United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR B UDUJE (of Counsel) Post Office Legal Services Impact House 2 Edridge Road Croydon CR9 1PJ
For the Respondent	MISS S DORIS (of Counsel) Penman Johnson 5 George Street Watford Herts WD1 0SQ


 


MR RECORDER LANGSTAFF QC

1. This is an appeal from a decision of an Employment Tribunal at London Central. By Extended Reasons promulgated on 23 January 2001 the Tribunal decided that Mr Burkett had been unfairly dismissed by his employers, then known as the Post Office. They decided that he had contributed to his dismissal such that the compensation should be reduced by thirty percent.
2. The essential facts, derived from the Tribunal decision, are these. Mr Burkett was employed for just over nine years. He had no disciplinary record. On 19 November 1999 he was dismissed. The reason for his dismissal was that he had overfilled the engine of a Post Office vehicle with oil such that when the vehicle was used the engine blew. The Tribunal began its decision by investigating the background facts. They did not, at that stage, focus, as they should have done, upon the reason which the employer had for the dismissal.
3. It is common ground that the question which the Tribunal had to address was that posed by Section 98 of the Employment Rights Act 1996. That requires, first, under subsection (1), that the employer should show the reason for the dismissal, and that it is a reason which falls within Section 98(2). It should then proceed to determine in accordance with Section 98(4), if those requirements are fulfilled, whether the dismissal is fair or unfair having regard to the reason shown by the employer. The answer to that question depends on whether, in the circumstances, the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and is to be determined in accordance with equity and the substantial merits of the case. That requires a focus, not upon the underlying facts which led to the dismissal, but upon the employer's reasons for the dismissal, and whether those reasons were looked at from the employer's standpoint sufficient to justify the dismissal.
4. The Tribunal found, at paragraph 2(f), that the overfilling by Mr Burkett was accidental. They proceeded, further, to conclude that when his employers came to consider the circumstances that led to their dismissing him they both had an honest belief that he had deliberately overfilled the vehicle. Secondly, that before doing so they had had a careful and thorough investigation of the factual evidence, the engineering case and the medical background.
5. The Tribunal continued, in its decision, to remind itself, however, of the applicable law. It recited the well known authority of Post Office v Foley and HSBC Bank v Madden. That case, reported at 2000 IRLR 827, deals with the approach which a Tribunal should take when it is looking at a disputed question of conduct. The approach to be taken under Section 98(4), which we have set out in essence above, is helpfully developed in the case of British Homes Stores Ltd v Burchell [1980] ICR 303. That case provides that before a dismissal by an employer is likely to be held reasonable by a Tribunal, the employer must have, first, an honest belief that the misconduct alleged, existed; secondly, that belief must be based on reasonable grounds; and thirdly, that it followed a reasonable investigation.
6. The question, whether or not the reasonableness of the grounds is to be measured by the Tribunal itself making an objective appraisal of those grounds, is answered by the Court of Appeal decision in Madden. In the leading judgment in the Court of Appeal, Lord Justice Mummery said, at paragraph 79:

"Instead of determining whether the bank had made reasonable investigations into the matter and whether it had acted within the range of responses of a reasonable employer, the tribunal in effect decided that, had it been the employer, it would not have been satisfied by the evidence that Mr Madden was involved in the misappropriation of the debit cards or their fraudulent use and would not have dismissed him. The tribunal focused on the insufficiency of the evidence to prove to its satisfaction that Mr Madden was guilty of misconduct rather than on whether the bank's investigation into his alleged misconduct was a reasonable investigation."

That approach is further exemplified by the short judgment of Lord Justice Rix in the same case. He said, at paragraphs 83, 84 and 85:

"The possibility of an employment tribunal or of the Employment Appeal Tribunal substituting its own view for that of the employer in question could, in theory, arise in at least three different situations.

(1) Either tribunal may be tempted to substitute its own views as to the correct conclusion to be arrived at as to the employee's responsibility for the misconduct complained of. (2) The employment tribunal is charged under s.98(4) with the determination of the question whether the dismissal is fair or unfair and, in so doing, has to decide whether the employer acted reasonably or unreasonably in treating the s.98(2) reason as a sufficient reason for dismissing the employee.

