United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MR JOHN HENDY QC and MR MICHAEL FORD (of Counsel) Messrs Christian Fisher Solicitors 42 Museum Street Bloomsbury London WC1A 1LY
For the Respondents	MR GERRARD CLARKE (of Counsel) Messrs Watson Burton Solicitors 20 Collingwood Street Newcastle-upon-Tyne NE99 1YQ


 


MR JUSTICE MAURICE KAY: There are pending before the Industrial Tribunal in Leeds applications by numerous mine workers under the Transfer of Undertakings Protections of Employment Regulations 1981 ["TUPE"]. They commenced applications against Amalgamated Construction Co. as first respondents and A M Mining Services Ltd as second respondents, these being associated companies within a large group. Their business includes contracting directly or indirectly with British Coal, or more recently, RJB Mining (UK) Ltd, in the provision of mining construction services.

The case for the original applicants, now appellants, is that they were employed by Amalgamated Construction ["AMCO"], but that in 1995 they ceased so to be, whereupon they became employed by A M Mining Services Ltd ["AM"], before returning to the employment of AMCO in 1996.

At all material times, their place of work has been the Prince of Wales' Colliery. Their understanding was was that their changes of employer were brought about by British Coal or RJB contracting with AMCO, then with AM, then with AMCO again, under a series of separate contracts.

By their Notice of Appearance as originally filed, both respondents gave the same account as to who was contracting with British Coal or RJB at any particular time. It is necessary to refer briefly to the contents of that of Notice of Appearance. It stated in paragraph 4:

"4. The Applicant's employment with the First Respondent was terminated by reason of redundancy with effect from 30th September 1994 at which time the Applicant received his statutory redundancy entitlement in full. ...

...

7. The Second Respondent had been carrying out work at the Prince of Wales Colliery since August 1994. The Second Respondent had submitted a tender to British Coal for a further contract at Prince of Wales Colliery in respect of SW Laterals Extension Drivage on or around July 1994. ...

8. The tender submitted by the Second Respondent was submitted on a competitive tender basis and in no way was it guaranteed that the Second Respondent would be successful in its tender.

9. The Second Respondent was awarded the new contract number YCE10/32594 by British Coal at the Prince of Wales Colliery effective from around September 1994.

10. The Second Respondent interviewed the Applicant on 3rd October 1994 and the Applicant was offered employment with the Second Respondent to commence with effect from 3rd October 1994 to work on contract number YCE10/32594.

11. The Applicant signed to confirm his understanding and acceptance of the terms and conditions of his employment with the Second Respondent on 3rd October 1994. The Applicant was employed by the Second Respondent under employee number 81614.

...

13. The Applicant continued to work for the Second Respondent which continued to receive work from RJB Mining PLC. In or around November 1995 the Applicant was advised by the Second Respondent that its requirement for the work carried out by the Applicant had ceased or diminished, or was expected to cease or diminish. The Second Respondent had no further work available for the Applicant at the Prince of Wales Colliery.

14. The First Respondent tendered for and successfully secured a contract for RJB under contract number GH/POW/0375 in respect of SW Laterals Extension Drivage Phase 4 which was operative in November 1995. This contract was won on a competitive tender basis. The Applicant was advised of this by the Second Respondent and, as an alternative to the termination of his employment by reason of redundancy, the applicant was offered the opportunity of re-engagement by the First Respondent on terms and conditions identical to those under which he was then employed with the Second Respondent save that he became entitled to enhanced benefits in respect of sick pay entitlement.

15. The Applicant was interviewed by the First Respondent on 10th October [in fact November] 1995 and accepted re-engagement with the First Respondent from that date. The Applicant's employee number with the First Respondent is 400038."

Arrangements have been made for the hearing of a preliminary issue by the Industrial Tribunal commencing on 13th October, the issue being whether there has been a transfer of an undertaking under TUPE. The parties to that hearing are the appellants and AMCO, AM having ceased to be a party in June at the time when directions were given. We refer briefly to those directions. They refer to the withdrawal of the cases against AM and, having ordered the trial of the preliminary issue which had been identified, the directions went on to require that:

"4. Not less than 14 days before the date fixed for hearing, the parties' representatives will agree a bundle of documents for use at the hearing. ..."

