United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	John Bowers QC Instructed by: Messrs Halliwell Landau Solicitors St James's Court Brown Street Manchester M2 2JF
For the Respondent	Ms Anya Lewis (of Counsel) Instructed by: Free Representative Unit 1st Floor 49-51 Bedford Row London WC1R 4LR


 


JUDGE COLLINS:

1. This is an appeal against the decision of an Employment Tribunal chaired by Mr Flint sitting at London North. The extended reasons were promulgated on 14 January 1998 after a 2 day hearing which had taken place on 18 November 1997 and 18 December 1997. The extended reasons it has to be said are remarkably concise for a case which was of great importance to the parties, particularly to the appellant. This conciseness has obviously produced for the parties a certain amount of difficulty.
2. We wish to make two opening observations. First, the events which are at the heart of this case occurred in July 1997 and it is a matter of concern to this Tribunal that the matter has taken so long to be resolved. The appeal was dated 20 February 1998. The decision of this Tribunal allowing the matter to proceed to a full hearing was given as early as 6 May 1998 and in those circumstances, the original hearing date of January 1999 was far enough off to be a matter of concern. We understand the reasons why it was considered desirable for Miss Lewis to represent Miss Toner and why the matter had to be adjourned. But a further adjournment of a year seems to us a matter of grave concern. In the end the parties have had to wait an extremely long time for a resolution of these matters.
3. The next preliminary matter which I want to mention is to emphasise what is already clear to the lawyers but needs to be made clear again to the parties. Neither this appeal tribunal nor the Employment Tribunal is concerned to make a finding as to whether or not Miss Toner was, either alone or with another person, responsible for a fraud in the betting shop where she was employed. Whatever the result of this appeal there is no finding one way or the other on the question of whether Miss Toner was or was not a party to any fraud. This factual question is not one which was in the remit of the Employment Tribunal or of this Tribunal.
4. For the purposes of this appeal the facts of the case may be shortly stated. The respondent who is now 37 years old was a shop manager employed to run one of the appellants' betting shops between October 1992 and August 1997 when she was dismissed. On 14 July 1997 a bet was placed and the betting slip was copied. The result was that the bet was paid twice; once on 16 July 1997 on the fraudulent copy and secondly on 19 July 1997 when the genuine slip was passed through. The loss to the appellants was £81.90 but the amount is immaterial. Nothing can be plainer than the importance to the appellants in a business like this of maintaining 100% integrity in relation to movements of cash.
5. There was a disciplinary meeting held on 7 August 1997 which the meeting proceeded on the basis that there were only two candidates for the fraud. One was the respondent and the other was another employee. As it turned out the other employee was dismissed for other reasons by the time of the appeal interview which took place on 11 September and the disciplinary hearing was conducted in a factual context where either or both of the persons could have been responsible.
6. The respondent's explanation of her movements was not accepted. It is only necessary to say that it is accepted on her behalf that she gave two explanations of her physical whereabouts on the day when the fraudulent bet was paid out. First she had said that she was in the kitchen of the betting shop; subsequently she said that she had thought about it again and her recollection was that she was across the road in the bank. There had been a suggestion that she had given a third explanation but we pay no attention to that for the purposes of this judgment. Her explanation was not accepted and she was dismissed. She appealed to Mr Rust, who is the Regional Director, and we have in our papers a transcript of the note which was made of the appeal interview. At the end Mr Rust said that he would take time to make his decision and eventually he wrote a letter on 22 September saying:-

"There were only two staff present in the shop, you were one of them. There are only two possibilities as to who carried out the fraud.

And then he points out the inconsistencies, which I have already drawn attention to. And then he goes on to say: -

"There is no factual evidence to suggest that you committed the fraud, however on the balance of probability I consider it reasonable to suggest that you have been less than truthful and the inconsistencies suggest that you may have had some involvement in the fraud. Therefore I have decided to uphold the decision made by Mr Robert Ritchie to summarily dismiss you from our employ for gross misconduct for reasonable belief that you were in some way involved in the fraud at shop 1848 due to the explanations above and such the company can no longer continue to employ you in a position of trust."

