United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MR B LO (of Counsel) Messrs Hatley Linfoot & Whitlam Solicitors 3 St Peter's Close Sheffied S1 2EJ
For the Respondent	THE RESPONDENT NEITHER PRESENT NOR REPRESENTED


 


JUDGE BYRT QC: This is an appeal from the decision of an Industrial Tribunal sitting in Sheffield. The decision was promulgated on 11th November 1996 and by its terms the tribunal held that the employee, Mr Ashley, had been unfairly dismissed and further that the employers, UK Inspection Ltd, had unreasonably failed to provide Mr Ashley with a written statement of the reasons for his dismissal, contrary to the statutory provisions which then applied, namely s.53(1(b) of the Employment Protection (Consolidation) Act 1978. The employers now appeal that decision.

The background facts of the case are as follows:

The employers were incorporated in 1984 and are a company which provides inspection services in the oil and petrol chemical industry. Mr Goddard, the company's only witness before the tribunal, is its managing and sole director, and to all intents and purposes owns it. In 1990, Mr Ashley joined the company as its operations director. He was then about 55. He retained that employment until he was dismissed on 9th April 1996.

Mr Goddard built the company up from nothing. It reached a position of profitability but, by late 1995, it had lost much of its business and was trading at a loss.

The company's case was that on Easter Saturday, 6th April 1996, Mr Goddard had a meeting with his company accountant and concluded that the company could no longer justify Mr Ashley's continued employment. The company was closed for business until Wednesday, 10th April. On Tuesday, 9th April, at 10 p.m. Mr Goddard rang Mr Ashley at his home to tell him that he need not report for work the next day because he was being dismissed, as Mr Goddard alleges, for redundancy. He added that monies due to him, including two weeks pay in lieu of notice, would be sent to him.

Mr Ashley challenged the company's case that he was dismissed for redundancy. Whilst acknowledging that there had been a falling off of the company's business, he contended that the real reason for dismissal was something different. He had himself severed the tendon and nerve of his left hand index finger in February. Though signed off by the doctor for four weeks, he was back at work after only nine days. In his next pay packet, he was only paid statutory sick pay for the period he was away from work, a sum substantially less than his contractual pay. He did not feel able to challenge Mr Goddard's decision about this because, once he had made a decision, Mr Goddard would not permit discussion of it, as Mr Ashley had learned over the course of time. Instead, Mr Ashley wrote to Mr Goddard a letter in which he claimed from the company certain expenses which, prior to the docking of his pay, he had never intended to claim. This letter, he left on Mr Goddard's desk on Friday, 5th April. Mr Ashley's evidence was that he heard Mr Goddard raise his voice in anger as he read the letter. He went in to the latter's office to discuss the matter but on seeing that Mr Goddard was in no state of mind to enter into a rational discussion, he withdrew. Mr Goddard later told him he would consider the claim over the week-end. The next time they spoke together was when Mr Goddard rang on 9th April.

Mr Ashley claimed in evidence before the tribunal that he had made notes of the telephone conversation and had within two or three days written them up into a record which was as near verbatim as he could make it. That record was admitted into evidence before the tribunal. It began with Mr Goddard saying that since receiving the letter and claim for expenses, he felt that the relationship between the two of them had broken down, that the breach was irreparable, and that redundancy was the only way to sort it out finally. On this evidence, Mr Ashley submitted that the alleged redundancy was only a sham; that his dismissal was brought about by his claim for expenses in that, but for that claim, he would not have been dismissed. Had there been a genuine redundancy situation, there was no reason why Mr Goddard should not have discussed it with him. Had he done so, he would have advanced the alternative solution of himself taking a pay cut and/or the dismissal of one or more of the junior staff who would have found re-employment elsewhere easier than he would. At 61, it was next to impossible for him to get another job.

In the extended reasons for their decision, the tribunal state that they had no hesitation whatsoever in concluding that it was Mr Ashley who had been telling the truth as to the terms of the telephone call. In making their finding as to the reason for dismissal, they rejected the company's submissions and Mr Goddard's evidence that this was redundancy. They state as follows:

"6. ... We have no doubt that a redundancy situation might well have arisen at some stage but we do not believe it was the reason or even the principal reason for the applicant's dismissal. That, we have no doubt, was because the applicant had upset Mr Goddard who we accept, having seen his demeanour and observed his manner in giving evidence to the tribunal, is not a man who likes to have his decisions or ideas queried. He struck the members of the panel as someone who wishes to have things done his way without question. We have no doubt that the principal reason for the applicant's dismissal was the submission of his expenses claim."

