United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	Mr Pollard Consultant Messrs Pollard Associates Apex House 15 Ambleside Crescent Sprotborough Doncaster DN5 7PR


 


MR JUSTICE LINDSAY (PRESIDENT)

1. We have before us as a preliminary hearing, the appeal of Stonegate Farmers Ltd in the matter Mr R Smith -v- Stonegate Farmers Limited. The case arises out of a Decision at Birmingham and, broadly speaking, relates to unfair dismissal. Today Stonegate has appeared by Mr Pollard.
2. On 13 October 2000, Mr Smith presented an IT1 for unfair dismissal. He said that he had been dismissed on 14 July 2000. He said that as Assistant Manager of one farm, run by Stonegate Farmers Ltd, he had been required to move to another farm run by them, or owned by them, and he took the view that he was not entitled to be so required, and that he was dismissed for failing to act upon that instruction. He said:

"That although there was a job flexibility clause in my contract of employment my place of work was stated to be Poplars and that my employer could only exercise the clause for reasons of operational efficiency. I was not told why I had to move to the Lyndons and I was most certainly not told that I was being moved for reasons of operational efficiency and therefore I felt that it was not unreasonable of me to refuse the request."

3. On 31 October 2000 the company put in an IT3. It took the point that the two farms were only a mile or so apart and that Mr Smith's refusal to move represented gross misconduct. On 13 March 2001, there was a hearing at Birmingham, and on 18 April 2001 the Decision was sent to the parties. It was a unanimous Decision of the Tribunal, sitting under the chairmanship of Mrs P M Hughes and it was that the Applicant was unfairly dismissed and that the Tribunal would reconvene to consider the question of remedy.
4. On 22 May there was a Notice of Appeal from the company. It was a Notice of Appeal that gave four short grounds in paragraph 6 of the printed form. I do not think I need read them out, but they were shortly there stated.
5. More fully today we have a Skeleton Argument from Mr Pollard on behalf of the company and, in order to understand the case, it is convenient to take passages from the Skeleton Argument.

"The Issues

1.0 The Respondent was dismissed for refusing to comply with a legal and reasonable instruction issued by the Appellant.

2.0 Specifically the Respondent was instructed to work at a farm (farm B) operated by the Appellant some mile and a half from the farm that was his usual place of work (farm A).

3.0 The reason the instruction was issued to the Respondent was that a report commissioned by the Appellant from a specialist consultant in egg production and poultry husbandry indicated that there were a number of inadequacies in the operational standards at farm A. Inadequacies were also highlighted at farm B"

And then under the same heading, numbers 7 and 8, it says:

"7.0 Prior to issuing the instruction to the two workers the Appellant's General Manager [Mr Fiddler] sought advice from the Appellant's Company Secretary [Mr Hayter] regarding the Appellant's entitlement to move the two workers under the contract of employment.

8.0 The Appellant's Company Secretary made reference to an express Job Flexibility clause and an express Mobility Clause in the contract of employment generally and confirmed that in his view the Appellant did have the contractual right to move workers."

A little later at 11:

"11.0 A formal disciplinary process followed and the Respondent was dismissed by reason of gross misconduct."

And at 14:

"14.0 However, at page 8 part 14 of its reasons the Tribunal of Fact stated that in its view the Appellant was not able to rely on either the express Job Flexibility or Mobility Clauses because in its view the reason for the application of one or both contractual clauses was not for operational purposes."

At 20 it says:

"20.0 The Appellant asserts that the Tribunal of Fact erred in fact and law by disallowing the Appellant's reliance upon express contractual clauses incorporated into its contract of employment for the express intention that each clause was obviously intended."

And, finally, at 25, 26 and 27:

"25.0 The Appellant avers that in taking the approach that it did the Tribunal of Fact erred in law and that it was not entitled to draw the conclusions that it drew regarding the Appellant's right to rely on an express contractual Job Flexibility and Mobility clause.

26.0 The Appellant cites White -v- Reflecting Roadstuds Ltd [1991]/RLR 331 EAT in support of its contention.

27.0 The Appellant argues that if it is right on that point it must follow that the tribunal of Fact was wrong in law not to take full account of Farrant -v- The Woodroffe School [1998] EAT 176"

That, I hope, gives a sufficient picture, for immediate purposes, of the nature of the chief argument that Mr Pollard puts in front of us.

6. That Farrant case, though perhaps inevitable, given the prior authorities that it itself refers to, is at first blush a little surprising. Should it not be unreasonable, without more, for an employer to insist upon obedience to an instruction that he is not contractually entitled to give? However, let it be assumed, if an employer has a genuine belief, reasonably arrived at, that the instruction is contractually proper, that he may, in some cases, then be regarded as not unreasonable in insisting upon such obedience, and in turn, that it should be not unreasonable to dismiss for a non-compliance with that order.
7. On such an assumption, then in some such case it would be important to examine the existence or not of the employer's honest and informed belief and whether it had been, or could be regarded as a view reasonably arrived at. If, for example, the employer consults solicitors or Counsel as to the effect of the contract in law, he might plainly be better placed than if he had consulted no one or a person without legal qualification. Here the Employment Tribunal noted that the General Manager had consulted the Company Secretary. In their paragraph 3 (d):

"He did consult Mr Hayter, the Company Secretary, about whether the respondent's contract of employment permitted him to move staff in these circumstances and was told that it did."

We are bound to say that, if that was the advice that the Company Secretary gave, it hardly commends itself as plainly reasonable. The job flexibility clause, in the context of a contract that had both a job flexibility clause and a mobility clause, would not seem at first blush to authorise an instruction as to mobility, mobility here concerning working at or from somewhere other than the usual appointed place. The job flexibility clause said:

"It is an express condition of employment that all employees of the Company, including yourself, be prepared whenever applicable, and within reason to transfer to alternative departments or duties within the Stonegate Group. This flexibility is essential as the type and volume of work is always subject to change, and it allows us to operate efficiently in getting maximum potential from our workforce."

