United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MR TABACHNIK (of Counsel) Instructed by: Ms L Atherton Legal Adviser Engineering Employers Federation Broadway House Tothill Street London SW1H 9NQ
For the Respondent	THE RESPONDENT IN PERSON


 


JUDGE HAROLD WILSON: This appeal has been brought by the original respondent Company against the decision and award of the Employment Tribunal who found that the dismissal of the original applicant, Mr Bishop, was unfair because it was for a health and safety reason. Mr Bishop had complained of unfair dismissal saying that he had been dismissed for refusing to drive seven days a week as a Heavy Goods Vehicle driver. The respondent Company had admitted the dismissal but denied that it fell within the jurisdiction because of the short period of employment, which had been from 29^th September to the 8^th December 1997. Alternatively, the Company claimed that the dismissal was justified by reason of conduct, which was totally unspecified. Those contentions found no favour with the Employment Tribunal who initially made an award, which included a compensatory award. It also included a basic award. The former was for £741.71 and the latter was for £2,770.

In the course of the tribunal's decision, at paragraph 15, they had said:

"15. We also of course have to deduct by way of mitigation his earnings with the Driving Agency."

Subsequently, there was a review hearing. The Employment Tribunal decided that their earlier decision had to be varied. They came to the conclusion and ordered that the respondent Company should pay to the applicant a compensatory award of £2,030.48 instead of the original £741.71.

The matter had come back before the Employment Tribunal for review under Rule 11 and, in particular, because of an error they had made in their original award, which is expressed in paragraph 2 of the review decision:

"2. We agree that we made an error in relation to the application of the minimum basic award in health and safety cases of £2,770. Section 120 of the Employment Rights Act 1996 relating to that does not apply to section 100(1)(c) which was the health and safety ground upon which we found that the applicant had been unfairly dismissed. Accordingly, we revoke our decision to grant a basic award of that amount."

The tribunal went on later to say that they had not taken in to account in their earlier decision matters which, in their review decision, enabled them to increase their compensatory award, so that the total compensatory award became £2,030.48.

The Company appeals against that decision and was given leave to argue the matter fully upon the three points, namely whether the failure to give credit for the full amount of Mr Bishop's Agency earnings was right or not; secondly, in the alternative, whether the tribunal erred in failing to scale the amounts they took into account for January only; and thirdly, whether, in the circumstances, the tribunal had erred in making an improper use of its power to make a compensatory award. That last ground of appeal is based upon the fact that there was such a very considerable difference between the two compensatory awards resulting from the error in the original award of basic award and what seems quite clearly to have been the wish of the Employment Tribunal not to penalise the applicant by a severe reduction in his award and also, possibly, to reflect the not very flattering view they took of the conduct of the Company in this case.

In our view, having regard to the wording of s.123 of the 1996 Act, it must be applied strictly. S. 123 of the 1996 Act, so far as it is material, provides as follows:

"(1) … the amount of the compensatory award shall be such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the complainant in consequence of the dismissal in so far as that loss is attributable to action taken by the employer.

…

(4) In ascertaining the loss referred to in subsection (1) the tribunal shall apply the same rule concerning the duty of a person to mitigate his loss as applies to damages recoverable under the common law of England and Wales or (as the case may be) Scotland."

As Mr Tabachnik correctly points out in his argument, the purpose of an award under s. 123 is to compensate the applicant for actual out-of-pocket net loss which he or she suffers as a consequence of being unfairly dismissed.

To apply that statutory provision, it seems to us quite plain that there is no room for a scaling exercise. The fact that extra effort and time may be involved in achieving the degree of mitigation which has to be brought into account, is a different matter. We therefore find for the appellant Company on the first ground of the appeal. Therefore, the second ground disappears, since it was alternative. So far as the third ground is concerned, insofar as the full amount was not taken into account by the Employment Tribunal, and insofar as it sought, from the worthiest of motives, to change its ground so far as the compensatory award was concerned, we find that that was not a use of the power to make such an award which was open to the Employment Tribunal. The Employment Tribunal would however have been, in our judgment, entitled to give meaning to the phrase "just and equitable" which appears in the statutory provisions with which we are concerned. It seems to us, although we are told that there is no authority about the matter, that it would have been open to the Employment Tribunal to reflect the use of that phrase in cash terms which are neither punitive of the respondent Company, nor reflective of a double recovery, because they could have put a price on the cost to the applicant in expenditure of time and effort to mitigate his loss to the extent recognised in the original assessment.

Doing the best that we can, and bearing in mind the twin perils of double recovery and punishment which must be avoided, we have concluded that a figure of £500 justly and equitably would reflect the extra time expended in travel and work by the respondent in order to achieve the amount by which he mitigated his loss to the benefit of the Company.

In making this award we distinguish the judgment in the case of British Westinghouse Electric & Manufacturing Company v Underground Electric Railways Company of London Ltd [1912] AC 673. We distinguish that case on the basis that the principle enunciated by Viscount Haldane LC at page 689-90 is exhaustive, whereas in the statutory provision in the 1996 Act with which we are concerned, if the phrase "just and equitable" is to have any meaning, it has to have the meaning we have attributed to it for this particular purpose.

The end result is that Mr Bishop's award is of £643.94, which is the loss of earnings, plus £300 for the petrol extra expended, plus £500, which we say is just and equitable, to recompense him for the extra effort and time he put into mitigating his loss. The total, therefore, is £1,443.94. This amount is substituted for the amount stated in the review decision promulgated on 5^th August 1998.