The reasons went on to record that this finding was one which could not be justified as "some other substantial reason" such as might justify the applicant's dismissal, and that therefore the dismissal had automatically been deemed unfair. They added that even if they had come to the conclusion that the principal reason was redundancy, it would still be their view that the dismissal was unfair as there had been no warning or consultation.

Following his dismissal, Mr Ashley wrote a letter, dated 17th April to UK Inspection Ltd, stating that he had been to the Department of Employment with a view to registering and was asked for the reason for his dismissal. In the last paragraph he writes:

"Since I have not yet been advised of the reasoning I would be grateful if you could provide such information such that my claim will be recognised."

Mr Goddard replied on 19th April stating:

"... the formal position is that your last day working was 9 April, employment was terminated and monies relating to your entitlement of notice in lieu and redundancy paid over to you."

Dissatisfied with that answer, Mr Ashley instructed solicitors who wrote to Mr Goddard on 18th June 1996, requiring him "... to give full reasons for the termination of our clients employment ...". Mr Goddard wrote back on 28th June saying "... please be advised that Mr Ashley was made redundant, full detail provided to the Department of Employment."

The Industrial Tribunal, in their reasons, stated that Mr Goddard's first letter dated 19th April was insufficient to comply with the terms of s.53 of the 1978 Act. Likewise, in relation to Mr Goddard's second letter, they found his statement that he had sent the full reasons for termination to the Department of Employment, to be not good enough, and in the circumstances of the case, his failure to provide the required information, unreasonable.

The appellants, UK Inspection Ltd, now appeal both limbs of the tribunal's findings, alleging that the Chairman was biased in the way he conducted the hearing, and that in consequence the tribunal's decision should be set aside. More specifically, they allege that the Chairman interrupted Mr Goddard's evidence, both in chief and cross-examination, to such an extent that the witness was distracted from presenting the company's case the way he wanted; and further, he harassed their solicitor representative so that he was unable to adduce his clients' evidence the way he wanted. These allegations have been advanced before us with the aid of affidavits from Mr Goddard, and Mr Farrand, the solicitor instructed on the company's behalf.

By direction of the Employment Appeal Tribunal, the Chairman has been asked to comment on the allegations contained in the two affidavits. He has responded, having canvassed the view of the lay members, who, through the Chairman, have volunteered to make their views known in written form if required. We recognise that it will always be difficult for a Chairman to comment on the details of this sort of allegation when asked to so do several months and many cases after the one under enquiry. As we would expect, he has responded by telling us what he believes he would have done in the relevant circumstances. He says he would have interrupted the evidence where necessary to avoid repetition or to confine matters to the relevant. Whilst denying that he was in any way aggressive or belligerent, he accepted he could be forceful if necessary when parties fail to keep to the point after having previously been cautioned. Mr Goddard was, in the tribunal's view, someone who resented having his views questioned, and the Chairman says he would where necessary have told him he should answer the questions properly as they were put to him. In all, he says, he and his tribunal members were satisfied that the hearing was fair.

On the strength of what is alleged in the appellant's supporting affidavits and what is contained in the Chairman's comments, are we to say that the tribunal's decision should be set aside and a re-hearing ordered because of the Chairman's manifest bias?

The difficulty which presented itself to the tribunal was the fact that Mr Ashley was unrepresented whilst the appellant company was. Whilst this factor could not alter the adversarial nature of the procedures which apply in an Industrial Tribunal, it necessarily meant that, in order that justice be done as between the parties, the Chairman had to adopt more of an inquisitional role than would have been appropriate if both parties had been represented. This always presents the Chairman with something of a problem. He has to intervene to the extent necessary to ensure that he and his members have a proper understanding of the issues involved in the case, and of the facts relevant to those issues. Such intervention must be managed in such a way as not to prejudice his impartiality in the control of the case and the formulation of the findings which, together with his members, he has to make. It is also important that the perception of the parties is that he has maintained that impartiality. It is the appellants' case that the Chairman failed to maintain that impartiality and that in consequence the decision of the tribunal was so tainted with bias that it should be set aside.

Mr Bernard Lo of Counsel argued the appeal with care and thoroughness, directing our attention to the relevant authorities. We particularly appreciated his approach because Mr Ashley did not attend before us nor was he represented. Mr Lo referred to a number of cases which were illustrative of the way and the extent to which a Chairman should intervene in a case where one of the parties was unrepresented. He quoted authority to demonstrate that the burden of establishing bias rested with him. He cited the case of R v. Gough [1993] AC 646, extensively quoted in the case of R v. Inner West London Coroner ex parte Dallaglio and another [1994] 4 AER 139, to establish what he had to prove. We are satisfied that those two authorities provide us with the guidance needed to assist us in this case.