(3) The Employment Appeal Tribunal may be tempted to substitute its own views as to the s.98(4) question of reasonableness or unreasonableness."

We are, of course, here concerned not with the Employment Appeal Tribunal substituting views, but with an allegation, which we shall explain in due course, that the Employment Tribunal did just that.

7. Accordingly, the Tribunal in the present case had reminded itself that the correct approach was not to substitute its own views for that of the employer. It had also reminded itself that when considering the application of the British Homes Stores Ltd v Burchell test, the question whether there were reasonable grounds for an honest belief had to be answered, not by reference to the Tribunal's own objective views formed subsequently, but by reference to their assessment of that which it was open to a reasonable employer to conclude on the material before it. In other words, it involved not an assessment of whether the evidence did or did not convince the Tribunal of the guilt of an employee but whether it was reasonably capable of doing so to a reasonable employer.
8. Against the background of the cases which established the propositions we have set out, and about which there is no dispute before us, the Tribunal proceeded in the central paragraph in its decision, paragraph 7, to say this:

"The Tribunal's concerns centred on the employer's belief in the misconduct relied upon in dismissing and the grounds for that belief. The Tribunal concluded that the Respondents' thinking was dominated by their concerns about the potentially serious health and safety consequences of an overfilled vehicle going out on the public road, exploding and causing damage. With this health and safety concern dominating their thinking, the management concluded that there had been a deliberate overfilling, and very specifically dismissed on the basis of this deliberate overfilling, when there was not evidence to support that conclusion of deliberateness. This was evidenced by the fact that in closing submissions before the Tribunal deliberate overfilling was not the Respondents' case."

9. For the Appellants, Mr Uduje has argued three matters. First, he has said, that the Tribunal's decision shows, when taken as a whole, that the Tribunal substituted its own views for those of the employer in a manner which the Madden decision and the Foley decision demonstrate to be impermissible. Secondly, he submitted that the Tribunal had no proper basis for finding that the grounds for the honest belief which the employer formed were unreasonable given that the investigation was expressly found to be full, thorough and reasonable. Thirdly, he pointed to an apparent inconsistency which emerged when the Tribunal dealt with the issue of contributory conduct.
10. To explain those submissions and the issue of contribution requires exploration of the evidence in a little further detail. The Tribunal concluded, as a matter of fact, that there had been an altercation immediately before the alleged overfilling of the vehicle. In the course of that Mr Burkett had used derogatory words – interposing, it appears from material before them that they were trenchant workman's expressions – about the vehicle he was being asked to take out and suggested that something was likely to be wrong with it. They continued, however, as a finding of fact at paragraph 2(e) to say this:

"… that there were persistent problems of maintenance and reliability with vehicles and at the depot comments of that nature were normal and natural in the working environment and not sinister. There were not therefore good grounds for attaching great significance to the derogatory words in interpreting the subsequent overfilling event."

They concluded, however, that the Respondent, as a matter of fact, did significantly overfill the vehicle. At paragraph 3(h) they examined the nature of the decision taken to dismiss the Respondent. It was based on two things. The first was the Respondent's behaviour prior to the accident which was found to be unacceptable and in the light of that a conclusion that the overfilling of the vehicle was deliberate with a view to putting it out of service.

11. When one then reverts to paragraph 7 the conclusion of deliberateness was, as the Tribunal had found, based upon conduct. The highest that could be put was in two respects. First it is indicated in an internal note that the Respondent must have used the dipstick to determine that more oil needed to be put into the motor of the vehicle with which he was concerned. Accordingly, one might have expected that he would have checked the quantity of oil that he had added by reading the dipstick again once he had finished pouring the lubricant into the engine. Secondly, there was the comment about the vehicle to which we have expressly referred. Mr Uduje conceded, in the course of argument, that if the first of those matters had stood on its own, it could not possibly, on any basis, sustain a view that a vehicle had been deliberately overfilled with a view to causing it damage. He argued, however, that the evidence of the comment, taken together with the dipstick point, was such that any employer would be entirely within the bounds of reason to regard those as grounds upon which it might honestly believe that the overfilling had been deliberate.
12. Whatever the force of that argument might be in general terms, in this case the Tribunal had, in paragraph 2(e), already dealt with matters which, although found by them as facts, must have been within the knowledge of any employer in the position of the Post Office, that is that they must be taken to have known, since the depot was their depot, that people at the depot commonly used words about vehicles as trenchant and as expletive as those used by the Respondent on the occasion in question. The Tribunal, it seems to us, were entitled to come to the view that given that situation an employer with that knowledge would not be able to attach great significance to such words in interpreting the events of overfilling.
13. So far as the submission as to substitution is concerned, the issue for this Tribunal is whether we can be satisfied that in expressing the view which the Tribunal did in the words:

