United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant

MS A HEWITT (Of Counsel) Instructed by: Messrs B D Laddie Solicitors Dean Bradley House 46 Horseferry Road Westminster London SW1P 2AP

 

For the First Respondent	MISS CLAIRE PALMER (Of Counsel) Instructed by: Dechert LLP Solicitors 160 Queen Victoria Street London EC4V 4QQ
Second Respondent	Debarred from proceedings

SUMMARY

.The Appellant's grounds of appeal are based on perversity and an error of law in the construction of the TUPE regulations.


 


HIS HONOUR JUDGE PUGSLEY

1. This is an appeal from the decision of the Employment Tribunal sitting at Ashford in which the Tribunal decided that the Claimant was dismissed for a reason connected with the transfer of part of the 1st Respondent's business entity to the Respondent. The Claimant was therefore unfairly dismissed by the First Respondent for whose actions the 2nd Respondent is liable pursuant to Regulation 5(2)(b) of the Transfer of undertaking Regulations 1981.
2. Ms Hewitt appeared for both Respondents before the Employment Tribunal but the appeal is only by Monitus Ltd. In terms the Appellants say they are not alleging bias against the Employment Tribunal but it is suggested that the apparent disapproval of the Respondents employer's business activities led the tribunal unwittingly to make errors of fact and law. Objection is taken to the fact that the Tribunal used the words tax avoidance rather than tax efficient schemes. Particular objection is taken to the phrase in paragraph 5 of the decision that "various players are referred to in this complicated web of activity within the tax avoidance industry". The complaint is not that the Tribunal was stigmatising the Respondents activities as unlawful but that the phrases used suggest operations which were not entirely straightforward or were only just within the limit of legality.
3. Whilst we have some understanding of the Appellant's sensitivity we do not consider there is any duty upon an employment tribunal to adopt the language of a company's marketing department to describe the company's activities. We have to say that during the course of this case we have questioned whether there are real issues of law being raised as opposed to an attempt to re argue issues of fact which were put to the tribunal and failed and are now resurrected before us as issues of law.
4. The Tribunal set out its findings of fact at Paragraph 7 onwards:

"7 The Tribunal makes the following findings of fact:

7.1 The 1^st and 2^nd Respondents are involved in the tax avoidance industry. The 1^st Respondent operates tax avoidance schemes principally for those working and resident outside the UK. The 1^st Respondent has traded since 1998. Part of its services included completing tax returns and performing associated work for clients. Prior to 2003/4 these tax services were carried out for the 18 Respondent's clients by a firm of chartered accountants called Jayson Newman. This accountancy practice was taken over by Numerica. The tax work was performed by the Claimant who was supervised by Mr Barnett, a partner in Jayson Newman and latterly at the equivalent status but employed by Numerica following the take-over.

7.2 For the tax year 2003/4 the 1st Respondent decided to undertake its tax services inhouse. This work was actually performed by the Claimant who the 1st Respondent 'poached' nom Numerica. The Claimant does not possess formal professional accountancy qualifications but previously worked for the Inland Revenue and brought this experience into the tax avoidance industry for the benefit of the 1^st Respondent.

7.3 On 1^st April 2003 the Claimant commenced her employment with the 1^st Respondent. It operated at that time, 2 tax avoidance schemes requiring work by the Claimant. One was called the Partnership Scheme and the other the Employment Benefits Scheme. Initially the Claimant was more involved in the Partnership Scheme than the EBS scheme, which involved registering the members of the Partnership Scheme with the Inland. Revenue and also registering Consulting Overseas Limited ("CO"), as tax agent for the 1st Respondent. The EBS scheme involved less tax work than the Partnership Scheme .

7.4 During the following year there was a diminution in the work of the Partnership Scheme with clients reducing from about 150 to 50.

7.5 As a resu1t of changes in the law to nullify its benefits the 1^st Respondent decided to terminate the EBB Scheme in February 2004. It is this fact which the 1st Respondent contends led to the Claimant's redundancy.

7.6 The 1st Respondent did not have professional indemnity insurance for accountancy work which included the tax work performed by the Claimant. Such work was specifically excluded from the 1^st Respondent's insurance cover. Mr Bishop says it was during 2003/4 that his lack of Cover was pointed out to him by his insurance brokers and when this happened he became concerned about what he perceived to be uninsured exposure. The confirmation of cover is dated 24^th July 2003. The 1^st Respondent took no steps immediately to terminate the tax. preparation work but decided it would do so, 9 months later, in April 2004 at the end of the fiscal year. It decided to arrange for this work to be performed thereafter by the 2nd Respondent as it was able to obtain professional indemnity cover.

