United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MISS BARCLAY (Solicitor-Advocate) Instructed by: Free Representation Unit Peer House 4th Floor 8-14 Verulam Street London WC1X 8LZ
For the Respondent	MR CHRISTOPHER WALKER (Of Counsel) Instructed by: Messrs Wacks Caller Steam Packet House 76 Cross Street Manchester M2 4JU


 


HIS HONOUR JUDGE BURKE QC

1. The Appellants, Mr Baldwin and Mr Buffrey, appeal against the rejection by the Employment Tribunal, sitting at Bristol and chaired by Mr Griffiths, of their claims that they had been unfairly and wrongfully dismissed by their employers, Manpower Plc. Their claims were rejected on the basis of the Tribunal's conclusion that they had resigned from their employment and had not been dismissed.
2. Both Appellants were employed by the Respondents and were assigned by them to work at the Xerox plant at Mitcheldean in Gloustershire to which the Respondents provided a large number of workers. They had been so employed for several years. However, in 2001 the plant was to close down and the need for work from Manpower employees was ceasing or diminishing. It is common ground that both Appellants were employed under a contract of employment in each case pursuant to which their remuneration depended upon their being provided by the Respondents with work of the kind they were employed to do.
3. They were not entitled to remuneration if the Respondents did not provide such work. The absence of work did not terminate the contracts of employment or entitle the Appellants to terminate their contracts or treat them as terminated. If there was not enough work for the Appellants, the Respondents did not have to dismiss them and make a redundancy payment. They could simply keep the Appellants on their books without being obliged to pay them for as long as it took for other work to become available. In short there was a contractual right in the Respondents to place the Appellants in a position in which they were laid off without work and without remuneration but in which their contracts of employment continued to cater for the anomalous position of such employees.
4. There is a particular chapter of the Employment Rights Act 1996, Chapter III of Part XI, which is generally headed Redundancy Rights etc, which enables such employees to take action to trigger the right to a redundancy payment by themselves terminating their contracts of employment and applying for such a payment. These provisions are, in the unusual context of this type of case, necessary; for, without such provisions, a laid-off employee would not be able to obtain a redundancy payment albeit his employer had run out of work for him to do. Chapter III of Part XI exists to provide laid-off employees (and it also applies to employees on short time but short time does not arise in this case) with a necessary form of protection.
5. It is necessary to set out briefly the effect of Chapter III of Part XI of the Act. Employees are, by virtue of Section 147(1) of the Act, to be taken to be laid off for any week in which they are not entitled to remuneration in that week pursuant to the terms and conditions of their contract of employment because they have not been provided by their employers with work of the kind which they are employed to do.
6. An employee who is laid off as defined by paragraph Section 147(1) is, by Section 148(1), eligible for a redundancy payment by reason of his being laid off if he has been laid off in circumstances to which sub-section 2 of Section 148 applies and after being laid off he gives notice in writing to his employer indicating (in whatever terms) his intention to claim a redundancy payment in respect of lay-off. The circumstances to which sub-section 2 apply arise where the employee has been laid off for four or more consecutive weeks of which the last before the service of the notice ended on, or not more than four weeks before, the date of service of the notice or for a series of six or more weeks (of which not more than three were consecutive) within a period of thirteen weeks the last of which ended on or not more than four weeks before the date of the service of the notice. Section 149 permits an employer on whom a notice under Section 148 has been served to give a counter notice within seven days of such