United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MS E LAING (Of Counsel) Instructed by: MR R LOWE (Legal Officer) EEF Broadway House Tothill Street London SW1H 9NQ
For the Respondent	MR J WATT-PRINGLE (Of Counsel) Instructed by: Messrs Anthony T Bryson Solicitors 5-7 Grey Street Newcastle upon Tyne NE1 6EE


 


JUDGE BUTTER QC: Mr Henderson was born in June 1936. He was first employed by AMEC Process Energy Ltd in May 1975. In the summer of 1995 he lost that employment. It is against that background that an Industrial Tribunal had to consider the circumstances in which he left.

The matter came before the Industrial Tribunal at Newcastle upon Tyne on 15 January and 19 February 1996. Their Extended Reasons were sent out on 10 April. The unanimous decision of that Tribunal was that the Applicant had been unfairly dismissed. The Tribunal highlighted, and it is the main issue, whether the Respondent, that is to say the Appellant, had fairly selected the Applicant for dismissal on the ground of redundancy. It is against that decision that the employers now appeal.

The employers design and construct high value structures mainly for the off-shore energy market. Their manual workers are unionised but the staff, including the senior supervisors, are not, although there is a consultative committee.

Mr Henderson was a senior supervisor responsible for heavy lifting. That meant that he was responsible for moving heavy pieces of engineering construction work from one place to another. At the time his employment came to an end he had 53 riggers and 10 crane operators within his section, and he also had a foreman, Mr Parker, who was his immediate subordinate.

In the autumn of 1994 the employers experienced difficulties. They found that they had a declining order book. They decided in due course that there would have to be a substantial reduction in their workforce. In October 1994 there were job losses of 693. A further announcement was made on 1 May 1995 whereby the workforce was to be reduced by 1,200, of which 188 were to be from the staff.

The employers had perceived that there was a need to change the management structure. They decided also that they wanted the staff to be paid a salary and not pay overtime. In February 1995 they appointed a Mr Whiteley as their Human Resource Manager. He devised an assessment for all members of the staff; this included Mr Henderson. His assessment was on 10 May 1995. He scored 27. The scores were: senior supervisors - 2 scored 33 and the other 3, including Mr Henderson, scored 27.

According to the employer's evidence before the Industrial Tribunal the assessments were not the determining factor in selecting the Applicant for redundancy. Mr Dunn stated in evidence that the assessments were to see if everybody was doing their job. Mr Dunn formed the view that he did not need a senior supervisor in sole charge of the heavy lifting within the company's premises. There was a requirement that a company representative should be present when such operations took place, but it was thought there was no need for one of Mr Henderson's highly specialised skills.

In early June 1995 Mr Dunn discussed his proposals with Mr Whiteley, who agreed, and there was a decision that Mr Henderson should be considered for redundancy. He was not then informed of that decision. Mr Dunn stated that he wanted to ensure that the remaining senior supervisors would agree to the change in their contractual terms. He spoke with the other senior supervisors on about 12 June and they all agreed to the change and this was confirmed in a letter to them of 14 June 1995. He did not however discuss the change of terms with Mr Henderson.

On 20 June Mr Dunn held a meeting with all the senior supervisors including Mr Henderson. He indicated he was making redundancies and would welcome volunteers. A period of seven days was left open for volunteers to come forward but none did. On 28 June Mr Henderson was handed a letter stating that his job had been identified as being "at risk of redundancy" and he was invited to make representations.

A meeting was held on 5 July 1995. Mr Dunn, Mr Whiteley, Mr Henderson and a Mr Porter were present. Mr Henderson was shown the assessment. He disagreed very strongly with the rating. We have a note of the meeting. One passage to which we have been referred says this:

"... Mr Henderson then asked why on the 20th June, at the senior supervisors meeting had Mr Dunn said that the letter about to be issued to Foremen and supervisors offering voluntary redundancy excluded senior supervisors. Mr Dunn said he did not use the word excluded but did say it did not apply to senior supervisor and informed Mr Henderson that the decision on his redundancy had already been made at that point in time."

There was a discussion at that meeting which, according to the record, was very difficult and emotional.

After hearing what Mr Henderson had to say, Mr Dunn and Mr Whiteley adjourned for about ten minutes and they concluded that Mr Henderson should be made redundant and this was communicated to him. Mr Henderson appealed to a Mr Scott, the Director of Operations, who held a meeting to discuss it on 28 July. Mr Scott upheld the decision to dismiss Mr Henderson by letter of 7 August and so Mr Henderson's employment with the Respondents terminated on that day.

