United Kingdom Employment Appeal Tribunal

BAILII case number: [1996] UKEAT 745_95_2603

Appeal No. EAT/745/95

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 26th March 1996

Judgment delivered on 14th May 1996

THE HONOURABLE MR JUSTICE HOLLAND

MS S R CORBY

MR A D SCOTT

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MARKS AND SPENCER PLC          APPELLANTS

MS A MARTINS          RESPONDENT

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Transcript of Proceedings

JUDGMENT

Revised


 


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APPEARANCES

For the Appellants ELDRED TABACHNIK Q.C.

Mr F Kieran

Marks & Spencer Plc

46-47 Baker Street

London W1A 2DN

For the Respondent IAN McDONALD Q.C.

Messrs Bindman & Partners

Solicitors

275 Gray's Inn Road

London WC1X 8QF


 


MR JUSTICE HOLLAND: This is an appeal from a decision of an Industrial Tribunal sitting at London South, which decision appears from Reasons sent to the parties on the 31st May 1995. It is convenient to begin with a resume of those facts that were not in issue. The Applicant (and present Respondent), Miss Adelle Martins is now aged 30 and is Afro-Caribbean by origin. At all material times she has been committed to a career in fashion buying and has attained a Higher National Diploma in Merchandising and Buying for Distributive Trades. For some time she has wanted to join the Respondents (and present Appellants), Marks and Spencer PLC. Prior to 1991 she had made three unsuccessful applications. In 1991 she made a fourth such application. When this was rejected without an interview, she presented a complaint to an Industrial Tribunal against Marks and Spencer, alleging racial discrimination. These proceedings were compromised: she accepted £250 and an undertaking to give her an interview for the post of management trainee. On the 28th January 1992 she attended for that interview. It was preceded by a practical test designed to assess her ability to select colours, patterns and other aspects of a range of clothing with a view to marketability. This she did well. She was then interviewed for some 40 minutes by a Senior Selector, Mr R. Walters and the Senior Group Personnel Manager, Mrs S. Cherrie. They rejected her application. Miss Martins thereupon wrote asking for further details. In the result she was interviewed again, this time by the Recruitment Manager, Mrs Tyzack. Other than a finding that in the course of this interview Miss Martins alleged that Marks and Spencer `pursued racist policies' there are no findings as to what was said. Suffice it to say that there was no subsequent change in the position with the result that on the 21st April 1992 Miss Martins presented a complaint alleging discrimination contrary to the Race Relations Act 1976 ["the Act"]. Her essential contention was that when interviewing her on the 28th January the panel were doing no more than `going through the motions', victimising her because she had brought proceedings against the company, that is, she was apparently invoking Section 2 of the Act:

"Section 2: (1) A person ("the discriminator") discriminates against another person ("the person victimised") in any circumstances relevant for the purposes of any provision of this Act if he treats the person victimised less favourably than in those circumstances he treats or would treat other persons, and does so by reason that the person victimised has-

(a) brought proceedings against the discriminator or any other person under the Act ..."

In the event that allegation was readily to be refuted on the evidence but, without apparent opposition, the hearing before the Tribunal centred upon a wider ranging allegation, effectively that Marks and Spencer, by way of employees for whose acts they were responsible, had refused her employment not by way of victimisation but by reason of racial discrimination. Other sections thereupon became relevant:

Section 1: "(1) A person discriminates against another in any circumstances relevant for the purposes of any provision of this Act if-

(a) on racial grounds he treats that other less favourably than he treats or would treat other persons:

Section 4: (1) It is unlawful for a person, in relation to employment by him at an establishment in Great Britain, to discriminate against another-

(a) in the arrangements he makes for the purpose of determining who should be offered that employment; or

(b) in the terms on which he offers him that employment; or

(c) by refusing or deliberately omitting to offer him that employment.

Section 32: (1) Anything done by a person in the course of his employment shall be treated for the purposes of this Act (except as regards offences thereunder) as done by his employer as well as by him, whether or not it was done with the employer's knowledge or approval.