7.7 The 1st Respondent and CO, its tax agent, ""ere clients of Mr Barnett when at Jayson Newman and again after it was taken over by Numerica. He supervised the tax returns prepared for clients of both companies as wel1 as providing other accountancy advice. The Claimant worked under him and at his direction. Mr Barnett facilitated the Claimant's transfer to the 1st Respondent. He induced the Claimant to write an email to him claiming falsely that she had been approached directly by the 1st Respondent to work for them so as to n1islead the directors of Numerica so they would not think her leaving had been facilitated by Mr Barnett. Mr Barnett himself left Numerica on 16&11 May 2003 and the 2nd Respondent commenced trading 3 days later on 19^th May 2003.

7.8 The Tribunal accepts the evidence of the Claimant that tax associated work tends to increase in volume during the autumn and reaches it height by the end of January, the final date for submission of tax returns without penalty. It then goes t1noough a period of lull until mid summer/autumn when it begins to pick up again. There is therefore nothing unusual in someone whose main employment is the preparation of tax returns to find themselves working long hours in the height of the busy period without extra pay but this is compensated for by reduced hours of work in the spring and early summer

7.9 The Claimant accepted there was a reduction in the number of clients in the partnership scheme and that the EBS scheme was planned to terminate in April 2004. The Tribunal accepts her evidence that although the 2 schemes were reducing/terminating this did not mean her work on them would cease or even substantially reduce. She was required to prepare a number of tax returns for those in the final year of the scheme and for those who left the scheme part way through the final year. The Actinium Scheme was due to commence in Apri1 2004 and there would have been substantial work for the Claimant to do in setting this up and having it ready to run at the commencement of the 2004/5 fiscal year.

7.10 The Actinium scheme enabled the 1^st Respondent to cater for those clients who could not remain on the Partnership Scheme after comp1eting a maximum of 3 years and also for those on the EBS scheme which was becoming obsolete. The 1st Respondent planned to move its clients onto the Actinium Scheme which in fact it did in March 2004. The Actinium scheme involved more tax work than its predecessor, due to its structure and would therefore have increased the work to be performed by the Claimant.

7.11 The office arrangements of the Respondents are complicated and lack transparency. The 1^st Respondent holds the lease of the premises which it is not permitted to sublet. A number of businesses operate from the same premises. These include the 1^st Respondent and CO run by Mr Bishopp together with the 2nd Respondent run by Mr Barnett. There are 6 other companies operating from the premises, 2 of which are property companies jointly owned by Messrs Bishopp and Barnett. There is 1 lift to the premises. 1 room is shared by 3 solicitors employed by the 1^st Respondent. Mr Barnett; as the 2nd Respondent, occupies a room on the same corridor. He accepts he has no legal right to be there and does not pay rent. The 1^st and 2nd Respondents share a photocopier, fax machine and filing area. They also share a receptionist, who does typing for both. Both have their own computers which share a common server. Mr Barnett, when operating a computer of the 2nd Respondent, is able to access information on the computer system of the 1st Respondent.

7.12 The 2nd Respondent has clients other than the 1st. Respondent, but the 1^st Respondent is its major source of income. In May 2004, the 1^st Respondent represented about 80% of the 2nd Respondent's income estimated for the current year to be in the region of £200,000. The tax work is about £40,000 of that sum. This work is for clients of the 1^st Respondent who are unaware it is performed by the 2nd Respondent. It is performed on a sub contract basis from the 1^st Respondent. The only person dealing with this type of tax work at the 1st Respondent was the Claimant.

7.13 Following dismissal of the C1a,imant the ~ Respondent advertised for and engaged a chartered accountant (Leo Duffy) to perform the tax work previously undertaken by the Claimant together with additiona1 accountancy work. The 2nd Respondent charges the 1st Respondent for Mr Duffy's work and the 2nd Respondent pays approximately £2,000 per month to the 1st Respondent as a contribution to office expenses. Mr Barnett is working on devising a new tax avoidance scheme which he intends will be marketed by the 1st Respondent. Although the terms upon which this will be done have not yet been decided, as they will depend upon the efficacy and commercial va1ue of the new scheme, there is a tacit understanding between Mr Barnett and Mr Bishopp that they will share the profits to be generated and this factor is taken into account in the payment made by the 2nd Respondent to the 1^st Respondent for its share of office expenses.

7.14 The Claimant is a single mother and agreed with Mr Bishopp that she could work for the 1st Respondent Principally from home attending the offices of the 1st Respondent once a week on Wednesdays.

