United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MISS E BANTON (of Counsel) K Zaman Ali & Co Solicitors 409-411 Brixton Road London SW9 7DE
For the Respondents	MR D WAGSTAFF (Solicitor) David Wagstaff & Co Solicitors 19 The Avenue March Cambridgeshire PE15 9PS


 


MR JUSTICE BURTON: This is an appeal brought by Messrs Dixon, Anderson, Boyd and Guermet against the dismissal by unanimous decision of the Employment Tribunal sitting at London (South) of their claims for unfair dismissal by the Respondent, London General Transport Services Ltd.

1. Briefly, the history of the matter, which is fully set out in the Tribunal's extended reasons, is that there was, in Autumn 1994, a considerable sea-change in relation to the employment situation not only of these Appellants, but a large number of their colleagues involving the substantial change in arrangement at London Transport which was privatised at that time.
2. There was, it seems, a petition by a number of such employees, which these Appellants signed, in November and December 1994, protesting at changes in their terms and conditions of employment as a result of the new arrangements for employment arising out of that privatisation.
3. No grievance procedure was ever implemented, at least by these Appellants, but it seems that they and others continued to work for the Respondent, albeit with a degree of unhappiness.
4. In December 1995 Mr Dixon and Mr Anderson resigned from the Respondent's employment in circumstances to which I shall turn in a moment. In due course they and others issued applications in the Employment Tribunal against the Respondent for unlawful deduction of wages, which was dealt with by the Employment Tribunal with a different composition, but still held at London (South), in October 1997. In that matter there were 25 or more applicants, and the Tribunal found that a substantial number of those applicants had in fact waived any breach in relation to their contracts of employment and/or agreed by conduct or otherwise to variations of the contracts of employment. But it was found in relation to these Applicants, among others, that because they had signed the petitions which made it plain that they were accepting any changes under protest, they had not waived any breach, and were consequently entitled to recover the difference in wage between the old terms and conditions and the new terms and conditions as unlawful deduction from wages. We are told that there are pending appeals and cross-appeals arising out of that decision, but subject to that, that decision stands and the parties before the Employment Tribunal, with which we are dealing, did not in the event take a different position than an acceptance of that finding.
5. In the Employment Tribunal with which we are dealing, there were only the four Appellants. Two of them, as I have mentioned, Mr Dixon and Mr Anderson, resigned in December 1995 and wrote letters of resignation which make mention, apart from other matters, of the changes in the terms and conditions of employment, which by then had taken place a year earlier. So far as concerns the other two Appellants, Mr Boyd resigned in October 1996, a further ten months on. He too makes some mention of his conditions of employment but not specifically on the basis of a complaint about the change, he refers to excessive hours and extension of work that he was being made to work, without specific reference to the changes which had by then occurred two years before. Mr Guermet, the fourth Appellant, did not resign until 30th January 1997. He resigned by a letter of that date, in which he made no mention of the changes of terms and conditions of employment which had by then taken place 2½ years or so before, but he mentioned his unhappiness about a recent accusation of theft against him and certain other matters.
6. The case that was put before the Tribunal was that these resignations amounted to constructive dismissal by the Respondent and hence the claims for unfair dismissal.
7. The Employment Tribunal reached, as it appears to us, two entirely separate but equally conclusive decisions. They began in the decision by reviewing what had occurred since the petitions of November and December 1994, concluding that none of the four Appellants after the petitions had taken any action in a formal way to pursue what, no doubt, was an unhappiness about their terms and conditions, and indeed, on the contrary worked normally (paragraph 9 of the decision). The Tribunal concluded that there was "no legal inconsistency between a conclusion that a member of staff has elected to remain in employment and seek to sue for arrears of wages as a deduction without asserting a fundamental repudiatory breach of contract entitling him to treat himself as constructively dismissed" (paragraph 10 of the decision). It pointed out in paragraph 12 that all the Appellants, in particular Mr Guermet who had done so for "well over two years after the new terms and conditions had been imposed" had elected to "continue working and not to treat themselves as constructively dismissed." In paragraph 13 the Tribunal looked at the question of waiver and acquiescence. In paragraph 14 it concluded as follows:

"For the foregoing reasons therefore we found that each Originating Application in effect failed in limine because of the length of time which passed, and the conduct of each Applicant in continuing to work and affirm the contract; and the receipt of financial consideration as partial recompense for the changes. In any event however, we found (and we rely upon our conclusions on these issues as being supportive of our conclusions just stated) as a matter of causation that each [Applicant] left for a principal reason unconnected with any dissatisfaction with the change of terms and conditions. We deal with each Applicant now separately in chronological order of presentation of Originating Application."