"there was not evidence to support that conclusion of deliberateness"

the Tribunal was making its own assessment of the evidence as opposed to examining the appropriateness of the conclusion which the employers had reached from the standpoint of a reasonable employer.

14. We have been persuaded by Miss Doris, who appears for the Respondent, that there is insufficient material here for us to conclude that that is what this Employment Tribunal was doing. We think that the indications are the other way. First, the Tribunal had expressly reminded itself of the applicable principles in clear terms. Secondly, in expressing itself in paragraph 2(e), it had dealt generally with the quality of evidence which an expression of the sort used by the Respondent was capable of conveying. The Tribunal had not evaluated it for itself, rather approached it as a general proposition. Thirdly, the entire focus of paragraph 7, save for the last sentence, which is problematic, is upon the view which the employer reached at the time of dismissal. Thus, it begins by talking about concerns centring upon the employer's belief. It examines the Respondent's thinking. It looks at what was the dominant reason for the employer reaching the view it did. Then, when it comes to the critical phrase, it describes it in terms which do not read 'there was no evidence of deliberateness' which might leave it equivocal as to whether that was the Tribunal's view retrospectively or whether it was their assessment of the quality of the employer's view. Instead the words 'to support that conclusion of deliberateness' are inserted. The focus is thus not upon the Tribunal's own view but upon the conclusion which the employer reached. The word 'that' in front of conclusion is plainly a reference back to the very conclusion which the employer had reached at the time.
15. Accordingly, although it is not conclusive, we think that whether the passage is taken as a whole, or whether there is a focus upon the close wording of it, the indications are that this Tribunal was not only addressing the question it had posed itself earlier, but was appropriately addressing that question. Further, at paragraph 9, the Tribunal reminded itself of the Burchell test and recited that the Respondents (that is the Appellants in the present case) did not have reasonable grounds on which to sustain a belief that the Applicant deliberately overfilled his vehicle. Again, the words 'to sustain' indicate, though they do not conclusively state, that the focus of the Tribunal was upon the reasoning and quality of evidence before the employer and that the Tribunal itself was not substituting its own view.
16. We should add that the words that suggest there was no evidence to support a conclusion of deliberateness might be read in one of two ways. They might mean that there was no evidence at all which went to support that conclusion. As we have indicated, there was the dipstick point and the comment which was made. Those words might, alternatively, mean that there was no such evidence as could on any reasonable view support such a conclusion. It is not necessary for us to decide in which sense it was meant, but the latter appears the more likely. For the reasons which we have already given we do not think that we can say that the Tribunal were not entitled to take that view. There will be some cases which fall outside a range of that which is reasonable. In evaluating the quality of evidence available to support a conclusion in fact reached, we think this Tribunal was entitled to take the view that the evidence before it, in the light of the circumstances it has recited, was simply insufficient on any reasonable view.
17. The second basis for attacking the decision was that there was some inconsistency between concluding that the reasons were insufficient to support an honest belief when the investigation had itself been reasonable. Mr Uduje pointed out that there will, in most cases, indeed possibly all but a very small minority, be a considerable overlap between the second and third grounds of Burchell. Thus, a reasonable investigation is likely to throw up reasonable grounds for an honest belief. If there are not reasonable grounds it is likely to be because there has been an insufficiency of investigation. Accordingly, he says, that though in principle each is a separate test, in practice one informs the other.
18. We have no difficulty in accepting the generality of the point that Mr Uduje makes. The question for us, however, is whether that general point applies in the particular circumstances of the present case. That there may be cases in which those tests are indeed separate, and separately to be regarded, is demonstrated by the case of Granges Building Systems Ltd t/a Glostal Monarch v Hill a case decided before this Tribunal presided over by Mr Commissioner Howell QC on 18 October 2000, unreported, EAT/666/99, to which Miss Doris has drawn our attention. It would appear from paragraphs 19-23 that that case regards the Burchell tests as being separate tests. Miss Doris suggests that an argument to much the same effect as that addressed to us by Mr Uduje was rejected by that Tribunal on that occasion.
19. We see no particular reason why the tests must necessarily always so overlap that answering one will answer the other. If it were so there would be no need for separate tests. In this case, moreover, if the Tribunal's thesis was, as it appears to us to have been, that the Post Office knew, or ought to have known, of the situation in its own depot such that adverse comments about motor vehicles were commonplace, they had information which was relevant which did not require uncovering by investigation. It should have been known. We see no reason to fault a Tribunal approaching a matter under the three heads of British Homes Stores Ltd v Burchell, focusing upon those three heads separately in view to assisting to them to answer the question under Section 98(4) which was after all the statutory question which the Tribunal had to address.
20. Finally, we come to the question whether there is an inconsistency in approach by the Tribunal. In paragraph 10, in considering contribution, the Tribunal said that they found that there was irresponsibility on the Applicant's part in pouring a lot of oil into the vehicle with his mind not on the job, then driving off the vehicle knowing it had been overfilled. The word 'knowing' is important. Mr Uduje contrasted that with the finding of fact at paragraph 2(f). There the Tribunal concluded that the overfilling was accidental. The point put simply was that, if he knew that he had overfilled the vehicle, that was inconsistent with describing the overfilling as accidental. However, we accept the submission made by Miss Doris that the contrast here is between deliberate overfilling with the purpose of disabling a vehicle, the antithesis of which would be an accidental overfilling, as opposed to that which is referred to when contributory conduct was examined, namely the careless doing so with no thought of consequence. The real issue is the motive with which the act was done. We think that, although the decision is not as felicitously worded as perhaps it might have been, that is what the Tribunal were saying.
21. Finally, we should comment that in reaching the conclusion we have done and in evaluating the decision reached by this Tribunal, we have noted that the Tribunal began by setting out facts, some of which were irrelevant to the questions which it had to address. Secondly, we note that the last sentence of paragraph 7, referring as it does to closing submissions, again, was an irrelevant consideration in answering the question it had to address. We have in consequence looked carefully at the decision to see whether those evident flaws suggest that the Tribunal here was committing the errors of law, or any of them, which Mr Uduje suggests. However, despite our concerns about aspects of the formulation of the decision, we are unable to conclude that that is the case. It follows, that for the reasons that we have given, and despite the concerns we have expressed, this appeal will have to be dismissed.

