United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR GARY MORTON (Of Counsel) Instructed by: Ms J Leader 38 Bowring Green South Oxhey Hertfordshire WO1 6UN
For the Respondent	MR OLIVER HYAMS (Of Counsel) Instructed by: London Borough of Brent Brent Legal Services Town Hall Annexe Forty Lane Wembley HA9 9HD


 


MR JUSTICE HOLLAND

1. This is an appeal from the decision of an Employment Tribunal sitting at London Central which decision together with Extended Reasons was sent to the parties on 18 January 2001. The issue is unfair dismissal.
2. There were before the Employment Tribunal five Applicants each alleging unfair dismissal by the Respondents. All five had been employed by the Respondent Council as day centre workers at Strathcona Day Centre. On divers dates in and between August and October 1998 all five had had their respective employments terminated, ostensibly on grounds of redundancy.
3. As a preliminary to a summary of the facts it is helpful to note that a person involved in history that concluded with these dismissals was Mrs Linda Gardner. In the Extended Reasons she described as Changeover Day Co-ordinator in Day Options Development, a title totally opaque as to significance. We assume that it indicates some managerial role. Apparently, in 1997 she was involved together with other Council officials in setting up Options Development Agency Ltd, a company limited by guarantee, which company seems to have started trading in the year ending 31 March 1999 with Mrs Gardner as a director and company secretary. There was a dearth of factual findings about this company and its role (a matter to which we return later) but we infer that its role included receipt and utilisation for public purposes of funds that the Council as an entity could not bid for. It was also a registered charity.
4. Turning to the history of the matter as it appears from the Extended Reasons it is convenient to take up the account at paragraph 10. This reads as follows:

"In the spring of 1998 the Respondent resolved to set up a Further Education Centre at the Strathcona Day Centre using lecturers from the College of North West London. The Day Centre workers were unhappy with this change of direction for Strathcona. They were offered the services of a facilitator to discuss their concerns and he met some of the workers, including the Applicants, on 11 May 1998 with their union representatives. A list of issues was drawn up but no further meetings occurred. During the course of this period the day centre workers, or at least some of them including the Applicants, did not co-operate with the lecturers. It had been anticipated that this would cause difficulties for the lecturers but, in the event, the lecturers were able to cope with help from their own assistants."

We then move to paragraph 12:

"During the course of June 1998 the Respondent through its managers reached the conclusion that the conduct of the Day Centre Workers had shown that, taking into account the changes as a result of bringing in the lecturers, meant that they were not needed. Accordingly Mr Ludgate started to formulate plans to delete the position of Teacher/Centre Worker. At about the same time as he was preparing papers containing this proposal for the relevant council committees, Mr Ludgate consulted first with parents and carers of the users on 19 June and then had a meeting with the staff on 22 June 1998. Mr Grey and Miss Leader were present but the other Applicants were not. The staff were told that their posts were to be deleted. Minutes of that meeting were given to all staff later that week when Ms Hubert discussed the proposals with each member of staff individually. On the same day as the meeting a formal letter was sent by Mr Smithson to Mr Butterworth, the union's branch secretary."

We move further then to paragraphs 14 and 15:

"14. On 2 July 1998 Mr Ludgate had a second consultation meeting with staff which was attended by all the Applicants except Miss Leader who was on holiday. Mr Butterworth was also present. The proposals were confirmed to the staff on 8 July and arrangements regarding redeployment and redundancy were confirmed to them. Staff were told that they needed to ask for application forms for alternative positions."

15. The proposal to set up the Strathcona Day Centre as a Further Education Centre was reported to the Social Services Committee which endorsed the recommendation. On 8 July 1998 notices of redundancy were sent to all the affected staff including the Applicants. It was confirmed to them that they had the options of ring fenced interviews for two posts in the Albert Road Day Centre and two posts at the Strathcona Day Centre. These two posts arose because, following discussions during the course of what consultation had taken place management had come to the conclusion that two centre worker positions should be retained to assist with users with serious behavioural problems. The deadline for applications was fixed for 17 July but this was later extended to 22 July. Staff were also informed that there were three scale 3 posts available if any of them were interested although it was accepted that these did not amount to suitable alternative employment. In the letter it was made clear that if any of the employees wanted to seek redeployment to one or more available posts they should ask Miss Gardner for the relevant application form and job description."

5. At this stage of the Extended Reasons the Employment Tribunal looked into the particular circumstances of the various applicants. For present purposes we need not recite the further findings save that which concludes the history in paragraph 20:

"On 30 July 1998 an incident occurred at the Strathcoma Day Centre which the management considered to amount to a 'sit in'. As a result Miss Leader, Miss James and Ms Myers were sent home on 'garden leave' where they remained until their employment ended."

