United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR C HAY (Lay Representative) Instructed by Northern Complainant Aid Fund Checkpoint 45 Westgate Bradford W Yorkshire BD1 2TH


 


JUDGE ALTMAN

1. This is an Appeal from the decision of the Employment Tribunal sitting at Leeds on 31 March 2000 when following an earlier finding of unfair dismissal the Employment Tribunal concluded that the Appellant was entitled to neither a basic nor compensatory award on the ground that he had failed to mitigate his loss. The Appellant comes before us by way of Preliminary Hearing to argue that there is a point of law capable of being argued in full before the Employment Appeal Tribunal.
2. The submission made essentially by Mr Courtney Hay as we understand it is that the duty to mitigate requires the employee to act reasonably and that the Employment Tribunal came to a decision which no other reasonable Tribunal properly directing itself upon the law could come in concluding that the Appellant did not act reasonably in refusing to accept, 3 days after the dismissal, an offer of reinstatement with appropriate terms which had been in issue. Furthermore, he says that in their approach to the evidence as to what was reasonable it is to be inferred from the approach of the Tribunal to the facts that they must have set the standard of reasonableness too high. Reference is made to the case of Fyffe -v- Scientific Furnishings Limited [1989] IRLR 331 in which the then President Wood J said:

"To state the basic rule broadly it is that the plaintiff must take all reasonable steps to mitigate the loss to him consequent upon the defendant's wrong and cannot recover damages for any such loss which she could thus have avoided but has failed through unreasonable action or inaction to avoid. It is important to emphasise that the duties only to act reasonably and the standard of reasonableness is not high in view of the fact that the defendant is a wrongdoer".

And at one point the learned Judge says:

"When approaching the issue of reasonableness it is important to look at the surrounding circumstances and the reaction of the Applicant to any offer made to him must depend upon the circumstances in which that offer was made. The attitude of the employers and the way he had been treated, indeed upon all the surrounding circumstances."

3. The decision was made as I have said in the aftermath of an earlier decision reached on 10 March. The Appellant had worked since 1995 as a security officer for a company that, in the words of the Tribunal, "out sourced its security provision". This provision was taken on in 1999 by the Respondents. The Appellant was told by his earlier employers that his continuity rights in his employment would be passed to the Respondents. It appears that at that time the Respondent believed that the Transfer of Undertaking (Protection of Employment) Regulations 1981 did not apply and Mr Davidson of the Respondents, which we understand to be a very small business, visited the Appellant and arranged for work to begin on 8 September. Certain documentation had to be signed including the need to get some form of police clearance. In those documents the Appellant was concerned to see that the date of commencement of employment was identified as 8 September 1999. He believed, probably rightly it seems, that he had continuity of employment. He refused to sign the document and he made it clear to his employers why that was. This was discussed over a period of time.
4. On 1 November 1999 the Respondents through Mr Davidson wrote to the Appellant giving him an ultimatum to either sign the documentation or be dismissed. Obviously in the security business the Appellant's signature to these documents was essential not least in relation to police clearance but there remained the point of issue between the parties that led the Appellant to refuse to sign. The Employment Tribunal found that there were further discussions but neither party would change their position.
5. On 4 November 1999 Mr Hay, who was then advising the Appellant and who has represented him before us today, wrote a letter as a result of which Mr Davidson sought legal advice. In the meantime however, the threat of termination remained unaffected by Mr Davidson. At that point the Respondents were unsure whether the Appellant would come to work on 8 November and arrangements for cover in case he did not were made. The Appellant arrived and was surprised to find someone else on the site.
6. There was a dispute as to what then happened and some uncertainty, but as the result of a conversation between Mr Wildman for the Respondents and the Appellant he left work and did not return thereafter. Two days later, the Respondents received their legal advice to the effect that the Appellant was correct. Mr Davidson thereupon instructed his administration manager to go and see the Appellant on the following day, tell him of the advice, tell him that he had continuity of employment, apologise for the misunderstanding and ask him to return to work. The Appellant refused to do so. That was then followed by a letter from the Respondents confirming what had happened which was hand delivered. The Appellant's wife refused to accept it and the courier was told to return it to the Respondents. A copy of that letter was sent to Mr Hay. There was further correspondence.
7. Following that, the Employment Tribunal made a finding of unfair dismissal. It is clear that the threat to terminate employment unless the contract was signed was founded on an incorrect belief by the Respondents that they were right about the break in continuity of employment. On the face of it it is an inevitable conclusion that at all times the Respondents were acting in a sense genuinely and honestly, believing that they were right about the continuity of employment, so that they genuinely believed that there was no good reason for the Appellant to refuse to sign.
8. In their decision it was conceded that there was no admissible reason for dismissal under Section 98 of the Employment Rights Act and the conclusion was of unfair dismissal. When the Employment Tribunal came to consider the question of compensation they turned to the basic award. The Appellant refused the invitation of the Tribunal to consider re-instatement or re-engagement and the Tribunal came to the conclusion that it would not be appropriate for them to make an order for that.
9. However, they came to consider the basic award and there was a split decision. The majority reiterated the point as follows:

