United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR SIMON GORTON (of Counsel) Instructed By: Messrs Thompsons Solicitors Acresfield 8 Exchange Street Manchester M2 7HA
For the Respondent	MR TOM LINDEN (of Counsel) Instructed By: Messrs Eversheds Solicitors 70 Gt Bridgewater Street Manchester M1 5ES


 


JUDGE ANSELL:

1. The Appellant, Thomas Oakley, appeals against a majority decision of an Employment Tribunal who decided, following a hearing held in Liverpool on 18 January 2002, that the Applicant's dismissal was fair. The decision was promulgated on 13 February 2002.
2. The Appellant had been employed as a Courtroom Resource Manager by the Respondents. Following a restructuring in 2000, the Appellant's post, together with others, no longer existed. There was consultation with the unions and, as was found by the Tribunal, those at risk of redundancy would be considered for redeployment. The Appellant applied for the position of Team Leader which was one level down from his previous job but was unsuccessful in that application. He then asked to be considered for the post of supervisor which was two levels down but the Respondents declined to offer him that position. It emerged during the hearing, and was so found by the Tribunal, in paragraph 2.3 of their Decision that:

"2.3 ... It was privately decided that no one would be considered for a job more than one level above or below their post."

There was no finding by the Tribunal as to whether this policy was ever discussed with the unions as part of the consultation process, but it was conceded by the Respondents at the appeal hearing that the policy was not the subject of discussion during the consultation process with the unions.

3. The Appellant has two consultation meetings with the Respondents on 17 and 26 January 2001, when he asked to be considered for the post of supervisor. There was no finding by the Tribunal as to whether the policy decision previously referred to was discussed with him, although the majority of the Tribunal concluded that the policy decision was a reasonable one, on the basis that the Appellant might become resentful and disrupt the harmony of the section. The Tribunal's very brief reasons conclude as follows:

"4.3 The majority has concluded that it was reasonable for the respondent not to appoint the applicant as a supervisor. The minority has concluded that it was not.

4.4 The majority has concluded that the respondent did make reasonable attempts to find the applicant alternative work. The minority that it did not.

4.5 The majority has concluded that the applicant was adequately consulted, the minority that he was not."

4. The grounds of appeal effectively complain about the Respondent's redeployment scheme in the light of the fact that there was, on the face of the Employment Tribunal's decision, no finding that there had been consultation on the so-called private policy, either with the unions in the initial phase of consultation, or as part of the direct consultation with the Appellant. The grounds also complain about the unfairness of the decision not to offer the post of Supervisor to the Appellant, which appears to have been entirely based on a policy decision which was not explained, either to the unions or, indeed, to the Appellant. They ask this Court to substitute a finding of unfair dismissal and remit the matter back to a fresh Tribunal for consideration of the appropriate remedy. The Respondents seek to uphold the decision of the Employment Tribunal and rely on the findings that the Tribunal found the so-called private policy to be a reasonable decision, that the Appellant applied for and was unsuccessful in obtaining the Team Leader position and that at two consultation meetings his request for the post of Supervisor was discussed with the Respondents. The Respondents state that the failure to discuss the policy with the unions is not fatal to their case but merely one of the factors that the Court has to take into account when assessing fairness and they contend that any defect was cured by the two consultation meetings held between the parties.
5. At the beginning of the hearing and in submissions Respondents' Counsel, Mr Linden, highlighted that the Appellant's original complaint before the Tribunal concluded as follows:

"10 The Applicant claims that the employer's failure to (a) offer alternative employment and/or (b) re-deploy the applicant and or (c) consider the applicant for re-deployment and/or (d) inform him of vacancies made his dismissal unfair."

In other words, there was no complaint at that stage in relation to the failure to consult either the union or the Appellant regarding the policy decision. This is hardly surprising as the existence of this policy's decision only became known in the course of the evidence. We accept that, in his final submissions Mr Vogler, trade union representative on behalf of the Appellant, did indeed raise the issue of consultation, and it is therefore open to us to consider that issue.

6. Turning to the law, we remind ourselves at the outset that the duty of this Court is to correct errors of law and the fact that our members would decide a case differently does not mean that we can overrule an Employment Tribunal who have not misdirected themselves: see Retarded Children's Aid Society Ltd v Day [1978] ICR 437, in particular, as Lord Russell said in that case, at page 444, D:

"I think care must be taken to avoid concluding that an experienced Industrial Tribunal by not expressly mentioning some point or breach has overlooked it."

Equally, and on the other hand, although the decision of an Employment Tribunal is not required to be an elaborate formalistic product of refined legal draftsmanship, 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: see Meek v City of Birmingham District Council [1987] IRLR 250, and High Table Ltd v Horst [1997] IRLR 513. We are not satisfied that the findings and reasons in this case achieved that bare minimum.

