United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MISS C JONES (of Counsel) Messrs Edwin Coe Solicitors 2 Stone Buildings Lincoln's Inn London WC2A 3TH
For the Respondent	MR C CARMO (Solicitor) Messrs Carmo Solicitors 79 St Martin's Lane London WC2N 4AA


 


MR JUSTICE MORISON (PRESIDENT): This is an appeal against a decision of an Industrial Tribunal which was held at London (South) on 15th September 1997. By their decision which is contained in a written document sent to the parties on 25th September 1997, the Industrial Tribunal made the following orders:

(1) An order for re-engagement into any Grade C post which becomes available during the next three months.

(2) The question of the applicant's loss in the meantime will be the subject of another Hearing if not agreed between the parties.

(3) Should the respondents have interviewed the applicant for the post or otherwise considered that matter, still maintain that the re-engagement is not practicable, then the Applicant may apply for a further Remedy Hearing.

The background to this case may be briefly stated. The applicant had been employed by the respondents, the appellants in this appeal, that is the Wimbledon & District YMCA. That is part of a well-known national charitable organisation whose work is too well-known to be recited in this judgment. She first joined them in June 1989, although she had previously worked within the YMCA movement. In July 1990 she was appointed to the post of Child Care Director, which was the position she held until her employment was terminated in October 1995.

She complained to an Industrial Tribunal that she had been unfairly dismissed. She also complained that she had been unlawfully discriminated against on the grounds of her sex. Her application under the Sex Discrimination Act 1975 failed as a result of the tribunal finding that she was not unlawfully discriminated by her former employers. But the tribunal after a six day hearing, concluded that she had been unfairly dismissed by the YMCA.

The essence of their decision was that the existence of a redundancy situation within the Association was not the genuine reason for her dismissal, but that the real reason was an individual's wish to remove somebody who he found to be difficult and troublesome "under the cover of the need to make savings in the Childcare department." The tribunal found that:

"36. ... the Applicant was a member of Mr Page's management staff who, with others, had demonstrated hostility towards or at the very least a marked reluctance to execute Mr Page's plans to make financial savings and to run the Respondent's operation on more commercial lines. There had been a number of unpleasant exchanges between them and the working relationship had all but totally broken down; the Applicant had even launched an official grievance against Mr Page."

The tribunal went on in this way:

"36. ... In our view Mr Page, in his eagerness to be relieved of the difficulties being presented by the Applicant's attitude, seized upon the Board's resolution as his licence to dismiss her. Mr Page decided for his own personal reasons to dismiss the Applicant by translating a resolution that her post had been made redundant into a conclusion that she should be dismissed. Our conclusion that redundancy was not the genuine reason for dismissal is for us reinforced by Mr Page's conduct in (i) deliberately failing to inform the Board of Victoria Taylor's alternative recommendation; (ii) inviting the Board to make an important decision affecting her employment at a time when the Applicant and Dr Halden were on holiday; (iii) failing generally to consult with the Applicant about the implications of Victoria Taylor's recommendations and the options they presented; and (iv) failing formally to advice the Board that the grievance procedure had been invoked by the holder of a post which it was about to declare redundant. If Mr Page had not acted as he did in these ways the decision of the Board may, in our view, have been materially different."

They therefore came to the conclusion that the respondent organisation had:

"37. ... failed to satisfy the Tribunal that redundancy or reorganisation was the genuine reason for the dismissal ..."

and accordingly, in those circumstances, the application succeeded. But they went on to hold that even if they were wrong about that, they were satisfied that she had been unfairly dealt with, not least because:

"38. ... the full range of options for selection for redundancy had been deliberately withheld."

from her.

That was a decision against which there has no appeal, but which led to a remedies hearing. The Industrial Tribunal therefore had to approach the question of remedy in the light of the IT 1 which had been supplied, where it was made plain that the applicant was seeking reinstatement or re-engagement. At the hearing they turned their attention to re-engagement.

Very sensibly prior to the hearing of the case on remedies, the applicant, Miss Varndell, wrote to the Board of the YMCA on 7th September 1997. It referred to a coming vacancy, as it was described, of Programme Director and other vacancies and stated:

"I wish to put behind me any difficulties there may have been between the General Secretary and myself. Although I had an outstanding grievance, we need not revive this. The Industrial Tribunal have made their own judgments on the situation and I am sure you will consider these fully. Upon re-engagement, I would of course work within the status quo, accepting Stuart Page is the General Secretary. I do hope that Mr Page will also be able to put the past behind him."

