United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR SEAN JONES (of Counsel) The Law Offices of Marcus O'Leary Centennial Court East Hampstead Road Bracknell Berks RG12 1YQ
For the Respondent	MISS PATRICIA DEIGHAN (of Counsel) Messrs Lawrence Hamblin Concept House 9-11 Greys Road Henley-On-Thames Oxon RG9 1SB


 


MR JUSTICE CHARLES:

Introduction

1. This is an appeal against a decision of a Chairman of an Employment Tribunal sitting alone at Reading on 14 July 2000. His Order was as follows:

"This preliminary hearing as to whether the applicant has the requisite length of service to pursue his claim of unfair dismissal be adjourned and relisted for a hearing before a full tribunal of three (but not with this chairman) with a time estimate of half a day."

2. The parties are Mr Purdom (the Applicant before the Employment Tribunal and the Respondent before us) and Panasonic Industrial Europe Ltd (Panasonic) the Appellant before us and the Respondent before the Employment Tribunal.
3. Panasonic seek to have the Order set aside. They do so on the basis of issue estoppel.
4. At the end of the hearing we announced that we would dismiss this appeal and give our reasons later. Those reasons are contained in this judgment.

The background

5. It is and always has been common ground that Mr Purdom was dismissed on 28 May 1998.
6. However the date upon which his employment started has not been common ground. Three dates have been suggested. They are:

(a) 9 September 1996,

(b) 16 May 1997, and

(c) 16 June 1997.

7. If either of the first two dates are correct Mr Purdom would have the necessary two year period of employment to found a claim for unfair dismissal.
8. Panasonic assert, and have throughout these proceedings asserted, that Mr Purdom's employment did not start until 16 June 1997.
9. In his IT1 Mr Purdom asserts that his employment started on 16 May 1997 and in support thereof he relies on his Statement of Employment Particulars which include a commencement date of 16 May 1997. Panasonic assert that that date in his Statement of Employment Particulars is a typing error and should read as "16 June 1997". In support of that contention throughout the proceedings they have relied on points set out on the second page of their letter dated 19 November 1999.
10. Mr Purdom had joined Panasonic earlier on 6 September 1996. An issue raised in respect of this earlier period has been whether he was continuously employed from that date for the purposes of section 108 Employment Rights Act 1996. I say that this "has been" an issue because it may be that this issue is no longer being pursued by Mr Purdom.
11. An earlier hearing took place before the same Chairman of an Employment Tribunal sitting at Reading on 7 December 1999. His decision at that hearing with reasons were sent to the parties on 10 December 1999. His interlocutory order was that:

"1. The application on behalf of the respondents [Panasonic] that this Originating Application be struck out is refused.

2 This application be stayed pending the House of Lords decision in R v Secretary of State for Employment ex parte Seymour-Smith and Perez."

His reasons for that decision were as follows:

"1 Although Counsel for the applicant submitted that the applicant had commenced relevant employment on 9 September 1996 no real evidence was produced to the hearing to this effect. In fact, the respondents' stance was a fixed one year contract determining. The Tribunal therefore makes no determination on this dimension.

2 There was no dispute that the applicant commenced employment with the respondent on 16 June 1997 and that the effective date of termination of his employment was 28 May 1999.

3 The respondents sought under the provisions of Section 13(2) of Schedule 1 to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 1993 to strike out this application on the grounds that the applicant did not have the requisite qualifying period of employment under the provisions of Section 108 ERA 1996 to present a complaint of unfair dismissal.

4 Counsel for the applicant resisted this application submitting that the proceedings should be stayed pending Seymour-Smith.

5 I conclude that these proceedings properly should be stayed in line with the current practice of employment Tribunals throughout the country. It is also possible that the final determination in Seymour-Smith may give rights to bring unfair dismissal proceedings to applicants with less than 2 years continuous employment."

12. Before returning to those reasons it is necessary to set out some of the background to that hearing. This appears from correspondence passing between the parties and between them and the Employment Tribunal.
13. By a fax of 15 October 1999 Panasonic requested that Mr Purdom's complaint be struck out on the basis that he had not completed (the then) two years' qualifying service. Observations were sought from Mr Purdom's Solicitors who replied by a letter of 29 October that their instructions were that Mr Purdom commenced work for the Respondent on 16 May 1997 and they enclosed a copy of the Applicant's Statement of Employment Particulars (which, as I have said, showed that date as the commencement date). A Chairman (being the Chairman who made the two Orders I have already referred to) directed on 5 November 1999 that the case be listed for a two-day hearing.
14. By a fax of 19 November 1999 Panasonic repeated their request that the Originating Application be struck out. In that communication they stated that there was a typing error on the face of the Statement of Employment Particulars and that the employment started on 16 June 1997. There then followed a reference to a number of documents and explanations relating to them that Panasonic rely on to demonstrate that the employment commenced on 16 June 1997. The letter continued with the following paragraph:

"In light of the foregoing I wish to make application that this action be struck-out as the Applicant does not have the relevant two-year qualifying period of service. Further or in the alternative I would ask the Chairman to consider that the Applicant has not met the test to fulfil the requirements for a claim in unfair constructive dismissal."