7.15 At the time of leaving Numerica the C1aimant was invited by Mr Barnett to undertake some private tax work for him . She checked with Neil Dunlop, her line manager at the 1st Respondent, who gave approval. Over the next year the Claimant kept a detailed note of time spent on this private work and in early 2004 rendered Mr Barnett an invoice. It was for 53½ hrs for which she expected to be paid £15 per hour producing a total of £802.50. Mr Barnett's response was to decline to pay the bill and said the work undertaken was "work for the organisation" for which the Claimant had already been paid. The Claimant worked only for the 1st Respondent from which the Tribunal infers that Mr Barnett regarded work done for him to be related to or collected with work done for the 1st Respondent.

7.16 On 10th March 2004 the Claimant attended the 1st Respondent's offices to collect the post. Mr Bishopp came to her room and said he wanted to speak to her at 1pm in his office but did not tell her why. She attended as requested and was re-directed to Mr Barnett's room where she was met by both Messrs Bishopp and Barnett.

7 .17 The Claimant felt uncomfortable being confronted by both Messrs Bishopp and Barnett. Mr Bishopp did most of the speaking to begin with and appeared to be uncomfortable. Mr Barnett just stared at the Claimant until Mr Bishopp left to get some papers. Mr Bishopp said to the Claimant "we need to part company" and gave an explanation involving problems with insurance cover and regulatory problems, but without defining them. Mr Bishopp said the tax services provided by the Claimant were going to be performed in the future by an accountant mend of his "in the North" but when be was out of the room this was contradicted by Mr Barnett who said the work would be performed by the 2nd Respondent by an accountant he intended to employ.

7.18 Prior to commencement of the meeting neither the 1st nor 2^nd Respondent informed the C1aimant of the nature of the meeting and she was not invited to be accompanied. There was no mention or alternative employment with the 1st Respondent or by the 2nd Respondent, nor was there any suggestion that she might perform work in the office rather than at home or have her hours reduced during a temporary lull in work.

7.19 There was no consultation with the C1aDnant and she not invited to give her views about any of the matters discussed. It was clear from the way the meeting was conducted that the decision to dismiss her had already been taken prior to the meeting commencing and did not arise as a result of the meeting.

7.20 The Claimant was shocked and left the meeting, She telephoned her line manager, Mr Dunlop, to ask if he knew what was happening. He told the Claimant he was aware of an undercurrent against her partially because she worked from home and also because there appeared to be some unspecified conflict with Mr Barnett. The Claimant contended that her relationship with Mr Barnett changed, when she submitted her account in early 2004 and never recovered thereafter.

7.21 On returning to her home the Claimant looked at the website for Hays Personnel Recruitment and discovered an advert which she regarded as advertising her position. The salary location and benefits were virtually identical to those she enjoyed. The copy advert (176) discloses that it was posted on the website that same day on 10^th March by the 2^nd Respondent. The advert seeks a "Personal Tax Professional" and makes no reference to seeking a qualified accountant. It is expressed to be "ideal for a PA to Partner level candidate " i.e. someone at the Claimant's level

7.22 This advert was later withdrawn by the 2^nd Respondent who also withdrew its instructions to Hays. A subsequent advert was prepared and is referred to in an email from a different recruitment agency, dated 7^th June 2004. This sought a qualified accountant and led to the 2^nd Respondent employing Mr Duffy.

7.23 Mr Barnett agreed in x-exam that the room formerly occupied by the Claimant is now occupied by Mr Duffy. Mr Barnett admitted he has been closely involved with the 1st Respondent since its inception and designed many of its systems and procedures. He also accepted the Claimant's role preparing tax returns and associated work still exists although he claims it has diminished. It is now performed by the 2^nd Respondent's employee Duffy who performs some accountancy work in addition to the tax work. The 2nd Respondent is able to obtain and has professional indemnity insurance covering tax work which is part of normal accountancy work and therefore has always been available to it because Mr Barnett is a chartered accountant.

7.24 By letter dated 17^th March 2004 Mr Bishopp wrote to the Claimant giving her 2 months notice expiring on 12^th May 2004. No reason for her dismissal is given in the letter. The 1st Respondent requested the Claimant to liaise with Mr Barnett (of the 2nd Respondent) in the handover of her work.

7.25 A further meeting was arranged between Messrs Bishopp and Barnett with the Claimant for the 2nd April. This meeting proved difficu1t for the Claimant. Mr Bishopp wanted the Claimant to work her notice but it was decided it would be better if she did not and her employment was terminated immediately with the Claimant being paid wages in lieu of notice.