7. The classic guidance regarding consultation on redundancy was found in the decision of this Court in Williams v Compair Maxam Ltd [1982] IRLR 83, where Browne-Wilkinson J set out the following principles:

"There is a generally accepted view in industrial relations that, in cases where the employees are represented by an independent union recognised by the employer, reasonable employers will seek to act in accordance with the following principles:

(1) The employer will seek to give as much warning as possible of impending redundancies so as to enable the union and employees who may be affected to take early steps to inform themselves of the relevant facts, consider possible alternative solutions and, if necessary, find alternative employment in the undertaking or elsewhere.

(2) The employer will consult the union as to the best means by which the desired management result can be achieved fairly and with as little hardship to the employees as possible. In particular, the employer will seek to agree with the union the criteria to be applied in selecting the employees to be made redundant. When a selection has been made, the employer will consider with the union whether the selection has been made in accordance with those criteria.

(3) Whether or not an agreement as to the criteria to be adopted has been agreed with the union, the employer will seek to establish criteria for selection which so far as possible do not depend solely upon the opinion of the person making the selection but can be objectively checked against such things as attendance record, efficiency at the job, experience, or length of service.

(4) The employer will seek to ensure that the selection is made fairly in accordance with these criteria and will consider any representations the union may make as to such selection.

(5) The employer will seek to see whether instead of dismissing an employee he could offer him alternative employment."

8. What amounts to fair and proper consultation was set out by Glidewell LJ in R v British Coal Corporation and Secretary of State for Trade and Industry ex parte Price and Others [1994] IRLR 72 to include:

"It is axiomatic that the process of consultation is not one in which the consultor is obliged to adopt any or all of the views expressed by the person or body whom he is consulting. I would respectfully adopt the tests proposed in Hodgson J in R v Gwent County Council ex parte Bryant, reported, as far as I know, only at [1988] Crown Office Digest p.19, when he said:

Fair consultation means:

(a) consultation when the proposals are still at a formative stage;

(b) adequate information on which to respond;

(c) adequate time in which to respond;

(d) conscientious consideration by an authority of the response to consultation.

Another way of putting the point more shortly is that fair consultation involves giving the body consulted a fair and proper opportunity to understand fully the matters about which it is being consulted, and to express its views on those subjects, with the consultor thereafter considering those views properly and genuinely."

9. The issue of consultation both with the unions and the individual concerned was more recently considered by this Court in the case of Mugford v Midland Bank Plc [1997] ICR 399, where Judge Peter Clark set out the position as follows:

"The experience of the industrial members of this appeal tribunal is that consultation may take a number of forms. Where there is a recognised union, as in this case, the employer may enter into a redundancy procedure agreement which sets out agreed selection criteria, provision for re-deployment, collective consultation, a requirement to seek volunteers and so forth. Alternatively, absent such an agreed procedure, there may be consultation over the redundancy selection criteria to be applied, together with the other matters to which we have referred. However, experience also shows that trade unions rarely if ever wish to be involved in the actual selection of individuals for redundancy (other than on the basis of the last in, first out principle), since to do so would involve choosing between their members. That is generally regarded as an invidious choice for trade unions to have to make. On the other hand, trade unions will usually provide representation of their members at individual consultation meetings, following identification by the employer of individuals for redundancy.

It is in these circumstances that consultation between the employer and individuals identified for redundancy becomes important. It should normally take place before a final decision to dismiss is reached. It gives the employee an opportunity to put his case to the manager carrying out the selection, so that the latter may reach a fully informed decision. Support for this view is to be found in Walls Meat Co Ltd v Selby [1989] ICR 611, where the Court of Appeal, applying the reasoning of the House of Lords in Polkey, upheld an industrial tribunal decision that the dismissal of the employee was unfair where the employer failed to enter into any further consultation with the union or the employee after it had prepared a list of names of employees identified for redundancy. In particular, no discussions took place with the view to finding the employee alternative employment.

