United Kingdom Employment Appeal Tribunal

BAILII case number: [1996] UKEAT 1354_95_0805

Appeal No. EAT/1354/95

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 8th May 1996

Before

THE HONOURABLE MR JUSTICE BUTTERFIELD

MR D A C LAMBERT

MR A D SCOTT

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RICHARDSON SWEENEY LISTERS (a firm)          APPELLANTS

MRS P MacGREGOR          RESPONDENT

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Transcript of Proceedings

JUDGMENT

Revised


 


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APPEARANCES

For the Appellants MR L D WILSON

(Solicitor)

Messrs Listers

Solicitors

Austin House

33 Manor Row

Bradford

BD1 4PS

For the Respondent MR L MICHAELSON

(of Counsel)


 


MR JUSTICE BUTTERFIELD: Mrs MacGregor was employed by a firm of solicitors Messrs Richardson Sweeney as a secretary and audio typist in 1978. She remained so employed for the next 16 years. It was a small firm comprising one equity partner, one salaried partner, an assistant solicitor and eight secretarial and ancillary staff.

In the summer of 1994, the salaried partner and the assistant solicitor left. The remaining partner Mr Wilson decided to merge Richardson Sweeney with another firm, Lister Ryan. Terms were negotiated and the appellants Richardson Sweeney Listers came into existence in January 1995. The merger resulted in an excess of secretarial staff in the two old firms, over and above the requirements of the appellants. In early January 1995 Mrs MacGregor was told that she was redundant, indeed had been so since September 1994 when the salaried partner had left Richardson Sweeney, and that there was no position for her in new firm.

She was required by the appellants to work out her notice of 12 weeks. In doing so she had to do quite a lot of manual work, involving carrying files about the office, as a result of which she aggravated a pre-existing back injury. She struggled on for some weeks but on 23rd January 1995 she hurt her back again. She had to go home. Her doctor certified her as unfit for work and she remained off sick until her employment terminated on 12th April 1995. During that period she was paid only statutory sick pay.

Mrs MacGregor complained to the Industrial Tribunal that she had been unfairly dismissed and further that the appellants should have paid her her full pay for the period they had only paid her the statutory sick pay.

In a decision promulgated on 13th November 1995, the Industrial Tribunal sitting at Leeds decided that she had indeed been unfairly dismissed. The Industrial Tribunal found that the merger of the two firms of solicitors was a transfer of an undertaking and that Mrs MacGregor's employment had been terminated as a result of that transfer. They further concluded that there was an economic or organisational reason entailing changes in the work force, which was the reason for Mrs MacGregor's dismissal. However, the circumstances of that dismissal were such in the view of the tribunal as to render it unfair. In particular the correct unit was not chosen for the selection of a redundancy situation. The full and proper criteria was not applied to that situation. There was no proper or indeed any consultation. No consideration was given to any alternative form of employment for Mrs MacGregor, and no discussions took place between any partner and Mrs MacGregor before her employment was terminated. The respondents simply decided she was surplus to requirements and she was turned out of the job she had performed to the complete satisfaction of her employers for more than 16 years in a wholly unfair way. The first she knew of her fate was on her return to work after the Christmas break when she found her desk had been moved and most of her equipment removed from her. On the findings of the Industrial Tribunal, it was a peremptory and highly unsatisfactory response to repay years of loyal service. The tribunal concluded that she had been unfairly dismissed. There is no appeal against that finding.

However, the Industrial Tribunal rejected Mrs MacGregor's claim that she was entitled to full pay during her absence from work from the end of January to 12th April 1995. There was a clause in her written contract of employment which provided:

"Clause 10. Sickness of Injury Pay Entitlements.

None. Any payments which may be made are without any liability and entirely ex gratia and shall not create any precedent or future responsibility for liability for similar payments."

The tribunal found that in the past when the applicant had been ill, if she had been off for a short period of time, Mr Wilson had paid her her full salary. However, if she had been off for any length of time she had been paid her full salary for a short period of time, and then only her statutory benefits. Therefore, concluded the tribunal, she had no contractual entitlement to full pay during the whole of her sick pay period from 23rd January 1995 to 12th April 1995.

