United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR XAVIER AZALBERT Representative


 


JUDGE WAKEFIELD

1. This is the Preliminary Hearing of an appeal by Xelector Plc against the decision of an Employment Tribunal sitting at London Central on 12 March 2003 by which it was determined that the dismissal of the present Respondent Mr Joe Malinowski was unfair and that in addition to wages due to him he was also entitled to a compensatory award. A total award was made of £28,291.08.
2. The brief background facts to the Respondent's complaints were that having been continuously employed by the Appellant from 1 September 1999, latterly as United Kingdom Managing Partner, he was dismissed without notice on 31 July 2002. The Appellant, which has throughout acted without legal representation, claimed that the Respondent was dismissed for redundancy and that the dismissal was fair.
3. The Employment Tribunal in the decision with Extended Reasons sent to the parties on 30 April 2003 found that the dismissal was because the Respondent was redundant but held that it was unfair. They said at their paragraph 5 the following:

"The Employment Tribunal find that there was no specific consultation with the Applicant as to alternatives that may have meant that there was perhaps no need to make him redundant whether this might have resulted in him taking less pay, or even as the Applicant himself suggested, deferring his payment for a time or perhaps him staying and taking alternative employment with the company. We find that given that he had been directly involved in the employment of Mr Collier and had trained him and was clearly more senior in many respects, the fact he was not quite as experienced on the credit product side would not have been a real barrier to him carrying out Mr Collier's duties and that he should have been given the chance to do so if he wished, bearing in mind that Mr Collier was only on one week's notice and had only been employed for a short space of time, in contrast to the Applicant, who obviously held a senior position and had worked extremely hard for over three and a half years on behalf of the business. We find that the manner of the dismissal by a telephone call to be wholly inappropriate and unfair."

4. In calculating the appropriate period for which to award compensation the Tribunal said in their paragraph 6:

"The redundancy could for instance have taken place a week or even two weeks down the line if meaningful consultations with the Applicant had been unsuccessful. We do not know whether those discussions would or would not have been successful and we feel that the likely position is that the Applicant would have stayed in the employment of the Respondent and would have stayed on the salary that he had at the time of the termination of his employment, but that he would have been made redundant subsequently and we find that the appropriate date for that would have been the end of November 2002, a few days after Mr Collier actually left."

5. By its Notice of Appeal the Appellant attacks the decision as containing errors of law in that the findings of fact are said to be perverse. These are set out in paragraph 6 of the Notice, 6 respects in which those findings are said to be perverse:

"6. The grounds upon which this appeal is brought are that the employment tribunal erred in law in that:

The appellant appeals the decision of the employment tribunal as the findings of facts are perverse and therefore provide grounds for appeal:

In the case the Applicant did not try to assert that Mr Collier was an employee. (In fact, in the Applicant's Originating Application he has referred to Mr Collier as a contractor.) It appears that the Tribunal have not fully considered Mr Collier's employment status. They appear to be saying that a) Mr Collier should have been placed in a pool for selection for redundancy together with the Applicant; and/or b) Mr Collier's position was suitable alternative employment which should have been offered to the Applicant.

Both parties agreed that Mr Collier was a contractor and there is no legal obligation to place him in a pool for selection nor would his position should amount to "employment" for the purposes of offering the Applicant suitable alternative employment. In fact Mr Malinowski was considered for alternative employment for the CEO's position and it was brought to the attention of the tribunal that the company did not need to have two senior managers and one of the positions had to be made redundant. The company being in a dramatic situation had to reduce costs by way of redundancies and did not require two senior manager in the company.

The cases clearly indicate that an employee can be dismissed and replaced with a contractor and that is a genuine redundancy. That being the case, it is inconsistent if in a genuine redundancy we had to terminate the contract of a contractor and replace that contractor with an employee.

The tribunal based the compensation calculation on when Mr Collier's contract was terminated which should not be material to the decision as he was a contractor.

Therefore despite the fact that both parties accepted that Mr Collier was a contractor, the tribunal, of their own volition, took the view that Mr Collier was an employee. We consider this to be perverse and provide reasonable grounds for appeal for a company which was and is still in serious financial difficulties and had to make several additional redundancies since that of Mr Malinowski.

As of today a payment of £7,491.08 including pay for July 2002, accrued holidays, statutory redundancy payment and statutory loss of rights payment has been made. On the basis described in the points above we have withheld the 4 months of pay and benefits awarded."

6. One of the difficulties we have had in determining whether this appeal should go forward to a full hearing on any or all of the points raised, is that the Employment Tribunal in its Extended Reasons have not summarised the evidence which they heard nor have they set out any detailed findings of fact. We cannot know from the decision itself on what basis they found, for example, that there was no specific consultation with the Respondent thus rendering the dismissal unfair.
7. We were satisfied at an early stage in the argument on behalf of the Appellant today that the appeal should go forward to a full hearing at least on the question of the proper period for which a compensatory award was due to the Respondent. Having considered the Extended Reasons as a whole we are also just persuaded that the appeal in relation to the finding of unfairness and as to whether that finding was perverse given the evidence should also be fully argued. Some of the issues which are raised by that aspect of the appeal are closely related to the position of Mr Collier and the appropriate compensatory award.
8. To assist at the full hearing we order that the Chairman's notes of the evidence be provided. We also give leave to the Appellant to amend the Notice of Appeal, it is hoped with legal assistance, in order to clarify the issues which are raised. The hearing of the appeal will have a time estimate of ¾ of a day - Category C.