United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR THOMAS LINDEN (of Counsel) Instructed by: Matthew Brain Messrs Beachcroft Wansbroughs Solicitors 241 Glossop Road Sheffield
For the Respondent	MR DAVID MELVIN Representative British Medical Association Bartree House 406 Palatine Road Northendon Manchester M22 4DJ


 


MR COMMISSIONER HOWELL QC:

1. In this appeal which is before us today for full hearing the Lincoln & Louth National Health Service Trust seeks to have set aside as erroneous in law the decision of the Nottingham Employment Tribunal, comprised in extended reasons sent to the parties on 3 June 1999 after a hearing on 19 May 1999. That statement of reasons is at pages 3-9 of the appeal file before us. The proceedings in which that decision was given were proceedings brought by Dr Patrick Jonathan Cowan a qualified anaesthetist who had been in the employment of the health trust, the Appellants before us, for a period of over 12 years from August 1986 to 30 November 1998, most recently and materially for our purposes as a Locum Consultant Anaesthetist in the Lincoln County Hospital. The termination of his employment on 30 November 1998 was by due notice on the ground of redundancy. It took place after an offer of alternative employment at a smaller hospital in Louth, which the Tribunal held was a suitable offer of alternative employment, had been made to him by the health trust. However that offer had not been responded to by him or by the representative for the British Medical Association who was advising him and acting on his behalf at that time.
2. Dr Cowan's originating application was launched on 28 January 1999. In it he had claimed unfair dismissal, redundancy payment and breach of contract. The Tribunal held unanimously that the unfair dismissal claim was dismissed (it had in fact been withdrawn on Dr Cowan's behalf at the hearing) but that he was entitled to a statutory and contractual redundancy payment following the termination of his employment on the ground of redundancy on 30 November 1998. The basis on which they so held was that it had not been shown that he had acted unreasonably in rejecting the offer of suitable alternative employment that had been made to him. The Notice of Appeal dated 8 July 1999 on behalf of the Health Trust seeks to have that decision set aside, on the grounds there set out and amplified for us by Mr Linden in argument on the Health Trust's behalf: that the Tribunal had erred in declining to take account of his failure to discuss or even respond to the offer of alternative employment made to him. As I have said, the Tribunal accepted this had been an offer of suitable alternative employment within S.141 (3) of the Employment Rights Act 1996.
3. The single issue for us to consider on this appeal is whether that alleged error (of failing to take account of Dr Cowan's failure, or refusal, to respond in any way to the offer that had been made to him), is established on a proper reading of the Tribunal's reasons for awarding the payment and rejecting the employer's contentions that he had unreasonably refused a suitable alternative offer. S.141 (2) of the 1996 Act provides that where a suitable offer is made, the employee is not entitled to a redundancy payment "if he unreasonably refuses the offer ". It is common ground before us that the burden of proof of establishing that a refusal of a suitable offer is unreasonable is on the employer, and it is further common ground that the way in which an employee considers a suitable offer, if such an offer is made, and responds to it or does not respond to it is a relevant consideration to be taken into account under S.141 (2) as part of an overall assessment of the issue of reasonableness or otherwise. That appears from a succinct passage of the judgment of the Employment Appeal Tribunal in a case also involving the Lincoln National Health Service Trust to which our attention was drawn: Lincoln National Health Service Trust v Brown Employment Appeal Tribunal reference 418/97, delivered by his Honour Judge Clark on 29 October 1997. The only passage to which we need to refer is that at page 5E of the transcript, where after referring to the judgment of the Court of Session in the earlier case of Williamson v National Coal Board in 1975 his Honour Judge Clark stated the principle in these terms in a single sentence: -

"Failure to respond to an offer by the employer in the absence of a proper explanation may, on the facts, amount to an unreasonable refusal."

