United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR GUY BREDENKAMP (Solicitor) Instructed by: Messrs Eversheds Solicitors Central Square South Orchard Street Newcastle Upon Tyne NE1 3XX
For the Respondent	MR BRUCE CARR (of Counsel) Instructed by: Messrs Rowley Ashworth Solicitors 247 The Broadway Wimbledon London SW19 1SE


 


HIS HONOUR JUDGE J McMULLEN QC

1. This case is about breach of contract in the payment of contractual redundancy pay. I will refer to the parties as Applicant and Respondent.

Introduction

2. It is an appeal by the Respondent in those proceedings against the decision of an Employment Tribunal constituted as Mrs O R Harper sitting alone at Bristol, registered with Extended Reasons on 24 April 2002. Hence this appeal is heard under Employment Rights Act 1996 section 28(4) (judge alone). The Applicant was represented by Counsel and today by Mr Bruce Carr of Counsel. The Respondent was represented there and here by Mr Guy Bredenkamp, solicitor. The Applicant claimed breach of contract. The Respondent denied the claim.

The Issue

3. The essential issue, defined by the Chairman, was to determine whether a document which appears in my bundle at page 25 amounted to a binding agreement to pay the Applicant the sum of £11,261.28.

The Legislation

4. The relevant legislation is the Extension of Jurisdiction Order 1994. It is accepted that this is a contractual claim within the jurisdiction.
5. By a Notice of Appeal, an additional argument was raised as to the constitution of the Tribunal. That issue has not been pursued. The case was heard correctly by a Chairman alone, no objection being taken to it there or here, pursuant to section 28 (4). I therefore dismiss that ground of appeal.

The Decision

6. The Chairman found for the Applicant and awarded the sum he claimed. On appeal, the Respondent contends that the Chairman misconstrued page 25 because there is a condition precedent to the operation of that agreement. She incorrectly applied the law as contained in Chitty on Contracts at paragraph 12-042, 12-043 and the parol evidence rule at 12-094 to 12 095.

The Parties

7. The Applicant was employed by the Respondent as an Engineer since 1971. In July 2001 difficulties occurred within the business which necessitated a call for redundancies. The Applicant was called to a consultation meeting and he volunteered to be made redundant. The agreement is contained in page 25.
8. After the agreement was made, indicating that the relationship would cease on 17 August 2001, the Respondent changed its position in the light of the intentions of another engineer, Mr Slade, and revoked the agreement, so as to require the Applicant to continue to work. It did so on 15 August. Thereafter the Applicant continued to work under protest, maintaining that the agreement was binding. He then resigned by letter of 20 September 2001.

The Chairman's Directions

9. The Chairman directed herself by reference to the relevant passages in Chitty (above), as submitted by both advocates.

The Respondent's Case

10. The Respondent submitted that the Chairman had erred in law in that she failed to recognise that there was a condition precedent, made orally and recorded subsequently in writing. It is that there is a need prior to implementing the agreement for a Day Engineer to transfer to the Applicant's department. That is recorded at page 27 in what might be described as self-directions to Ms Rogers who was conducting the consultation exercise. It is said that the condition precedent was cited earlier in the meeting.
11. On behalf of the Applicant it is contended that page 25 represents a complete agreement and that the ground of appeal seeks to introduce a change in the actual wording of the agreement to make it mean something different.

Conclusions

12. I accept the argument of Mr Carr. Page 25 provides as follows:

"This agreement will not be regarded as binding as a precedent or as a guideline in relation to any other agreements, which might from time to time be entered into.

Following my letter volunteering for redundancy, and consultation between the company and the employee representatives, I accept the above terms and agree my employment with [the Respondent] will terminate on Friday 17^th August 2001 on the grounds of appeal of redundancy."

It is signed by the Applicant and Mr Rogers and dated 8 August 2001.

13. The agreement contains the following:

2 "Notice: 4 weeks of your notice has been worked. The remaining un-worked notice will be paid subject to tax and national insurance.