(3) In proceedings brought under this Act against any person in respect of an act alleged to have been done by an employee of his it shall be a defence for that person to prove that he took such steps as were reasonably practicable to prevent the employee from doing that act, or from doing in the course of his employment acts of that description."

With this enhanced ambit the hearing became prolonged. The Tribunal sat on seven days spread alarmingly over an effective year, that is on and between the 22nd April 1994 and the 6th April 1995. In the event the decision was that the complaint of racial discrimination succeeded and that compensation of £3,000 for injury to feelings was awarded, with leave to apply with respect to further compensation. It is against the first limb of this decision that Marks and Spencer appeal, contending that it was in various respects wrong in law.

THE FINDINGS

Having regard to the history of the hearing set out above, it may well be that drafting the Reasons posed problems: reviewing in April 1995 the issues and the evidence cannot have been forensically easy. That said, the Reasons as drafted have posed problems for all concerned in this Appeal: the whole is long, ill-organised and often rhetorical rather than judgmental in style. Crucial findings of fact have to be mined from separate not readily reconcilable passages and non sequiturs hinder comprehension. A flavour of the resultant problem can be given by this passage in paragraph 13:

"For the third time we repeat that we are well aware of the vagaries of the interviewing technique and the results it produced. For the third time we repeat that that we are not suggesting that our assessment of the Applicant during one day of giving evidence should compete with the assessment of the Applicant in 40 minutes of expert interviewing by Mrs Cherrie and Mr Walters. We are categorically saying that nothing but bias can explain their assessment and their marking in this instance".

For Miss Martins, Mr Macdonald QC is able forcefully to submit that this crucial passage reflects the Tribunal correctly directing itself that it should not substitute itself for the interviewing panel. For Marks and Spencer, Mr Tabachnik QC submits equally forcefully that the last sentence is a non sequitur unless the Tribunal's assessment does displace the panel's expertise, the penultimate sentence notwithstanding. For this Tribunal, there is a problem that could have been obviated. Additional to the foregoing, has been the failure to make findings specific to the relevant provisions of the Race Relations Act 1976, indeed the Reasons do not include any specific reference to that Act or its terms. Again, Mr Macdonald QC by careful analysis submits that there are findings sufficient to satisfy the statutory provisions; Mr Tabachnik QC with similar care argues the contrary and it has been left to us to do our best fairly to discern how the Tribunal directed itself. With this sad, but necessary preface we perceive the fact finding exercise of Tribunal to have arrived at the following, at least in outline:

1. Marks and Spencer did deliberately take successful steps to conceal from the interviewing panel the history leading to the arranging of an interview for Miss Martins.
2. In the event the decision of the interviewing panel to reject Miss Martins' application was, having regard to her performance in the practical test (it being agreed that she had done well) and to what the Tribunal surmised was her performance in the interview, perverse, that is, it was a decision that no reasonable panel could come to.
3. Given the selection expertise of, respectively, Mrs Cherrie and Mr Walters, that perversity reflected bias on their part against Miss Martins.
4. The subsequent interview with Mrs Tyzack elicited from Miss Martins an allegation that Marks and Spencer "pursued racist policies" but this did not initiate any enquiry.
5. In the event, Marks and Spencer do not pursue racist policies: it has "... done far more, generally speaking, than it could reasonably be expected to do", making "extensive efforts to pursue its equal opportunities policy".
6. That said, notwithstanding the foregoing, there is within Marks and Spencer a "corporate mentality which to put it simply prefers the majority"; a "somewhat generalised discriminatory attitude". This finding is based upon:

a. A failure to achieve an apportionment of employees from ethnic minorities of 3 or 3.5%; and

b. The evidence of Mr Walters, himself Afro-Caribbean in origin: "He had sought to introduce what was called a Focus Scheme. The intention was to concentrate on recruitment of racial minorities to achieve qualifications. (He) was quire clear that if this scheme were to have a chance of success it had to be sponsored at the very top level of management".

7. The explanation for the bias is found in paragraph 21 in the following terms:

"It is inconceivable that Mr Walters would actively discriminate against the Applicant. We believe, however, that Mr Walters like Mrs Cherrie was infected by the somewhat generalised discriminatory attitude which we have just outlined. It seems to us not only reasonable but correct to infer that that infection produced the reaction that gave rise to the destructively negative interview report that we have revealed earlier in this decision."