The Industrial Tribunal set out the facts clearly and in detail. They then set out the law. It is said on behalf of the employers today that they erred in their approach so far as the law is concerned. Criticism is made in respect of their approach in a number of respects. In paragraph 22 of their decision they referred to the case of Williams v Compair Maxam Ltd [1982] IRLR 83. They began their paragraph however by saying:

"To determine fairness general guidelines or principles (but not rules of law) have been suggested by various decided cases but in particular by Williams v Compair Maxam Ltd which summarised the matters to be considered as follows:-"

They then set out a number of matters referred to in that case.

The case of Williams differed on its facts from the present case. It was, among other things a union case, and if the Industrial Tribunal here had applied the observations there as though they were a rigid test, then they would have been in error. We do not consider that they did so however, and since they specifically directed themselves in the following words:

"22 However the Tribunal must take care in not imposing its own views of what is a reasonable criteria for selection."

it is a bold argument to say that they then went on and did so, thus providing a point of law which would enable the Employment Appeal Tribunal to intervene.

Some of the words in paragraph 27 of the decision have been criticised. It appears to us that the employer's attitude before the Industrial Tribunal was, at times, inconsistent. We accept the argument of Counsel for the Respondent to this appeal on this issue. The Tribunal necessarily had to make findings of fact as to the real position. We are not persuaded that they fell into the error which is alleged by the Appellant, in saying as they did in paragraph 27:

"... We considered that the respondents used the incorrect unit of selection in deciding on who was to be made redundant. Consideration should have been given to the situation within the department operated by the applicant as it was within this department that a reduction in staff was envisaged."

There has been much argument before us as to whether this was a stand-alone redundancy, or whether the Tribunal erred in treating the case as one relating to a selection from the pool. It may be useful to consider what the position would have been if one of the four other employees had had a low assessment. On the material before the Tribunal, there was, in our unanimous view, scope which permitted the Industrial Tribunal to come to the conclusion it did in relation to the question of a pool. There was scope for the view that the employers had decided, quite simply, that Mr Henderson had to go.

The Tribunal went on in paragraph 29 to say:

"The respondents had come to a decision that they needed to make somebody redundant. They had decided to alter the contractual terms under which the senior supervisors operated. They sought to agree with the senior supervisors, apart from the applicant, those terms and conditions. They did not consult with the applicant in regard to his terms and conditions. They did not indicate, at that stage, that the applicant's job was at risk."...

They then referred to a whole number of matters and they conclude towards the end of that paragraph:

"We do not consider this to be proper consultation within the definition of that term. There was no exploration of whether Mr Henderson could do the foreman's job or what needed to be done in the heavy lifting department to reduce the management structure. A decision had been made prior to the meeting with Mr Henderson that the other senior supervisors would be retained and that Mr Henderson would not be. The respondents were going through the motions of what they considered to be a consultative meeting when in fact they were putting forward their reasons why they considered that the applicant should not be continued to be employed and should be made redundant."

In the case of Rowell v Hubbard Group Services Ltd [1995] IRLR 195 the Employment Appeal Tribunal had to consider, among other things, the question of consultation. We have been referred to extracts from the judgment. It may be sufficient if I cite one passage set out in paragraph 15 in which there is reference to the case of R v Gwent County Council ex parte Bryant and the judge there said:

"Fair consultation means:

(a) consultation when the proposals are still at a formative stage;

(b) adequate information on which to respond;

(c) adequate time in which to respond;

(d) conscientious consideration by an authority of a response to consultation."

That particular case dealt with a different situation. Judge Levy QC sitting at the EAT went on to say:

"Though given in a different context than that of employment law, we think the passage of assistance to employers when they have to consult with staff in the context of dismissal for redundancy or dismissal. There are no invariable rules as to what is to be done in any given situation; everything will depend on its particular facts."...

We are satisfied that the Industrial Tribunal in the present case was entitled to reach the conclusion which it did in relation to the question of consultation. We have considered the various other points which have been argued, but with respect we do not believe them to be of substance. Taking all matters into account we are unanimous in our conclusion that the Industrial Tribunal was entitled in relation to the various issues which have been raised on this appeal to reach the conclusion that it did and that it has not been demonstrated to have acted in error of law. We so hold. The appeal is accordingly dismissed.