7.26 On leaving the building the Claimant left a letter for Mr Bishopp at the reception desk, dated 2^nd April [179]. This asked for reasons for her dismissal. It was responded to by Mr Bishopp in his letter of 15^th April [186] in which he asserts the Claimant was redundant due to reduction of clients from 150 to 50. He also referred to regulatory changes requiring the person undertaking the Claimants position to have qualifications which the Claimant does not possess. He also referred to the 1^st Respondent's lack of professional indemnity insurance. Mr Bishopp does not specify the regulatory changes referred to or the qualification required.

7.27 No evidence was adduced of any regulatory changes occurring during 2003/4 which would have required someone performing the Claimant's duties to have professional qualifications. Evidence was adduced of the 1st Respondent's insurance brokers saying they were unable to obtain professional indemnity cover for the tax work conducted by the 1^st Respondent but there was no evidence of other enquiries being made in the insurance market generally or by other brokers. The lack of insurance cover did not cause the 1st Respondent immediately to terminate its tax work.

8. The Tribunal had cited to it the following authorities:

Iceland Frozen Foods v Jones [1983] ICR 17

Whitbread plc v Hall (2001] ICR 699

Mugford v Midland Bank Plc [1997] ICR 399

Clarkson International Tools Ltd v Short (1973J ICR 191

James W Cook & Co v Tipper [1990J ICR 716

Polkey v Dayton Services Ltd [1988] ICR 142

Mining Supplies Ltd v Baker [1988] ICR 676

Whitewater Leisure Management Ltd v Barnes [2000] ICR 1049

BSG property Services v Tuck [1996] IRLR 134

9. The Tribunal unanimously reaches the following conclusions:

9.1 The Tribunal reminds itself that pursuant to s.98 of the Employment Rights Act 1996 it is for an employer to show the reason, or principal reason, if more than one, for dismissa1and that it is a potentia11y fair reason.

9.2 In this case the Respondents do not dispute that the Claimant was dismissed by the 1st Respondent and therefore it is for her employer to show the reason for dismissal. The 1st Respondent contends it dismissed the Claimant on the basis of redundancy and/or some other substantial reason ("SOSR") namely the lack of insurance cover.

9.3 The Tribunal accepts that during 2003/4 Mr Bishopp realised the 1st Respondent did not have professional indemnity insurance to cover the preparation of tax returns and he did not want the 1st Respondent to be exposed after April 2004. This was a commercial decision the 1st Respondent was entitled to make. However, it was content to wait until the end of the fiscal year and did not make other enquiries to see if appropriate cover could be obtained.

9.4 The 1st Respondent decided therefore to transfer that work to the 2^nd Respondent as from Apri12004. The only employee engaged by the 1^st Respondent performing this work was the Claimant.

9.5 The decision to dismiss the Claimant was taken on or before 10^th March and was communicated to her on that date at a meeting attended by both Messrs Bishopp and Barnett.

9.6 The practical (as distinct from legal) boundaries between the 1st and 2nd Respondent are extremely blurred and ill defined. This is clear from the way they share office space, equipment, staff, computer systems and data bases and contemplate sharing profits in a new scheme to be developed by Mr Barnett. If they were operated as separate and distinct entities Mr Barnett would not have been present at the Claimant's dismissal and more particularly would not have been referred to in the letter of dismissal as the person to whom the Claimant should hand over her current work. The meeting also would not have taken place in Mr Barnett's office.

9.7 What is clear is that the preparation of tax returns for clients of the 1st Respondent (which includes Actinium in the future) was performed prior to the Claimant's dismissal by her, employed by the 1st Respondent and after her dismissal this work was transferred to the 2nd Respondent and was thereafter performed by Mr Duffy, once he was recruited. This work was an essential part of the business conducted by the 1st Respondent and remains so.

9.8 The Tribunal has taken into consideration the principles set out in Whitewater Leisure which says when considering whether a TUPE transfer has occurred there are 2 questions to be considered namely whether there was an identifiable business entity constituting an undertaking, and if so whether there had been a relevant transfer of that undertaking; that in relation to the first question the entity had to be identifiable as a stable and discrete economic entity, sufficiently structured and autonomous, but not necessarily having assets and in relation to the second question, relevant factors were similarity of activity before and after transfer, a transfer of assets or a brand name or goodwill or a licence to use equipment or assets and whether the majority of employees or the significant employees in terms of skill had been engaged by the transferee and if appropriate why certain employees were not taken on by the transferee.

