United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR CLIVE SHELDON (of Counsel) Instructed By: Messrs Wiseman Marshall Solicitors 7 High Street Rayleigh Essex SS6 7EU
For the Respondents	MR PAUL SPENCER (of Counsel) Instructed By: North Lambeth Law Centre 14 Bowden Street Off Cleaver Street London SW11 4DS


 


MR JUSTICE MAURICE KAY:

1. This is an appeal from a decision of an Employment Tribunal sitting at London (North) on 10 November 1999. The decision of that Tribunal is summarised on its face in this way; that the Tribunal unanimously decided that the appellant's claim of victimisation under the Sex Discrimination Act 1975 and the Race Relations Act 1976 is dismissed "on withdrawal by the applicant"; that the appellant's claim for unfair dismissal is dismissed; and that the appellant's breach of contract claim is dismissed upon settlement as lodged with the Tribunal. That brief list of findings came after proceedings which took a course that has been the subject of submissions before us today. It is necessary, however, to go back a little into the history.
2. The appellant is a solicitor, who obtained employment with the respondents, who are in turn the umbrella body for administering law centres throughout the country. The respondents obtain funding through grants from local authorities, the National Lottery or elsewhere. The position which the appellant held with the respondents was that of Disability Rights Legal Project Development Worker. She was offered that post by letter dated 10 October 1996 which stated that it was a fixed term post, initially for 11 months, funded by the National Lotteries Board, with the possibility of annual extensions for a further two years depending upon satisfying the requirements of the funding body and raising matched funding to supplement the reduced grant allocation for years two and three.
3. We do not need to go into great detail about what happened in the earlier part of the appellant's employment. In due course, by a letter dated 10 August 1998, the appellant's employment was terminated. The letter stated:

"I am writing to you on behalf of the executive committee of the LCF and on their instructions … this is a letter to give you formal notice that unless further funding is received to cover the costs of continuing your employment by 10 October 1998, your contract will come to an end. This notice is in accordance with the terms and conditions stipulated in the letter offering you the post dated 10 October 1996 which requires an eight week notice."

4. To cut a long story short, there was correspondence and there were communications about funding and its future. It seems that by the effective date of termination in October, there was some available money but by no means enough to keep the appellant in post for another year, although, in the event, after her dismissal, such funding was forthcoming in December 1998.
5. It follows from the history as we have so far related it, that the case for the respondents was always that the termination of the appellant's employment was related entirely to a funding problem which had not been overcome by the October deadline and that, in all the circumstances, she was fairly dismissed. The case for the appellant, as put in her originating application, was very different. Her originating application alleged; (1) victimisation under the Sex and Race Discrimination Acts, (2) unfair dismissal and (3) breach of contract.
6. When addressing the date when the action complained of had taken place, she put in her originating application: "Victimisation from April to October 1998". She added details of the three headings of her claim. As to the first, "Victimisation", she put it in this way in her originating application:

"1. Victimisation

A colleague of mine resigned from The Law Centres Federation on 7^th May 1998, following allegations of gross misconduct, which were made against him. I was ostracised and victimised at work because of my support for this colleague from the point at which the LCF's Staff and Executive Committee became aware that I was to testify for him as a witness, in internal disciplinary proceedings, relating to allegations of sexual harassment and assault which had been made against him by a female colleague.

I gave evidence for my colleague at an Internal Disciplinary Appeal which took place on Friday, 13^th March 1998 and, later, at an Industrial Tribunal Hearing at London (North) (Case No: 6001807/98). I was not invited to give evidence at the initial Internal Disciplinary Hearing, relating to the allegations of gross misconduct against him, which took place in December 1997."

7. That then was her victimisation claim. She was contending that she had done a protected act, namely, giving evidence for the aforesaid colleague in disciplinary proceedings where he was on the receiving end of allegations of sexual harassment and assault and, she had been ostracised and victimised for some months as a result of that involvement. In the originating application she then went on to describe her unfair dismissal claim, beginning with this paragraph:

"2. Unfair Dismissal

In my view, The Law Centres Federation dismissed me unfairly because of my opposition to their actions against my colleague and as a direct result of my decision to give evidence for this colleague at his Internal Disciplinary Appeal and, later, at the Industrial Tribunal Hearing."

