United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR J TAYLER (of Counsel) Mr M Foster (Solicitor) London Borough of Islington Town Hall Upper Street London N1 2UD
For the Respondent	MS E ANDREW (of Counsel) Messrs Lemon Hudson & Co 16 Chase Side Southgate London N14 5PE


 


JUDGE PETER CLARK: This is an appeal by the employer, the London Borough of Islington ("the Council") against a decision of an industrial tribunal sitting at London (North) over 6 days, upholding the Respondent, Mr Cutler's complaint of unfair dismissal. Extended reasons for that decision are dated 27 February 1997.

The Facts

The Respondent was employed by the Council from 7 January 1975 until his dismissal on grounds of gross misconduct on 27 November 1995. He was then employed as a Principal Systems Accountant.

In November 1993 an internal investigation uncovered a fraud involving 23 transactions totalling £45,715.12 whereby cheques drawn on the Council's bank account had been made payable, illegitimately, to a M Stevens and paid into an account in that name at the Kingsway Branch of the Birmingham Midshires Building Society.

A photograph on a photocopy identification card relating to that account holder appeared to officers of the Council to resemble the Respondent.

Between 15 and 21 November 1993 the Respondent was on leave. On his return to work on 22 November 1993 he was arrested and taken to Islington Police Station. On the same day he was suspended without pay, as provided for in his contract of employment.

Mr Hodges, the Chief Internal Auditor, was informed by police that the Respondent had attempted to conceal an ATM cash card for the relevant building society account and that a pink computer job request slip, of a type used in the Council's Systems Section in which the Respondent worked, and which related to that account, had been found in his bag.

Pausing there, the Tribunal found that as at that stage of the investigation, in late November 1993, the Council had reasonable grounds for suspecting that the Respondent had been involved in some kind of gross misconduct, and that it was proper to them suspend him pending a disciplinary investigation.

Mr Graney, the Director of Finance, nominated Mr Bradley, Director of Finance and Property Services, to conduct the disciplinary proceedings. The Respondent objected to his appointment but the Tribunal found his objection to be groundless.

On 1 December 1993, having been briefed by Mr Hodges and Alan Manlove, Head of Systems Section, Mr Bradley interviewed the Respondent, who denied any knowledge of the fraud. Further, he declined to comment, on the advice of his solicitor, on the information supplied by the police to the Council.

In due course he was charged with the disciplinary offence of raising fraudulent payments on the creditors system. A disciplinary hearing was fixed, first for 14 December and then 23 December 1993. Meanwhile, on 3 December the Respondent wrote to Mr Bradley, asking for certain computer held information which he required for his defence.

On 14 December Mr Bradley wrote to the Respondent asking why that information was essential to his defence.

The disciplinary hearing did not take place in December 1993. Indeed, it did not begin until 28 September 1995 (before Mr Graney). There were further hearings then held on 12 October and 24 November 1995.

The reason for this delay, the Tribunal found, was first, because the Respondent fell ill. He was offered a number of dates in July 1994, but on 9 June 1994 Mrs Cutler, the Respondent's wife, wrote to Mr Bradley in these terms:

"Dear Mr Bradley,

Thank you for your letter of the 1st June 1994 which, postmarked 6th June, arrived yesterday.

As your letter states, you are aware of my husband's illness and therefore, presumably, his doctor's opinion that he is in no fit state to attend a meeting with yourselves. I appreciate it is in your interests to call a disciplinary hearing, but feel that medical advice should take precedence. I have not informed him of the contents of your letter and am not prepared to do so, or to let him attend any such meeting in his current state of mind.

I believe his participation in such an action would be pointless as, not only is he incapable of formulating a written response at the present time but also, given his condition, is unable to adequately brief any representative who might act on his behalf. I am therefore somewhat intrigued as to why you feel either of your proposals would enable him to present an adequate defence or give this hearing any credibility whatsoever?"

A hearing was then arranged for 15 December 1994. On 29 November 1994 Mrs Cutler wrote to Mr Bradley indicating that the Applicant would attend the hearing on that date. She added:

"The information relating to historical data on operator codes and functions, originally requested in December 1993, is still required as David feels it is a vital point of evidence. As I understand it, the passwords used are believed to have been accessed through the system. In order to do this an original entry must have been made and the audit record will show exactly whose code this was made under. Given the seriousness of the accusation, I consider that documentary evidence of these actions is vital and must cover the whole period concerned. If you wish to ensure a fair hearing is conducted, you must surely allow David to call whatever evidence he feels is essential to his defence and to ask him to justify a request for evidence, the purpose of which must be as clear to you as it is to him, is both irrational and unreasonable."

Mr Bradley replied on 9 December 1994, explaining that he would not be able to respond to the request for the additional information in time for the hearing to be held on 15 December. He again asked why the information was essential to the Respondent's defence. Meanwhile, the hearing was postponed until 26 January 1995.

On 19 December Mrs Cutler wrote again to Mr Bradley, explaining that the information was necessary to determine who accessed the passwords used and how this may have been done to perpetrate the fraud. She confirmed that the Respondent would attend on 26 January.

