United Kingdom Employment Appeal Tribunal

BAILII case number: [1996] UKEAT 572_95_1202

Appeal No. EAT/572/95

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 12 February 1996

Judgment delivered on 11 March 1996

HIS HONOUR JUDGE P CLARK

MR J A SCOULLER

MR N D WILLIS

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LADBROKE RACING LTD          APPELLANTS

MISS R HOLDING          RESPONDENT

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Transcript of Proceedings

JUDGMENT

Revised


 


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APPEARANCES

For the Appellants A KORN

(of Counsel)

Messrs Dibb Lupton

Broomhead

125 London Wall

London

EC2Y 5AE

For the Respondents J LIVESEY

(of Counsel)

Messrs Moger Sparrow

6 High Street

Keynsham

Bristol

BS18 1DQ


 


JUDGE CLARK: This is an appeal by the employer against a majority decision (the Chairman: Mr C F Sara dissenting) of the Bristol Industrial Tribunal sitting on 16 December 1994 and 6 March 1995 that the Respondent employee, Miss Holding, was unfairly dismissed. Extended reasons for the decision are dated 4 April 1995.

The Respondent had been employed by the Appellants as a cashier in their Keynsham betting shop since 25 June 1990.

In early June 1994 Mr Doyle, the Appellants' Regional Security Officer received information which suggested that two separate types of fraud were being perpetrated on the Appellants at the Keynsham shop. The first concerned "unflashed bets". This is a reference to the system of putting betting slips through a camera system which records the time the bet was laid to ensure that it was not put on after the race had started. An "unflashed bet" is a slip which did not go through this timed photographic process, thus allowing bets to be placed after the result of the race is known. Secondly, "inflated bets". This involves altering the amount shown on a slip as paid out in winnings to a customer. We were shown examples in this case. Thus, on betting slip No.10380 copied on page 80 of the bundle placed before this Tribunal the "Returns" figure of £10.10 had been altered to £16.10 manually, thus providing the opportunity for a dishonest member of staff to remove £6 from the till.

Mr Doyle set in train an investigation. The manager of the shop, referred to below as "Mrs X", was on holiday. The Respondent was interviewed by him on 8 and 10 June. She was excluded from involvement in the unflashed bets, but it emerged that she had paid out on and later "addlisted" all the inflated bets.

She was suspended by Mr Doyle pending a discovery hearing. Whilst suspended, Mrs X returned from holiday and was interviewed by Mr Doyle on 12 June. She admitted responsibility for the unflashed bets, but not the inflated bets. She promptly resigned.

On 14 June the Respondent attended a disciplinary hearing conducted by Mr Little, the Area Sales Manager. As a result of that interview Mr Little prepared an 8-point rationale (R49) which led him to conclude that it was the Respondent, and not Mrs X, who was responsible for the inflated bets. He summarily dismissed her. She appealed to Mr Perry who upheld the decision to dismiss following a hearing held on 7 July 1994.

The Tribunal unanimously concluded that the reason for dismissal was misconduct; that the Appellants held an honest belief in the Respondent's misconduct and that dismissal for such an offence fell within the band of reasonable responses open to a reasonable employer. Where they parted company was in relation to two matters. First, the majority concluded that the Appellants did not have reasonable grounds for their belief that the Respondent was guilty of the misconduct alleged, that is responsibility for the inflated bets; secondly, they found that the dismissal was procedurally unfair. Against both those findings the employer now appeals.

Chairman's Notes

Before dealing with the substantive grounds of appeal we should first record our ruling on use by the parties of notes of the oral evidence given before the Industrial Tribunal at this appeal hearing and our reasons for that ruling.

On 2 November 1995 the Appellants applied to this Tribunal for a direction that the Chairman produce his notes of evidence taken by him at the Industrial Tribunal hearing. That is the correct procedure in accordance with paragraph 13 of the 1981 Employment Appeal Tribunal Practice Direction. On 20 November 1995 the application was refused by the President, Mummery J, and by letter of that date the parties were informed of that decision.

For the purposes of this appeal hearing the parties submitted a bundle of documents running to 113 pages.