7. The Tribunal found that the employers had reasonable grounds for believing that the respondent was involved in the fraud which had taken place and that a reason did exist for her dismissal, one relating to her conduct. They found the dismissal to be unfair however, and their reason for that is set out essentially in paragraph 3 of their reasons:-

3."The Respondents had not investigated the matter with sufficient fullness in order for them to be satisfied that the Applicant was necessarily the employee engaged in this fraud. There was another employee working in the shop at the time that might in our view have been similarly implicated in the fraud or might have been the sole perpetrator of it. It was wrong therefore of the Respondents to put the whole of the blame for this fraud on the Applicant.

The Tribunal then go on in a process, which it has been submitted to us and we agree, was wholly illogical: -

"There must however be some suspicion that it was the Applicant who was responsible for this fraud rather than the other employee. We also have regard to the fact that the Applicant was the manager of the shop. Accordingly we find that the Applicant is 50% to blame for her dismissal and her compensation is to be reduced accordingly."

8. The illogicality is plain. The tribunal could only have ordered a contribution if they had considered that the employee's conduct merited it, but the earlier part of their decision is predicated on the assumption that the employers had acted without sufficient material for it to be clear what the employee's conduct was. Both parties agree today that either the decision of this Appeal Tribunal must be that the dismissal was in fact fair, alternatively if the dismissal was unfair, that there should no reduction of compensation on the grounds of contributory conduct.
9. We agree with the submission made by Mr Bowers on behalf of the appellants that the Tribunal was wrong in expressing the view that there was an obligation on the employers to decide that the employee was necessarily the person engaged in the fraud before it was fair for them to act upon their views for the purposes of dismissing her. The reasoning of the Tribunal discloses nothing to challenge the ordinary way of approaching questions of this kind. Was there a fraud committed? Did the employers have a genuine belief that it was the employee who had committed it? Did they have reasonable grounds for that belief? And did they conduct a procedure and make decisions based on the procedure, which were fair and reasonable in all the circumstances? It has been suggested that there may be a secondary issue namely, whether or not the employers had solid and sensible grounds for distinguishing between the respondent and the other employee. It is an expression derived from the observations of Wood J. in Parr v Whitbread PLC [1990] IRLR 39 which has been utilised as a test in subsequent decisions. Miss Lewis who appeared in the tribunal below accepts that she did not explicitly run this point before the tribunal. It seems that there two reasons for that, one that she simply attacked the employer's decision to dismiss on its own terms in so far as they related to her client and two that since Mr Lock had in fact been dismissed for other reasons by the time the disciplinary procedure reached its culmination the need for the employer to make distinctions between the respondent and Mr Lock no longer existed. Since the issue was not raised or run before the tribunal it does not seem to us that it should form any part of our reasoning today
10. It is essentially a very straightforward matter for the Tribunal to have determined by answering the questions which I mentioned earlier in this judgment. In our judgment if the tribunal had asked those simple questions they would have answered them by saying that a fraud was undoubtedly committed; it was undoubtedly committed either by this respondent or by another person or by both of them together; the appellants had a genuine belief that it was the respondent; they had reasonable grounds for that belief, as the Tribunal determined they did, both because it was either her or somebody else or both and because she had given conflicting accounts of her whereabouts at the material time. The Tribunal would have held that the disciplinary procedure was as fair as it could be in the circumstances.
11. I pause for a moment to note that although the tribunal criticised the extent and fullness of the disciplinary procedure, Miss Lewis has been unable to suggest what steps the employers should have taken and that they did not take. Particularly bearing in mind the responsibility cast upon the respondent in her position as manager, the tribunal would and should have held that in all the circumstances the employers acted fairly in treating their belief, well grounded as it was, as being a sufficient reason in all the circumstances for dismissing her.
12. It was originally suggested in the appellants' skeleton argument that this was a case which should be remitted to the Tribunal for a rehearing. We do not find it appropriate to adopt that course. It would be a course of desperation in a case which has dragging on for so long but in any event we do not find it necessary. This is a case where the findings of fact which the Tribunal made, however concise, are sufficient for us to express the view that on the basis of those facts the tribunal should have held the dismissal was fair. For these reasons this appeal will be allowed and the finding that the respondent was unfairly dismissed will be reversed.