9.9 In applying these tests the Tribuma1 is satisfied that an identifiable business entity within the 1st Respondent existed prior to the transfer, namely one devoted to the preparation of tax returns and associated tax work. It was stable in that it was a permanent and necessary part of the service provided by the 1st Respondent for its clients and was transferred to the 2nd Respondent. The activities of the 1st and 2^nd Respondents, with regard to these functions, were the same both before and after transfer. Much of the same office equipment was used both before and after transfer and only 1 employee was used in both the 1^st and 2nd Respondents. The skills required to undertake this work are the same.

9.10 The Tribunal is satisfied that there was a transfer of part of the 1st Respondent's business entity to the 2nd Respondent and it was a transfer to which TUPE applies. It is also satisfied that the C1aimant's dismissal was connected with the transfer which is the principal reason for her dismissal.

9.11 The 2nd Respondent contends there was an ETO reason for dismissing the Claimant. The 200 Respondent contends it did not accept transfer of the Claimant because it wanted to engage a qualified accountant rather than use an unqualified person like the Claimant. The Tribunal finds it was not necessary for the 2nd Respondent to engage a qualified person to perform the work undertaken by the Claimant. This is reinforced by the advert made on behalf of the 2nd Respondent on 10th March, being the date when the Claimant was informed of her dismissal. This clearly refers to a non qualified person and the Tribunal rejects the evidence of Mr Barnett that the initial advertisement was a mistake. The advert, in its nature and timing, is entirely consistent with tile fact of the Claimant's dismissal which had been decided by Messrs Barnett and Bishopp prior to the meeting with the Claimant on 10th March. It had already been agreed between them that the tax work would be transferred to the 2nd Respondent and the 2nd Respondent needed to recruit someone quickly to take over this work. This is implicit from the letter to the Claimant from Mr Bishopp dated 17^th March asking the Claimant to liaise with Mr Barnett over her unfinished work. The Tribunal concludes the withdrawal of this advert and its replacement by the later advert was contrived by Mr Barnett to cover his tracks once he realised these proceedings were likely to occur.

9.12 The Tribunal therefore concludes there was no ETO reason on the 2^nd Respondent entailing changes in its workforce being the reason or principal reason for the Claimant's dismissal.

9.13 The Tribunal concludes the dismissal of the Claimant was in any event procedurally unfair. She was given no prior notice of the meeting which took place on 10th March. She was given no opportunity to be accompanied and to be confronted by Messrs Bishopp and Barnett was oppressive. No consultation took place and the views of the Claimant were not sought. No alternatives were considered such as the Claimant working at the office or doing shorter hours and it is clear the decision to dismiss her had already been taken. No proper reason was given to the Claimant until later when she asked for reasons. She was also left feeling uncertain about the effective date of her termination.

9.14 By operation of regulation 5(2)(b) of TUPE, liability for the Claimant's unfair dismissal by the 1st Respondent lies with the 2nd Respondent and the Tribunal therefore finds that 2nd Respondent is responsible for the Claimant's unfair dismissal by the 1st Respondent.

9.15 By way of summary, the Tribunal asks itself what was the reason, or if more than one, the principal reason for the Claimant's dismissal. TheTribunal concludes there may have been more than one reason leading to the decision but the principal reason was because the 1^st Respondent decided to transfer its tax associated work to the 2nd Respondent and the 2nd Respondent decided it did not want to employ the Claimant. Her dismissal was therefore for a reason connected with the transfer.

9.16 The insurance issue caused the 1st Respondent to transfer the tax function to the 2nd Respondent but did not directly cause it to dismiss the Claimant. It is not clear from the evidence exactly when Mr Bishopp discovered the 1st Respondent was exposed to risk but whenever it was there is no evidence that he acted quickly as a result of that discovery to dismiss the Claimant.

9.17 Having made the decision to transfer the tax function to the 2^nd Respondent the Tribunal accepts a redundancy situation would have arisen within the 1st Respondent as it then no longer required or expected to require, in April 200, an employee to perform the Claimant's function. However, this redundancy situation arose or was created as a consequence of the decision to transfer the tax function to the 2nd Respondent. It was therefore not the sole or principal reason for the dismissal but at best could have been a secondary or consequential reason.

9.18 This is confirmed by Mr Bishopp in his written statement which disc1oses that the exposure was discovered during the 2003/4 year when it was pointed out to him by his brokers. He says the 1st Respondent "took the decision to stop providing Tax Return services at the end of the financial year 2003/2004 and to sub-contract such little Tax Return work as remained to Monitus Ltd. All of the Applicant's job duties ceased or were expected to cease by March 2004 or thereabouts and there was no longer a need for an employee to carry out her role". He does not assert that the lack of insurance cover caused him to dismiss the Claimant but admits it caused him to transfer the function performed by her to the 2^nd Respondent which reinforces the Tribunal's conclusion.