4. That statement of the general principle we did not understand to be in any way disputed by either side before us. So all turns on the way in which the Tribunal actually did or did not take into account on the actual facts of this case the response or lack of it on the part of the employee. The circumstances in which the offer was made and the way the Tribunal addressed this issue or (in Mr Linden's submission failed properly to do so) are apparent from the terms of their extended reasons. After referring to the making of Dr Cowan's existing post redundant on 30 November 1998 they said at paragraphs 5-6:

5."On 20 October 1998 the Respondent wrote to the applicant and his representative at the BMA to confirm that a post of associate specialist at Louth Hospital was to be established and the applicant was asked if he wished to express any interest in the post and, if not, why he thought it was unsuitable. It was suggested that a meeting would be arranged in November. The BMA responded on the applicant's behalf, saying that, without detailed information concerning the job plan, it would be difficult to say whether it was a suitable alternative. In response to the suggestion of a meeting, the BMA said:

"Dr Cowan and I would be more than happy to meet with you about this post, but I think it is essential that you let us have more details about the actual job content to enable a view regarding suitability to be taken."

6. "The respondent then, by letter of 10 November, provided a proposed job plan, showing the sort of sessions that would be likely and confirming that the job had a one three-on-call commitment. The BMA acknowledged that information, but did not respond substantively. On 20 November 1998 the respondent wrote again to the applicant and the BMA for a decision on the post, confirming that they would be happy to have a meeting and requiring a decision and again pointing out to the applicant that, as the job was considered to be suitable alternative employment, any rejection of the offer would jeopardise any anticipated redundancy payment. There was no response to that letter and, on 7 December 1998, after the applicant's employment had ended, the respondent again wrote, accepting its understanding that the applicant did not wish to consider the alternative post but suggesting that even at this stage they were open to discussion and asking what was unsatisfactory about the job. That letter was not replied to until a letter of 14 January, simply saying that the post was not suitable alternative employment and that an application would be made to the Employment Tribunal. It was only when in these proceedings the applicant was asked to give further and better particulars of his reasons for rejecting the offer, that any details were given."

5. The Tribunal's next following paragraphs then go into the substantive reasons why Dr Cowan, the Applicant before them, contended at the hearing that the alternative offer was not a suitable offer for him and was not one that he found acceptable. It appears that for practical purposes his two major objections were not to do with moving from Lincoln to Louth, because he did not have permanent premises in Lincoln anyway, but because the Louth Hospital was a smaller hospital. Thus his duties there as a Associate Specialist, which was the job on offer, would have required increased on-call responsibilities and also, because of the smaller nature of the hospital, would have involved less completed and difficult surgery, so that he felt that the "quality of work" would be generally of a lower standard for the purposes of advancing his own career than had been available to him as a Locum Consultant at Lincoln. As the Tribunal recorded in paragraph 8: -

8. "The applicant did object to the new post because it required on-call responsibilities, which were not in his current job as a locum consultant. He does not dispute that, as an associate specialist or any other level that he could have obtained, the likelihood is that he would have been required to do some on-call. However, he felt that the on-call at Louth was a particular problem. He was required to be on-call for one day out of three and one weekend out of three."

And in paragraph 9, they set out the reasons why he felt that the quality of work at a smaller hospital would be less advantageous to him. But as is common ground he did not discuss these objections with the respondent at any time before matters had developed to the point of the application being made to the Tribunal.

6. It was submitted to the Tribunal on behalf of the Health Trust by a Mr Brain, the Solicitor appearing on its behalf at that stage, that the offer that had been made to Dr Cowan was a proper and suitable offer of alternative employment and that he had been unreasonable in his refusal, by failing to make any attempt to inform the respondent of his position about the job or to discuss it. After reference to some authority, it appears to have been submitted to the Tribunal that the authorities all showed that acting unreasonably in refusing a suitable offer was by itself sufficient to disqualify an applicant from a redundancy payment. We should say that the matter has not been put as highly before us, as that proposition apparently made to the Tribunal suggested. Dealing with the issues they had to address the Tribunal recorded first in paragraphs 14 and following: -