8. The Tribunal then dealt in paragraphs 15-51 with the facts of the resignations. The conclusion at paragraph 53 is in round terms:

"It follows from our foregoing conclusions that we have in each case found that as a matter of causation the Applicant did not prove that his resignation was caused by any repudiatory breach of contract. All applications are therefore dismissed."

9. It might well mean that the Tribunal could have put first in their decision paragraphs 15-53, concluding, as they did firmly on the facts, that these were resignations, and resignations as a result of matters to which I will refer to in a moment, and not, even purportedly, acceptances of repudiation at all, and then gone on to deal with the first part of their decision, on the basis that in any event if their findings of fact had not been as above set out, they would have reached the conclusions that are set out in paragraph 14. They did not so structure it, and it seems to me perfectly understandable, one cannot lay down any kind of way in which decisions should be set out by tribunals, that they should have dealt with the point that they saw as being general to all four Appellants first, before going on to deal with the facts. But it is equally clear that they come to two wholly independent decisions, both of which justifying the dismissal of the unfair dismissal claims, and that the second is wholly one of fact.
10. I turn briefly to consider their findings of fact in relation to all four Appellants.

Mr Dixon

In paragraph 25 the Tribunal said this:

"We have no doubt at all that the principal reason why Mr Dixon resigned was because he faced the risk of a serious disciplinary penalty as an outcome of being reported by Mr Pierce and referred for a disciplinary hearing by Mr Johnson"

The Tribunal rejected, in paragraph 26, the suggestion that:

"the conduct of the Respondents in the evidence of Mr Pierce and the evidence of Mr Johnson amounted to repudiatory behaviour. Furthermore we believe and find that Mr Dixon had a reasonably clear idea of the trouble that he was in and it was for that principal reason that he chose to leave."

Mr Anderson

In paragraph 32 the Tribunal say as follows:

"In Mr Anderson case therefore, we looked at all the facts and his own evidence in order to ascertain what was the reason why at that particular time he decided to terminate his employment. [December 1995] We came to the conclusion that the principal reason why Mr Anderson terminated his employment at that time related certainly to his ill-health absence and the fact that he knew he would be obliged to see the company doctor in the light of his poor attendance record. We find that Mr Johnson had been perfectly reasonable in his handling of Mr Anderson and his sickness absences up to that time, but that matters were coming to a head. There was certainly nothing in Mr Johnson's behaviour towards Mr Anderson or the behaviour of Mr Anderson [it must be somebody else] towards Mr Anderson at that time which could be criticised, ie alone amount to fundamental repudiatory behaviour."

The Tribunal's conclusion, at paragraph 33, was:

"Mr Anderson was unclear in his evidence as to how or why he claimed that the changed terms and conditions affected his health. Mr Anderson's flurry of different "reasons" for not returning to work at that time made it quite [clear] to us that he had decided to leave but we were not satisfied that he had proved that the reason for his resignation was the imposition of new terms and conditions over one year before and/or that such imposition had remained fundamentally repudiatory behaviour."

Mr Boyd

In paragraph 37 the Tribunal say:

"… In his case we also considered what was his principal reason for resigning and it was quite clear to us that having moved house and having found alternative work he made an ordinary and no doubt from his point of view a sensible decision to change jobs, and it was only when he applied to the PTSC [the new union in which he and his fellow Appellants were members] that he decided additionally to argue that the main factor of his decision was the imposed terms and conditions of some two years before."

Mr Guermet

The Tribunal in relation to Mr Guermet which, as I above indicated was a resignation on 30th January 1997, even further divorced in time from the changes in terms and conditions in 1994, conclude as follows at paragraphs 49, 50 and 51:

"49. We regret to have to conclude that we found Mr Guermet's case entirely devoid of merit. …

50. We have no doubt at all in Mr Guermet's case that the reason why he resigned was because he knew that he faced a very serious risk of dismissal for gross-misconduct which would involve probably considerable difficulty in obtaining a useful reference …

51. We find that Mr Guermet himself must have realised his case was hopeless and furthermore that by framing his notice of resignation in the way in which he did that the Respondents would be obliged to treat it very seriously. …"