service and, if a counter-notice is given and not withdrawn, the employee's right under Section 148 to a redundancy payment is removed and the employee is not entitled to redundancy payment except in accordance with the decision of an Employment Tribunal. Section 150 provides that the entitlement to a redundancy payment by reason of being laid off does not arise unless the employee terminates his contract of employment by giving such period of notice as is required by that section. It is not necessary for present purposes to go into the details of those notice requirements. Finally, Section 151 provides that an employee is not entitled to redundancy payment by reason of being laid off if he is dismissed by his employer.
7. While at first sight it may seem to those who are not familiar with Chapter III of Part XI unusual that an employee may trigger by his own actions an entitlement to a redundancy payment, for the reasons which we have explained the provisions of Chapter III are necessary to provide protection to those who have been laid off for the periods described in Section 148. Otherwise such employees would either have to leave the employment of the employer without a redundancy payment or they would have to retain their contract of employment without remuneration until such time (if ever) as the employer was able again to provide appropriate work. The reason why resignation is required before the entitlement arises is, manifestly, that no-one can obtain a redundancy payment from his employer and still remain in the same continuous employment.
8. Now, with that background, we can turn to this individual case. There is no dispute but that the Appellants, as a result of the progressive closing down of the Xerox site and the absence of available work which their employers could give them, were told that they would cease to work at that site from 10 August 2001. They were so told by Mr Matthewman, the Respondents' manager. There may have been a dispute as to when they spoke to Mr Matthewman; but that was of no significance. More important was what appears to have been a dispute between the Appellant and Mr Matthewman as to what was said. In their witness statements, taken as their evidence in chief, the Appellants said that they were told that their positions would be finishing on 10 August. Mr Matthewman, in his witness statement, no doubt taken in turn as his evidence in chief, said that the Appellants were told that they were no longer required to remain on assignment to Xerox. In the absence of notes of evidence, we cannot tell whether the Appellants in evidence put their case forward on the basis that Mr Matthewman, by saying that their position would be finishing, was telling them that they were dismissed or was merely telling them that their assignment to Xerox was ending. But that does not matter, because the Tribunal expressly found, at paragraph 3 of their decision, that the Appellants were laid off. This is a finding to which we will return shortly.
9. The Tribunal went on to find that the Appellants were advised by Mr Matthewman that they would be entitled to redundancy payments after 28 days of lay-off if they asked for it and that the Appellants were fully aware of what the reality of the position was, namely that the Xerox plant was closing down and that their contracts of employment with the Respondents could continue indefinitely without remuneration or they could exercise their rights "under the relevant part of the Employment Rights Act", by which the Tribunal were plainly referring to Chapter III of Part XI of that Act, to obtain redundancy payment from the Respondents. The Tribunal accepted that the Appellants were probably unaware of the niceties of the relevant provisions of the Act but found that they were given advice by Mr Matthewman as to what they had to do in order to recover their redundancy entitlement under the Act. What they had to do, as we have set out in considering the relevant provisions of Chapter III, was to serve a notice making a claim for a redundancy payment in each case; and they had to resign from their employment.
10. On 7 September, which if 10 August is counted as a day of lay-off, was the 29^th day of lay-off each of the Appellants wrote an identical letter to the Respondents. They said:

"My employment with Manpower at Xerox Micheldean was terminated on 10 August 2001. Twenty eight days has now lapsed so could you send me my P45 and my redundancy payment."

On 10 September the Respondents replied saying that the Appellants' positions were no longer available due to the downturn in demand at Xerox and setting out a calculation of what they described as a notice payment; but the Tribunal found, and plainly correctly from the figures, found it to be a calculation of the redundancy payments which the Respondents were accepting that they should pay and which were indeed paid in appropriate sums.

11. Thereafter the Appellants commenced proceedings in the Employment Tribunal, claiming that they had been dismissed on 10 August, the date on which their lay-off commenced, had not been paid their money in lieu of notice and had been unfairly dismissed by reason of the absence of sufficient consultation. The Respondents claimed that the Appellants had not been dismissed but had resigned by their letter of 7 September. The Tribunal found, at paragraph 9 of their decision, in effect that the letters of 7 September were intended as and had amounted to a combination of notices of intention to claim under the provisions of the Act ie Section 148 coupled with resignation, without which of course there would have been no entitlement to redundancy payment.
12. The Tribunal further found, at paragraph 11 of their decision, that the letters of 10 September to the Appellants were not dismissals but were merely the provision of the appropriate calculation of the redundancy payments to which the Respondents accepted the Appellants to be entitled. It is important to note that the Tribunal did not decide that the letters of 7 September were resignation letters which satisfied all the conditions set out in Section 150. Those letters did not give any notice. But whether the Appellants had complied with the requirements of Section 150 was irrelevant because the Respondents had paid the redundancy payments without taking any technical points as to entitlement or as to service of appropriate notice.
13. The Appellants now challenge both the finding of the Tribunal that there was a resignation in each of their cases and the finding of the Tribunal that there was no dismissal in each case. We propose to address firstly the submission that the Tribunal erred in failing to find that the Appellants had been dismissed. It is important in considering the Appellants' submissions, to focus upon the date on which the dismissals are said to have occurred. In their Originating Applications, which were in substance identical to each other, both Appellants asserted that they had been dismissed on 10 August. In their letters of 7 September both Appellants stated that their employment with Manpower at Xerox Mecheldean was terminated on 10 August. These words may well have been intended accurately to convey the message that their assignment to Xerox terminated on that date rather than that their contract of employment terminated on that date; but, whatever they intended or understood, Miss Barclay on their behalf accepts that she must establish that the Appellants were dismissed on 10 August. She does not seek to rely on any subsequent act on the part of the employers as constituting a dismissal. In particular, she does not rely on the letters from the Respondents to the Appellants of 10 September. Miss Barclay's submissions as to dismissal were, in large measure, based on what she said the Appellants believed to be the position which was achieved on 10 August and at least what they asserted was their understanding of what had been achieved by the time that the Tribunal proceedings were commenced or were in train; but what they believed does not determine the issue as to whether or not they were dismissed. Whether they were dismissed or not is, as is made clear in the decision of the Court of Appeal in Martin v Glynwed Distribution Limited [1983] ICR 511, a question of fact. The Tribunal found as a fact in paragraph 3 of their Decision that the Appellants were laid off. It is not suggested that, by so finding, the Tribunal were intending to convey that they were dismissed. The contrary is manifestly the case. The Tribunal had addressed themselves directly to the provisions of Chapter III of Part XI of the 1996 Act and were aware of the factual context in this case and the contractual provisions which led Mr Matthewman to advise the Appellants of their rights under those provisions. When they decided, in paragraph 3 of their decision, that the Appellants were laid off on 10 August they meant precisely that. Miss Barclay has not been able to suggest that that finding was perverse or can in any other way be undermined. Save by her contention that whether there was a dismissal was a matter of law which appears to us to be contrary to the effect of the Court of Appeal decision to which we have just referred there appears to us to be no route by which Miss Barclay can evade the effect of that finding of fact by way of resolution of the issue between the Appellants on the one hand and Mr Matthewman on the other hand as to what was said when they were informed as to what was going to happen from 10 August. The Tribunal have resolved that issue in favour of Mr Matthewman's version.
14. We are unable, therefore, to see any basis on which it can be said that the Tribunal's conclusion that the Appellants were laid off and not dismissed on 10 August was an error of law. It is true that the Tribunal did go on to consider expressly whether the letters of 10 September constituted dismissals; but, in view of Miss Barclay's concession that she has to establish dismissal as at 10 August, we do not need to make any comment as to and we have not heard any argument upon that alternative with which the Tribunal felt they should deal. It has to follow that the Appellants have failed to establish that they were dismissed as and when they say they were and therefore that their claims for unfair dismissal and wrongful dismissal were properly dismissed.
15. It is strictly unnecessary for us to go on to consider whether the letters of 7 September were resignations. That issue would only have had to have been resolved if a point as to entitlement to redundancy payments under Chapter III of Part XI of the Act had arisen; but it does not. However, it is fair to the parties, who have addressed us on this issue and generally with skill and economy, that we should briefly set out our views on that issue. Miss Barclay submitted, in essence, that the Appellants did not know the details of and the effects of the relevant provisions of the Act and, in writing their letters in the terms that they used, were doing no more than responding to the instructions or advice given to them as to how to obtain their redundancy payments by Mr Matthewman. She submitted that all they had done by those letters was to ask for the redundancy payments which they had been told they could have after 28 days of lay-off and for their P45s; and she drew our attention to an unreported decision of the Employment Appeal Tribunal which someone, with commendable industry, has found called Bates v British European Transport Ltd, EAT 309/94. In that case the Employment Appeal Tribunal, presided over by Mummery P, was dealing with a case in which the central issue was whether the employee had resigned by asking for his P45. The Employment Appeal Tribunal, at page 11A, said this:

"In summary the reason why we find this to be an erroneous decision is that the Tribunal based its conclusion of resignation on a request for a P45 in a letter. The letter cannot itself be construed as a letter of resignation. The request for a P45, whether made in a letter or orally, is not itself clear evidence of a resignation. A P45 is needed whenever there is a cesser of employment. Employment may cease by reason of dismissal. It may cease by reason of resignation. The mere request for a P45 is ambivalent."