6. Having found that central history in the terms thus recited the Employment Tribunal directed itself as to law. It cited first Section 98, Employment Rights Act 1996 as follows:

"(1) In determining for the purposes of this Part whether the dismissal of an employee is fair or unfair, it is for the employer to show –

(a) the reason (or, if more than one, the principal reason) for the dismissal, and

(b) that it is either a reason falling within subsection (2) or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held.

(2) A reason falls within this subsection if it –

….

(c) is that the employee was redundant …

(4) Where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer) –

(a) depends on whether in the circumstances (including the size and administrative resources of the employer's undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and

(b) shall be determined in accordance with equity and the substantial merits of the case."

7. The Employment Tribunal further cited Section 139 which so far as relevant is as follows:

"(1) For the purposes of this Act an employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to –

(b) the fact that the requirements of that business –

(i) for employees to carry out the work of a particular kind, or

(ii) for employees to carry out work of a particular kind in the place where the employee was employed by the employer

have ceased or diminished or are expected to cease or to diminish."

8. Directing itself on the material so far cited in this judgment the Employment Tribunal considered first the reasons for dismissal and set its views out in paragraph 31 in these terms:

"The first matter the Tribunal considered was whether or not the Respondent had shown the reason for dismissal. The Tribunal was satisfied on the evidence before it that the reason for dismissal was redundancy. The Respondent had decided that it no longer needed as many centre workers as were previously employed. There had been 11 but, after the period during which what consultation there had been had taken place, the Respondent had concluded that it now needed two in addition to three lower graded positions. This falls full square within the provisions of section 139(1)(b)(ii) of the 1996 Act."

9. The Tribunal then moves from reasons to consider the fairness of dismissals. In the upshot, dealing with this aspect of the matter, it concluded with respect to the three Applicants, Miss Leader, Ms Myers and Miss James that the dismissals were unfair, in particular because owing to some failure to provide appropriate application forms to them they had not been in a position to apply for interviews for the ring fenced post. With respect to the remaining two applicants, they decided that the dismissals were fair because they had been in a position to make that application. There then was the situation at the conclusion of the Employment Tribunal hearing, a conclusion that was subsequently confirmed on review. All five appeal. The case that they present is as follows. Granted, they say, that the decision dealt with the case that was the subject of the original complaints made in October 1998, it had wholly failed to address a further limb to their case that was extant by October 2000, that is, by the start of the prolonged hearing before the Employment Tribunal. This case is helpfully advanced on behalf of the Applicants by Mr Morton. Mr Morton points to what does appear from the Extended Reasons as to this further limb to the case. There are three references to it. Paragraph 1 notes as follows:

"The Applicants complain that their dismissals, allegedly for redundancy, were unfair because there was no redundancy. They also complain that the dismissals were a sham created by one of the Respondent's officers as a result of complaints made about her financial dealings by some of the Applicants."

That being the first reference, one then moves to paragraph 13 where it is recited:

"As a backdrop to these events at around this time complaints were being raised with Councillors and the Local Member of Parliament that Miss Gardner was profiting from a private company with which she was involved. In fact, unknown to the Applicants making these complaints, this allegation was misconceived. Miss Gardner's involvement was with a charitable company limited by guarantee and she stood to make no profit for herself out of this company."

10. The next reference to this further limb is in paragraph 26 in the course of which the Tribunal is reviewing the submissions that had been made at the conclusion of the evidence on behalf of the Applicants. They noted these submissions as including the following:

"Miss Leader also submitted that the real reason for dismissal was because the Applicants had 'whistle blown' about the activities of Miss Gardner. For the avoidance of doubt the Tribunal wishes to make it clear that the Tribunal concluded that the complaints about Miss Gardner were misconceived and that Miss Gardner had not acted in any way improperly with reference to the company with which she was involved which, as the Tribunal has stated in its findings of fact, is a company limited by guarantee."

11. A final reference to this additional matter comes in paragraph 32. It reads as follows following on from paragraph 31 in these terms:

"The Tribunal therefore went on to consider the fairness of the dismissals. The first matter to be confirmed is that the Tribunal did not believe that this was a dismissal of a result of 'whistle blowing'. The Tribunal was satisfied that the Applicants had to some extent, been the authors of their own misfortune. By failing to corporate fully with the lecturers it had been revealed that the Respondent did not need to employ as many people in the position of centre worker as it was then employing."