Mr Uduje

Sir, doing the best I could in the circumstances to digest the decision and the reasoning, I am instructed, and I do ask, for leave to appeal against that decision, because one is bound to of course, the rule does not allow me to wait for the ……………………………[inaudible] before applying for leave, so in the circumstances I do ask for leave.

Mr Recorder Langstaff

Do you have any ground other than the arguments you have addressed to us?

Mr Uduje

No Sir.

Mr Recorder Langstaff

No, we are against you, you will have to go to the Court of Appeal if you wish to appeal it.

Miss Doris

Sir, I make an application for costs. I say that the proceedings today have been unnecessary and I rely on the decision. Firstly with regard to the first strand of argument, Sir, you find that there was insufficient material for that to succeed. Secondly, on the second ground, you said that the Tribunal properly applied the statutory question, and lastly, with regard to contribution, you accepted my submission about it being deliberate and accidental, that being the difference for substantive unfair dismissal case and contribution respectively.

Mr Recorder Langstaff

I need not trouble you to respond – we reject the application for costs. First, this case went through the Preliminary Hearing procedure. It is our view that, had we heard the matter at a Preliminary Hearing, we too would have thought that there were points which were worthy of further deliberation at an Inter Partes Hearing. The proceedings have not been improperly brought, nor vexatiously brought, for that reason. It seems to us, given the difficulties to which we have adverted in respect of the way in which the reasons of the Tribunal were formulated, that it was an entirely proper appeal to bring. We do not think there are any grounds at all for the application for costs and we reject it.

Thank you both for your assistance.