8. Following this apparent finding of direct racial discrimination, there comes a finding dealing with the contention by Marks and Spencer that the company had proved a defence by reference to Section 32(3):

"22. Our conclusion, therefore is that the Applicant was denied an opportunity of employment as a Trainee Manager with the Respondent by reason of the effects of a discriminatory attitude prevailing in the organisation. The Respondent totally failed adequately to inquire when the result was challenged. In general, the Respondents' extensive efforts to pursue its equal opportunities policy, however unsuccessful they may be, would not permit us to say that the Respondent had failed to take reasonable steps to eliminate discrimination. In this particular instance, however the Respondent has failed to take reasonable steps to inquire into this allegation to ascertain whether it has a foundation and, if it appears to have a foundation, to rectify the position. The Respondent is, therefore, vicariously liable for what happened in the interview with the Applicant on 28 January 1992."

THE APPELLANTS' CASE

On behalf of Marks and Spencer Mr Tabachnik QC made the following submissions:

9. The Tribunal had misapplied, further or alternatively misconstrued Section 32(3).
10. Any relevant finding that Marks and Spencer had failed to take reasonable steps to inquire into any allegation of racial bias was perverse.
11. The Tribunal had substituted its own assessment of Miss Martins for that of the interviewing panel, a course that was impermissible by law.
12. The Tribunal's finding of racial discrimination was perverse in that the findings of respectively bias on the part of the interviewing panel, of the ethos of racial discrimination and of the causal connection between such bias and such ethos were perverse.

Section 32(3)

It is submitted:

13. That `such steps as were reasonably practicable to prevent the employee doing that act, or from doing in the course of his employment acts of that description' refers to steps taken in advance of the act or acts relied upon, given the connotation of `prevent' as something done in anticipation;
14. That the `act' relied upon by Miss Martins as racial discrimination was her rejection by the interviewing panel;
15. That in paragraph 22, as already set out in full in this judgment, the Tribunal made a finding as to the taking of reasonably practicable steps to prevent racial discrimination by employers, such including that of the interviewing panel, in the terms of the third sentence: "In general the Respondents' extensive efforts to pursue its equal opportunities policy, however unsuccessful they may be, would not permit us to say that the Respondent had failed to take reasonable steps to eliminate discrimination."
16. That latter finding was in law a finding that Marks and Spencer had made out a defence under Section 32(3); and
17. That with respect to the balance of paragraph 22 any failure to inquire into any allegation and, if appropriate, to rectify such does not qualify or provide an exception to the finding set out in 3. and 4.: whether or no employees have subsequently enquired into allegations of past racial discrimination does not bear upon the question as to whether or no they took reasonably practicable steps in advance of such discrimination with a view to preventing it.

In response to these submissions, Mr Macdonald conceded Mr Tabachnik's construction of Section 32(3), but submitted that otherwise the argument was misconceived: what his client complained of as racial discrimination was the denial of an opportunity for employment as a trainee manager and that had come about because of the rejection by the interviewing panel and the subsequent failure to rectify. A finding that, overall, Marks and Spencer had failed to discharge the Section 32(3) burden could be justified. Mr Tabachnik's reply was to the effect that Miss Martins' complaint could not relate simply to the denial of an opportunity for such employment but only to so much involved therein as amounted to racial discrimination; and that the Tribunal had not found racial discrimination arising after rejection by the interviewing panel. He thus maintained his analysis of paragraph 22.