That apparently was not the attitude shared by the employers. They gave evidence at the Industrial Tribunal to indicate with more or less certainty that they did not consider that she should be reinstated or re-engaged. A witness gave evidence, putting the case as the tribunal described it, graphically: "I ask myself would it work? The answer is undoubtedly no. It would not work". As the tribunal observed, it appeared that the Association was still wracked by the original schism which led to the dismissal of the applicant, and that to re-engage her would be, as they said "to put the cat back among the pigeons."

Against that background, not surprisingly, the Association made forceful submissions to the Industrial Tribunal that it was simply not practicable to have her back in their employment. They stressed the fact that this was a small employer with few staff, and that there must exist a close personal relationship between the managers, and therefore, reinstatement or re-engagement could only be appropriate in exceptional circumstances, as it was put. The respondents also pointed out that in the schism which had occurred, the applicant had been a member of a camp which had bitterly opposed Mr Page to the point of putting in writing that they had no confidence in him.

On the other hand, it was submitted to the Industrial Tribunal that there was a vacancy; that the applicant had given an undertaking to accept Mr Page's rule; and that the Committee had not formally reached a conclusion as to whether she should be taken back or not, were the tribunal to make a recommendation to that effect. There were various other points made.

Accordingly, it fell to the Industrial Tribunal first of all to consider whether this was a case where it was practicable to make an order for re-engagement in accordance with the provisions of s. 115 and 116 of the legislation. They came to the conclusion that although they were not confident as to the eventual outcome, by which I think they mean they were not confident as to the attitude that would ultimately be taken by the YMCA, they thought that there was something in the applicant's point, and they continued:

"8. ... There is, we find on the evidence before us, enough to make a determination that it is practicable to comply with an Order for Re-Engagement within the meaning of Port of London Authority -v- Payne. This will enable the parties further reflect upon the situation and consider any application which the Applicant makes to them for the vacant position and to consider her undertakings."

In the last paragraph the tribunal said:

"11. It seems to us that the best order is not to order the engagement in those terms and allow the Applicant to re-apply to the Tribunal if she is not re-engaged and still wishes to argue that it is practicable."

The YMCA appealed. Through their Counsel, Miss Jones, they have ably argued that the Industrial Tribunal have made a re-engagement order which was outwith their power when one has regard to the terms of s. 115 of the Act.

It was, secondly, urged upon us that the finding made by the tribunal that it was practicable for an order to be made, was perverse. Our attention in that connection was drawn to a number of authorities. In the first place we have regard to the decision of the Port of London Authority v Payne [1994] IRLR 9. There, the Court of Appeal identified a two-stage process:

"42 It is quite true that a stage 1, that is, before an order for re-engagement is made, the Industrial Tribunal must make a determination on the evidence before it whether it is practicable for the employer to comply with an order for re-engagement. In my judgment the necessity for such a determination is apparent from the wording of s. 70(1) which provides that save in specified circumstances the fact that a permanent replacement for a dismissed employee had been engaged is not to be taken into account 'in determining, for the purposes of subsection (5)(b) or (6)(b) of s.69 whether it is practicable to comply with an order for ... re-engagement'. Furthermore an employer who wishes to take advantage of the exception specified in para. (a) of s.70(1) has to show that it was not practicable for him to arrange for a dismissed employee's work to be done without re-engaging a permanent replacement. The language of s.70(1) seems to me to be only consistent with a requirement that at stage 1 a determination as to practicability has to be made. But the determination or assessment. It is not a final determination in the sense that it creates an estoppel or limits an employer at stage 2 so that he can only rely on facts which have occurred after the order for re-engagement was made.

43 The conclusion that the determination at stage 1 is provisional accords with common sense and is supported by several authorities of the Employment Appeal Tribunal. In Timex Corporation v Thomson [1981] IRLR 522 Browne-Wilkinson J explained the process to be carried out at stage 1 as follows:

'Section 69(6) only requires the Industrial Tribunal to have regard to the matters of practicability. In our judgment there is not need for an Industrial Tribunal to reach a final conclusion that re-engagement is practicable before making any such order. If, having made an order for re-engagement, it proves not to be practicable to perform it there are no adverse consequences for the employer. If the employee asks for compensation by reason of failure of the employers not to re-engage, no order for additional compensation can be made under s.[75A(2)] if the employer satisfies the Tribunal that it was not practicable to comply with the order. Therefore at that stage the Industrial Tribunal will have to decide, looking at the matter in the knowledge of the actual facts which have occurred, whether or not it was practicable to carry out the order. At the stage when the order to re-engage is being made, it is not in our judgment necessary for the Industrial Tribunal, looking at further possible events, to make a definite finding that the order for re-engagement was practicable. They must have regard to the question of practicability and if they are satisfied that it is unlikely to be effective, they will no doubt not make an order. The only strict requirement is that they should have regard to practicability.'"