9.19 The Claimant previously worked for and under the direction of Mr Barnett when they were together at Numerica. No criticism has been made of the C1aimant's ability or performance. The function performed by the Claimant was transferred from the 1st to the 2nd Respondent. The decision not to transfer the Claimant with her function was made prior to the transfer being made but in contemplation of the transfer. The Tribunal asks why the Claimant simply did not transfer with her function. The only reason advanced is because Mr Barnett decided he wished to avail himself of the opportunity to replace the Claimant with a qualified accountant who would be able to perform work in addition to that performed by the Claimant. The Tribunal rejects this explanation for the reasons already set out. It concludes the advertisement with Hays Personnel Selection was for the Claimant's position and was authorised by Mr Barnett and placed on the same day as the Claimant was informed of her dismissal and was intended to find a replacement for her as soon as possible. The Tribunal infers that for some undisclosed or unidentified reason Mr Barnett decided he did not want to employ the Claimant once the 2nd Respondent took over the tax work. The actual reason for not wanting her to transfer lo the 2^nd Respondent with her function is unimportant to the Tribunal's decision. Firstly, it is for the employer to establish the reason for dismissal and Mr Barnett not only has not done so but the 2nd Respondent was never the Claimant's employer.

9.20 The Tribunal firstly rejects the contention there was an ETO reason leading to the Claimant's dismissal. There was no requirement or necessity to have a qualified accountant undertake the work performed by the Claimant and therefore a decision to employ a qualified accountant in pace of the Claimant would not be a reason "entailing" a change in the 2nd Respondent's workforce, Secondly, the Tribunal rejects this explanation by Mr Barnett which is inconsistent with the advertisement placed by him on the very day the Claimant was informed of her dismissal seeking a replacement for her by someone of equivalent unqualified status. Thirdly, even if the Tribunal were wrong in concluding there was no valid ETO reason the Claimant's dismissal fails to satisfy the requisite reasonableness test pursuant now to s.98(4) of the Employment Rights Act 1996, both procedurally and substantively."

5. The grounds upon which this appeal is brought are that:

(i) the Employment, Tribunal erred in law in that it made a number of findings of fact for which there was no evidence and/or which were perverse in view of the evidence. The Appellant will rely upon the following as being the principal and substantial errors:

(a.) In relation to the Respondent's employment by Sandfield Systems Limited ("Sandfield"), the Tribunal found at paragraph 7.7 that Mr. Barnett of the Appellant "…facilitated the Claimant's" transfer to the 1^st Respondent. He induced the Claimant to write an email to the 1^st Respondent to him claiming falsely that she had been approached directly by the 1st Respondent to work for them so as to mislead the6 directors of Numerica so they would not ,think her leaving been facilitated by Mr Barnett…". In fact, there was no evidence to suggest that Mr. Barnett had "facilitated" the employment, and it was the Respondent's own evidence that she had indeed been approached directly by Neil Dunlop of Sandfield. The Tribunal's conclusion that Mr Barnett had sought to mislead the directors of Numerica in this respect was without foundation.

(b) In relation to the issue of whether there had been a diminution in the Respondent's work with. Sandfield, the Tribunal found at paragraph 7.9 that the reduction of the partnership scheme" and termination of the. "Employment Benefits Scheme" did not mean that the Respondent's work under them "…would cease or even substantially reduce", and that with regard to the new "Actinium Scheme" "... there would have been substantial work for the Claimant to do in setting this up..". These findings were perverse, in the light of the evidence that the number of clients in the Partnership Scheme had reduced by two-thirds, that the Employment Benefits Scheme had ceased entirely, and that as at the date of the hearing (March 2005) no work at all had yet been carried out in relation to the new Actinium Scheme.

(c) In relation to the meeting which took place on the 10th March 2004, the Tribunal found in paragraph 9.13 that "No proper reason [for the dismissal] was given to the Claimant until later when she asked for reasons." This finding is contrary to the Respondent's own evidence under cross examination, and the documentary evidence arising out of her communication with her recruiting agency (to be found in the supplementary bundle).