"As set out in our original decision the position is that within 3 days of the dismissal having taken effect on 8 November Mr Howe visited the (Appellant), explained to the (Appellant) that the respondents had been in error, apologised to the (Appellant) for that error and offered him his job back on the terms that his continuity was continued and with the enhanced pay and the other benefit which he had obtained following the respondents over the contract. The (Appellant) rejected that offer out of hand. The offer was put in writing and delivered by hand to the (Appellant's) house and the letter was turned away by the (Appellant's) wife. The respondents wrote to the (Appellant's) representative reiterating the offer and enclosing a copy of the letter which had been written on 11 November. Even as at today there has been no response from the (Appellant's) representative or the (Appellant) to that letter. The view of the majority is that the (Appellant) did act unreasonably in refusing the offer of reinstatement which was made the respondent. Perhaps the more so by reason of the submission made by Mr Hay on behalf (Appellant) today where in paragraph 2.5 of his submission when he is urging the Tribunal in relation to the compensatory award he points out the difficulties which the (Appellant) is in in finding future employment. No doubt Mr Hay had those matters in mind when the offer of reinstatement was made in November but despite that the offer of reinstatement was not accepted. In the view of the majority the (Appellant) acted unreasonably and in the view of the majority it is just and equitable to reduce the basic award to nil and that we propose to do.

The view of the minority is that the (Appellant) was unfairly dismissed by the respondents as they now admit and it is not right that the (Appellant) should be deprived of all his remedies against the respondents in those circumstances. The making of a basic award in the view of the minority would be just and equitable because the respondents should be aware that they must treat all employees irrespective of their race, irrespective of their gender in a fair and proper manner and these respondents failed to do so."

10. The Employment Tribunal then considered the question of mitigation so far as it affects the compensatory award. There is clearly a distinction. The basic award goes essentially to the fact of unfair dismissal having taken place. The compensatory award normally goes to restore the employee for the loss that he has suffered and therefore the approach may be different and in this case it was different to the extent that the Tribunal were here unanimous. Again, they point out in the following terms:

"The fact is that on 11 November the (Appellant) was offered reinstatement, he was offered everything that he wanted in terms of the continuity. Bearing in mind Mr Hay's letter of 4 November, everything that he asked that the respondent should do they had done. They sought to right the wrong which they done to the (Appellant) and the (Appellant) refused to have the wrong righted. In the view of the Tribunal the (Appellant) failed to mitigate his loss."

11. The Employment Tribunal then considered the case of Fyffe to which we have referred and correctly directed their attention to the need to look at the seriousness of the conduct, emphasising the difference in the facts as between the 2 cases and pointing out that this was not a case of a very late conversion, of inconvenient circumstances because of Tribunal proceedings or anything of that kind. And the Tribunal therefore came to the view that there would be no entitlement to the Applicant's compensation as a result of the failure to mitigate his loss.
12. In some respects this appears to have been a harsh decision. We are told that the Appellant was at the time a 60 year old man, a mature man, that his dignity was bruised and we are asked to take into account the fact that this was an employment that had gone on for only 2 months. It was not like a longstanding good relationship in which there was a slight 'blip', as Mr Hay described it, which should normally be capable of repair. It was a short relationship and therefore it was not unreasonable for the employee to regard the employers as having been in fundamental breach of contract and having broken the terms of trust and confidence.
13. We can understand the disappointment of the Appellant that, having won the claim for unfair dismissal and having previously won his contention that he had continuity of employment. He is deprived of the whole compensation because he did not agree to go back to work. But even bearing in mind that the error appears to have been on the part of the respondent as to the contractual right of the employee, the Employment Tribunal directed their attention to the fact that the employer sought to put that right as quickly as he could. And they came to the conclusion that the Appellant was unreasonable in refusing to accept the apology, the restoration of his contract, the acknowledgement that he was right, all of which were within 3 days of his dismissal.
14. We can see no arguable error of law in that approach. The Tribunal directed themselves to the legal provisions in the case of Fyffe. They took into account the facts of the case and the circumstances and formed a judgment upon it. Indeed, there was a split in the judgment in the Tribunal which is just the sort of thing that can happen when Tribunals are doing their best to form fine judgments on issues of fact which are before them. But there is in our judgment no error of law arguable on the face of that decision. It is not arguable. It does not seem to us that the Employment Tribunal got it so wrong that their decision was perverse and we find no argument that as a matter of law they set the standard of reasonableness too high. That was an argument of fact for the Tribunal to consider in the way that they did and accordingly this Appeal must be dismissed at this stage.