Mrs MacGregor has been acting in person until a day or two ago. In her response to the appellant's appeal, she described herself as feeling very aggrieved that the appellants got away without paying her the wages for the period of her notice. We take the view that that in substance if not in form amounts to a cross-appeal. If it does not amount to a cross-appeal we give leave for it to be added today.

The Industrial Tribunal then considered compensation. Mrs MacGregor eventually received £2,200, her full basic redundancy entitlement from the appellants. The Industrial Tribunal thus were concerned only with a compensatory award under the provisions of Section 74 of the Employment Protection (Consolidation) Act 1978 that provides:

"... the amount of the compensatory award shall be such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the complainant in consequence of the dismissal in so far as that loss is attributable to action taken by the employer."

Mrs MacGregor had remained unable to work as result of her ill-health and was, as at the date of hearing before the Industrial Tribunal in October 1995 in receipt of sickness benefit and invalidity benefits only. The tribunal calculated her compensatory award by taking a net loss of £43.51 per week for 18 weeks to 16th August 1995 and a net loss of £35.41 per week for eight weeks to the date of the hearing, and continuing at that rate for a further period of, as is expressed in the tribunal's findings, 22 weeks, by which time the tribunal concluded she could realistically be expected to obtain work at the appropriate level.

We pause to observe that it has been drawn to our attention by Counsel for the respondent that in the decision of the tribunal a period of 22 weeks is applied to a multiplicand of £35.41 producing it is said a total of £920.66. In fact, that final figure represents 26 weeks not 22 weeks. 26 weeks is of course six months, it is conventional period taken in circumstances such as this. We are quite satisfied that the period of 22 weeks was intended by the tribunal to be 26 weeks and is an error that has simply crept in to the transcription of the extended reasons.

Together with the loss of statutory rights which the respondent had enjoyed, the tribunal's calculations produced a total award of £2,137.12. The net losses were in each case calculated by deducting the statutory benefits Mrs Macgregor was receiving from her average weekly take home pay of £87.91.

The appellants appeal against the finding in relation to compensation. It is submitted that by calculating the award as they did, the Industrial Tribunal found that Mrs MacGregor had not been available for work due to sickness up to the date of the hearing, and would continue to be unavailable for work by reason of sickness until March 1996. If that be right, the tribunal erred in so calculating the compensatory award, since in rejecting Mrs MacGregor's claim for breach of contract, they had found that her maximum entitlement was only statutory sick pay and no more. Further, if compensation was calculated on the basis of statutory sick pay, her loss was limited to £8.10 per week for the period of 18 weeks following her dismissal, and nothing thereafter when her statutory benefits were increased to the same level as the statutory sick pay which she would have received had her employment not been terminated. Thus, it is said, her total award should be at most £145.80 together with £150 for loss of her statutory rights.

Mrs MacGregor's answer to this is that her incapacity arose because she was required whilst working out her notice to spend her time not carrying on the job for which she had been employed, namely that of an audio/typist, but fetching and carrying files, a task which involved constant lifting, bending and stretching, and something which she had not hitherto been obliged to undertake. She says that Mr Wilson knew perfectly well she had a very weak back, and that in instructing her to carry out this work, he must have appreciated that there was at least a real chance that she would become incapacitated. She was thus in effect forced out of her job she says. Had she been permitted to remain carrying out her pre-merger work, she would have been able to work out her notice properly and thus have been entitled to the award in fact made.

The respondent, Mrs MacGregor further contends that the fact that the Industrial Tribunal took into account the receipt by her of sickness benefit and later invalidity benefit during the periods for which compensation was awarded, is not an implied finding that the respondent was unavailable for any work. Further that if there is such an implied finding arising from the manner in which the Industrial Tribunal calculated the compensation, it is that Mrs MacGregor was unavailable for the work required of her by the appellants. That, it is said, is consistent with the tribunal's stating that she had satisfied them that she had been making realistic attempts to obtain work. If she had been unfit for all work, she could not so have satisfied the Industrial Tribunal.