(d) In relation to the Appellant's recruitment of a qualified accountant, the Tribunal in paragraph 9.11, rejected Mr Barnett's evidence that the initial advertisement was a mistake, and found that "...the withdrawal of this advert and its replacement by the later advert was contrived by Mr Barnett to cover his tracks once he realised these proceedings were likely to occur." There was no evidence upon which this conclusion could be reached. It is contrary to the documentary evidence showing that the second advertisement had been placed and invoiced by the 31^st March 2004 (page 178 of the bundle) by which time the Respondent had made no complaint, and the evidence that Leo Duffy, a qualified accountant, was employed by the Appellant in April 2004.

(e) In respect of the relationship between the Appellant and Sandfield, the Tribunal's conclusions and the tone of their findings (in paragraphs 5, 7.11 and 9.6) were not supported by the evidence. In particular, the Tribuna1's finding in paragraph 7.13 that the Appellant and Sandfield "...will share the profits..." generated by a future scheme, is not a proper ref1ection of Mr Barnett's evidence. In paragraph 9.6, despite apparently accepting that the Appellant and Sandfield were legally separate entities, the Tribunal appears to conclude that they should not be treated as such because the "…practical (as distinct from legal) boundaries)…are extremely blurred and ill defined…". There was no proper evidence upon which the Tribunal could reach this conclusion, and/or the same was perverse.

(ii) the Tribunal erred in law in finding that that there was in this case a relevant "transfer of undertaking" under the TUPE Regulations, in that:

(a) it was wrong "in law and/or misapplied the law in finding, on the basis of the evidence before it, that the "tax work" being carried out" by the Respondent for Sandfield was "identifiable as a stable and discrete economic entity" and was "sufficiently structured and autonomous", and therefore constituted an "undertaking" (as found in paragraph 9.9), and/or

(b) it was wrong law and/or misapplied the law m finding, on the basis of the evidence before it that the "tax work" was "transferred" to the Appellant (as found in paragraph 9.10, where the Tribuna1 does not state expressly why it was satisfied that there was transfer). In relation to this question, the Tribunal took no account of the evidence that the tax work continued to be controlled by Sandfield and was simply "out-scored to the Appellant (in the way that it bad previously been to Numerica) with the Appellant being paid for "work done" on a. monthly basis and that the work could therefore have been withdrawn from the Appellant at any time, and it took no account of the evidence that the "Tax Agent" continued to be Consulting Overseas Limited and not the Appellant.

(iii) the Trlbuna1 erred in law in finding, on the basis on the evidence before it, that there was no "economic, technical or organisational reason" for the Appe1lant failing to employ the Respondent (as found in. paragraphs 9.11 and 9.12). In paragraph 9.11 the Tribunal found that "...it was not necessary for the 2^nd Respondent to engage a qualified person to perform .the work undertaken by the Claimant". The Tribunal directed itself in law and/or misunderstood the law and/or misapplied the law in failing to take into account the fact that the Appellant needed to employ a qualified person because of its need for the employee to cover tasks beyond those previously undertaken by the Respondent. The Appellant relies on the fact that at that time, its sole employee was Wayne Barnett and a qualified Assistant was needed for the purposes of the business.

(iv) In the premises, the Tribunal erred in law in finding, on the basis of the evidence before it, that the principal reason for the Respondent's dismissal was Sand field's transfer of its tax associated work to the Appellant (as found in paragraph 9.15), and in failing to find that the principal reason was "redundancy or some other substantial reason."

6. We have to say that subsumed with the Appellant's skeleton argument there is an implicit premise - which never surfaces as an explicit submission - that the Chairman and members of the Tribunal are under a duty to accept her client's case and to view the evidence in the way in which she wished it to be put. Ms Hewitt displayed a mechanistic approach as though pieces of evidence could be myopically analysed and because such pieces of evidence could be construed as supporting her client's case to suggest that any finding adverse to her case should be regarded as perverse.
7. Ms Palmer for the Respondent has referred us to such cases as Stewart v Cleveland Guest Engineering Ltd [1994] IRLR 440 EAT and Yeboah v Crofton [2002] IRLR 634 which warn appellate tribunals that it should only interfere with a decision of an employment tribunal if it is "irrational", "offends reason" or "is certainly wrong ". There is a plethora of other authority to support the contention that appellate courts should resist the seductive temptation to consider that they are in a better position to evaluate the evidence than the court or tribunal of first instance. The speech of Lord Hoffmann in Piglowska v Piglowski [1999] 3 All ER 632 at 634 with which every member of the House of Lords concurred pointed out:-

a) That the court of first instance has the advantage of seeing the witnesses and evaluating the significance of their evidence;

b) That the exigencies of daily court room life are such decisions are nearly always capable of being better drafted;

c) That unless it is demonstrated to the contrary it should be assumed that those carrying out a judicial function know what they are doing.