On 16 January 1995 Mr Bradley wrote to the Respondent informing him that it would take time to produce the material sought and thus the hearing would again have to be postponed.

No further hearing date was then fixed for this reason, so Mr Bradley told the Tribunal. There was an impending criminal trail of the Respondent in relation to this matter. Mr Bradley decided to await the outcome; if the Respondent was convicted, that would curtail the disciplinary process. However, that was not the outcome. The Respondent stood his trial at the Wood Green Crown Court in June 1995 and was acquitted on the Judge's direction. Apparently, the prosecution were found to have been in abuse of process by not providing the Respondent with the computer information which he had requested in order to mount his defence.

On 9 August 1995 Mr Bradley wrote to the Respondent enclosing some of the information requested but, so the Tribunal found, a full set of the information reasonably requested by the Respondent was never sent to him before the disciplinary hearings concluded on 24 November 1995.

Following the decision to dismiss the Respondent, taken by Mr Graney, the Respondent appealed internally to a Council sub-committee. His appeal failed.

The Industrial Tribunal Decision

The Tribunal directed themselves as to the well-known Burchell test. They found that in December 1993 the Council honestly believed on reasonable grounds that the Respondent was guilty of the misconduct alleged.

However, they then turned to the adequacy of the Council's investigation prior to taking the decision to dismiss. They identified as a constituent part of a reasonable investigation, the need to give the employee an opportunity to provide his explanation. They found that he was not given a proper opportunity due to the Council's failure to provide him with all the information which he, in their view, reasonably requested.

Further, they found that the Council had unreasonably delayed in bringing the disciplinary proceedings to a head. Although the early delay was caused by the Respondent's illness, the Tribunal concluded that the Council was not sufficiently concerned about its responsibility to conduct disciplinary proceedings promptly since they anticipated that there would be a criminal conviction and then there would be no need to conclude the disciplinary proceedings.

Thus on two grounds, the Council's failure to provide information and the unjustifiable delay in holding the disciplinary hearing, the Tribunal found the dismissal to be unfair.

Remedies

The Tribunal made a full basic award, based on the Respondent's long service, and a compensatory award limited to £150 in respect of loss of statutory rights, on the basis that the Respondent was not fit to return to work after the expiry of his contractual sick pay.

The Appeal

In this appeal Mr Tayler, on behalf of the Council, attacks both findings made by the Tribunal which led to its conclusion that the dismissal was unfair.

As to the finding that the Council failed to provide computer held information, in an accessible form, reasonably required by the Respondent for his defence, he submits that the Tribunal applied the wrong test. The question is not whether the Tribunal thought that the Council ought to have provided the material, weighing the expense involved against the importance of the employee being given a proper opportunity to provide an explanation, but whether no reasonable employer, carrying out that balancing exercise, would fail to provide all the information sought. He relies upon the decision of Northern Ireland Court of Appeal in Ulsterbus Ltd v Henderson [1989] IRLR 251, and the guidelines set out in the judgment of Browne-Wilkinson J in Iceland Frozen Foods Ltd v Jones [1982] IRLR 439, paragraph 24, for the proposition that here the Tribunal has substituted its own view of the need to provide the information for that of the Council, tested against the standard of the reasonable employer.

He so submits against a background of the Tribunal failing to mention the provisions of s.98(4) of the Employment Rights Acts 1996 in their reasons, and in circumstances where, Mr Tayler submits, the Tribunal misapplied the Burchell test.

In reply, Mrs Andrew contends that the Respondent succeeded on the basis that at the date of dismissal the Council had not carried out a reasonable investigation in that the Respondent had not been given a proper opportunity to offer an explanation. He had sought the information in accessible form as early as December 1993. When asked why he needed the information he, through his wife, explained the reason. The Council repeatedly promised to supply the information requested but never did so in full. Consequently, he was denied the opportunity to deal with the serious allegations made against him. That was a breach of natural justice sufficient to entitle the Tribunal to conclude that the dismissal was unfair.

On this aspect of the case we prefer the analysis advanced by Mrs Andrew. In our judgment it was open to the Tribunal to find, on the facts here, that the Council had failed to give the Respondent a proper opportunity to defend himself; a reasonable investigation would have included the provision of information necessary for that purpose. It is not a question of the Tribunal substituting its view for that of the employer, but of the Tribunal judging this employer by the standards of the reasonable employer and finding it wanting.

Secondly, delay. We accept Mr Tayler's complaint that the employer here can hardly be criticized for postponing a disciplinary hearing in summer 1994 when faced with a request by the Respondent's wife not to proceed with the hearing when the Respondent was suffering from ill-health. However, that is not the sole criticism made by the Tribunal. Once the Respondent was fit to attend a disciplinary hearing in late 1994, the Council delayed whilst it gathered information sought by the Respondent and later, in the hope that the Respondent would be convicted at his criminal trial, thereby obviating the need for a full disciplinary hearing.

In our judgment, this Tribunal's reasoning must be looked at in the round. Having done so we have concluded that the Tribunal reached a permissible decision on the facts as found; there was no patent material misdirection in law. In short, there are no grounds in law for interfering with the Tribunal's decision. The appeal must be dismissed.