The decision of the Industrial Tribunal makes it plain, as it seems to us, that they were mindful of the fact that there was this two-stage process, and they were applying their minds as to practicability in the context of a stage one enquiry.

It was also submitted to us that the decision in the case Nothman v London Borough of Barnet (No.2) [1980] IRLR 65, was of relevance. During the course of his judgment Ormerod LJ indicated that it was unlikely that an order for reinstatement or re-engagement would be sensible where the former employee was of the view that her employers and particularly the people with whom she had been closely working, were effectively conspiring against her. It seems to us that that case is of no particular help to us in the context of the particular facts of this case.

But reliance was place on a third authority, Enessy Co SA T/A The Tulchan Estate v Minoprio and Minoprio [1978] IRLR 489, a decision of the Employment Appeal Tribunal sitting in Scotland presided over by Lord McDonald. He said in a passage which is plainly obiter to the decision, at paragraph 2 as follows:

"The order for reinstatement has not been appealed against but we feel it right to record that in our view it was not realistic to make an order of this nature in a case where parties involved were in close personal relationship to each other such as they were in the present situation. It is one thing to make an order for reinstatement where the employee concerned works in a factory or other substantial organisation. It is another to do so in the case of a small employer with few staff. The Industrial Tribunal record that they took this matter into account before making the order to reinstate, but we are left with the feeling that they have proceeded with the question of reinstatement in much too broad a fashion. Where there must exist a close personal relationship as is the case here reinstatement can only be appropriate in exceptional circumstances and to enforce it upon a reluctant employer is not a course which an Industrial Tribunal should pursue unless persuaded by powerful evidence that it would succeed."

Counsel therefore stressed that it should be regarded as exceptional to make such an order where the employer is a small company.

It seems to us that this authority must be viewed with caution. It is clear that the passage in question was obiter. In so far as the judge is indicating that there must exist a close personal relationship as opposed a business relationship, we would not be prepared to follow what he has said. It seems to us, as a matter of law that there cannot be any circumstance of a general nature which should lead a tribunal to say the making of an order is exceptional. That is not the way the statute is drafted, and that is adding an unnecessary gloss to the words which are contained in the statute. It seems to us that Industrial Tribunals will wish to take a mature view of the question whether it is practicable to make an order for re-engagement or reinstatement. Tribunals are well aware of the fact that they are considering that question against the background, usually, of a hotly contested allegation of unfair dismissal. Often in the course of litigation allegations are made by one side against the other, and if it were to be regarded as a good reason for not making an order for reinstatement or re-engagement that such allegations had been made, then that would defeat the purpose of the Act. Industrial Tribunals with lay members will be well familiar with argumentation between both sides of industry which can lead to perfectly satisfactory working relationships despite the anger and bitterness sometimes evident in the way in which their positions are put one to another. So also with litigation.

It seems to us that, in this case, the Industrial Tribunal was well entitled to reach the conclusion that it was practicable to make an order for re-engagement, especially having regard to the letter which was sent by the applicant to her former employers which was the sort of olive branch that one would have expected in a case such as this, and one could have expected reasonably from an organisation such as the YMCA, that there would have been a rather more positive response to it.

In those circumstances, in relation to the second ground of appeal, namely that the decision that it was practicable to make an order for re-engagement was perverse, we are unanimously of the view that the Industrial Tribunal were entitled to arrive at the conclusion they did on the material before them and we see nothing perverse in their decision.

However, in relation to the first point, that is to say whether the tribunal have made an order which complies with s. 115, here we respectfully depart from what the Industrial Tribunal has done.

It seems to us reasonably clear from the terms of the Act itself without the assistance of any authority, that before an order for re-engagement can be made, the tribunal will have to identify with a degree of specificity the nature of the employment and they must also identify the remuneration for the employment and the date by which the order must be complied with. It seems to us in this case that the tribunal erred in law in purporting to make an order for re-engagement in relation to an unidentified post, with unidentified remuneration for compliance within an unidentified period.

We reject the argument by Mr Carmo, that one can deduce the remuneration from the employment by reference to the fact that this was to be a Grade C post. There are seven points within the grade. He says well it must mean no less than the minimum for the Grade C post. It seems to me that that is not a proper way of dealing with an order for re-engagement which is intended to let the employer know with particularity as to what he is supposed to do.

Furthermore, it seems to us that in suggesting that having made an order for re-engagement there would have to be some kind of job interview, the Industrial Tribunal were failing to recognise what an order for re-engagement is tantamount to. An order for re-engagement is the tribunal's direction that the employee shall take back into their employment the employee on the terms which are there set out. If they fail to do that, then there are certain financial consequences which occur, unless at Stage 2 the employers are able to satisfy the tribunal that it was not practicable to comply with that order.