Further, we find the approach of the appeal tribunal in Rolls Royce Motor Cars Ltd v Price [1993] IRLR 203 instructive on this point. In that case the employer consulted with the recognised trade unions over selection criteria to be used in a proposed redundancy exercise. No agreement was reached and the employer proceeded to apply its chosen criteria in selecting 29 employees for redundancy. No individual consultation took place with those identified for redundancy under the criteria. The industrial tribunal, in considering reasonableness under section 57(3) of the Act of 1978, concluded that the dismissals were unfair in circumstances where no individual consultation had taken place. On appeal it was argued on behalf of the employer that paragraph 46 of the ACAS Code of Practice then in force - it has since been revoked with effect from 1 June 1991 - provided for consultation 'with employees or their representatives'. That expression is to be found in the speeches of Lord Bridge and Lord Mackay in Polkey v A E Dayton Services Ltd [1988] ICR 142. Accordingly, it was submitted that an employer discharges his obligation to consult if he does so either with the trade union or with the employee individually. It is not necessary to do both. Mr Linden similarly submits in this case, notwithstanding that the code has now been revoked. The argument was rejected in Rolls-Royce Motor Cars Ltd v Price [1993] IRLR 203. Knox J, giving the judgment of the appeal tribunal, put the matter this way, at p. 208:

'It was pointed out that the process of consultation as regards the selection of the criteria came to an end because the unions ceased to carry on any such process and would not co-operate in further investigation of that particular issue, and it may very well be that that was as far as the company could be expected to take the process of consultation in relation to the selection of the criteria themselves. But it is at the second stage that it seems to us that it would not be right to express the obligations on employers in terms of a rigid rule that states that the obligation is only to consult either the unions or the individuals and if the unions have been consulted as far as the unions are prepared to be consulted, that releases the employer from any further consultation duties.

We of course do not go to the opposite extreme and say that in all cases employers are under an obligation to consult with individuals. Here we have a decision on the facts of this particular case by the industrial tribunal, that an employer acting reasonably would have seen, for example, individuals identified on the points system and disclosed the assessment to them. We are unable to find that there is any principle of law that makes that a necessarily erroneous view. To do that it seems to us that we would be in grave danger of erecting what was said in Williams v Compair Maxam Ltd into the terms of a statute, and we would equally be in grave danger of providing an alternative to the actual provisions of section 57(3) which leave the matter wide open for decision by an industrial tribunal whether the dismissal was fair or unfair in the circumstances set out in that subsection. For those reasons we are not persuaded that the Industrial Tribunal was guilty of a relevant and significant error of law in this decision.'

We would ourselves similarly adopt that approach in this case.

Finally, it should be noted that consultation can continue until the employment is terminated. see Stacey v Babcock Power Ltd [1986] ICR 221, applied in Walls Meat v Selby [1989] ICR 601, 610S, per Balcombe LJ.

Having considered the authorities, we would summarise the position as follows.

(1) Where no consultation about redundancy has taken place with either the trade union or the employee the dismissal will normally be unfair, unless the industrial tribunal finds that a reasonable employer would have concluded that consultation would be an utterly futile exercise in the particular circumstances of the case.

(2) Consultation with the trade union over selection criteria does not of itself release the employer from considering with the employee individually his being identified for redundancy.

(3) It will be a question of fact and degree for the Industrial Tribunal to consider whether consultation with the individual and/or his union was so inadequate as to render the dismissal unfair. A lack of consultation in any particular respect will not automatically lead to that result. The overall picture must be viewed by the tribunal up to the date of termination to ascertain whether the employer has or has not acted reasonably in dismissing the employee on the grounds of redundancy."

10. Applying those principles we would make the following observations about the consultation process in this case, as far as we are able to do so, based on the very brief findings of the Tribunal:

(1) There was no consultation with the union over the private policy. We regard that as a serious defect in the light of the finding of the Tribunal that "it was publicly stated that those at risk of redundancy would be considered for re-deployment". We consider that the union representative may well have had an input into the so-called policy.

(2) Whilst there were two consultation meetings with the Appellant there was no finding that this very important policy was explained to him, so that the Appellant could put his case to the Manager carrying out the selection in order that the latter could reach a fully informed decision.

(3) The only grounds found by the Tribunal for the Respondents declining to offer the Appellant the role of Supervisor was the policy decision. Since that policy decision had not been the subject of consultation, either with the unions or the individual concerned, we consider that the decision-making process in relation to the role of Supervisor was tainted with unfairness.

11. We have considered whether we should remit the matter back to the same Tribunal for them to consider making further findings on the issue of consultation. However, since there was no dispute before us that there was no consultation with the unions regarding the private policy nor was it asserted that, in the course of the hearing before the Tribunal, evidence had been adduced that the policy had been explained clearly to the Appellant in the course of the two meetings with him, do not propose to remit the matter.
12. Finally, we ask ourselves the question, as to even if consultation had taken place, would it have made any difference. Our view is that it may have done. To say that it would not would negate the whole impact of the consultation procedure which is such an important factor in considering the fairness or unfairness of a dismissal for redundancy. As we have previously stated, the ability of the unions to comment upon the policy decision may well have had an impact on the effects of that decision as far as this Appellant was concerned.
13. For these reasons we would substitute a finding of unfair dismissal and remit the matter back to a differently constituted Tribunal so that remedies can be considered.