United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR N BOOTH (of Counsel) Messrs Thompsons Solicitors Congress House Great Russell Street London WC1B 3LW
For the Respondent	MS E ANDREW (of Counsel) Instructed By: Mr N Woolf Messrs Woolf Simmonds Solicitors 1 Great Cumberland Place London W1H 7AL


 


MR JUSTICE CHARLES: The parties to this appeal are a Ms Brandao who is the Appellant before us and the Applicant before the Employment Tribunal and Globo International (London) Ltd, who was the Respondent before the Employment Tribunal but also have a cross-appeal before us.

1. The appeal by Ms Brandao is against a decision of an Employment Tribunal sitting at London (North), the Extended Reasons for which were sent to the parties on 6 January 1999. The decision of the Employment Tribunal was as follows:

(i) "The Applicant's complaint of direct sex discrimination fails;

(ii) the Applicant was not disabled within the meaning of section 1(1) of the Disability Discrimination Act 1995 and her complaint of disability discrimination fails;

(iii) the Applicant was dismissed by the Respondent;

(iv) the Applicant was unfairly dismissed by reason of capability;

(v) It is just and equitable that percentage reduction of 80% should apply to the basic and the compensatory awards;

(vi) The issue of remedy was adjourned to 25 January 1998; and

(vii) No order as to costs."

2. The appeal by Ms Brandao is against the finding in subparagraph (v) that it was just and equitable that a percentage reduction of 80% should be made to the basic and compensatory awards.
3. This case came before this Tribunal by way of preliminary hearing. At that hearing Mr Justice Lindsay gave what is in our view a full and helpful judgment identifying issues. It includes the following paragraphs:

2 There are two familiar types of percentage reductions, one broadly called 'contribution', which is a convenient label to discuss the reducing mechanisms of section 122(2) and section 123(6) of the Act. It is applicable when the conduct of the complainant or some action of the complainant make it just and equitable to reduce the award – that is one class of reduction. The other, broadly called 'Polkey' by reference to the House of Lords case of that name, is where the position is that the Employment Tribunal has to reflect that even though an employee has been dismissed improperly (so as to lead to the likelihood of an award in his or her favour), there was in any event a likelihood that he or she would, after what is usually a short interval, have been able to have been and would have been dismissed properly.

3 The Tribunal here dealt only with 'contribution' and not with 'Polkey', although, in effect, Mr Booth tells us that they were addressed to some extent on that but not on contribution. It is only on the contribution side of things that Ms Brandao seeks to appeal. Mr Booth relies on a quotation from Gibson v British Transport Board and we see great force in that citation. The question of law on this part of Mr Booth's prospective appeal is whether, on the facts as found by the Employment Tribunal, it could be said that Ms Brandao had contributed to her own dismissal by way of some blameworthy or improper conduct. If all that was said against her (as seems to be the case) is that during periods when she had been given medical certificates and had supplied them to her employer, indicating general debility and panic attacks, she nonetheless made little contact with her employers and had given no indication as to when she might be in a position to return to work, could that possibly have been properly held to have amounted to blameworthy or improper conduct? We see that there a point of law emerges. It is a point of law that merits the matter going to a full hearing.

4 The second ground that Mr Booth raises is that Ms Brandao's contribution was never addressed at all by the parties before the Employment Tribunal and he draws our attention to Slaughter v C Brewer & Sons EAT (1990) ICR 730, a case which has many parallels with the case before us and which draws attention to the need for an Employment Tribunal to indicate to the parties that it is moving on to the subject of contribution if it is minded to do so and also draws attention to the fact that there can be a need for evidence directed specifically to the question of contribution. Mr Booth tells us that not only was there no argument on contribution, there was no evidence on it either. We see that also to be a proper argument of law justifying the matter going to a full hearing.

5 There does need to be some caution in going forward because, given that Polkey was not ruled upon by the Tribunal, it could be here (it is not for us to decide) that Polkey in any event would have reduced any award to Ms Brandao substantially and it is worth both sides considering, as they prepare for a full appeal, whether the game is worth the candle because if contribution is swept aside only to have Polkey in its place, it might be that the appeal has little financial content in it. But that is just a cautionary matter for both sides to take into account. We permit the matter to go to a full appeal, both on the question of law as to whether what was found as contribution could have been contribution in any case and also as to natural justice. Skeleton arguments are to be exchanged not less than 14 days before the hearing. Authorities to be relied on by either side should also be photocopied and sent to the EAT office not less than 14 days before the hearing. Non-compliance with either of those two directions may lead to an adjournment and an adjournment may lead to an Order for costs. We will invite Mr Booth to indicate whether we need to make a request for the Chairman's notes as to any argument or evidence relating to the subject of contribution in order that the negative that he wishes to assert, namely that contribution was never raised, can be pointed to.