8. The Employment Tribunal were, at first blush, wrong in considering that the flexibility clause could only be used if, objectively regarded, the change that was required conduced to efficient operation. But, perhaps more relevantly, there was no need or licence to construe the flexibility clause in its reference to alternative departments and duties to include alternative places, as one can plainly have more than one department, or more than one duty, at one place. Although, therefore, for what might seem a wrong reason, the Tribunal was nonetheless, in our view, right in seeing that the job flexibility clause did not here assist the company.
9. As for the mobility clause, that provided:

"Although you are usually employed at one particular site, it is a condition of your employment that you are prepared, whenever applicable, and within reason on a temporary basis, to transfer to any of our other sites. This flexibility is essential to the smooth running of our business."

The Tribunal, as it seems to us, was right in concluding that this did not help the company either. The Tribunal said:

"The tribunal took the view that this clause would enable the respondent to move the applicant from one site to another but on a temporary basis. There is no suggestion that the instruction to move the applicant was intended to be of a temporary nature."

10. Accordingly, the instruction given to Mr Smith was, it seems at first blush, not contractually justified. That being the case, the question of whether the company, nonetheless, reasonably thought that the order was contractually justified, became a crucial question and the Tribunal neatly summarised the effect of the Farrant case as follows, in their paragraph 10:

"The tribunal were referred to the case of Farrant -v- The Woodroffe School [1998] IRLR page 176, which is authority for the proposition that if a respondent holds a genuine, if mistaken, belief that its employee is guilty of gross misconduct in refusing to obey its instructions, it may be reasonable in the circumstances to dismiss the employee for that reason."

11. The Tribunal therefore turn to the question to the existence or not of a particular belief and they dealt with it in their paragraph 17. First of all they began paragraph 17 by saying:

"Having considered the above matters, the tribunal addressed the question of whether, in the circumstances, it could be said that the respondent had a genuine, if mistaken belief, that the applicant had failed to obey a reasonable instruction and therefore was reasonable in dismissing him."

And then they continued:

"17. We took the view that the process from beginning to end was significantly flawed and that it seemed to us that no reasonable employer would have dismissed the applicant in these circumstances. The respondent was aware of the applicant's concerns but chose to treat them as irrelevant. The applicant did not unequivocally refuse to move, instead he stated he would not do so without being given reasons. Rather than provide reasons and discuss the matter with the applicant, the respondent treated his qualified refusal as a disciplinary matter. The respondent was aware that the applicant took the view that it was not entitled to move him under the contractual clauses concerned but, again, took the view that this was irrelevant. In our opinion neither the disciplinary hearing nor the appeal hearing addressed the correct issues and in our view had the hearings done so, it may well have been that the applicant could have continued to work for the respondent. In our view, these matters lead up to conclude that the respondent had not established a genuine, mistaken belief that the applicant had failed to obey a reasonable instruction.

18. In all the circumstances, the tribunal took the view that the case could be distinguished from that of Farrant."

12. Some, at least, of those reasons given for the conclusion seem, arguably, and of course at this stage we are only concerned with what is arguable, hardly to be reasons for the company not to have had a genuine belief in the contractually justified nature of the instruction that it gave to Mr Smith.
13. Moreover, there is no mention of what the precise advice given by the Company Secretary was. We do not know whether he had any qualifications to advise on a legal issue. We do not know why an outside or a qualified lawyer was not consulted. We do not know whether the Company Secretary was referred back to, once it had become plain, as it did, that Mr Smith took the view that the company was not entitled to require him to move in the way that it had so far insisted on.
14. The Employment Tribunal's view that no reasonable employer would have dismissed does not lead to or even point towards a conclusion that the employer did not subjectively or reasonably believe that it was entitled in contractual terms to do as it did. Nor does treating Mr Smith's concerns as irrelevant point to such a conclusion. If the company had been entitled, contractually, to do as it did, it might not have been wrong, contractually, to treat his concerns as irrelevant. Nor does the conditional nature of Mr Smith's refusal reflect on the nature of the company's belief.
15. Accordingly, we do see it as arguable, and we emphasise we are only saying that this is a possible error of law, that the reasons given for the Tribunal taking the company not to have had a reasonable belief in the contractual propriety of the instruction that it was given do not point to the conclusion at which they arrived.
16. The last sentence of paragraph 17, in other words, is not justified by the reasons given in the preceding parts of paragraph 17. That we see as an issue fit to go forward. As it is going forward, then the other points that are sought to be raised in the Skeleton Argument seem to us appropriate to be heard; they are not such as are likely to take very long.
17. They are first, that the Employment Tribunal neglected to notice, either to reject or accept, alleged evidence from the company that in fact it met Mr Smith's condition that he would move if the company accepted that he was not to be held totally to blame for the problems at the farm at which he worked, and secondly, the related question of whether, if that were so, had he not, to some extent, contributed to his own dismissal by nonetheless continuing to act by refusing the instruction to move.
18. So, the three issues we have described are proper to go forward. We see the matter as a Category B matter. Skeletons should be exchanged not less than fourteen days before the hearing. The matter will take of the order of an hour and a half and we add that although we have expressed some views on the construction of the job flexibility and mobility clauses, if, in the course of argument at the full hearing, on any of the three issues that go forward, that construction comes into contention, well then, the panel at the full hearing will, of course, remember that our views have been formed ex parte, and to that extent are necessarily provisional. We have only been concerned with what is arguable. But, unless Mr Pollard has any further procedural requirements, the matter goes forward in the way that we indicate.