United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MR ANDREW HILLIER (of Counsel) Instructed By: Ms P Molyneux Messrs Rollit Farrell & Bladon Solicitors Wilberforce Court High Street Hull HU1 1YJ
For the Respondent	MR NICHOLAS STOREY (of Counsel) Instructed By: Mr N T Betteridge Messrs Smithson Greenfield & Co Solicitors 49 Perrymount Road Haywards Heath West Sussex RH16 3BN


 


JUDGE HICKS: Mr Wilcox, the Respondent, was employed by the Appellant company as the manager of a division which dealt in scrapped or out-of-date machines and disposed of them either second-hand or as scrap metal. A number of the sales were cash transactions. The practice was that cash arising in that way was banked and appropriate invoices raised to account for the VAT element in the sums received.

1. An occasion arose on which there was a sale of this kind of three machines for £300 cash. The money reached Mr Wilcox, who put it in an envelope marked "Staff outing", or words to that effect, and placed it in the safe. There was, in due course, an outing of some 30 members of staff to a greyhound stadium, authorised and paid for by the employers, in the sense that the employers paid for transport and entrance. Mr Wilcox took the £300 out and used it, in the words of the Employment Tribunal, "to buy drinks for the staff and place bets on the dogs". The tribunal continues: "There is no suggestion that the Applicant stole the money and used it for his own purposes and the Respondents agree that the money was used for this purpose". The general thrust of that finding is fairly clear, whether or not the tribunal is to be taken as saying that absolutely none of the drinks or bets was for Mr Wilcox, and whether or not it intended in using the word "stole" accurately to reflect the precise ambit of the offence of theft.
2. The circumstances came to light in the course of an investigation into other matters and there was a disciplinary hearing conducted by Mr Round, the employer's financial director, at which Mr Wilcox admitted to poor judgment in his dealing with the £300. It seems clear that the facts, as set out above, were not at any stage in dispute. Mr Round found that there had been a breach of trust and false accounting on Mr Wilcox' part and summarily dismissed him for gross misconduct. He appealed. The appeal was heard by Mr Albert, the managing director. Mr Albert found that there had been breach of trust and dishonesty but reduced the penalty to dismissal with three months' pay in lieu of notice.
3. The Employment Tribunal upheld Mr Wilcox' complaint of unfair dismissal, but decided that his compensation should be reduced by 25% for contributory conduct.
4. The reasons given by the tribunal for its finding of unfair dismissal are as follows:

"5. … It seems to us that both Mr Round and Mr Albert failed to investigate the matter properly. The matter ought to have been investigated in greater depth to discover what this £300 was doing in the safe and what the Applicant intended to do with it. To assume without conducting these investigations that there had been a breach of trust seems to us not to be justified by the circumstances. The Applicant had worked for the Respondents without criticism for some four and a half years and had committed this one act only. There was also the point that the night out was paid for by the Respondents and it seemed that it would have been possible, had the Applicant chosen to do it this way, to obtain an advance of petty cash in order to make extra payments for drinks and bets on the night out. If this is so then the real offence is not misappropriation of the money but simply dealing with it wrongly in that it ought to have been banked and the proper invoices raised and any spending money required for the night should have been obtained through petty cash. It is our view that, having regard to this failure in investigation to discover and come to a proper informed conclusion on what exactly had happened, dismissal of the Applicant cannot be within the band of reasonable responses open to the reasonable employer. The Respondents, when effecting the dismissal were not in possession of all the facts on which an informed judgment could be made, but merely assumed that there was some attempt by the Applicant to break the trust which the Respondents reposed in him. The circumstances we find reveal only a foolish action by the Applicant. While we recognise that we should not substitute our reviews [sic] for the views of the reasonable employer we cannot accept that the action of the Respondents here was within the band of reasonable responses."

5. In our judgment the tribunal fell into errors of law in two respects. In the first place it relied primarily and repeatedly for its finding of unfairness upon a failure by the employer to investigate properly, but the only further investigation it suggested was one "to discover what this £300 was doing in the safe and what the Applicant intended to do with it". The answers to those questions, however, were known, and there was no doubt or dispute about them. We agree, without finding it necessary to quote from the judgments, with what we take to be part of the rationale of the decisions of this Appeal Tribunal in The Royal Society for the Protection of Birds v Croucher [1984] IRLR 425 and Boys and Girls Welfare Society v McDonald [1996] IRLR 129, namely that the absence of further investigation is not of itself unfair where there is no real conflict or question as to the relevant facts.
6. In the second place, despite twice referring to the established test whether the employers' action was within the band of reasonable responses open to the reasonable employer, the tribunal shows by the sentence "The circumstances we find reveal only a foolish action by the Applicant" and by its statement that the employer's conclusion that Mr Wilcox' conduct amounted to a breach of trust was "not justified by the circumstances" that it was in truth substituting its own decision for that of the employer.
7. The appeal must therefore be allowed. Although the skeleton argument for the Appellant asks us to enter a decision that the dismissal was fair we are clear that this is not one of those rare cases in which that can properly be done. Our decision is that this tribunal's reasons are flawed, not that no reasonable tribunal, properly directing itself, could make a finding of unfair dismissal. The application is therefore remitted for rehearing before a differently constituted tribunal.