The letter then raised points relating to constructive dismissal and continued with the following assertion:

"The Applicant never once made mention of working under protest and therefore we submit that it is impossible for him to make out a case in unfair constructive dismissal. As there was no dismissal by Panasonic then the Applicant has no cause of action in an unfair dismissal claim either.

For the foregoing reasons I would respectfully ask the Chairman to review this matter and strike this application out for want of prosecution."

It is apparent from that letter that Panasonic were then seeking to strike out on alternative grounds and not simply on the basis that Mr Purdom did not have the necessary two year qualifying period of employment.

15. On 24 November 1999 the Employment Tribunal wrote to the parties in (inter alia) the following terms:

"Further to correspondence received, the Chairman has directed that this case be set down for a Directions Hearing to consider the respondent's request for the application to be struck out.

The hearing has been arranged for 7 December 1999 at 9.30 am and will be heard before a Chairman sitting alone.

If a party chooses not to attend the Chairman may proceed to give such directions as appear to be necessary or desirable in that party's absence. The Tribunal will not hear evidence and witnesses are not expected to attend.

The parties will be informed in due course, in writing, of any directions given."

On the face of it that is a letter setting a "Directions Hearing". This is apparent from the first quoted paragraph, the point that the Chairman is going to be sitting alone and the point that the Tribunal would not hear evidence and witnesses were not expected to attend.

16. We pause to comment that having regard to the issues raised by Panasonic to establish that there was a typing error in Mr Purdom's Statement of Employment Particulars, it would have been necessary for evidence to be heard and considered to determine that issue. Additionally, it seems to us that it would have been necessary for evidence to be heard to enable the Employment Tribunal to deal with the alternative basis upon which Panasonic had sought to strike out the Originating Application if it was pursued.
17. On 2 December 1999 Mr Purdom's Solicitors wrote to the Employment Tribunal with a copy to Panasonic. That letter was in the following terms:

"This matter has been set down for a hearing on 7^th December 1999 on the preliminary point of whether the Applicant has sufficient qualifying period for a claim of unfair dismissal.

The Applicant was dismissed on 28^th May 1999 prior to the introduction of the Unfair Dismissal and Statement of Reasons for Dismissal (Variation of Qualification Period) Order 1999.

The issue of whether the Applicant has sufficient qualifying period cannot be determined until the House of Lords reaches a decision in R v Secretary of State for Employment, ex parte Seymour Smith and Perez (1995) IRLR 464.

We respectfully request that this matter be stayed, pending their Lordships' decision."

18. On 6 December 1999 the Employment Tribunal wrote to the parties in the following terms:

"A chairman has considered the applicant's solicitor's application for a stay and the respondent's solicitor's response. The respondent wishes to continue with its application and is entitled to a hearing. Accordingly the hearing on 7 December 1999 remains listed.

We have not seen the Respondent's Solicitor's (ie Panasonic's) response referred to in this letter.

19. Counsel for Panasonic before us places considerable reliance on this letter of 6 December 1999 and submitted that it showed that the issue to be determined on 7 December (ie the next day) was whether or not the Originating Application should be struck out and thus whether or not Mr Purdom had the relevant two years of employment.
20. We do accept that submission. Even if Panasonic had not in their application to strike out raised other grounds, and notwithstanding the first paragraph of Mr Purdom's Solicitor's letter dated 2 December 1999, we are of the view that the hearing that remained listed is the hearing described in the letter from the Employment Tribunal dated 24 November 1999. It was therefore a Directions Hearing at which the Employment Tribunal would not hear evidence and witnesses were not expected to attend.
21. In any event in our judgment the correspondence shows some confusion as to what was to happen at the hearing on 7 December and considerable room for misunderstandings.