14."…We have to apply to apply a two- stage test. The first question is whether, objectively, the offer was suitable alternative employment. The applicant could not continue as a locum consultant and because of the change in the requirements could not get another job at that level. The best that he could obtain was as an associate specialist. That was what the respondent offered to him at a salary which, although less than his previous salary, was as good as he could expect and was in his own speciality. The fact that Louth is a smaller hospital and that the on-call was more onerous than the applicant's previous job or a job in a bigger hospital does not prevent the job being suitable alternative employment, looked at objectively. We accept that the respondent was justified in believing that it had made a good offer to the applicant."

15. "The second stage of the test that we have to apply is, was the applicant unreasonable in refusing the offer of suitable alternative employment? We accept the points put forward by the respondent and do not consider that the applicant acted properly in failing to discuss with the respondent his objections. We consider that neither the applicant nor his representative at the BMA come out well from this process. However, we do not consider that unreasonableness in the way he negotiated with the respondent is the test that we should apply. It seems to us that we must look at the way the applicant approached the decision to see whether he was reasonable or not in deciding not to accept the offer. We have considered the cases Mr Brain referred to us to, but do not feel that they show as he argued that, if the manner in which the applicant dealt with the respondent was unreasonable, that makes his refusal unreasonable."

They then referred to two of the authorities cited to them, in particular the case of Williamson v NCB, (to which we have already referred in citing the judgment of his Honour Judge Clark in the earlier Lincoln NHS Trust case). They considered the suggestion that as in Williamson had the applicant discussed the position offered, he might have been offered work of another kind, so that his failure to discuss his problems meant he had failed to obtain proper information so that a decision on that basis was not reasonable. They continued : -

16.. "That is not the situation in the case before us, as the respondent does not dispute that, even if the applicant had discussed the position with them, there was no job available and, whilst they could have made minor changes, essentially the type of work would have remained the same and a significant level of on-call would have remained for some time with no guarantee that it would have changed."

17. "We have to decide whether the applicant was unreasonable in refusing the alternative offer on the grounds that he has given to us. We have no reason to believe that those are not genuine grounds. The on-call required at Louth was onerous, by requiring him to be in the close vicinity of the hospital for one day and one weekend out of three. That was both significantly worse than he had been doing and also compared with the sort of on-call he might have expected at a bigger hospital with more people. Furthermore, we accept that the applicant felt that the quality and variety of work was important to him and he was entitled to see it in that way. He did not need to discuss further with the respondents to have sufficient information about the type of work at Louth. He wanted to be in a bigger, more active unit, with all that goes with that. Taking account of the high level of on-call and the degree of reduced job satisfaction, we consider that Dr Cowan was not unreasonable in taking the view that this offer was unsuitable to him."

18. "It follows that, as we consider that he was not unreasonable in rejecting the offer in the way that he did, he is not disqualified from a redundancy payment either statutorily or under his contract."