Thereafter, the appellants sought discovery of documents. This began in correspondence culminating in an exchange of letters on 9th and 15th July 1997. On 9th July AMCO's solicitors wrote:

"We would be grateful if you could advise as soon as possible whether you propose to request Further and Better Particulars and Discovery in relation to any application in addition to the requests already made."

On 15th July the appellants' solicitors replied:

"We will not be requesting Further and Better Particulars and Discovery in addition to the requests already made."

Although further and better particulars had been requested, they had not been replied to at that time. There was correspondence about the replies, the outcome being that the appellants extended time to AMCO until 26th August. In the event, on 26th and 29th August solicitors for AMCO supplied further and better particulars.

The provision of further and better particulars prompted a change of mind on behalf of the appellants, so that on 4th September their solicitors wrote to AMCO's solicitors requesting extensive further discovery. The request is in this form:

"Could you please supply the following by way of urgent discovery:-

1. A bundle containing the relevant contracts showing their numbers. The bundle you have supplied does not contain the contract numbers.

2. Please supply a copy of the plan referred to in the contracts.

3. Please supply copy contractual documents with AMCO before the first transfer and sample wageslips for each of the Applicants.

4. Please supply copy terms and conditions of employment with AMS.

5. Please supply new terms and conditions with AMCO where not supplied in the Replies to Further and Better Particulars.

6. Please supply a bundle containing all correspondence between both Respondents, their parent company and outside bodies such as RJB Mining relating to the tendering process, including letter inviting tenders and the tenders themselves and the letter accepting the tenders.

7. Please supply all correspondence between the |Respondents and any other party regarding the Applicants termination of employment.

8. Please supply Board Minutes of both Respondent Companies dealing with the tendering process and with the transfer of employment of the Applicants and/or their termination of employment.

9. Finally we would like to arrange inspection of the personnel files of both companies relating to each of the Applicants. Please let us know when we may have an appointment to do this."

The appellants did not receive a prompt reply to that request. A chasing letter was sent on 15th September which produced a reply dated 17th September indicating that the request would be dealt with "appropriately", and complaining about the timescale.

This did not please the appellants' solicitors and, on 18th September they wrote to AMCO's solicitors and to the Regional Chairman of the Industrial Tribunals making application for discovery. Their letter to the Industrial Tribunal of 18th September enclosed the letter of 4th September which we have quoted extensively.

At that stage the solicitors for AMCO set out their replies to the nine numbered requests. Their replies are in the following form:

"1. A request cannot be made for the bundle requested as these documents do not exist. Discovery can only be made in respect of documents which are already in existence prior to the action commencing.

2. We have requested copy plans from our client and shall supply them to the Applicants' representative in due course.

3. This request is unspecific. The relevant parties to the alleged transfer of undertaking in this matter are Amalgamated Construction Co. Limited and AM Mining Services Limited. AMCO is the name of the group company which Amalgamated Construction Co. Limited and AM Mining Services Limited are both part. In any event, the request is unspecific.

4. We shall make arrangements for a sample of this document to be sent to the Applicants' solicitors.

5. We would repeat the comments in 3 above. All requests for terms and conditions made in the Request for Further and Better Particulars have been supplied to the Applicants' representative.

6. This request is unspecific, but we have requested documents form our client in an attempt to satisfy this request.

7. We have requested these documents from our client.

8. These documents do not exist in the form requested.

9. The Applicants' representative has not been specific in detailing the specific information they require to inspect in the personnel files. In any event, we are willing to allow inspection of the personnel files so long as the Applicants' representatives specify precisely the details of the documents they require sight of."

Those observations were sent by AMCO's solicitors to both the appellants' solicitors and to the Industrial Tribunal Chairman. The Chairman considered the representations which had been made by both sides on paper as of course is quite normal in such cases.

