretion to award costs. That does not arise in those circumstances.