7. Mr Linden who has appeared before us for the Appellant Health Trust submits that the way in which the Tribunal's reasons are there set out, shows that they wrongly excluded from their minds the questions of the conduct of the Respondent. They themselves found this manifestly unreasonable, as is apparent the comments they made about what they describe as his "not having acted properly" in failing to discuss his objections: paragraph 15 of their reasons. Mr Linden accepts that the Tribunal referred to the conduct of Dr Cowan and his representative on more than one occasion in their statement of reasons but despite the terms in which they did so he submits the passages in paragraphs 15 and 17, where the Tribunal defined for themselves the test they had to apply and the issue they had to decide show that they left themselves no real room to take proper account of the reasonableness or otherwise of the applicant's conduct in declining in effect to consider or even discuss the suitable offer of alternative employment that had been made to him.
8. Mr Melvin, who appeared on behalf of Dr Cowan as the Respondent to the appeal, submitted on the other hand that these issues of what should or should not count as reasonable in the particular circumstances of the case are all issues of fact and degree, which it is the proper province of the Employment Tribunal and not of this court to determine. He said the Tribunal's stated reasons showed clearly that they had had present to their minds the conduct of the Respondent and his representative of which they plainly disapproved, but nevertheless had reached a conclusion on the facts with which it was not proper for this Tribunal to interfere. We have carefully considered both submissions which were well and comprehensively argued before us and we consider there is merit in both. It is, we accept, not the function of this Tribunal to subject the stated reasons of an Employment Tribunal to an over refined scrutiny or to identify imaginary errors of law or principle from the fact that the reasoning might perhaps have been better expressed if more time had been available to devote to it, or that every single point of fact or contention raised is not referred to specifically in the Tribunal's statement of reasons. However at the end of the day, we have concluded that in this case the Tribunal's stated reasons do not show with the required degree of clarity that they correctly directed themselves to all relevant considerations on the issue of the employee's reasonableness here: in particular the way in which he failed to respond to the offer that had been made to him. Accordingly, we accept the argument of Mr Linden that the Tribunal's stated reasons fail to show with adequate clarity that they gave weight to the complete failure on the part of the Respondent even to entertain or discuss the offer that had been made to him.
9. It is in our judgment relevant that (as is apparent from paragraph's 5-6 of the Tribunal's statement of reasons), the offer that was made was of a new post, and was put in terms that expressly included proposals to discuss anything about the post which was of concern to Dr Cowan. In those circumstances, we do not think it was right to infer that the offer had been put in such totally inflexible terms as to make it reasonable on the part of the employee not to respond to it or to be willing to discuss it at all. Insofar as the Tribunal's rejection of the employer's contention may appear to be based on an assumption of that kind, we think that it must have been erroneous. Although the Tribunal refer to the response (or lack of it), at more than one point in their statement of reasons, we do not for our part find it apparent from paragraphs 15-17 how the conduct of the employee (which the Tribunal itself found, we accept, manifestly unreasonable was taken into account in the actual decision. This was not in our judgment a case where the offer made was itself so totally unsuitable and not worth discussing, that it could have been right for the Tribunal to approach the case on the basis that even to accept an offer of discussion would have been a completely sterile exercise or that any discussion would have been simply a matter of going through the motions on the part of the employee, with no real prospect of anything of value emerging from either side. We say that especially as the Tribunal appears expressly to have accepted that this was a suitable offer of alternative employment, and that has not been disputed before us on behalf of Dr Cowan.
10. The consequence is that we allow the appeal. We set aside the Tribunal's decision as erroneous in law on the ground that the stated reasons do not show with the required degree of clarity that all material issues have been sufficiently taken into account or at least do not show the way in which they have been so taken into account. That leaves the question of the future conduct of the case. We record that we have been concerned as the argument developed at an apparent inconsistency in the Tribunal's findings in this case, between their express acceptance that the alternative job offer made to Dr Cowan was a suitable offer of employment, and their apparent acceptance on the other hand, that it was so unsuitable for him that it was not even an offer worth him discussing. Although obviously the two questions of suitability and unreasonableness on the part of the employee are not exact mirror images, we have had some difficulty in understanding how the two are reconciled in the way the case has been handled so far.
11. We have therefore concluded that the right course is for the entire case to be sent back to a differently constituted Tribunal, for that Tribunal to conduct a complete rehearing and redetermination of all material issues on redundancy, (unfair dismissal having been withdrawn at an earlier stage). That will involve the new Tribunal being able to consider both whether the offer that was actually made, in the terms it was made, was or was not a suitable alternative offer of employment under s.141 (3) the question under s.141 (2), which has occupied the argument before us of whether the employee's response to that offer was or was not unreasonable in the judgment of the Tribunal. On that basis, we allow the appeal and remit the case for rehearing by a differently constituted Tribunal.