United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MS IVIMY (OF COUNSEL) Instructed by: MESSRS SYDNEY MITCHELL CAVENDISH HOUSE 39 WATERLOO STREET BIRMINGHAM B2 5PU
For the Respondent	MR R M SHEPHERD (Representative) MANGEMENT & PERSONNEL SERVICES ST JAMES HOUSE FREDERICK ROAD EDGBASTON BIRMINGHAM B15 1JJ


 


JUDGE SMITH

1. This is an appeal by Mr Pearson, the Applicant before the Employment Tribunal, against particular parts of the decision of an Employment Tribunal held at Birmingham over several days between the 9 January 1996 and 20 June 1996, of which Extended Reasons were sent to the parties on the 8 August 1996, whereby the Employment Tribunal held, amongst many other findings that the Employment Tribunal had to make, that the Appellant Mr Pearson had been unfairly dismissed by the Respondents, Halesowen College, but limited his compensation to £8,640.00 and further held that an application which he had presented of rather uncertain date (but which was accepted to be after his dismissal) claiming a remedy for breach of contract was to be dismissed.
2. As we have already said there were numerous other issues which fall to be decided by the Employment Tribunal against which no appeal is made, and it is obvious to us that this was a very lengthy and difficult hearing and we have sympathy with the Employment Tribunal for the sheer number of different and difficult issues with which they had to deal. As we have already stated the grounds of appeal are specifically limited to particular matters, as clearly set out in the grounds of appeal and the skeleton argument of counsel for the Appellant, Ms Ivimy.
3. Put shortly, there are two grounds of appeal, namely: - (1) that in dealing with the Appellant's claim for breach of contract in respect of which they did assume jurisdiction, the Employment Tribunal failed to make findings which it is submitted it was necessary for them to make in order for the Employment Tribunal properly to decide whether or not there had been a breach of the Appellant's contract by the Respondent College and if so, what loss, if any, flowed from the breach. That is the first ground of appeal.
4. (2) Secondly, it is submitted that the Employment Tribunal erred in law when assessing compensation in relation to the compensatory award, arising from the unfair dismissal of the Appellant with effect from 31 August 1995, in concluding, as they did, that the Appellant's employment would have come to an end fairly on 31 December 1995 and thus limiting the compensation payable by way of a compensatory award to that period. It is submitted that there was no sufficient factual basis for the Employment Tribunal to conclude that there would have been a breakdown in the relationship leading to a fair termination of the Appellant's contract of employment by 31 December 1995 and similarly that there was no proper factual basis for the Employment Tribunal concluding that the Appellant could have been fairly dismissed for refusing to accept new terms and conditions by the same date. It is submitted that such findings by the Employment Tribunal were without foundation, and were purely speculative. In the alternative, it is submitted that, having regard to the number of imponderables as to whether the Appellant would have been fairly dismissed in the future, it was wholly wrong for the Employment Tribunal to conclude that it was 100% certain that he would be dismissed by 31 December 1995.
5. Whilst it is necessary for us to bear in mind the entire decision of the Employment Tribunal, we consider it is only necessary for the purposes of this judgment, and in order to deal with the points raised on appeal, to refer to the particular parts of the decision directly germane to the grounds of appeal. We shall refer to those passages and then express our conclusions on the points raised on this appeal in the light of the submissions very ably made to us by Ms Ivimy of counsel on behalf of the Appellant and the helpful submission that we have had from Mr Shepherd on behalf of Halesowen College.
6. The Employment Tribunal found that the Appellant had been employed as a lecturer in computing by the Respondent College from the 1 January 1986 until the 31 August 1995. At paragraphs 13 and 14 of the Employment Tribunal found as follows:-

"13. The tribunal has no doubt that the terms and conditions referred to in the letter of 14 August 1985 were those contained in the document produced by the National Joint Council for Lecturers in Further Education in England and Wales (known as the Silver Book) subject to local variations."

"14. The applicant does not accept the variations in the Silver Book terms and conditions since 1 January 1986, whether national or local in origin, affected his contract of employment. The tribunal is satisfied that in so far as variations to those terms and conditions were made by collective agreement between the parties to that National Joint Council, or were made by local agreement pursuant to the provisions contained in the Silver Book, they did form and become part of the applicant's terms and conditions of employment."