FURTHER GROUNDS OF APPEAL

The remaining three submissions of Mr Tabachnik can be considered compendiously. The Industrial Tribunal made two findings that were fundamental to its overall finding of racial discrimination: first, that the interviewing panel was biased against Miss Martins and, second, that such bias reflected racial discrimination. Averting to the first such finding Mr Tabachnik submits that it had to be perverse. Given that the Tribunal had not itself witnessed the original interview, how could it reasonably find that the subsequent rejection arose from bias? The answer, he submits, is that the Tribunal formed such a favourable view of Miss Martins having seen her give evidence that it wanted to substitute its own assessment for that of the interviewers and could only do so by making a finding, so unwarranted as to be perverse that the interviews were biased. Averting to the second finding, Mr Tabachnik submits that it was so unsupported by evidence as to be similarly perverse. In response to these submissions Mr Macdonald reminds us of the need to respect findings of fact made by Industrial Tribunals unless such fall into the `my goodness, that must be wrong' bracket. see Neale v Hereford C.C. (1986) ICR 471, 483. He submits that neither finding can be so condemned. In particular, he submits that it is possible to discern a determination by this Tribunal not to substitute its own assessment of Miss Martins for that of the interviewing panel, but to arrive at a condemnation of the latter's decision by way of a legitimate judicial process. Again, he maintains that the second crucial finding, that is, that the bias reflected racial discrimination should not be condemned as perverse, not least when racial discrimination is rarely overt and when this Tribunal is denied, the opportunity to review inferences drawn during the receipt of oral evidences.

THE FINDINGS OF THE MAJORITY

18. In our judgment on the findings of fact made by the Tribunal, Marks and Spencer had in law made out the defence provided for by Section 32(3). As to this, first, we are satisfied that Mr Tabachnik's analysis of paragraph 22 and in particular of the significance in law of the third sentence is sound. Second, let it be supposed that proven racial discrimination by employees was reflected not just in the conduct of the interview but additionally in the subsequent review and the failure to rectify (and it has to be said that the findings about the latter are open to different interpretations) we can see no reason to confine the ambit of the proven steps by way of prevention to just the earlier discrimination and not to the whole of the acts and omissions. In this context, we note that Mr Macdonald neither did nor could attack the finding favourable to Marks and Spencer as itself perverse and there was indeed ample to support it. Not only did the Tribunal endorse the submission made to it on behalf of Marks and Spencer "that it was difficult to know what more (it) could do", but turning from the general to the particular, the Tribunal found that Marks and Spencer had ensured that the interviewing panel had no knowledge of the reason for the interview (thereby to prevent a rejection based on victimisation as defined by Section 2); had included in the panel Mr Walters, a Senior Selector of Afro-Caribbean origin with an interest in recruiting from ethnic minorities; yet further, had set up an ad hoc review, none being normally undertaken. Plainly it would have been no surprise to Marks and Spencer if Miss Martins had been selected for employment.
19. Turning to the further grounds of appeal, the majority would loyally support the assessment of the interview by the Industrial Tribunal if it could discern from the Reasons an approach to the evidence consistent with that of a reasonable Tribunal. It is here that the problem arises. Notwithstanding a decision to condemn as biased that which could not of itself be put in evidence and which, having regard to the circumstances of the interview and to the identity of the interviewers, ought not to have been such, the reasoning as expressed in the Reasons defies analysis. The critical passage in paragraph 13 has already been set out in our preface to `The findings', together with the respective submissions as to its meaning. What that passage does mean is not elucidated by the preceding paragraphs dealing with this topic, paragraphs 7 to 12 inclusive. Thus, in paragraph 7, the Tribunal highlights Mrs Cherrie's evidence that "... the fundamental area of weakness was that she did not communicate effectively. She was just not clear"; in paragraph 10 they note that both interviewers told them that Miss Martins had behaved before them very differently than when before the Tribunal; and in paragraph 11, they accept that this could be true. It is then that they record their own impression of Miss Martins as "coherent, articulate with well presented evidence" and add later in paragraph 12 "We can scarcely conceive of any situation in which the Applicant we saw ... could properly be described as inarticulate." It is then that in paragraph 13 on a premise that, as we have noted, is open to debate as to its meaning, there is the finding not just that the interviewing panel got it wrong, but that it was biased. It may be that acceptable reasoning led to this latter decision, but such does not appear from the Reasons as drafted. There is no clear disavowal of the substitution of their own views for that of the interviewing panel and no clear train of logical thought. Presently on the Reasons as drafted, the majority has to say `My goodness, that must be wrong'.