Because the applications had been made pursuant to two documents from the appellants' solicitors, the decision came in two stages. By a letter of 23rd September 1997 the Regional Secretary of the Industrial Tribunals stated that the Chairman has:

"The Chairman has directed me to reply as follows:-

1) Your request for discover [sic] of documents is refused. The request is clearly in the nature of a fishing expedition and I do not see that the documents requested will assist the Tribunal in determining the issues in these case."

By a second letter dated 23rd September the same correspondent said that:

"... a Chairman has directed as follows:-

"I am not prepared to make the Orders as requested at this stage. I cannot see that they are at all necessary for the proper determination of the issues in these cases."

It is from those decisions that the appellants now appeal to this tribunal.

There has been no dispute as to the legal principles which govern the present circumstances. Discovery in the Industrial Tribunals is governed by a statutory instrument which incorporates the provisions of Order 14 of County Court Rules 1981 (as amended). The most material provision is Order 14. r.8(1) of the County Court Rules 1981 which provides that on the hearing of an application:

"... the court, if satisfied that the discovery, disclosure, production or supply sought it not necessary, or not necessary at that stage of the action or matter, may dismiss or adjourn the application and shall in any case refuse to make an order if and so far as it is of opinion that discovery, disclosure, production or supply, as the case may be, is not necessary either for disposing fairly of the action or matter or for saving costs."

Both parties are agreed that the leading authority in this area remains The Peruvian Guano Company (1883) 11 QB 55 and, in particular the passage in the judgment of Brett LJ at page 63 where he stated:

"... It seems to me that every document relates to the matters in question in the action, which not only would be evidence upon any issue, but also which, it is reasonable to suppose, contains information which may - not which must - either directly or indirectly enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary. I have put in the words "either directly or indirectly" because, as it seems to me, a document can properly be said to contain information which may enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary, if it is a document which may fairly lead him to a train of inquiry, which may have either of these two consequences ..."

We have also been referred to the decision of the Court of Appeal in The Captain Gregos briefly reported in the Times Law Reports for 21st December 1990 in which Bingham LJ, as he then was, stated:

"The test of relevance upon the question of discovery of documents was not whether those documents would or would not help a party but whether that party should have an opportunity to peruse the documents."

We have also, helpfully, been referred to the decision of the Court of Appeal Wallace Smith Trust Co Ltd v Deloitte Haskins & Sells [1996] 4 All ER 403 and, in particular to the list of principles set out in the judgment of Neill LJ at pages 412 to 413.

As we have indicated, the Industrial Tribunal Chairman was not persuaded on paper that an Order was appropriate.

For the respondents, Mr Clarke rightly reminds us of the powers of this tribunal upon an interlocutory appeal, and he refers in his skeleton argument, in particular, to Adams and Raynor v West Sussex County Council [1990] IRLR 215, in which the Employment Appeal Tribunal summarised the position as to appeals from interlocutory orders, stating that three issues to be decided are:-

(1) was the order within the powers given to the tribunal?

(2) was the discretion exercised within guiding legal principles?

(3) can the exercise of the discretion be attacked on Wednesbury principles (that is: was it perverse)?

It is his submission that applying those tests ought to lead us to dismiss this appeal.

Since the decisions of the Industrial Tribunal and, after the Notice of Appeal was filed, there has been a change of position by the respondents. This is evidenced, in particular, by a letter sent by AMCO's solicitors to the Industrial Tribunal on 27th September. Without quoting from it in detail, the change of position amounts to this, that whereas until last week the case for AMCO was that there had been three contracts with British Coal or RJB, the first via AMCO, the second via AM and the third by AMCO, they have now asserted that the party which contracted with British Coal or RJB on every occasion was in fact AMCO and not AM. They further assert that during the time when the appellants were employed by AM, AM was acting as a subcontractor providing labour for AMCO to fulfil its second contract with RJB. We are told that whilst the original intention had been for AM to contract directly with RJB, in the event, RJB did not agree to this but preferred to continue contracting with AMCO it previous supplier. In all these circumstances, the case for AMCO is that there has never been a TUPE transfer.

