United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	DERMOT HUGHES COUNSEL
For the Respondent	MR G BRANCHFLOWER COUNSEL


 


1. Mrs Turner had commenced work in January 1984 as an administrator key worker for the Appellants. They are a Community College run under a company Limited by Guarantee that provides training in the Community in the areas of technology, languages and crafts and is funded by the Learning Skills Council and Sheffield City Council. It has directors and a board of directors who therefore managers.
2. The background facts are that in August 1995 the Board of Directors sanctioned a pay rise for Mrs Turner and a co worker Mr Hill so that they would be paid with effect from 1 August the sum of £241.32 to reflect extra duties that each had taken on. This represented £25 per week pay rise and those extra duties had arisen because of the departure of a manager of the college and a division of his duties amongst other employees.
3. Indeed, it was not in dispute that there were considerable changes of personnel in the college at around this time in 1995 and re-allocation of duties. In October 2002, following problems with the running of the college, a Mr Jepson was appointed Chairman of the board. Mrs Turner was away on sick leave shortly afterwards suffering from stress and inquiries began to be made in relation to the amount of sick pay that she was receiving. Mr Jepson conducted a very detailed inquiry in relation to the figures and the level of pay, and it emerged that she had been paid from 11 August 1995 a sum of £245.64 per week that is against the sum of £241.32 that had been voted at the board meeting; and rather more importantly from 26 December a sum of £262.14. per week.
4. The Tribunal record that there was a no board meeting minutes or resolutions nor other formal confirmation of those increases. The matter became even complicated because certainly by the time that these matters were investigated in the course of disciplinary proceedings in April 2001 and onwards a document entitled “"job description”" was produced. This had been prepared around 28 November 1995 with the assistance of a Mr Johnson employee of Sheffield City Council who had been co-opted at the time to work with Appellants and that recorded a rate of pay for Mrs Turner of £245.73 per week which was 9 p more than the weekly pay rate which had been in force and subsequently discovered from 11 August.
5. The Tribunal records that around December 1995 a Mr Saunders had left the college; he had been the Chair of the Board and also employed as co-ordinator and Mrs Turner had taken on some of his duties but again there was nothing formally recorded as we said already to confirm the December pay increases.
6. These matters therefore, were sufficiently serious for the Appellants to commence disciplinary proceedings which took place when she returned to work in April 2001. Indeed there was a Board Meeting on 30 April which resolved that, having received Mr Jepson’'s report about these matters, if a satisfactory explanation was not forthcoming from the employee they would have no alternative than to dismiss her.
7. There had already been a meeting when the employee Mrs Turner accompanied by Mr Birkby, who was her advisor from a local Advice Centre, had been told about these investigations. At that stage the meeting on 11 April had wanted to find “"a conclusion beneficial to herself and the college”".
8. By way of background the bookkeeper for all the relevant period was a Mrs Judy Everitt. The direct responsibility for the payment of the wages to Mrs Turner and to Mr Hill was in fact Mrs Turner’'s own responsibility but Mrs Everitt had overall responsibility for bookkeeping and records and she had worked at the college or had association with them for over 15 years. She left in January 2001 and both we and the Tribunal have seen a letter that she sent to Mr Jepson around that time, certainly in not pleasant terms complaining about as it were the change of regime and his attitude to a number of matters. She made quite serious allegations against him in relation to providing “"jobs for the boys”" in other words his regime, and also in relation to misspending with regards to the provision for instance of new desks and chairs and there was a threat within the letter to report these matters to outside individuals particularly the social inclusion unit and Board and Company members.
9. Shortly thereafter it appears that Mrs Everitt had met with Mrs Turner about the matters that were being raised against her. Mrs Turner’'s evidence before the Tribunal was that she had a meeting of about one to two hours with Mrs Everitt over the holiday period when she went over the figures that Mrs Turner had showed her and she tried to assist her with the explanation.
10. Further it appears that on 16 April Mrs Everitt wrote a detailed letter to Mr Birkby giving her the benefit of her recollection and knowledge about these matters and providing what appear to be an explanation for why these increases had been paid and making it clear that as far she Mrs Everitt was concerned Mrs Turner was certainly not in any way responsible for any form of malpractice or dishonest activity.
11. Mr Birkby it seems took no action on that letter; its details were never disclosed within the disciplinary process Mrs Turner was not aware of that letter until matters emerged in the course of preparation for the Tribunal proceedings.