7. At paragraph 16 to 18 the Employment Tribunal found that disputes had arisen over the Appellant's contractual duties and in particular, the Employment Tribunal found that he amongst others was not prepared to accept the new terms and condition which the Respondents sought to introduce.
8. The Employment Tribunal found disputes arose relating to invigilation duties which on their findings led to a claim being brought by the Appellant for loss due to being compelled to work beyond contractual hours for invigilation duties which was dismissed by a deputy district judge in the County Court in 1994. An appeal was made to circuit judge which was subsequently withdrawn. Of direct relevance to this appeal, at paragraph 18 of the decision, the Employment Tribunal made important findings of fact relating to the contractual dispute as follows:-

"18. Unfortunately matters between the applicant and the respondents did not improve and the applicant contended that he was not obliged to undertake certain aspects of work which the respondents required of him. One of the bones of contention between the parties related to parents' evenings. In Section 9 of the Silver Book there are provisions which stipulate the maximum number of sessions which a lecturer such as the applicant can be required to attend college as well as placing a limitation on the number of hours a week which he may be required on duty. Such was the applicant's timetable that he would not have been able to attend parents evenings during academic year 1994 – 1995 without exceeding the maximum number of sessions."

9. Unfortunately, as appears from the findings of the Employment Tribunal, the relationship between the Appellant and the Respondent College did not improve. A disciplinary hearing took place in January 1995 as a direct result of the Appellant's appeal to the circuit judge, and in consequence, the Appellant withdrew his application before the circuit judge. The grievance procedure was then invoked by the Appellant's grievance was rejected. Thus he brought his first application before the Employment Tribunal on 16 February 1995. This led to a further disciplinary hearing on 13 March 1995 at the conclusion of which the Appellant was dismissed with effect from 31 August 1995.
10. The Employment Tribunal found that the reason for the dismissal was the presentation of the Appellant's complaint to the Employment Tribunal. The Appellant's internal appeal was dismissed. In paragraphs 49 – 56 of the decision, the Employment Tribunal concluded that the dismissal was unfair for the reasons there set out. It was clear from the findings of the Employment Tribunal that right up to his dismissal the Appellant remained in dispute over his hours of work. According to the Employment Tribunal specifically in regard to invigilation work and working in attending parents' evenings, both of which the Appellant contended in were in excess of his contractual obligations under the Silver Book.
11. The Employment Tribunal expressed their findings and conclusions in relation to their understanding of the Appellant's claim for breach of contract as follows: -

"63. The remaining claim relates to breach of contract. The tribunal was asked t look at the claims relating to hours of work, specifically hours of work as to invigilation and parents' evenings. The Applicant made it clear that he would not work more than the number of hours for which he was obliged to work and, save in cases where he voluntarily did so, did not work over the number of hours. The question of invigilation was determined by the Deputy District Judge in October 1994. It is res judicata and is a matter on which the tribunal can make no comment. In connection with parents' evenings, the applicant made his views well known. He was told that the respondents considered that he was contractually obliged to attend them. He told them in no uncertain terms that he did not believe that he was so obliged to attend. In his own words he attended them voluntarily. He made it clear to all concerned that was the basis of his attendance. The Tribunal can see no breach of contract by the respondents. That claim too fails."

12. It is particularly in relation to the Employment Tribunals findings in that paragraph that the first ground of appeal is based. The Employment Tribunal then turned to deal with remedy in respect of the unfair dismissal. They concluded that neither reinstatement nor re-engagement was practicable because the relationship between the parties had deteriorated to such a degree that neither option was practicable. Having calculated the basic award, against which there is no appeal, they turned to consider the amount of the compensatory award and correctly set out the relevant legal principles by reference to section 74 of the 1978 Act (now section 123 of the 1996 Act) at paragraph 73 of the decision. They then expressed themselves as follows:-