8. She then went on to describe the history of funding and how she perceived the handling of that issue. We do not need to say anything about the breach of contract claim.
9. When the matter came before the Employment Tribunal, the case was listed for either two or three days. What happened in the event, is that on the first day, a witness who was attending pursuant to an order of the Tribunal at the behest of the appellant, gave evidence and other witnesses including the appellant on the one side and the appropriate witnesses on the other side also gave evidence. However, the parameters within which they did so were limited by the approach which the Tribunal had decided to take. No doubt with the best of intentions, the Employment Tribunal decided to consider first the funding issue. Whilst the witness who was attending by order also gave evidence on the victimisation issue to the extent that she expressed the view that the reason for the dismissal was not victimisation, we have the very clear impression, and it is not seriously challenged by Mr Spencer, who represented the respondents at the Employment Tribunal and here, that the approach of the Tribunal was effectively to treat funding and unfair dismissal as a discrete matter, to reach a conclusion upon it and only then, if necessary, to proceed to consider victimisation.
10. What happened was that halfway through the afternoon of the first day, having heard the evidence to which we have referred, and having largely confined it within the parameters we have described, the Tribunal announced its decision to the effect that the reason for the dismissal was a lack of funding and that that in all the circumstances, had been fair.
11. There then arose the question of what should happen to the victimisation claim. It is difficult to make precise findings about what happened next. It is quite clear that the Chair of the Employment Tribunal encouraged the parties to settle their differences in circumstances which embraced the issuing to the appellant and her advisers of what both sides now describe as a "costs warning". It is put on behalf of the appellant that it really took the form of a threat that if she were to return the next day and to pursue her victimisation claim, she might have to pay the costs of the respondents. We do not have an official transcript of what was said. The closest we come to it is an attendance note that was made by the appellant's father, who is a very experienced solicitor, and no issue is taken by Mr Spencer as to the accuracy of this part of his note. It reads as follows:

"She (that is the Chair) said that they would be happy to come back tomorrow but "these matters were not, in her view, very well covered in Elizabeth's statement and it was possible that the other side would want to claim costs against Elizabeth if we did come back tomorrow and lost the victimisation argument"".

12. Clearly what happened after that is that having been encouraged to discuss terms of settlement, the parties reached agreement some time after the members of the Employment Tribunal had left the building. That agreement is set out on pages 78 and 79 of our bundle. It embraces the withdrawal of the victimisation claim, the settlement of the breach of contract claim in the sum of £750 and the preservation of the appellant's right of appeal. It seems that that document was produced on the first day of the hearing, handed to a member of the Employment Tribunal staff after the members of the Tribunal had left and placed before the Tribunal the following morning. In due course the Employment Tribunal produced Extended Reasons for the decision and they accord with what we have just described. They find that the reason for the dismissal was an insufficiency of funding and that the dismissal had been reasonable in the circumstances.
13. The first and principal ground of appeal advanced by Mr Sheldon on behalf of the appellant, is that the Employment Tribunal fell into error by deciding to treat the funding issue and unfair dismissal as a compartmentalised part of the case which could be considered to the point of decision without consideration of the victimisation claim. Mr Sheldon points to the way in which the originating application had been set out and, indeed, had been amplified by a lengthy reply to a request for Further and Better Particulars. Quite plainly, the correspondence which had preceded the dismissal included letters in which the appellant had advanced her claim of victimisation in conjunction with her complaints about the respondents' approach to funding.
14. There was before the Employment Tribunal, a lengthy witness statement from the appellant. It ran to 23 pages. The first part of it dealt with the history of the funding and the attempts which, in the appellant's view, had been "obstructed", to extend it. However, the latter part of that lengthy statement contains her evidence on the issue of victimisation. Part of it reads as follows:

"When I was dismissed from my post on 14 October 1998 it was on the pretext that insufficient funds were available to continue with Disability Rights Project. I know this to be untrue. In my opinion my dismissal was undoubtedly influenced by my earlier support for a male member of staff (Mr Chris Lucas) who eventually resigned having faced serious allegations of gross misconduct. I was victimised at work because of my support for this colleague from the point at which the LCF Executive Committee became aware that I was to testify for him as a witness at an appeal hearing relating to allegations of sexual harassment made against him by a female colleague."

At a later stage she states:

"I was obstructed in my attempts to obtain further funding for the Disability Rights Project by the LCF."

And later again:

"I was also deliberately precluded from any discussions concerning general funding bids and how these might relate to the Disability Rights Project. Although Pauline Alden, the Vice Chair of the LCF, was identified as the relevant contact on the Executive Committee for the purposes of the Disability Rights Projects, she made no attempt to discuss the progress of the project with me from March 1998 onwards. Indeed, she told me that there would be no need to re-arrange a meeting scheduled for 2 June 1998 to discuss the National Lottery bid which I was obliged to cancel due to illness. She also failed to attend any of the Disability Rights Project Working Party meetings from March 1998 onwards and gave no apologies. She was one of the members who sat on the panel of the Internal Disciplinary Appeal hearing which I attended on 13 March 1998."