12. Those then being the limited references in the Extended Reasons to this, a further limb to the Applicants' case, Mr Morton on their behalf takes in essence two points. First, he submits, that a finding that there was no financial chicanery on the part of Miss Gardner may blunt this part of the case but it does not fully answer it. Granted that Miss Gardner might have been ready to be vindictive if bad behaviour had been exposed is obviously possible for vindictiveness to flow as a reaction to any attempt, however misguided, to impugn her motives.
13. Second, said Mr Morton, in any event there is a dearth of fact finding on this topic. Who blew what whistle when, why and to what if any effect? What was the case as to how it impacted if at all on the history as found by the Employment Tribunal? Why did the point not arise in the IT1s of October 1998? How and why had it arisen in the next ensuing two years? None of these matters were covered in the citations from the Extended Reasons which constitute a full expose of all that it said on this topic. Both he and Mr Hyams for the Respondent drew attention to the guidance given by the Court of Appeal in Meek v The City of Birmingham District Council [1987] IRLR 250 & 251. There Bingham LJ giving the judgment of the Court said:

"It has on a number of occasions being made plain that the decision of an Industrial Tribunal is not required to be an elaborate formalistic product of refined legal draftsmanship, but it must contain an outline of the story which has given rise to the complaint and a summary of the Tribunal's basic factual conclusions and a statement of the reasons which have led them to reach the conclusion which they do on those basic facts. The parties are entitled to be told why they have won or lost. There should be sufficient account of the facts and of the reasoning to enable the EAT or, on further appeal, this court to see whether any question of law arises; and it is highly desirable that the decision of an Industrial Tribunal should give guidance both to employers and trade unions as to practices which should or should not be adopted."

14. In the light of this guidance Mr Morton submits that that which appears in the Extended Reasons is inadequate and he urges that an appeal should be allowed so that there could be at least consideration given to a re hearing before a different Tribunal. We interpose at this point to assume that the advantage to the three persons now appealing who were in fact successful before the Employment Tribunal is that a re hearing might result in a finding of unfair dismissal for no tenable reason and in that way entitle them to a more substantial award than has been forthcoming in the present circumstances.
15. Turning from the position of the present Appellants to the Respondents Mr Hyams emphasises the fact of a hearing of evidence over a prolonged period no less than five days. He points further to an emphatic and terse finding that 'whistle blowing' had nothing to do with the dismissal and he draws attention to a readily sustainable free standing factual case such that serves in itself to support the Employment Tribunal's findings. We have not found this an easy case to resolve but in the end we are unanimously of the view that these appeals must fail. Several matters weigh with us. First, there can be no doubt in the minds of the parties nor in the mind of any reader of the Extended Reasons as to the basis relied upon by this Employment Tribunal for the findings as to the reasons for the dismissals nor as to their findings as to the respective fairness of those reasons. The facts relied upon are adequately set out; as free standing facts they are wholly or substantially not in dispute and as Mr Hyams submits they are entirely adequate when considered in conjunction with Sections 98 and 139 of the Employment Rights Act 1996 to sustain the Employment Tribunal's findings.
16. Second, it is inconceivable that in the course of the deliberations which led to these findings the Employment Tribunal did not address itself to the potential for 'whistle blowing' being the essential cause with all that would otherwise be relied upon being a 'sham' reflecting some indirect or indirect form of punishment. The issue was before them. It was unavoidable and in the event there was a finding upon it in paragraph 32, albeit in terse form.
17. Third, whereas in our judgment Mr Morton is right in as much as vindication of Miss Gardner's as character was not a complete answer, it went some way to blunting the issue and that vindication in its turn fell to be considered along with all the other apparent factors, for example, was it conceivable that resentment by Miss Gardner accounted for this radical alteration of the conduct to this day centre-alteration which at the time arguably struck nobody as referable to personal pique, see the ET1 of October 1998 so that, referring back to the words of Bingham LJ, 'whistle blowing' was not part of the story that actually gave rise to the complaints.
18. In essence, given the clear factual basis for the findings, we can be satisfied that the decision is sound and we can be satisfied for present purposes with the terse but clear finding of fact serving to reject 'whistle blowing' as a reason for these dismissals or any of them. That said, we do criticise the Employment Tribunal for not expressly summarising the case as to 'whistle blowing' and the evidence relied upon. To do so would have been courteous and sensible and would have added authority to the finding that it did make rejecting 'whistle blowing' as an explanation. Were it not for a clear identification of the factual matrix of the preferred and sustainable case, we would have gritted our teeth and sent it back for a rehearing. As it is we dismiss these appeals, leaving the situation as it is. We readily appreciate the disappointment of the Appellants. It may be some slight comfort to them but only slight, that as Mr Morton realised when I put the question to him, that which would flow from allowing the appeals might not be all that could be desired from the point of view of the Appellants. Given the present state of affairs there would have a difficult situation to unravel and one that may not in the end work necessarily to their favour. However, for the reasons indicated those are our views.