It is to be noted that when Mrs MacGregor returned to work in early January 1995, she was told there was no work for her in her former capacity as an audio typist, but she must input data on the firm's computer, typing in names and addresses of clients. The tribunal found that this involved her having to go to files to ascertain details, carrying the same, returning the same and the like, which itself then resulted in the aggravation of a back injury from which she had suffered before. There was thus a clear finding from the tribunal that the exacerbation of her pre-existing back condition was caused by the work she was required to undertake. The tribunal further found she having attended for work on 20th January 1995, she found that the computer she had been using had been removed by the respondents for other purposes and she therefore had to do still more manual work during that day. That, the tribunal found, resulted in her aggravating the back injury even further. She attended for work again on 23rd January 1995, and again was having to carry out more manual work without being able to sit and carry out her normal work or indeed the work of inputting data on to the computer. This, the tribunal found further aggravated her back injury, as a result of which she was unable to continue in further employment.

It was wholly unnecessary for the tribunal to set out these details unless they had determined that Mrs MacGregor did indeed aggravate her back condition as a result of being required to carry out work which was not her normal work and as part of its conclusion that she had been unfairly dismissed. Although the Industrial Tribunal did not expressly set out its conclusions to this effect, we are quite satisfied that the tribunal must have found that Mrs MacGregor's incapacity arose out of her unfair treatment arising out of the redundancy situation, that is to say the action taken by the employer referred to in Section 74(1). Had the respondent been treated fairly, she would either have been permitted to work out her notice in her old job, or would have been paid in full in lieu of that notice up to the date of the termination of her old job, and, in those circumstances, would not have aggravated her pre-existing back condition. Had that been the position she would then have been able to obtain other employment immediately on leaving the appellant's firm. All this, in our judgment is implicit in the findings of fact reached by the Industrial Tribunal.

It is submitted by Mr Wilson on behalf of the appellant, that the Industrial Tribunal is concerned only to compensate the respondent within the meaning of Section 74. It is not there to compensate her for any industrial injury. Of course that is correct, but the tribunal is entitled to and plainly did in this case take into consideration all the circumstances having regard to the loss sustained by the respondent in consequence of the dismissal.

The appellant's submissions are mathematically accurate, but ignore the factual matrix in which those mathematics sound. We unanimously conclude that the submissions of the respondent are correct and that the Industrial Tribunal was wholly entitled to rule as it did in relation to the award of compensation.

As to the cross-appeal, our attention is drawn today to Section 50 of the Employment Protection (Consolidation) Act 1978 which provides:

"(1) If an employer gives notice to terminate the contract of employment of a person who has been continuously employed for [one month] or more, the provisions of Schedule 3 shall have effect as respects the liability of the employer for the period of notice required by section 49(1)."

The period of notice required for Section 49(1) in this case was 12 weeks. Schedule 3 provides:

"2(1) If an employee has normal working hours under the contract of employment in force during the period of notice, and if during any part of those normal working hours-

(b) the employee is incapable of work because of sickness or injury;

then the employer shall be liable to pay the employee for the part of normal working hours covered by paragraph (b) a sum of not less than the amount of remuneration for that part of normal working hours calculated at the average hourly rate of remuneration produced by dividing a week's pay by the number of normal working hours."

In other words, she was entitled to her full pay not merely statutory sick pay by virtue of the relevant statutory provisions. Why the Industrial Tribunal fell into error in this way we know not. It is plain that they did. They may have been misled by the use of the words "breach of contract" in the original application, but it was perfectly plain that the respondent was simply seeking to be compensated as she was fully entitled to be for her full wages during the period she was off sick before her employment came to an end.

In those circumstances, we propose to allow the cross-appeal and we shall award Mrs MacGregor under that head, the sum of £354.10 being 10 weeks at her net loss of £35.41 per week.

For those reasons the appeal is dismissed and the cross-appeal is allowed.

Application for costs on behalf of the respondent refused.