15. Mr Sheldon said, next, with clear justification, that that witness statement explains the linkage which the appellant was seeking to make between the two issues of funding and victimisation. His complaint, effectively, is that the appellant was denied the opportunity to have the case considered on the basis of that linkage and was denied the opportunity to have her case of unfair dismissal properly considered in the context of an allegation of victimisation. That, it is abundantly clear, is what she was advancing as the principal reason for her dismissal.
16. On behalf of the respondents, Mr Spencer, who has assisted us greatly with his frank recollections of what occurred in the Employment Tribunal, submits that the approach of the Employment Tribunal fell within its powers of case management. An Employment Tribunal has the power to "conduct the hearing in such manner as it considers most appropriate for the clarification of the issues before it and generally to the just handling of the proceedings." That is an extract from Rule 9(1) of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 1993 and Mr Spencer submits that what the Employment Tribunal did on this occasion was entirely consistent with that power.
17. As this appeal took shape, the grounds of appeal and an affidavit in support of them by the appellant's father, who exhibited his Attendance Note of the proceedings, were sent to the Employment Tribunal Chair for her comments. Her first comments about the splitting of the issues was in the form of a denial that she had directed that the Advocates should restrict their arguments to the issue of funding only. She recalls that she discussed with them the issues that were likely to arise. She also says this;

"We had to consider what was the reason for the termination of the Applicant's contract. Was it, as alleged by the Applicant, because of the fact that she had given evidence previously at the Tribunal against the Respondents or because the Respondents had lacked funding?"

18. That description of what the Employment Tribunal had to consider was of course impeccable. However, the complaint is that by concentrating on funding to the exclusion of victimisation, the Employment Tribunal effectively prevented itself from comparing the different reasons which had been advanced as explaining the dismissal. There is something about the Chair's comments that give rise to our deepest concern. She indicates in three places in her detailed comments that victimisation was not something that had been covered by the appellant in her witness statement. That is quite simply erroneous as we have already described. It was covered. The coverage of it extended over several pages and some of it was highly specific.
19. It follows from this history as we are relating it, that the decision to split the issues was made on the erroneous assumption that the evidence was virtually silent on the question of victimisation and that the decision on unfair dismissal was made in total disregard of the appellant's case on victimisation and the way in which she sought to link it to the issue of funding and through that to the issue of unfair dismissal. This was not a case in which having heard the evidence on what it thought might be a discrete issue, the Employment Tribunal postponed its decision on the issue. On the contrary, it made a decision and gave an extempore judgment on that subject adverse to the appellant before consideration was given to proceeding to the next stage.
20. In our judgment, the Employment Tribunal fell into error by proceeding in that way in the circumstances of this case. It ought not to have reached its conclusion on unfair dismissal without regard to the appellant's case on victimisation. The overlap between the two ought to have been self-evident and, as we have indicated, it may be that the error arose from a wrongful perception that the witness statement was silent on the subject of victimisation.
21. That error, in the way in which the Employment Tribunal approached the case, seems to us to go to the heart of the decision that it made. In those circumstances, we take the view that there is no alternative but to allow the appeal on that ground and to remit the matter for hearing before a differently constituted Employment Tribunal.
22. We return briefly to the second ground of appeal which related to the "costs warning". This, is seems to us, is more difficult. We would not wish to say anything to discourage a degree of robustness on the part of Employment Tribunals in encouraging parties to discuss, negotiate and settle their claims. What is obvious is that there is a line upon one side of which falls acceptable robust comments and encouragement and on the other side, threat and coercion. On the material before us, including in particular, the Attendance Note of the appellant's father, we are not satisfied that the Employment Tribunal crossed the line and engaged in threats and coercion in this case. If that had been the sole ground of appeal, in all the circumstances this appeal would not have been allowed.
23. There was a third ground of appeal which related to the finding on the unfair dismissal claim. It was in part a re-working of the first ground of appeal and in part a reasons challenge. It seems to us that in reality that ground of appeal stands or falls by the outcome on the first ground of appeal. That first, and by far the most important ground of appeal having been successful, we do not feel the need to say anything more about the third ground of appeal.
24. It follows that the appeal will be allowed and the matter remitted to the London (North) Tribunal for rehearing before a differently constituted Tribunal. The remission is in relation to unfair dismissal and victimisation and I shall also add we form no views whatsoever as to the likely outcome of this case when it is properly heard by the Employment Tribunal