4. The Remedy Hearing took place as indicated in the finding of the Employment Tribunal on 25 January 1999 and the Extended Reasons in respect of that decision were sent to the parties on 2 February 1999. Unsurprisingly, in that hearing the Employment Tribunal applied the 80% reduction referred to in their earlier decision. They apply it to the basic award, the award in respect of statutory rights and to the compensatory award and in the latter case they state that it is expressly applied pursuant to section 123(6).
5. In paragraph 5 of the Extended Reasons relating to the Remedy Hearing the Employment Tribunal say this:

"5 We considered the compensatory award payable to Ms Brandao pursuant to section 123 of the Act. We considered what the situation would have been had Ms Brandao not been unfairly dismissed. In view of her illness, which continues, and in respect of which she tells us she is still unable to work although she is undertaking a degree course, we considered that it was likely that had she not been unfairly dismissed she have been dismissed fairly after medical reports had been obtained. We noted from the evidence before us at the full merits hearing that the Respondent was not quick in dealing with Ms Brandao's illness and therefore we estimate that it would have taken them four months until 31 December 1997 to obtain the necessary medical reports and dismiss Ms Brandao fairly. She would then have been entitled to 12 weeks' notice based on the statutory notice provisions of section 86 of the Act which means that she would have been unfairly dismissed seven months after the date of her actual dismissal. Having taken this into account we limit the compensatory award in respect of the prescribed element to seven months pay."

6. On 22 May 1999, that is very shortly after the Preliminary Hearing before this Tribunal, the Respondent put in an Answer and Cross-Appeal, paragraphs 4 and 5 of that read as follows:

"4 The Respondents cross appeal from the decision of the Employment Tribunal awarding the Respondents a compensatory award of compensation for unfair dismissal of £5,135.83.

5 The Respondent's grounds of appeal are that:-

(a) The Tribunal failed to consider as set out in Polkey v AE Dayton Services Limited [1988] ICR 142 whether any further procedural steps would have been futile and as such would not have altered the decision to dismiss.

(b) The evidence of the Appellant at the hearing was that at the time of the dismissal and at all times up to and including the date of the hearing she was not fit to resume employment. In the premises therefore the Tribunal erred in principle on the basis in which they calculated the Appellant's compensatory and/or basic award."