It seems to us in those circumstances that the making of an order for re-engagement is an order which must be expressed as such and the employers should not be left in a position where they can avoid the consequence of non-compliance. That is not the way an order for re-engagement or reinstatement should be made.

Accordingly, we are left in some doubt as to the explanation for the tribunal's order. It was suggested to us in the course of argument, that the parties, effectively, had asked the Industrial Tribunal merely to deal with practicability and for the tribunal to give an indication as to whether they wanted to make an order for re-engagement, which would be of great assistance to the parties, it might be thought, in terms of conciliating between the parties. The suggestion that an agreement had been made in that way was not accepted by Miss Jones. It seems to us likely that the Industrial Tribunal in an attempt, quite understandably, to be helpful to the parties, has fallen between two stools. It tried to make an order to help the parties to come to terms in the hope that they would not be seeing the case again, but held back from making a full order.

It appears to us that the YMCA are determined that they will not re-engage this applicant. We can only express the hope that a responsible body such as the YMCA with certain responsibilities that come from holding a charitable status, will wish to give mature reflection to the question as to whether that attitude that they have taken so far is one which they should maintain.

The question then arises as to what we should do, if, as we are, we are satisfied that the order made by the Industrial Tribunal did not comply with s. 115(2). It seems to us that the correct course to take in this case is to remit the matter back to the same Industrial Tribunal, so that they can comply with the requirements of s. 115(2). They obviously will have to do so as at the moment they are making their order. Accordingly, it seems to us, that they will be required to have regard to any vacancies that there may be as at that date. We do not consider that it is practicable for us to suggest that the Industrial Tribunal should somehow blinker themselves and approach the matter as though they had originally been dealing with it in September 1997. We should take no course which blinkers an Industrial Tribunal in that way. That being so, they will bound to have regard to the position as at the date when they come to reconsider the matter.

For this purpose, it seems to us, having regard to what we have been told happened at the Industrial Tribunal, that it would be entirely appropriate that we ourselves should exercise the powers of the Industrial Tribunal to require the respondents to give discovery so as to enable that exercise to be properly carried out by the Industrial Tribunal.

The power to give discovery arises under r. 4 of sched. 1 of the Industrial Tribunals (Constitution and Rules of Procedure) Regulations 1993, and in accordance with that rule, we make an order which the Industrial Tribunal has power to make, directing that the appellants, that is the Wimbledon & District YMCA, disclose to the applicant's representative within 28 days, such documents as are within their custody, possession or power which relate to the vacancies which they have in their organisation at Grade C. That documentation will include any advertisements, any internal memoranda and the like which bear on the question as to the availability of a position for Miss Varndell to take up. I must add to that order a notification that if there is non-compliance, without reasonable excuse, then the organisation will be liable on summary conviction to a fine. The order that we make in this case will state the amount of the current maximum fine as we are required to do.

Armed with this information, it seems to us that the Industrial Tribunal will be able to resume its task of considering the matters afresh. It seems to us important that the issue as to the practicability of making an order for re-engagement in terms of the working relationships and so forth between the parties, should not be further open for review. As we see it, they have adjudicated on that issue and have arrived at a final conclusion. That does mean, however, that if there was some particular reason which was specific to a job in question in respect of which they were proposing to make a re-engagement order, the tribunal should not be permitted to take that into account. But having regard to the terms of the decision of the Industrial Tribunal in this case, it seems to us that they should entertain no arguments of the sort which are dealt with in paragraph 6 of their decision because that has led to an adjudication. In other words, the Industrial Tribunal will have to set about the task of considering what order for re-engagement it should make having regard to such information as the employers will have provided in terms of availability of positions; and any particular evidence as to the practicability of re-engagement in that particular post which arises not by reason of the past events, but by reason of something peculiar to the job itself. In those circumstances, we anticipate that a short hearing for directions before the Industrial Tribunal would be appropriate, and we would express the hope that they should hear and determine this case as soon as practicable, because both parties will wish to know where they stand.

We reiterate our view that the responsible course for the YMCA to take at this stage is to retain an open mind as to whether if an order is made which is compliant with s. 115 it should be complied with. It is not satisfactory where an employer has behaved in the way that they have in this case that they should then seek to say that under no circumstances will they put the wrong right by giving the applicant the remedy which she is seeking.

The appeal is therefore allowed to the extent that we have indicated, and it will be remitted back to the same Industrial Tribunal, subject to the directions which we have given in this judgment.