The appeal as to the finding that any bias was racially motivated is even stronger. In sub paragraph (g) of the analysis of the actual findings is cited (from paragraph 21) the sum total of the finding that Mrs Cherrie and Mr Walters were racially motivated. Not only is there no explanation of the alleged connection between "the somewhat generalised discriminatory attitude we have just outlined" and their conduct of the interview, it is apparent that one evidential source for the existence of such an attitude is Mr Walters himself, again as recited in our resume of the findings, this time sub-paragraph (f). As to why Mr Walters not only did not seize this opportunity to advance his concern for recruitment from ethical minorities, but abandoned any such predilection and his professional standards out of deference to a corporate preference for an ethnic majority appears nowhere in the Reasons. We may add that even the finding of this corporate preference persisting in defiance of Marks and Spencer equal opportunities policy is open to strong comment. That finding seems (allowing again for the drafting) to depend on the two factors identified in sub-paragraph (f) of our resume, both being dubious: the shortfall in apportionment is meaningless without more parameters (for example as to time) and it is difficult to condemn the workforce of Marks and Spencer on the basis of the evidence of Mr Walters, not least when his employers select him as the interviewer. Overall we again have to be in the `My goodness that must be wrong' bracket.

THIS APPEAL

By way of a majority decision it is plain that the appeal must be allowed and the decision quashed. Our concern as to the fact finding, in its approach, further or alternatively in its expression, suggests a remission to a differently constituted tribunal for a rehearing. However, first, the passage of time makes this hardly realistic even if the fresh tribunal adhered to the ambit of the original complaint, that is, victimisation. Second, the Section 32(3) point is, founded on a finding of fact that does stand up to examination. The majority think that we can properly dispose of the appeal by simply allowing it on the basis of the Section 32(3) point, and we do so, directing that the complaint be dismissed.

THE FINDINGS OF THE MINORITY (Ms S. Corby)

The minority is of the view that the appeal should be dismissed. First the Industrial Tribunal found that the interview was biased. She does not think that finding was perverse. The Industrial Tribunal had plenty of evidence. The Applicant's performance in the practical test took up over a third of the interview and Miss Martins "persuaded ... (those conducting the interview) that she had the skills". Yet the comments on the report form, which are dealt with in detail in a lengthy paragraph 12 of the Industrial Tribunal decision, are negative. Nor does she think that the Industrial Tribunal substituted its own decision for that of the interview panel. Indeed they expressly say they were not doing so.

Having found bias, the next question is whether it was racial. Given that the Race Relations Act has been in existence for 20 years, it is extremely unlikely that racial discrimination is articulated. The Industrial Tribunal has to draw inferences. Moreover, the test is objective, not subjective. Discrimination can be conscious or unconscious and the company's explanation of Miss Martins failure at interview, viz that essentially as at 27 she was older and more experienced than most applicants, so a higher standard was appropriate, did not convince the Industrial Tribunal. Having drawn inferences, the Tribunal was entitled to reach that decision and in doing so they took into account that the position was for a trainee. The minority therefore, does not find the Industrial Tribunal's decision perverse on this point.

Finally, there is the Section 32(3) defence. The minority is of the view that Mr Macdonald's submission is to be preferred to that of Mr Tabachnik.

The minority also find that the Industrial Tribunal's decision is not perverse here. There were facts that supported their view that that the company was liable. For instance, it found "no evidence" that Mrs Saddler, a recruitment manager, discussed the basis for the interviewers' conclusions with either interviewer. Mrs Tyzack, another recruitment manager, did not act on Miss Martins's allegation, after the interview, that Marks and Spencer "pursued racist policies", despite the background to the holding of the interview. Moreover, the Industrial Tribunal records that the equal opportunities manager (sic) said that:

"members of ethnic minorities were probably not chosen because the Respondent had high standards. The inference of this from the point of view of attitudes is obvious. Perhaps because Mrs Richards saw this she added a second reason which was that the right grades among ethnic minorities were not applying".

The Industrial Tribunal also found that the company's equal opportunity scheme were "energetically monitored but policies are not implemented".