"74. The tribunal concludes that the applicant's employment would have come to an end fairly on the 31 December 1995. The tribunal makes that finding for the following reasons. First, the relationship between the applicant and the respondents was such that the basis of the relationship was seriously endangered by the antagonism between them. Sadly this breakdown would be likely to have resulted in a fair termination of the applicant's employment by 31 December 1995 in any event. Secondly, by agreement with the recognised trade unions, the respondents introduced new terms and conditions of employment applicable to their staff to be in force no later than 1 September 1995. Taking into account the applicant's attitude to the contractual relationship between the parties up to the time of his dismissal and expressed in evidence to the tribunal, the tribunal is satisfied that the applicant would not have accepted the new contractual regime and accordingly, following consultation between the trade unions, the tribunal is satisfied that the applicant's employment would have been terminated, the College being no longer prepared to continue the employment of persons on the Silver Book conditions. These conditions were, and are, regarded by the applicant as being essential to his role as college lecturer. The tribunal is satisfied that the applicant would not have accepted the change to his terms of employment."

13. It is the reasoning in this paragraph and in particular the two reasons given for concluding that the Appellant would have been fairly dismissed 31 December 1995 which are the subject of criticism by way of grounds two and three of the grounds of appeal as developed by Ms Ivimy in her skeleton argument.
14. Having heard the submissions we find it is convenient to express our conclusions first on the grounds of appeal relating to compensation for unfair dismissal. We accept the submission of Ms Ivimy that the approach of the Employment Tribunal in paragraph 74 of its decision was unfortunately erroneous and cannot be supported. With regard to the first reason put forward in that paragraph by the Employment Tribunal in support of their conclusion that the Appellant would have been fairly dismissed by 31 December 1995, Ms Ivimy rightly accepted that an Employment Tribunal is entitled to consider whether an employee would for reasons unconnected with an unfair dismissal have been fairly dismissed in any event within a certain period of time. However, Ms Ivimy submitted, correctly in our judgment, that before an Employment Tribunal can properly reach any such conclusion it must have properly found adequate primary facts from which such an inference can safely be drawn. She cited the analogous situation in King –v- Eaton Limited No.2 [1998] IRLR 686 where there had been fundamental irregularities giving rise to an unfair redundancy dismissal and where the employers sought to lead additional evidence before the Employment Tribunal to show that, had a fair procedure been followed the result would have been the same. The Courts of Session in Scotland held that the Employment Tribunal had been right to refuse to allow such evidence. Lord Prosser's judgment is accurately summarised in the head note as follows:-

"In the present case, the employment tribunal was justified in refusing to allow evidence as to whether the employers' failure to consult made any difference. The absence of proper consultation at the stage at which the method for selecting those to be made redundant was being adopted and the criteria for assessment determined, had the effect of putting that method and those criteria in doubt and "went to the heart of the matter." To ask whether the same method or criteria would have been adopted if there had been consultation beforehand, or to try to show what method or criteria would have been adopted in the light of consultation, would be to embark upon a sea of speculation, where the opinions of witnesses could have no reliable factual starting point."