11. In those circumstances, there were the clearest possible findings of fact, so far as causation is concerned, which of course is that to which the Tribunal refer in paragraph 53, that the alleged discontent or continuing discontent with the terms and conditions of employment have nothing whatever to do with the resignations of these Appellants and that there was in fact no constructive dismissal because the resignations were true voluntary resignations.
12. Miss Banton, who has sought to put forward submissions on behalf of the Appellants, has not been able to make any challenge to those findings of fact; she has not suggested that they were perverse. She has suggested that the Tribunal erred in relation to its consideration of the question as to whether there was a repudiatory breach which was capable of acceptance and in relation to their conclusions on affirmation and acquiescence, to which I will turn to in a moment. She says that if, as she contends, the Tribunal asked the wrong question or at any rate came to the wrong answer in relation to affirmation of the contract, then that could, would or might infect their conclusions of fact, and she said that in some way they asked themselves the wrong questions.
13. We can see no substance in that at all. It is quite clear that the second conclusion of the Tribunal, which was in fact, for reasons I have given, its first conclusion, namely that as a matter of fact these resignations were resignations and had nothing to do with the terms and conditions problem so many years before, was a conclusion which they came to on the facts, and without consideration of the acceptance of repudiation point, as a matter of law or at all, save to dismiss it as part of the causation of the resignation, and that they were entitled to and indeed obliged to ask the question was there a dismissal before they went on to any other question. They did ask themselves that question and they concluded that there was not a dismissal, and on the facts there were voluntary resignations for the reason they found.
14. That is an end of this appeal, because that it is a solid and sensible and satisfactory ground upon which the Tribunal reached its conclusion, and one which cannot possibly be and has not been challenged as to its factual basis. But out of courtesy to Miss Banton I turn to deal briefly with her main submission which related to the second ground, with which the Tribunal dealt. As I have indicated, the Tribunal could well have dealt with it by saying that because of its conclusion on the first ground either it did not need to deal with the second matter or only as an alternative. In fact, it put forward two entirely independent grounds for dismissing the claims for unfair dismissal, and to deal with them in the order I have indicated, and so I deal with that second ground.
15. The conclusion of the Tribunal was that in fact there had been an acceptance of the new contract, to the extent that there had been no acceptance of repudiation. They recognised that there had been no waiver of the breach in relation to non-payment of the salary, because there indeed had been a claim in the earlier Tribunal hearing which had been successful in respect of deduction of wages, but they rightly held that there is a distinction between waiver of a breach and affirmation of a contract. An innocent contracting party, faced with a breach by his fellow contractor, can take one of three courses. The first is that he can assert, rightly or wrongly, that that breach is repudiatory, and terminate the contract either immediately or within a reasonable time on the basis of acceptance of repudiation. The second is that he can ignore the breach completely and thus not only affirm the contract but waive the breach. The third is that he can keep the contract alive, and thus affirm it, and not accept the repudiation, but sue in respect of the breach. That is what the Tribunal found here that the Appellants had done, that they had not waived but indeed sued on the breach by way of a claim for unpaid wages, and had not accepted the repudiation. The way in which they had not accepted the repudiation was:

(1) by continuing to work under the new contract after the initial complaint in the petition;

(2) by suing and recovering, although I am told it has not been paid, as a result of the appeal, the unpaid wages; and

(3) by virtue of the lapse of time.

It is quite plain that the Tribunal could have made a very substantial distinction, if there had been a case to be made at all, between Mr Dixon and Mr Anderson who delayed a year and Mr Boyd and Mr Guermet who delayed not only very substantially longer than that, but even after their fellow Appellants had (if they did) accepted the repudiation. The case for affirmation against Mr Boyd and Mr Guermet is inevitably much, much stronger even than the case in respect of Mr Dixon and Mr Anderson.

16. In the light of all that, the Tribunal found, as a matter of fact and conclusion on the facts, that the Appellants had accepted the repudiatory breach by their course of conduct from the beginning of 1995 onwards. That, it seems to us, was also a finding of fact with which this Tribunal could not interfere.
17. But Miss Banton has brought forward two matters. Both are put by her under the general heading of 'continuing breach', in respect of which she says that the Tribunal erred. I take the second point first because it is speedily dealt with, and it was her subsidiary point. She alleges that there was a failure by the Respondent to cause to be implemented and/or activated the Respondent's grievance procedure. She points to the findings of fact by the Tribunal in paragraph 9 of its decision, to which I have already referred in passing, and I read the whole paragraph as follows:

"9. … Mr Robert gave evidence that, so far as he was concerned, there had always been in operation a typical grievance procedure which involved an initial approach to line manager and upward progression through management stages in a fashion which is well-known throughout many large companies. It is our conclusion that it would have been obvious to any member of staff and for that matter to … the members of the Public Transport (Staff) Consortium ("PTSC"), that such a procedure operated had any member of staff wished to take it up. On the evidence before us, none of the four Applicants after the petitions of November and December 1994 took any action in a formal way to pursue what we have no doubt was an unhappiness about their terms and conditions, and indeed on the contrary worked normally subject to the particular problems which we find existed in each case until the actual termination of their employment."