We now turn to consider the appeals in relation to the categories of documents which were identified in the application via the letter dated 4th September from which we have quoted extensively.

It has become apparent in the course of submissions that in relation to items 1, 2, 3, 4 and 5, there is no outstanding issue, save for the reference to wage slips in item 3. It is conceded on behalf of AMCO that their contracts with British Coal or RJB are disclosable; that a copy of the appropriate plan in each case is disclosable; and that the contractual employment documents with AMCO before the first change of employment to AM are disclosable. In the course of submissions it appeared that there was no issue as to 4, not least because by now those items have been disclosed. So far as 5 is concerned, upon refinement, it was made clear that the request related only to items of a category which had already been disclosed in part, and there is no objection to its disclosure in full.

Turning to the question of the wage slips. There is still resistance on the part of AMCO, so far as they are concerned. The argument advanced on their behalf is that the appellants do not need them for the purposes of the issue now before the tribunal, because they have the employment statements containing all the information which is necessary at this stage.

We have not seen all the documentation that has been disclosed. We have been provided, by way of illustration, with the documentation in respect of one applicant, Dockerty. It is apparent from what has been disclosed in his case that the statement of terms and conditions of employment dated September 1994, is silent as to the commencement of the date of that period of employment with AMCO. Whilst it is a pro forma which has been added to in writing in certain parts, paragraph 4 states:

"4. Your employment with the company began on [blank]. Your employment with any previous employed does not count towards a continuous period of employment."

The date upon which each particular appellant commenced employment with each of the two employers relevant to these proceedings is a potentially significant matter. Since the one sample before us is blank as to that item, it seems to us that the request for discovery of wage slips is a proper request, and applying the tests to which we have referred, it seems to us, that the tribunal ought to have ordered discovery of it. Accordingly, in relation to that item which forms part of item 3, we shall allow the appeal and make an appropriate order.

Pausing there, we have drawn to the attention of Counsel, the fact that the withdrawal of AM as parties to these proceedings on 27th June 1997, makes it impossible for us to make any order against that company now. That was not a point that was being advanced on behalf of AMCO in the correspondence which preceded this hearing, in the course of which, indeed, the solicitors for AMCO referred to making requests of AM for documents of some categories sought. We have sought the guidance of Counsel as to how to deal with this anomaly, bearing in mind that AM was once a party, and bearing in mind further, that the two companies are closely associated and part of the same group. Whilst it remains the case that we are not in a position to make any orders against AM, it seems to us, on the basis of what Counsel have said, that a measure of common sense and co-operation ought to be forthcoming and, if it is not, then there are, as Mr Hendy QC points out, other procedures at his disposal for assisting in the procurement of the material which he seeks.

Jumping ahead to item 9 in the letter of 4th September, again there seems to be no remaining significant issue between the parties. Indeed, the response of AMCO's solicitors was that they would allow inspection, so long as there was specificity as to the details of the documents required to be inspected.

We have some sympathy with AMCO's solicitors, so far as the response to that original request is concerned, because it was somewhat vague in its expression and, taken literally, might have permitted or required a far greater trawl and inspection than is justified by the circumstances of the case. However, Mr Hendy has made it plain that all the appellants are interested in under item 9 are documents which cast light or may cast light on who the employer of a particular appellant was at the material times that are relevant to the issue to be tried on 13th October 1997. Following that refinement, no remaining issue exists between the parties. In allowing this appeal, we shall order disclosure on the more specific basis referred by Mr Hendy. I should add that in relation to that and in relation to the wage slips, we do not see that any disclosure ought to go back further than 1st July 1994.

That leaves us with the more contentious area of items 6, 7 and 8 in list contained in the letter of 4th September.

Mr Hendy submits that these were always highly relevant documents for any consideration of the issue as to whether there had been one or more transfers under TUPE. He adds that that is now even more the case, since the change in position adopted by or on behalf of AMCO. He makes clear that one of the matters which the appellants will seek to explore is whether the relationship between AMCO and AM and the outward presentation of contractual relations in this case, is in fact a sham the purpose of which has been to disadvantage the appellants, although this is not his primary submission.

