United Kingdom Employment Appeal Tribunal

BAILII case number: [1995] UKEAT 920_95_0811

Appeal No. EAT/920/95

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 8 November 1995

Before

THE HONOURABLE MR JUSTICE MUMMERY (P)

MISS J W COLLERSON

MRS P TURNER OBE

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T C CLEANING CONTRACTORS LTD          APPELLANTS

MISS T MARSH          RESPONDENT

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Transcript of Proceedings

JUDGMENT

PRELIMINARY HEARING

Revised


 


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APPEARANCES

For the Appellants MR V H TAVARIS

Finance Manager


 


MR JUSTICE MUMMERY (PRESIDENT): This is the preliminary hearing of an appeal by T.C. Cleaning Contractors Ltd against two decisions of the Industrial Tribunal in proceedings against the company by Miss Teresa Marsh, formerly employed by them as a cleaning manager.

On the preliminary hearing Mr Tavaris, finance manager of T.C. Cleaning Contractors Ltd, has represented the company. We explained to him that the purpose of the preliminary hearing is to determine whether the appeals raised an arguable legal point. If they do not, there is no point in the matter proceeding to a full hearing.

The background to the appeals is that on 10 March 1995 Mrs Marsh brought a claim for constructive dismissal from her position as a cleaning manager. She said that, while she was off sick, she had received a letter dated 1 February 1995 demoting her as a Cleaning Manager; she resigned, considering that she had been constructively dismissed.

The claim was resisted by the company on the basis that there had been no dismissal, express or constructive. They said they were unable to accept her claim that she had been forced out of her position as a cleaning manager; what Miss Marsh had done was to deliberately misconstrue an offer of help as grounds for a change of contract. It was made perfectly clear to her that only she could relinquish her position. She had resigned. She had not been dismissed.

That was the issue before the Industrial Tribunal at London (South) on 24 May 1995. Miss Marsh appeared in person. Mr Tavaris represented the company. The Tribunal found that Miss Marsh had been unfairly dismissed and awarded her compensation of £5,524.56.

The crux of the case, as Mr Tavaris has accepted, is how the Tribunal should have interpreted the letter of 1 February 1995 sent to Miss Marsh while she was off sick. The Tribunal said in paragraph 5(g) of the decision:

"5(g) ... This letter was central to the whole question whether the Applicant had been constructively dismissed. It is therefore necessary to reproduce it in full:

`Dear Miss Marsh

Re: Revised terms of Employment

Over the past few months your position as Cleaning Manager at Burgess Hill has not been exercised to the proper level, absenteeism causes problems for proper supervision and administration of the cleaning programme.

We are prepared to offer you a position as full-time janitor to retain your services, will you please confirm that you are prepared to accept the revised terms.

Yours sincerely.'"

It was signed by Mr Stevens, the area manager.

The Tribunal found as a fact that when Miss Marsh received this letter she was shocked. She felt that her employers had effectively down-graded her from the post of cleaning manager to that of a full-time janitor, with a consequent loss of pay and status. She was particularly upset that the letter was sent to her without any prior consultation or discussion and while she was off sick suffering from stress. She said she felt "gutted" because there had been no complaints about her work from either the area manager or from Tesco's. She said that she had attempted to ring Mr Stevens after receipt of the letter, but she had been unsuccessful. Mr Stevens asserted that, although Miss Marsh had rung the office, she did not ask to speak to him.

On 11 February she sent a letter in these terms:

"Dear Mr Stevens

I am writing to inform you that I shall not be returning to work and hereby give one week's notice from Monday 13 February '95. Also due to the fact that I was given no notice of my recent demotion from manager to janitor, either verbally or in writing prior to period of sickness I shall be taking T.C. to the Industrial Tribunal. This will be on the grounds of constructive dismissal. ..."

On receipt of that letter Mr Stevens wrote to Miss Marsh on 14 February pointing out that it was not his intention to place her position as manager in jeopardy. He was merely attempting to put into place alternative arrangements to ensure the supervision of the store and to meet with her own preference, as he understood it. In his letter he said:

" ...

We cannot accept your interpretation that a genuine offer of help could be construed as demotion. ..."

Those were the crucial facts of the case. The Tribunal correctly referred to the provisions of Sections 54 and 55 of the Employment Protection (Consolidation) Act 1978 and to a number of leading cases on the principles of constructive dismissal. The Tribunal applied those principles, as laid down by the Court of Appeal, to the facts of the case. Their conclusions in paragraph 8 were these:

"8. Applying the relevant statutory provisions in the light of guidance from the higher courts the Tribunal find that the letter of 1 February 1995 was a clear indication to the Applicant that her position as cleaning manager was no longer available to her and that the employers were prepared to offer her a position as a full time janitor in order to retain her services. Although Mr Stevens and Mr Tavaris tried their best to persuade the Tribunal that the Applicant misconstrued this letter the Tribunal find it difficult to see how the letter could be interpreted in any other way other than a clear indication on the part of the employer that they no longer felt bound by an essential term of the contract between the parties namely that the Applicant should continue to maintain her position as a cleaning manager at Burgess Hill. ..."

The Tribunal went on to explain further reasons why they regarded the employer company as having committed a repudiatory breach, which Miss Marsh accepted. She handed in her resignation without unreasonable delay.