16. Miss Barclay submits that the Appellants here had done no more by way of resignation than had the Appellants in that case. Mr Walker, on behalf of the Respondents, has pointed out, firstly, that in that case there was no other evidence of resignation except the request for a P45 and, secondly, that when the employees' solicitors later alleged that the employee had been dismissed, the employers appeared to have accepted that that was so, so that there was contrary evidence to resignation. He contrasted that case with another decision of the Employment Appeal Tribunal, which may or may not have been more easy to find with appropriate industry, called Fabar Construction Ltd v Race and Sutherland [1979] ICR 529 in which the employees, who had been laid off, sought a redundancy payment under the then equivalent provisions to those now in Chapter III of Part XI of the 1996 Act. The employees offered to give to the employers a week's notice and ask for their P45s and holiday pay. The employers took the technical point that the letters in which the employees had offered to give notice were not actually notices of resignation but only offers to give notices of resignation.
17. The Employment Appeal Tribunal, on this occasion presided over by Talbot J, said at page 533 D:

"It is important to note, first that the section does not require the notice to be in writing; it is sufficient if it is an oral notice. Secondly, in our view, it is important to remember that these statutory requirements must be viewed in the context of the matters in respect of which Parliament was legislating. It is our view that it would not be right to attribute to such a notice, as required by that section, the same kind of formality as, for instance, is required when a landlord seeks to determine the tenancy of his tenant. But the vitally important factor here is the request, at the time of the offer to give the notice for return of the P45. Quite plainly the request for the P45 indicated, and was understood to indicate, that the employment was being terminated in respect of each man. Where therefore the industrial tribunal were faced with what was the statement by one of the employees that they offered to give their notice, coupled at the same time with a request for a P45 which was in effect a determination of that contract, it seems to this appeal tribunal that the majority of the industrial tribunal were entitled to find that what took place between Mr Race and Mr Carr was in effect the giving of a notice within the meaning of section 6(3)(a) of the Act."

We should comment that that passage indicates, by reference to what was open to the Tribunal, that the question of whether a letter such as that in that case or letters such as those in this case amounted to resignation is also primarily a question of fact. What is clear from these two cases is that, where a letter of the type written in this case falls to be considered and a P45 is requested, the Tribunal has to consider the effect of the letter and of a request for a P45 in the particular context in which the letter and the request are made. In this case the Tribunal had to resolve the issue as to resignation by taking into account the context of the particular circumstances which applied in that context, namely that the Appellants were laid off and, unless they sought a redundancy payment by triggering the Chapter III of Part XI procedure, they could not obtain redundancy payments and either had to go off and seek other employment without redundancy payments or had to remain in employment with the Respondents for as long as it took for another assignment to turn up in a situation in which, as the Tribunal found on the evidence, the prospects of such work were extremely poor. While outside that context the letters of 7 September might not be readily taken as letters conveying resignation, in that special context, in which the Appellants had been advised as to the process by which redundancy payments could be obtained which process necessarily involved a resignation, it was open to the Tribunal, in our judgment, to decide on the facts that those letters did contain or constitute resignation.

18. Paragraph 8 of the decision makes it clear that the Appellants, to use the Tribunal's expressions, "were fully aware of what the reality of the position was" and "knew perfectly well what game was being played". The Tribunal found that they were given advice by Mr Matthewman as to what they had to do in order to recover their redundancy entitlement under the Act. On the basis of their findings of fact and on the basis of the context as a whole, the Tribunal were, in our judgment, entitled to decide as they did that the letters which the Appellants sent were letters which consisted of or included resignation; and we do not regard that conclusion reached by the Tribunal as being one which was reached in error of law.
19. For those reasons these appeals are dismissed.