For AMCO it is submitted by Mr Clarke that the items in paragraphs 6, 7 and 8 are classic examples of fishing expeditions by a litigant in search of material to bolster up a case which is incomplete.

We have given careful consideration to that in the light of all the circumstances. Item 6 relates to documents concerned with the tendering process. That is a matter which embraces the issue upon which there has been a change of position in this litigation by AMCO. Mr Clarke submits that once the appellants have the actual contracts between AMCO with British Coal/RJB, they will have all they are reasonably entitled to, and that the Industrial Tribunal Chairman was well within the parameters of a reasonable decision in so deciding.

We have come to a contrary conclusion. It seems to us that in the circumstances of this case, as they have been explained to us by Counsel, the appellants are entitled to documents relevant to the tendering process, and not just to the contracts to which that process successively gave rise. Accordingly, we shall allow the appeal in relation to item 6.

However, we feel it appropriate to exercise caution as to the drafting of the order which gives effect to that judgment. In the form in which it is set out in item 6, the reference is to:

"... all correspondence between both Respondents, their parent company and outside bodies such as RJB Mining relating to the tendering process, including letter inviting tenders and the tenders themselves and the letter accepting the tenders."

We take the view that the specific requirement ought to be in relation to AMCO a reference to letters inviting tenders, tenders, correspondence thereafter and letters accepting tenders. For the avoidance of doubt, it ought also to include correspondence in the possession of AMCO relating to the same matters but between AMCO and AM, or AMCO and its parent company. We have already explained why we limit the order to AMCO and do not extend it to AM.

Item 7 relates to correspondence:

"... between the Respondents and any other party regarding the Applicants termination of employment."

Again, in that form, it seems to us, that the request goes too far, not only in including AM, but in being expressed in such a form that would include, for example, correspondence passing between AMCO and its solicitors for legal advice in relation to the termination.

It seems to us that so far as item 7 is concerned, the appellants are entitled to non-privileged correspondence between AMCO and AM, or between AMCO any other associated company, or between AMCO or any appellant, and to that extent, we shall the appeal.

This leads us finally to item 8, which refers to the Board Minutes of "both Respondent Companies". It follows from what we have said that there can be no order so far as AM is concerned, although if we are to make an order against AMCO, it would follow that any documents in AMCO's possession which relate to the internal affairs of AM, would be disclosable by AMCO, subject to any further application which may be made. But what of the question of Board Minutes as a matter of principle? Again, having regard to the history of this case and the issues that are raised, it seems to us, that the Board Minutes of AMCO dealing with the tendering process and with the transfer or termination of employment of any appellant, are matters of legitimate entitlement so far as the appellants are concerned. In coming to that conclusion, we repeat that we do not consider any alternative conclusion to be one which could reasonably be made. Having said that, we are mindful of the need to preserve confidentiality as to wider matters not directly relevant to this case, and for the avoidance for doubt (if any there be) we make it clear that the disclosure of Board Minutes which we order in allowing this appeal, may be on the basis which provides for an editing of those minutes in respect of matters not relevant to the issue to be tried on 13th October 1997.

It follows, therefore, that this appeal will be allowed. It will be necessary for the order giving effect to this judgment to be drawn with some care, and upon that, we invite the assistance of Counsel, having explained in as much detail as we can, what we have in mind in relation to each of the headings.

In the course of submissions, neither Counsel has suggested that the hearing date, a week next Monday, is or should be jeopardised by the consequences of the allowing of this appeal. And we are most anxious that it should not be jeopardised. We were pleased to hear that the respondent is almost ready to supply a suggested trial bundle which would include the matters in items 1 to 5, save for the wage slips. It is important that the trial date be held and that the consequences of this appeal be implemented as speedily as possible. We shall order the respondent to serve on the appellants the proposed trial bundle containing copies of all the documents which are now discoverable as a result of this order and to do so by mid-day on Tuesday, 7th October 1997. We shall also order that the appellants be allowed such inspection of the original documents as they shall reasonably require.

An application for costs on behalf of the appellants refused.