The Tribunal added at the end of that paragraph that the correct test to apply to the letter was an objective one. Applying that test the letter evinced an intention, on the part of the employer, no longer to be bound by the contract; that was repudiatory conduct. The question of Mr Stevens's intentions in writing the letter, or his beliefs, did not determine the question whether there was a breach.

The Tribunal concluded that this was a case of constructive dismissal. They said, correctly, that was not automatically an unfair dismissal. They applied Section 57(3) and found that under that section the dismissal was unfair.

The full reasons were sent to the parties on 6 June 1995. The company did not service a Notice of Appeal against that decision until 25 July 1995; that is outside the period of 42 days, allowed by the rules of this Tribunal for the institution of an appeal.

The company applied for an extension of time in which to appeal against the decision. On 23 August 1995 the Registrar of this Tribunal refused an extension. There was no appeal against that. The position is that it is too late to appeal against the original decision.

We would add this. Even if the appeal against the original decision was in time, we are unable to find any error of law in it. Mr Tavaris repeated the arguments put by him to the Tribunal. The essential argument is this letter of 1 February 1995 was an offer, not an ultimatum. He referred to a number of other cases where, on different facts, the courts reached a conclusion that there was no constructive dismissal. Those cases do not assist. The question whether there is constructive dismissal or not depends on the particular facts of the case. The constructive dismissal in this case depends on how the recipient of a letter, such as that of 1 February 1995, would read it objectively.

In our view, the Tribunal were entitled to come to the conclusion that a letter, which is headed "Revised terms of Employment" and refers to an offer of a demoted position, "to retain your services", amounts to a unilateral attempt by the employer to vary the terms of employment and that amounts to constructive dismissal.

Mr Tavaris also raised the question of the inordinate amount of time that Miss Marsh had taken off during her ten years as a cleaning manager at Burgess Hill. He submitted a schedule of days, taken off. He said that the Industrial Tribunal had refused to allow evidence of absence to be given.

In our view, the Industrial Tribunal was correct in excluding that evidence. As appears from the Notice of Appearance the ground on which the company resisted Miss Marsh's claim was simply that she had not been dismissed. They did not seek to raise any alternative claim; e.g. that, if she had been dismissed, it was for reasons relating to her capability to do the job.

The Tribunal were entitled to require the parties to argue the case on the issues raised in the Originating Application and in the Notice of Appearance. It is too late for Mr Tavaris to raise, on an appeal, the question of a reason for dismissal on grounds of capacity.

The result of the appeal against the original decision reached on 24 May 1995 and notified to the parties on 6 June 1995 are, first, that the appeal is out of time and an extension of time has been refused and, secondly, even if it were in time, there is no arguable error of law relating to the conclusion of constructive dismissal.

The Notice of Appeal also contains an appeal against the refusal of an application for review. That refusal was made less than six weeks before the service of the Notice of Appeal. This appeal is therefore in time. A letter was sent to the Tribunal dated 16 June 1995, asking the Tribunal to review its decision on constructive dismissal in the interests of justice. That is a ground on which a review can be granted by a Tribunal under Rule 11(1)(e) of the 1993 Industrial Tribunal Rules of Procedure.

The letter of 16 June repeats the arguments unsuccessfully advanced before the Tribunal at the original hearing. The letter refers to the crucial letter of 1 February. It is argued that that was central to the whole question of constructive dismissal. We agree with that. Arguments were presented on the facts and on the law. The basic argument sought in the review application was stated in paragraph 8 of the letter:

"8. We respectfully suggest that Industrial Tribunal should have adjudicated the letter of 1 February 1995 to the Applicant as one of offer and not one implicit or implied that the Applicant would become a Janitor and furthermore the appointment was permanent."

The letter seeks to support that submission by referring to a number of cases, some of which were referred to in the Tribunal's decision, notably Western Excavating (EEC) Ltd v Sharp [1978] IRLR 27, still good law on the law of constructive dismissal. Nothing was said in the letter about a review on sickness or absence as a reason for dismissal. The company's position still was "there had been no constructive dismissal".

The application for a review was refused by the Chairman for extended reasons notified to the parties on 23 June 1995. The ground for refusing the review was that it had no reasonable prospect of success. In the extended reasons the Chairman referred to the hearing at which Miss Marsh had succeeded; to the letter of 16 June and said this:

"3. It appears to the Chairman of the Tribunal that the Respondents are asking the Tribunal to review its factual findings. It is also noted that the submissions made in the review are in large measure similar, if not identical, to the submissions made at the Full Merits Hearing.

4. Having considered the Respondents detailed grounds in support of their application for a review it is my opinion that the review application has no reasonable prospect of success. Accordingly I refuse the application."

The Chairman has a discretion to grant a review if the interests of justice require it. That can only be appealed on the ground that no reasonable Chairman, addressing himself to all the material factors in the case, could reasonably have refused to grant a review. As I have mentioned, the appeal against that decision is in time, but, in our view, there is no basis on which the company can argue that that is a perverse decision or one which no reasonable Tribunal Chairman could have reached. We have already explained our reasons why the decision of the Industrial Tribunal was legally correct and contains no misdirection or error of law.

In those circumstances we find that, although the review appeal is in time, it contains no arguable legal point. The Chairman exercised his discretion in a legally permissible way. The effect of what I have said is therefore this; that the Appeal Tribunal dismisses both appeals; the first, because it is out of time and reveals no legal point; the second, because there is no arguable legal point.