We pause to observe that during the appeal hearing we were taken to a total of some 15 pages within that bundle. This is unsatisfactory. It is for the parties to prepare a bundle of documents relevant to the issues in the appeal. It does not help simply to photocopy every document on the Solicitor's file and lodge them all.

Pages 21-64 of this bundle, so the index shows, are notes taken by an employee of the Appellants who attended the Tribunal hearing. Those notes were agreed by the parties, who further agreed that they could be referred to at the appeal hearing. We refused to take the notes into account in reaching our decision. Why? The practice in this Tribunal is clear, but we take this opportunity to re-state it.

Appeals to the Employment Appeal Tribunal are on questions of law only. See Employment Protection (Consolidation) Act 1978, Section 136. It is not for this Tribunal to re-open the factual arguments which were for the Industrial Tribunal to decide. Further, Chairman's notes will not be ordered to allow a party to embark on a "fishing expedition", either to establish further grounds of appeal, or to support an otherwise defective Industrial Tribunal decision.

Thus the starting point is whether or not the Chairman's notes will be ordered. If they are not, that is usually the end of the matter. What is not permissible is for the parties, by agreement, to attempt to circumvent a refusal to order Chairman's notes by producing instead their own notes of the hearing below.

In limited circumstances, where the parties discover an inaccuracy or lacuna in the Chairman's notes ordered and provided, an agreed note correcting the error or filling in blanks may be submitted to the Chairman for his comments. Dexine Rubber Co Ltd v Alker [1977] ICR 434.

It will only be in exceptional cases that this Tribunal will take into account additional notes taken by the parties. See Owen & Briggs v James [1981] ICR 377, 386C.

As in that case we looked at the notes de bene esse at Mr Livesey's request. More precisely, we were taken to one answer by Mr Little in evidence. In fact, the point sought to be made by Mr Livesey could equally well be made from the documentary evidence which was before the Tribunal. It follows that it was not necessary to have any notes of evidence to determine this appeal.

The final point is this. If parties to an appeal wish to seek an order for production of Chairman's notes it is incumbent upon them to identify which particular parts of the evidence are required, going to which specific issues in the appeal. This Tribunal is naturally reluctant to burden Industrial Tribunal Chairmen with the task of producing notes of evidence which, in the event, are barely, if at all, referred to in argument on appeal.

Procedural Unfairness

We deal first with this aspect of the majority's findings, since Mr Livesey did not feel able to support this part of their decision.

The majority express themselves at paragraph 11 of the reasons in this way:

"11 The majority consider that the respondents failed to operate a fair procedure. The applicant was interviewed at length on matter which amounted to a criminal offence, without being told that she had no obligation to say anything, without having the opportunity to be accompanied by a fellow employee and without knowing the nature of what was alleged against her in advance. In addition she was not supplied with a copy of her statements."

That paragraph makes four criticisms of the employer which we shall deal with in turn:

(1) The Respondent was interviewed at length on a matter which amounted to a criminal offence without being told she was not obliged to say anything. This is a criticism of Mr Doyle, who interviewed her on 8 and 10 June 1994 as part of his preliminary investigation without administering the old-style police caution. This criticism is wholly misconceived. His was not a criminal enquiry subject to the rules of the Police and Criminal Evidence Act 1984. It is well established that the safeguards applied to criminal investigations have no place in the employment setting. Morley's of Brixton Ltd v Minott [1982] ICR 444.

(2) There was no obligation on the employer, under its own rules or the ACAS Code of Practice, for an employee to be represented by a Trade Union Official at a preliminary investigation of the kind carried out by Mr Doyle. At the subsequent disciplinary hearing she was accompanied by Mr Munday.

(3) An employee is entitled to know the nature of the charge against him or her before any disciplinary hearing is held. Spink v Express Foods Group Ltd [1990] IRLR 320. The same is not true of a preliminary investigation like that of Mr Doyle in this case. She was aware of the charge before going into the disciplinary hearing held by Mr Little on 14 June 1994.

(4) She was not given copies of her statements. She was however, given a full opportunity to read her own statements before both the disciplinary and appeal hearings.