12. The disciplinary hearings took place on 11 and 18 May and there are minutes of both meetings. Mrs Turner in her witness statement suggests that the first meeting on 11 May she raised the issue of contacting Mrs Everitt. The Tribunal make no finding about that, they only make a finding that later on at the appeal process she raised the issue of whether the employers had contacted Mrs Everitt.
13. Prior to 11 May, the employers had indeed contacted a number of the Board Members and the overall view was that no increases would have been authorised if they had not been minuted. That was not the view of the then Chairman of the Board; there was a conflict in evidence about what he told Mr Jepson although the Tribunal accepted Mr Jepson’'s version that along with the other Board Members his view was that no increases would have been authorised if they had not been minuted.
14. Mrs Turner’'s explanation of the increases was really one of extra responsibility and she was saying that nothing wrong had happened and she certainly would not have paid wages without some agreement from the Managers or Board Members. A Mrs Wharam who was a Board Member, who had not been contacted beforehand because it was thought that she would be sympathetic to Mrs Turner, was brought along to the disciplinary hearing by Mrs Turner and she expressed the view supporting Mrs Turner that something might have been missed off the minutes.
15. The proceedings were adjourned to 18 May but Mrs Turner did not attend then, because there was some misunderstanding. Mr Birkby was there albeit initially to deal with Mr Hill’'s disciplinary proceedings, Mr Hill being much in the same category as Mrs Turner. Mr Birkby was asked at that meeting whether there was anything else he wanted to put forward and he again did not reveal the detailed contents of the letter from the bookkeeper Judy Everitt which was seemingly in his possession and the decision was taken to dismiss. There was an appeal hearing and the decision was upheld. Within the appeal notes there is reference to Mrs Turner asking why Judy Everitt had not been involved from the beginning of the inquiry. The Chairman was unable to answer this question.
16. At the end of those minutes Mr Birkby, Mrs Turner and Mr Hill are asked to produce any further evidence in support of their claim. Mr Birkby he said it was not their intention to produce any further evidence as they felt that all relevant evidence had already been put before the sub-committee. Again an opportunity there to produce the letter from Mrs Everitt which opportunity was not taken up.
17. The Tribunal accepted that there was a potentially fair reason for dismissal relating to misconduct and effectively relating to possible alleged dishonesty on the part of Mrs Turner. But they held that there were a number of areas where they concluded that a reasonable employer acting reasonably within the normal range of responses would not have acted in the way that this employer had acted. Complaint is made today by the Appellants in relation to those particular findings.
18. Firstly, and most importantly, is the failure of the employers to contact Mrs Everitt. It is not dispute that other than Mrs Turner who was the person who was the payer of these funds in terms of preparing the cheques and dealing with the paper work, the next best person to give assistance in these matters in terms of the detail would have been Mrs Everitt.
19. The findings of the Tribunal were that Mr Jepson did not contact her because he was upset by her attitude and presumably by that he means the letter of January and appears to resolve to have nothing more to do with her. Today it was suggested that the sub-reason may be that he felt she was only going to support Mrs Turner’'s case but that is not a finding of the Tribunal. The Tribunal find that as a reasonable employer to allowed his pride or personal feelings to have inhibited his inquiry into the truth abut a matter which was likely if unresolved to lead to the Applicant’'s dismissal is something that he should not done as a reasonable employer.
20. Today it is argued that that bearing in mind the very contentious letter advance sent by Mrs Everitt in January the reaction of Mr Jepson was a reasonable one and that he should not have been expected to have to go back to her to seek further information on this particular topic.
21. We were referred on another issue within this appeal to a decision of this court British Steel Corporation v Williams transcript EAT 776 of 82. In that case an employee having clocked on for a morning shift was seen by a manager six miles away from the factory where had had clocked on, allegedly not at work, and obviously dealing with his own matters. These allegations led to his dismissal was in relation to his failure to be at work. At an early stage the union who were representing him had suggested to the employers that the whole gang at work this morning should be contacted initially, only one person was, and he could only provide as it were a partial alibi. Eventually, the employee at an appeal hearing some months later brought forward a further member of the gang Mr Bone who was able to provide more substantial evidence in support of Mr Williams. However, Mr Williams’' misconduct in not producing witnesses earlier on was penalised by the Tribunal at first instance by means of an award of contributory conduct and the case primarily concerned whether or not that this correct and we shall return to that part of the case below.
22. However at page 10E of the transcript Mr Justice Neill hearing the decision of the Court said this:

“"The employers are making a serious accusation against Mr Williams it was for them to prove it, it was for them once the matter had been challenged by him as it was to investigate it”"

23. That is again an example of the obligation on employers where a serious allegation has been made to carry out proper inquiries. True they are not carrying out inquiries to the level of a criminal investigation but the allegation here against Mrs Turner who was an employee with many years of service was effectively of dishonesty that she had paid herself unauthorised increases. The Tribunal took the view that with the background of that serious allegation and her lengthy employment and indeed with the issue, certainly raised at the appeal hearing, of the possibility of then contacting Mrs Everitt, that it was appropriate for Mr Jepson as it were to swallow his pride and to as a reasonable employer contact the one person who would be able to provide possibly very relevant and cogent information about what had gone on particularly since these events had occurred some five or six years previously.
24. We cannot fault the Tribunal’'s view with regard to that approach in terms of what a reasonable employer should do. Similarly the Tribunal raised concerns about other matters where again we are quite satisfied that their approach was a correct one in asking themselves the correct question as to whether the employer’'s response was within a reasonable range.
25. First of all it is said that the employer’'s gave insufficient consideration to the existence of the job description. Not only did the job description provide and explanation for the August pay increase but it also provided evidence that matters could take place without there being a formal board minute or other written notification within this organisation. The view of the Tribunal was that this document provided possible explanation and support to what Mrs Turner was saying namely that not everything was minuted within the Board Meeting process.
26. Next the Tribunal were critical of the fact that an earlier approach should not be made to Mrs Wharam. True she did appear albeit produced by Mrs Turner at the first meeting on 11 May 2001. The Tribunal’'s view is that the Respondent could have gleaned from Mrs Wharam had they approached her considerably sooner than that hearing and interviewed her at the same time as board members. The employer’'s concern that she was going to be in Mrs Turner’'s camp was again not a proper approach in the light of the important inquiries that they were carrying out.
27. Again we agree with the Tribunal’'s view on these matters that a reasonable employer carrying out a proper inquiry would indeed have contacted her earlier along with the other board members and that to single her out simply because she might be partial towards Mrs Turner was not an appropriate explanation.
28. Two less significant issues on unfairness related to the wording of the Board Resolution and also a comment made by Mr Jepson in cross examination that “"something happened, it may have been dishonesty anything may have happened”" suggesting that he did not have a genuine belief in this lady’'s guilt. We do not place great store on that particular comment since earlier on in the Tribunal’'s findings they seem to accept that Mr Jepson did indeed have genuine belief in relation to there being a potentially fair reason for dismissal.
29. In terms of procedural fairness a complaint was raised that Mrs Turner was not at the adjourned hearing on 18 May. She was however, represented by Mr Birkby and to that extent we do not pay much reliance in terms of that element of unfairness. The substantial complaint really is in relation to Mrs Everitt and in relation to the failure to give proper regard to the existence of the job description and as regards those matters we can find no fault in the Tribunal’'s approach.
30. On the issue of contribution the Tribunal considered the failure of Mr Birkby to produce the letter to either of the May hearings when it was clearly in his possession. The matter was dealt with by the Tribunal in this way “"we do not feel able on the balance of probability to conclude that the Applicant was guilty of the misconduct alleged against her. We must also reject the novel argument put forward by Mr Hughes that the Applicant can be regarded as has having contributed to her dismissal by her choice of Mr Birkby as in has Mr Hughes view an ineffectual representative during this preliminary process. The Applicant went to an Advice Centre and she was entitled to expect competent advice and assistance. She cannot be held responsible if that is not what occurred”". Having heard from Mr Hughes today we are quite satisfied that the Tribunal were misrepresenting his submissions. His argument simply was that in terms of deciding whether Mrs Turner was culpable or blameworthy in her conduct contributing to the dismissal the actions of Mr Birkby as her agents should effectively be visited upon her as the principal responsible for the acts of an agent.
31. In support of his contentions he has drawn our attention to the case of Allen v Hammatt [1982] IRLR 89. In the case an employee had mistakenly been paid some insurance money by his employers insurers being the proceeds of sickness policy to cover absences of employees. The employers had already paid him his full wages so that the money was effectively due to the employers. Mr Allen the employee kept held of the money, acting on advice from solicitors not to repay the money until they had looked into the matter particularly on the basis that he was about to raise personal injury claim, although the employers had not the same insurers in respect of both matters.
32. The Insurers kept on writing to the employers asking for the employee to return the money but he never did and eventually the employer was informed until the money was returned the employee would not be included in the accident policy which led to his dismissal.
33. The Tribunal having found unfair dismissal held that his failure to repay the money albeit on the advice of his solicitors was a matter contributing to his dismissal and reduced his compensation by 60%. The decision of this court was given by Mr Justice Brown Wilkinson, President the head note reads as follows:

“"The authorities established that Industrial Tribunals should adopt a broad common sense approach and should see if there was conduct by the employee which is blameworthy. In doing so contrary to the submission made on the appellant’'s behalf, the blameworthiness of the employee is not to be looked at divorced from the actions of persons acting on his behalf as his agent. The general principle that a man is held responsible for the acts of his agent, so that the culpability of a party to proceedings takes into account the acts or omissions of that party’'s agent, applies also in the context of industrial relations legislation. If an employee’'s solicitors fall short of their professional duty, his remedy is to seek compensation from them, not from his employer”".

34. Mr Branchflower seeks to distinguish that case on the basis within the Allen case there was fault on the part of the employee in not returning the money he argues that there was an element of culpability in respect of Mr Allen’'s own actions, although based on the advice of his solicitors. In any case he suggests that no fault can attach to Mrs Turner because she was not aware that Mr Birkby had the letter in his possession and moreover at the appeal hearing she had alerted the employers the possibility of them contacting Mrs Everitt.
35. We cannot see that the distinction is justified and are of the view that Allen Hammatt makes it quite clear that in terms of assessing culpability it can be the culpability of the agent rather than the employee which will lead to a deduction in an appropriate case. In Williams to which we have already made reference the deduction in that case was set aside by this court. At page 10 letter F they said this:

“"We consider that would be imposing too high a duty or obligation on Mr Williams to have required him to make known exactly who else could speak on his behalf. It might well have been very sensible thing for him to do and it is a matter of regret that perhaps he did not take that course. But looking at the definition of culpability and blameworthiness described as the judgment of Brandon L.J. it does not seem to us in the context of the present case that Mr Williams could be described as being culpable or worthy of blame. He did not produce Mr Bone as witness until 2 April it may be that was unfortunate but we do not think it will be right to describe that as something worthy of blame or as culpable “".

36. Mr Hughes seeks to distinguish Williams firstly, on the grounds that in the Williams case the trade union officials had at an early stage alerted the employers to the possibility of contacting the gang and secondly, because albeit at a late stage Mr Bone was indeed produced as a witness by the employee. He contrast that position with the one in this case where at no stage was the letter from Mrs Everitt giving a very detailed explanation of events produced by Mr Birkby and indeed at the appeal hearing he was asked in very clear terms whether he had anything to else to produce or say and he said that he did not that everything had been produced.
37. It seems to us that there was culpability on the part of Mr Birkby in failing to reveal that letter. Whilst the letter itself was not known to Mrs Turner, she had already had an hour and half meeting with Mrs Everitt and presumably was already in possession of quite detailed information. It is not clear from the minutes whether that detailed information passed on to her and set out in the letter was set out by Mrs Turner at the meeting on 11 May to which she attended. At the very least we are of the view this is a case where a deduction should have been made by way of contributory behaviour to reflect the failure of Mr Birkby to produce the letter.
38. We do not propose to send this matter back to the Tribunal for further consideration. The facts are clear from their findings and from the additional documentation that we have seen and we will propose to make a contributory deduction of 20% to mark the culpable behaviour of Mr Birkby for which we hold Mrs Turner liable.