In R v. Gough (supra), Lord Goff said at page 659:

"... bias is such an insidious thing that, even though a person may in good faith believe that he was acting impartially, his mind may unconsciously be affected by bias ... the approach of the law has been ... to look at the relevant circumstances and to consider whether there is such a degree of possibility of bias that the decision in question should not be allowed to stand ... it is not necessary that actual bias should be proved ... if, in the circumstances of the case (as ascertained by the Court), it appears that there was a real likelihood, in the sense of a real possibility, of bias ... justice requires that the decision should not be allowed to stand."

Later he said in conclusion at page 670:

"Finally, for the avoidance of doubt, I prefer to state the test in terms of real danger rather than real likelihood, to ensure that the Court is thinking in terms of possibility rather than probability of bias."

Lord Woolf, in a concurring speech at page 671, said:

"... I agree that the correct test to adopt in deciding whether a decision should be set aside on the grounds of alleged bias is that given by Lord Goof, namely whether there is a real danger of injustice having occurred as a result of the alleged bias ... When considering whether there is a real danger of injustice, the Court gives effect to the maxim [that justice must not only be done but be seen to be done] but does so by examining all the material available and giving its conclusions on that material. If the Court having done so is satisfied there is no danger of the alleged bias having created injustice, then the application to quash the decision should be dismissed."

In the case of R v. Inner West London Coroner (supra) Sir Thomas Bingham MR refers to the test set out in R v. Gough and says at page 162:

"The House of Lords unanimously upheld the second of these tests, expressed in terms of real danger, to make clear that it is possibilities not probabilities which matter. The decision shows, as it seems to me, that the description "apparent bias" traditionally given to this head of bias is not entirely apt for if despite appearance of bias the Court is able to examine all the relevant material and satisfy itself that there was no danger of the alleged bias having in fact caused injustice, the impugned decision will be allowed to stand."

Applying the above test to the facts of this case under review, we are satisfied that having examined all the material available and relevant to the issue of unfair dismissal, there is in our judgment no danger of the alleged bias having created any injustice and accordingly the appeal on this issue should be dismissed. Putting on one side the tribunal's acceptance of Mr Ashley's version of the telephone conversation of the evening of 9th April, the evidence seems to us to be overwhelming that the dismissal took place unfairly because it was without warning or consultation. We accept that economic pressures or other special circumstances might dictate dismissal without consultation. Mr Farrand hints at this in his affidavit but he does not allude to any evidence which was given at the hearing to establish such a case. Indeed, it would have been difficult for him to do so in view of Mr Goddard's reply to Mr McEwen on 25th September 1996 when he is recorded as saying:

"I thought of releasing him - first of all in December but I didn't pursue it. I had no direct discussions with him regarding redundancy. We constantly discussed the lack of work-load."

It is difficult, in our view, to envisage what justification there might have been in April for springing redundancy upon Mr Ashley without a period of time in which he might have been consulted for an alternative solution. Neither Mr Farrand's affidavit nor the notes of evidence suggest that the crisis was so instant or the risk on warning Mr Ashley so great that Mr Goddard had no reasonable alternative but to dismiss him the way that he did.

Such a conclusion determines the outcome of this first limb of the appeal but we would wish also to say that we are not satisfied that any bias has been proved against the Chairman. The latter's notes of evidence are most full and neither the affidavits of Mr Goddard or Mr Farrand nor any later affidavit cite any critical passages which have not been recorded. The affidavits contain subjective judgments which are rejected by the Chairman. Whilst Mr Lo sought to distil from the latter's comments on the proceedings some acceptance by the Chairman of an element of misconduct, we can find nothing in those comments suggesting any misbehaviour on his part. It is the Chairman's duty to regulate the proceedings so as to ensure that irrelevancies do not intrude and time is not wasted. If there is a reluctance on the part of a witness or an advocate to accept the Chairman's control, there is likely to be and often is a souring of the atmosphere in the proceedings. All we are saying at this point is that there is nothing in the affidavits which convinces us as a matter of possibility that the Chairman behaved improperly in the circumstances of this hearing.

Addressing the second limb of the appeal, we are satisfied that there was ample evidence on the exchanged correspondence, to substantiate the tribunal's findings. At the time Mr Goddard wrote his letter dated 19th April, he had been made aware of the reasons why Mr Ashley needed the information he sought. His oblique response justified the further request made by Mr Ashley's solicitors on 18th June for "full written reasons" for the dismissal. The reply they had sought had been sent elsewhere. Applying the test in R v. Gough (supra), we are satisfied, on the documentary material before us, that there is no danger of any alleged bias creating injustice. The tribunal were fully entitled to find there had been non-compliance with s.53 of the 1978 Act.

In the circumstances, we dismiss the appeal.