7. It seemed to us, reading paragraph 5(a) of that cross-appeal that a ground being advanced was that the Employment Tribunal applying Polkey should have found that the dismissal was not an unfair dismissal. However, it was made clear to us by Counsel for the Respondent that that was not their position and that there is no cross-appeal against the conclusion of the Employment Tribunal that the dismissal was an unfair dismissal. It was further made clear to us that the relevance of the Polkey decision is in the sense described during the hearing as "Polkey Stage II" and relates simply to the amount of compensation that should be awarded.
8. In this judgment when referring to contribution, I shall be referring to contribution pursuant to the statutory provisions of sections 122 and 123 and when referring to Polkey Stage II I shall be dealing with the effect that that decision has on the damages that can be awarded to an applicant.
9. Prior to the Remedy Hearing the Respondent made written submissions and attended at that hearing through a trainee solicitor who, as we understand it, was not intended to take any part in, and did not in fact take any part in, the Remedy Hearing.
10. The Remedy Hearing proceeded, as we understand it, with Ms Brandao giving some evidence and submissions being made on her behalf by Mr Booth that there should be no limitation such as that found in paragraph 5 of the Extended Reasons, which I have already referred to.
11. Returning now to the original hearing. Having heard from both Counsel who appeared before the Employment Tribunal, as we understand it, it is common ground between the parties that it was intended and understood that the original hearing was to deal with, and only with, liability. However there was some debate and disagreement before us as to the manner in which the Polkey case was referred to before the Employment Tribunal. We are not in a position to resolve such disagreement and we obtain no assistance in this respect from the Extended Reasons given by the Employment Tribunal because they simply do not refer to the case. What is entirely common ground is that at the original hearing neither Counsel made any submissions to the Employment Tribunal on contribution.
12. The common ground as to the position at the original hearing has the following effects as we perceive the position. First, when the hearing commenced and the witnesses were being called to give their evidence the focus of the parties and of the Tribunal was on liability. Secondly, questioning therefore was not, or was not fully, directed to issues that would arise in respect of contribution. Thirdly, the Employment Tribunal did not have the benefit of submissions as to the correct legal approach to be applied on issues of contribution which were common ground before us, and require a two-stage approach or consideration relating to blameworthiness or culpability of the employee and causation.
13. The Extended Reasons resulting in a finding that there was 80% contributory fault do not refer to the relevant law and, in our judgment, it is not possible to discern from the face of those reasons that the Tribunal below applied the relevant law in reaching their conclusion as to contribution. Again, in reality this was common ground and flows from the common ground that the issue was simply not before the Employment Tribunal.
14. From that common ground Ms Brandao, through her Counsel, argues that given the findings that the Employment Tribunal in fact made and the relevant law, it can be seen that any Employment Tribunal who had to deal with the issue of contribution would inevitably find that there was no contributory fault.
15. From that submission it is then asserted that we should make a finding that there was no contributory fault, leaving the award made by the Employment Tribunal as it is but without the relevant 80% reductions, as included in their calculation. We do not agree.
16. In our judgment it is not correct to say by reference to findings made as a result of a hearing where the parties focused upon liability that any Employment Tribunal hearing this case and directing their minds to contribution throughout it would conclude that there was no contributory fault. The first point is that the evidence was not directed specifically to the issue. The second point is that neither party was given the opportunity to make submissions to the Employment Tribunal as to how they should approach the evidence as to the making of findings and as to how the findings should be taken into account in applying the relevant legal tests. Therefore, it seems to us that we cannot reach a decision ourselves on contribution.
17. The next issue that arises is whether or not the matter should be remitted to the same or to a different Employment Tribunal. As to this the Respondent urged us to remit the matter to the same Tribunal on the bases (which is not uncommonly submitted) that (a) they will remember much about the evidence, and (b) therefore, the matter can be dealt with more shortly and more conveniently. However, the thrust of the submission made was that nevertheless it would be appropriate and necessary for the old Employment Tribunal to hear further evidence and certainly to hear submissions.
18. The problem as we see it in this context is that it was common ground that the original Employment Tribunal dealt with contribution in circumstances in which neither party was expecting them to deal with it and without hearing submissions. In taking that approach in our judgment they erred in law and did not take a course or procedure which was fair. The reason for that is that they simply did not allow parties to make submissions on that point before reaching a decision on it, or consider and give them the opportunity to deal with the evidence focused on that point.
19. We therefore pose these further question to ourselves: (1) "If the original Tribunal were to re-hear this matter would justice be being seen to be done? (2) "Would members of that Employment Tribunal feel a difficulty or inhibition if they were to rehear the case?" In answering both those questions it seems to us clear that justice would not be being seen to be done if the original Tribunal were to hear the issue of contribution. Further as to the second question, it seems to us, putting ourselves in the shoes of the members of the original Employment Tribunal, that we would feel a difficulty or inhibition in determining the issue of compensation and in particular in satisfying ourselves that we were not simply trying to rationalise a conclusion we had previously reached without the benefit of submissions from the parties.
20. That leaves the final question whether or not the newly constituted Employment Tribunal should be limited in the matters, which are the subject of their deliberations, to contribution and should exclude from their considerations Polkey Stage II. The argument in favour of that course is that it is clear that at least to some extent on the Remedy Hearing the Employment Tribunal considered Polkey Stage II and it can also be said that they did so in the light of written submissions put in on behalf of the Respondent and a decision reached by the Respondent, with the benefit of advice not to take any more active part in that hearing.
21. The difficulty we have with that course is that if a new Tribunal is to hear the case or, indeed, if the matter of compensation were to have been heard by the original Tribunal, there is inevitably some degree of overlap between contribution and Polkey Stage II. The Employment Tribunal in their Extended Reasons, both in respect of the original Liability Hearing and in respect of the Remedy Hearing, do not give precise reasons as to their Polkey Stage II deliberations. Also on the second occasion they clearly approached the Polkey Stage II deliberations against a background of a conclusion already reached that there should be an 80% contribution and it seems to us that that has the consequence that their approach to those deliberations is flawed.
22. A point was made on behalf of the Respondent that the Employment Tribunal erred in not giving them the opportunity to give evidence as to how long it would have taken to obtain relevant medical evidence or certificates and reach a decision. In our judgment that alone would not found a conclusion that Polkey Stage II should be open for further argument in this case because, in our judgment, there was nothing unfair or incorrect in the Employment Tribunal proceeding on the basis of the written submissions of the Respondent and there is no force in the point made to us that Employment Tribunal could only make the finding they did if one or other of the parties had given evidence that that was the likely period.
23. However, we have concluded that the lack of reasoning in the two Extended Reasons to explain precisely how Polkey Stage II has been applied, taken together with the failure of the Employment Tribunal to give the parties an opportunity to address the Tribunal on contribution and put evidence before the Tribunal focused on contribution, leads to the result that their overall approach to the assessment of the compensation in this case is flawed in law and that what should be remitted to a new Employment Tribunal is the issue of compensation. On that hearing it will be open to both the parties to raise such points as they wish, both as to contribution and as to what we have described as "Polkey Stage II".