In these circumstances we are satisfied that the majority's finding of procedural unfairness was perverse, in the sense that no reasonable Industrial Tribunal, properly directed, could conclude that the procedure employed by these employers was unfair.

Reasonable Grounds for Belief

The majority's finding is contained at paragraph 9 of the reasons in these terms:

"9 The Tribunal is unanimous that the respondents genuinely believed that the applicant was guilty of the conduct alleged, which was altering the amounts payable on the betting slips, after payment to the customer, and pocketing the difference. The respondents' reasons for their conclusions are set out at p.49. The view of the majority is that these reasons did not amount to reasonable grounds for believing that the applicant was guilty as alleged. The majority's reasons for forming this view are:-

(1) Mrs X had admitted the other thefts.

(2) Mrs X also had the opportunity to carry out the thefts alleged against the applicant.

(3) The respondents were wrong to place emphasis, as a reason for believing that the applicant was guilty, on the fact that the applicant said she had not noticed or reported the irregularities. This was not part of her job, she had no instructions on what to do in such circumstances and there was evidence that Mrs X did not take kindly to being checked up on.

(4) Mrs X's unwillingness to admit these thefts when she admitted the others was not a significant indication that she was innocent of these thefts.

In these circumstances the majority consider that the reasons set out by the respondents were flawed and did not amount to reasonable grounds for believing that the applicant was guilty as alleged."

We look at the four reasons relied upon by the majority in the context of the proper enquiry to be carried out by an Industrial Tribunal.

It is not for the Industrial Tribunal to substitute its own view of the material before the employer and to arrive at its own conclusion as to whether or not it, the Tribunal, finds that there are reasonable grounds for believing that the employee is guilty of the misconduct alleged. Iceland Frozen Foods Ltd v Jones [1983] ICR 17.

In our judgment the majority have fallen into that trap. They have substituted their own view of the evidence instead of considering whether the grounds for belief set out by Mr Little in his note (R49) provided reasonable grounds for his belief that it was the Respondent who was responsible for the inflated bets. We heard submissions by Mr Korn to the effect that in addition to that misdirection in law, the majority's finding that the employer did not have reasonable grounds for its belief was perverse. We do not propose to rule on that submission in light of the course which we feel obliged to take with this case.

The Result

Mr Korn urges us to allow the appeal and substitute a declaration of fair dismissal. Mr Livesey submits that if the appeal is allowed the matter should be remitted for a further Industrial Tribunal hearing. He reminds us of the guidance to be found in the judgment of Sir John Donaldson MR in O'Kelly and Others Plc v Trusthouse Forte [1983] ICR 728, that this appeal tribunal should only use its powers under paragraph 21(1) of Schedule 11 to the Employment Protection (Consolidation) Act 1978, where it finds an error of law, to reverse the decision of the Industrial Tribunal in circumstances where all the necessary facts have been found.

One difficulty in this case is that the Tribunal has made no finding as to whether or not this employer carried out a reasonable investigation. We have carefully considered whether we are in a position to make such a finding on the basis of the primary facts found by the Tribunal, but have concluded that we are not.

It follows that this matter must be remitted to a fresh Industrial Tribunal for rehearing on the basis that the reason for dismissal related to the Respondent's conduct; that the employer honestly believed that she was guilty of the misconduct alleged; that there was no procedural unfairness of the type identified by the majority in paragraph 11 of the reasons, and that dismissal for the misconduct alleged was a penalty falling within the band of reasonable responses.

That leaves the following issues for determination by the next Industrial Tribunal:

(1) did the employer have reasonable grounds for believing that the Respondent was guilty of the misconduct alleged?

(2) did the employer carry out as much investigation as was reasonable in the circumstances?

(3) overall, did the employer act reasonably or unreasonably in treating the reason for dismissal as a sufficient reason in accordance with Section 57(3) as amended of the 1978 Act.

We formulate the questions in that way, bearing in mind that there is no onus of proof resting on the employer to satisfy the Tribunal as to the question of Section 57(3) reasonableness. Post Office (Counters) Ltd v Heavey [1990] ICR 1.

Accordingly the appeal is allowed and the case remitted to a fresh Industrial Tribunal on that basis.