The hearing on 7 December 1999

22. We have seen the Chairman's notes of that hearing. They show that Panasonic's representative made submissions which effectively repeated the points made relating to the two year qualification period contained in Panasonic's letter of 19 November 1999. They therefore included an assertion that Panasonic admitted that there was a typographical error on the Statement of Employment Particulars showing a commencement date of 16 May 1997. "Admitted" is the word used by Panasonic in their letter. It seems to us that more naturally they should have said "asserted".
23. The Chairman's note of the submissions made on behalf of Mr Purdom contain no acceptance or agreement that there was a typing error on the Statement of Employment Particulars but record a new point, namely that it was being asserted on behalf of Mr Purdom that he had a fixed one year contract commencing on 9 September 1996 and there had been continuous service from September 1996. The notes also record that Mr Purdom's representative submitted that, even if Panasonic's representative was correct in what she said as to the start date, because of the Seymour-Smith case the Originating Application should be stayed.
24. After a brief note of the submissions in response the Chairman's note records that at 10:32 am the Tribunal retired and then at 10:46 am under the heading "Decision from the Chairman" the following is included in the note:

"There was no evidence adduced before the Tribunal of employment prior to 16 June 1997 but I am not considering or making a ruling on that aspect. The decision of the Tribunal is that the application to strike out is refused. It is proper that the matter should be stayed pending the House of Lords' determination in Seymour-Smith. I cannot say that this application is frivolous within the ambit of Rule 13 of the Procedure Regulations."

Panasonic's case on this appeal

25. Panasonic accept that there was no agreement or acceptance by Mr Purdom's representative on 7 December 1999 that the commencement date of his employment was 16 June 1997. However, Panasonic argue that on 7 December 1999 the Employment Tribunal decided that this was the commencement date.
26. First it was said that this is implicit in paragraph 2 of the reasons given by the Chairman for his decision. In effect it was submitted that that paragraph should be read by adding, after the words therein "there was no dispute", the words "and I so find".
27. We do not agree. We see no reason to add those words. The paragraph makes sense as it stands.
28. The second (and in our judgment more powerful) argument advanced by Panasonic was that before deciding to grant a stay it was necessary for the Employment Tribunal to determine whether or not Mr Purdom had the necessary two years' qualifying employment because if he did there was no need for a stay. We see some general force in that submission. However, an alternative course was open to an Employment Tribunal and that was to decide that there should be a stay because the result in the Seymour-Smith case could have rendered dispute as to whether Mr Purdom commenced his employment on 16 June 1997 or earlier wholly academic.
29. In our judgment looking solely at the reasons sent to the parties for the decision made on 7 December 1999 this is the course that the Chairman took. This view is confirmed by his notes relating to the decision made on 7 December 1999.
30. Looking at the reasons in our judgment the first paragraph thereof is a clear indication that the Chairman took the view that he was not going to decide whether or not Mr Purdom had been employed for two years. We do not accept Panasonic's argument that if, as Panasonic assert to be their understanding, Mr Purdom is no longer pursuing an argument that his employment started in September 1996, the first paragraph of the reasons can effectively be ignored and the second paragraph thereof treated as a decision by the Employment Tribunal that Mr Purdom commenced employment on 17 June 1997.
31. An additional strand of Panasonic's argument was that having regard to the nature of the hearing on 7 December 1999 it was incumbent upon Mr Purdom through his representative to put his argument that the employment commenced on 16 May 1997 (rather than 16 June 1997) and their failure to do so had the effect that Mr Purdom is now estopped from pursuing that argument. In this context Counsel for Panasonic referred us to Henderson v Henderson [1843] 3 Hare 100, in particular at 115 (or 319 of the English Report). This is a well known passage relating to issue estoppel which has been applied to Employment Tribunal proceedings in Divine-Bortey v London Borough of Brent [1998] IRLR 525. In respect of the principle of issue estoppel we have also had regard to Arnold v National Westminster Bank [1991] 2 AC 93, in particular at 106 G to 107 H and 110 G where it is made clear that cause of action estoppel or issue estoppel is essentially concerned with preventing abuse of process.
32. Counsel for Panasonic also referred us to Mensah v East Hertfordshire NHS Trust [1998] IRLR 531 in support of the proposition that it was not the duty of the Employment Tribunal to introduce argument on the starting date. We accept that point.
33. We do not accept that the principle set out in Henderson v Henderson applies in this case for the following reasons, namely:

(1) the approach of the Employment Tribunal was not as Panasonic asserted it was (or had to be) namely that it was necessary for them to decide whether or not Mr Purdom had two years' employment before ordering a stay;

(2) rather the Employment Tribunal took the approach that they would order a stay without deciding on his length of service because following the decision in the Seymour-Smith case his length of service might be an academic issue; and

(3) the hearing on 7 December 1999 was a Directions Hearing at which neither side were expected to advance their cases on the length of Mr Purdom's employment and therefore the submissions made were indicative of the parties respective cases as and when the issue as to the length of service fell to be decided.

34. Further and in any event the principle in Henderson v Henderson is one that applies save "in special circumstances" and in our judgment the circumstances of this case and in particular the background to the hearing on 7 December 1999 and the course of that hearing are circumstances that mean that the principle should not apply and that it would not be an abuse of process for Mr Purdom to pursue his claim.