Notice: 12

Notice worked: 4

Notice un-worked: 8

Notice payment: subject to tax and NI: £3,161.28"

In addition to that payment, the Applicant was to be given £6,000 statutory redundancy pay, £1,600 non-statutory redundancy pay and a further award of £500.

14. There is nothing in that agreement to indicate any conditionality. I pointed out to Mr Bredenkamp that it appears to record that the Applicant had already been given notice by his employer to terminate the relationship pursuant to his entitlement to 12 weeks, he having been employed in excess of 12 years.
15. What the agreement does is to bring forward the actual termination date and to accord to the Applicant a payment in lieu of working the additional eight weeks, together with the additional payments which I have referred to above.
16. The document is in terms an agreement. In terms it distinguishes between other forms of precedent or guidelines in other agreements which will not be binding. This agreement, indicating that it is binding, records the clear acceptance by the Applicant of the bringing forward of the date of termination on the monetary terms set out above.
17. The reason for the termination is expressed to be redundancy. Naturally the Respondent here carried on appropriate consultation with the Transport and General Workers Union, which it recognised, and sought volunteers to make the process of redundancy more humane. In responding to a call for volunteers the nature of the employment relationship did not change. A dismissal by way of redundancy by the employer is the manifestation of that sensitive procedure. It remains at all times the action of the employer in terminating the relationship.
18. It is contended that the notes which follow and which are signed by Ms Rogers and Mr Bailey include a condition that the agreement would not take effect unless a Day Engineer transferred. I reject this. This document is a self-direction to the officer of the company who is interviewing a potentially redundant employee. The wording on this document says this:

"Your position is therefore declared redundant. Today's meeting will be confirmed in writing to you, clarifying the terms of redundancy. If you are still wanting to be selected you need to confirm by completing the form that will be enclosed with the letter."

It seems to me that the Applicant regarded the document at page 25 as being the form which would be forthcoming. He indeed signed it at the end of the meeting.

19. Subsequent to that, a further document was raised which is not signed by the Applicant and which says this:

"Your position is therefore likely to be declared redundant – on the understanding that a day engineer transfers to cover the shift position. (We hope to be able to confirm this 10-8-01). If you are still wanting to be selected (and have not already done so) you need to confirm by completing the form that will be enclosed with the letter."

20. No other form has been produced to me or to the Chairman. Thus I conclude that these two documents, which differ in the language they use from the agreement, occurred after the signed agreement and did not impose a condition precedent to it.
21. I accept Mr Carr's argument that the impact of such documents would not be to construe the signed agreement but to change its terms. On its face the agreement contains no condition and indicates the cessation of the relationship on 17 August 2001. It is binding. As an agreement it required the Respondent to honour the terms and if it were the intention of the Respondent to make this agreement conditional, it could and should have said so.
22. The Applicant is entitled to rely on this document as indicating when his employment will terminate and how much he will receive upon that. It can only be changed by his agreement and he never did give his agreement.
23. In the circumstances, therefore, I construe the contract to mean what it says, to be binding upon both parties and I uphold the decision of the Chairman that the Respondent owes the Applicant the sum outstanding.

Procedure

24. After giving this judgment I have been told that this case was the subject of a hearing by a full EAT presided over by His Honour Judge Peter Clark, which directed that only one point be sent forward. The Tribunal dismissed the complaint by the Respondent about the constitution of the Employment Tribunal below, that is as a Chairman alone. It was because I understood there was a live issue about that, that I invited the parties to make submissions at the outset under section 28 (4). None was made.
25. I now see that Judge Clark's EAT ordered this case to be tried on appeal by a full EAT. Since I was unaware of that I have to deal with it. No submissions were made then or now that I was sitting irregularly in breach of Judge Clark's order.
26. It is the duty of parties to ensure that the bundle produced, ultimately by the Appellant, includes those documents set out in the Practice Direction which include the EAT order on a preliminary hearing. Had that been done, this embarrassment would not have occurred.