18. Miss Banton has referred to a decision in W A Goold (Peamak) v McConnell and another [1995] IRLR 516 in which there was no grievance procedure; employees had a grievance, sought to find a method of pursuing that grievance, tried on several occasions in July 1992 to have that grievance dealt with, and when they found there was no procedure and the grievance was not being dealt with, they resigned the day after a rebuff of a proposal for an interview with the Chairman of the company, and claimed constructive dismissal. An employment tribunal concluded that the employer's failure to provide and implement a grievance procedure amounted to a breach of the employees' contract of employment which was sufficiently serious to justify them in resigning.
19. The facts of that case, it is plain, are very far away from the facts of this case, as found by the Tribunal. In this case there was a grievance procedure. There is no suggestion that there was any attempt even to take a step towards the grievance procedure, never mind implement it, as the Tribunal conclude could easily have been done. There is simply the fact of an outstanding petition, which was left where it was, both by these Appellants and, it seems, their fellow petitioners. There is certainly no finding that the employers failed to take steps pursuant to either the implementation of a grievance procedure or attempts to do so. There is also, of course, no finding, indeed the reverse, that the failure by employers to deal with a grievance procedure had any causative role at all in, never mind being the reason for, the resignation of these Appellants. But Miss Banton submits that there was a continuing breach in relation to the failure by the employers to deal with a grievance procedure.
20. It seems to us that that is completely unarguable. First of all, Miss Banton pointed to section 3 of the Employment Rights Act 1996 and submitted that there was some breach by the employers. There plainly is no such breach. Section 3 requires there to be a grievance procedure within the contract of employment and on the findings of this Tribunal there was such, and that is the end of it. Insofar as there is any obligation of an employer to do anything more than have a grievance procedure, we can only think that Goold, which depended of course on its particular findings of fact, would show that employers have simply got to ensure that, if pursued, the grievances made are not aborted or rebuffed and there is no suggestion here of any such rebuff by the Respondent, indeed, the finding of fact is that nothing further was done by these Appellants.
21. Miss Banton submits that the employers were under an obligation to have treated the petition as if it was the implementation of a grievance procedure, and that there was a failure by the respondents in that regard. If there was such a failure in February 1995 or so, and even if that did amount to any kind of serious breach of contract by the Respondent, and we do not believe that either of those propositions can be made good on the facts of this case, that would not be in our view be a continuing breach but would have been a breach that occurred at the time of such rebuff and one which should then have been accepted as a repudiatory breach, if it ever could have been, which we doubt.
22. I turn to the second way in which the question of continuing breach is put. Miss Banton submits that the fact that wages were underpaid from the time when the new conditions of employment were imposed in the Autumn of 1994 amounts to a continuing breach of contract by the Respondent. She refers to the case of Reed v Camphill Engravers [1990] IRLR 268, where there is an additional factor that the continued non-payment of wages and/or continued fixing of rates of wages, amounted to an illegality, because the employers were paying less than they were required to pay by the Wages Council and the orders issued by that relevant body which set out statutory minimum rates of remuneration for workers in the relevant industry, and that a breach which amounted to an illegality could not be waived. To that intent, plainly Reed is distinguishable in a material respect. But she points to the simple fact that Reed illustrates that a non-payment of wages can be a continuing breach and that is plainly right. What she needs to submit, however, and succeed in submitting, so as to be able to show that there was some error in law by the Employment Tribunal, is that what that amounted to was a continuing repudiatory breach, and a continuing repudiatory breach which had not been affirmed by the Appellants, as the Tribunal found.
23. It is our provisional view, but because of the clear view we have that this appeal should in any event be dismissed for the reasons we have already given so far as the findings of fact of the Tribunal are concerned, this point does not arise for consideration and is not in any way part of the ratio of this decision, that the Tribunal was entitled to conclude that the non-payment of the wages was not a continuing repudiatory breach, enabling the Appellants, while otherwise continuing to work, to preserve the possibility of accepting repudiation of the contract any day they chose. The repudiation in this case, if repudiation it was, was the wholesale change of the terms and conditions imposed on those employees who did not object at the end of 1994. One of the ongoing consequences, but only one, was a lowering in the wages; that amounted to a continuing breach which was not waived, as is clear from the fact that these Appellants recovered the sum due in the other Employment Tribunal proceedings. However, such underpayment was, as Mr Wagstaff has submitted, a run-off, or a consequence, of the repudiatory breach, and not itself a continuing repudiatory breach capable of acceptance long after the repudiation in itself, namely the imposition of the new terms and conditions, had been reluctantly accepted by these Appellants and their fellow employees.
24. In those circumstances, we conclude that, even had the point been separately considered by the Employment Tribunal, it would have been entitled to find that even the continuing breach had not been either repudiatory or indeed accepted as repudiatory, but had been the subject matter of the separate enforcement by way of the claim for unlawful deduction of wages. But of course, in any event, all that is wholly subsumed by the fact that the Tribunal in any event found that these voluntary resignations had nothing whatever to do with acceptance of repudiation and/or that any repudiation, continuing or otherwise, was not causative of the resignation.
25. In those circumstances, we have no hesitation whatever in dismissing this appeal.