15. Ms Ivimy submitted that the necessity for this approach applied even more strongly where, as in the instant case, the Employment Tribunal is looking into the future and seeking to construct a future hypothetical fair dismissal which is not in any way directly related to the facts of the original unfair dismissal.
16. Tested in this way we unanimously agree that the first reason given by Employment Tribunal for concluding that there would have been a fair dismissal by 31 December 1995 cannot be supported. Merely to state that the relationship between the Appellant and the college was bad and in danger of breaking down cannot amount, without more, to a sufficient reason for dismissal, let alone a fair dismissal, within the terms of section 98(4) of the 1996 Act. Looking at the decision, it is quite uncertain as to how or why the Employment Tribunal could have concluded that the breakdown would be likely to have resulted in a fair termination of the Appellant's employment. Presumably this finding is predicated upon some kind of misconduct by the Appellant, but no proper finding is made nor could it properly be made in regard there to. A breakdown may be equally consistent with a situation giving rise to a constructive dismissal apart from anything else. The first reason cannot be supported.
17. In our judgment, unfortunately, the second reason given is equally erroneous. Here again, Ms Ivimy correctly accepted that the Employment Tribunal were entitled to find as a fact that the Appellant would not have accepted the new terms and conditions which were on offer from 1 January 1995. However, she correctly submitted that that fact alone is not sufficient to justify a dismissal on the grounds of some other substantial reason. Before a refusal to accept new terms an conditions can give rise to such a fair dismissal, in addition to a proper procedure being followed by way of consultation, advanced warning of the change, and so on, it is necessary for an employer to establish that it was unreasonable for the employee to decline the new terms. Thus it is necessary for a tribunal to analyse what is or would have been the effect on the employee of the proposed alteration in the contractual position. All this is clear, as Ms Ivimy rightly submitted, from the decision of Evans –v- Electrical Holdings Limited [1982] ICR 323, particularly in the judgment of Mr Justice Browne Wilkinson, as he then was, giving the judgment of the Employment Appeal Tribunal, at page 327 at letters (d) and (g). Here again, unfortunately, the reasoning of the Employment Tribunal does not include any such analysis as to the substance of the change. The Employment Tribunal needed to make findings, amongst other things, as to the extent to which the new terms were more or less favourable, the reason for their imposition and the number of employees who accepted them and indeed as to all relevant circumstances relating to the change. In our judgment the failure of the Employment Tribunal to make such findings had the result that there was no proper factual basis for the conclusion that the Appellant would have been fairly dismissed by 31 December 1995 for refusing to accept the new terms. Accordingly, for these reasons we allow the appeal on the ground relating to compensation.
18. We can deal much more shortly with the ground relating to the findings of the Employment Tribunal that the Respondents had not been in breach of contract as expressed in paragraph 63 of the decision. It is clear from the Appellant's IT1 at page 22 of the bundle that a major plank of the Appellant's case before the Employment Tribunal was that for a lengthy period of time, apparently from 1992 or thereabouts, he had been forced to work at least 10 hours per week above and beyond the hours which he was contractually obliged to work. Thus his case was not a case limited to parent's evenings and invigilation duties. It was a much more substantial and wide-ranging claim than that. According to the Appellant this was a central part of the dispute between the parties.
19. No doubt because of the great number of difficult issues which the Employment Tribunal had to consider in this difficult litigation, we had to conclude that the Employment Tribunal failed to make the findings of fact in relation to this claim which were necessary in order to decide it one way or the other. In our judgment Ms Ivimy correctly submitted that it was essential for the Employment Tribunal to make findings as to: -

(a) what hours per week the Appellant could lawfully be required to work under his contract;

(b) how many hours he had in fact worked;

(c) assuming (b) exceeded (a) at what rate he should have been paid in relation to such extra contractual work and to make a comparison with what pay he actually received.

Only by making such findings could the Employment Tribunal properly conclude whether there was a breach of contract and, if so, the extent of any loss.

Additionally, the Employment Tribunal needed to make relevant findings as to: -

(a) whether the Appellant carried out such extra work voluntarily or under protest;

(b) even if it was carried out voluntarily, whether such conduct amounted to a waiver of any breach of contract by the College.

20. In our judgment the present findings of the Employment Tribunal are inadequate in relation to, this particular claim and lead to the conclusion that either the Tribunal did no turn their mind to these issues, understandably in the light of all the other issues with which they had to deal, or that, if they did, they have not set out their findings in such a way as to enable the Appellant to know why his claim for breach of contract has been dismissed.
21. We should make clear that, despite certain confusion over dates, there is no doubt that the Employment Tribunal accepted that they had jurisdiction in respect of the Appellant's claim for breach of contract. Accordingly the appeal is also allowed on this ground.
22. Subject to hearing the representatives on this part of our judgment we are provisionally satisfied that, provided it is reasonably practicable, the case will have to be remitted to the same tribunal for a rehearing as to: -

(i) the breach of contract claim; and

(ii) the amount of proper compensation by way of compensatory award for the unfair dismissal.

23. With regard to the former, again, subject to hearing any representations, we would think it appropriate, unusually, for us to direct that the Appellant should set out the nature of his claim for breach of contract in the form of a straight forward point of claim and that the Respondent college should put in straight forward points of defence to that claim so that in this way issues can be clarified before the remitted hearing takes place. We allow the appeal on that basis subject to hearing any submissions. We should make it clear that the pleaded claim must remain strictly within the confines of the original claim as put forward in the Originating Application.