8. The older cases used to refer to industrial tribunals as industrial juries. We consider that. the authorities to which we have adverted require this tribunal to respect the fact finding role of the employment tribunal and not to emasculate its function by an over zealous and artificial textual analysis of the text of a decision. The factual background of many cases which an employment tribunal has to determine are complex and arise over a period of time rather than a point of time. To treat a decision like a shopping list of factual findings is to view it from a false perspective because it is in danger of missing the bigger picture.
9. This is more than collegiate loyalty but is based on an appreciation of the very nature of the judicial decision making process. In his succinct summing up of the decision making role Mummery J in Hall v Latimer 1994 ICR 218 CA (quoted with approval at 226) likened the task to painting a picture rather than ticking off a check list. Although the case turned on the status on a tax payer the formulation has a much wider application:

"The object of the exercise is to paint a picture from the accumulation of detail. The overall effect can only be appreciated by standing back from the detailed picture which has been painted, by viewing it from 3 distance and making an informed, qualitative appreciation of the whole. It is a matter of the evaluation of the overa11 effect of the detail, which is not necessarily the same as the sum total of the detail. Not all details are of equal weight or importance in any given situation"

10. Notwithstanding the tenor of the cases to which we have adverted the Employment Appeal Tribunal does intervene when it consider that the Employment Tribunal has misunderstood the evidence, has failed to carry out a balancing act, by failing to make specific finding of fact has

constructed a foundation too frail to support the generalised findings of fact which it makes and when the Employment Tribunal fails to leave any visible trail which shows why it has reached the conclusion to which it has come.

11. None of the members of this Tribunal have been persuaded by any of the arguments which have been put that the Employment Tribunal is in error in making the findings of fact to which it has come. It is true that the tribunal may well. have chosen to make different findings of fact. We accept the argument put by Ms Palmer that in effect these grounds of appeal alleging perversity are no more than a complaint by the Appellants that the Tribunal preferred the evidence of the claimant to that called by the respondents. Further we accept Ms Palmer's submission that on issues about which only the Respondents could give evidence there is no duty to accept the evidence which the Respondents call on such issue.
12. A single example of the approach which the Appellant has adopted suffices. Mr Barnett placed an advertisement for a personal tax professional with no requirement that candidates should be professionally qualified on the same day as the claimant was dismissed; thereafter he

withdrew that advertisement and placed an advertisement for someone who was professionally qualified and indeed a candidate was appointed who was professionally qualified.

13. In her skeleton argument Ms Hewitt makes a number of pertinent points as to why the Tribunal should have accepted that the placing of the first advertisement (which did not include the requirement for a professional qualification) was a mistake. The tribunal was not obliged to accept the evidence put before it by the Respondents. Having seen the witness it was entitled not to accept such evidence. The assessment of the credibility a witness is a matter for the employment tribunal not for this tribunal.

Errors of Law

14. In her skeleton argument Ms Hewitt accepts that the Tribunal at paragraph 9.8 correctly directed itself as to the correct approach but suggests that the Tribunal had failed to apply the test which it is accepted it had correctly formulated. The decision of this Tribunal has to be read against the background that both parties had put before the Tribunal lengthy detailed written submissions. The submissions made by the parties are reflected in the decision.
15. The Appellant's contention is that it was not open to the Tribunal to find that the tax work was an identifiable business identity. Permeating this ground of appeal is the unspoken premise that the parties (or their advocates) have the right to dictate to a Tribunal what matters they must place weight on in determining a case. Of course an Employment Tribunal must have regard to the submissions made by the respective parties but ultimately it is for the Tribunal to find what arguments it finds compelling.
16. A tribunal is not, as is implicitly suggested in the Appellant's skeleton argument, erring in law in failing to accept matters urged upon it on behalf the of the Respondent. It is for the tribunal, not the parties, to assess the weight to be given to a particular aspect of the case. If one reads Paragraph 9.7 onwards the Tribunal gives a reasoned decision why it reached the decision it did and we see no error of law in its conclusions. We consider the Tribunal properly set out its reasoning for its finding that the entity was transferred to the Appellant; Ground 6(ii)(b) of the Appeal.
17. In view of its findings that it. did not accept the legitimacy of the argument that a qualified person was necessary (see Paragraph 9.20 of the decision) the whole basis upon which it is suggested that it was an error in law in finding there was no economic and technical or organisational reason for failing to employ the Claimant is fundamentally flawed. Ground 4 does not appear to have been pursued before us but in any event it relies on a finding of fact made in respect of the First Respondent which is not a party to the Appeal.
18. As Ms Palmer has pointed out the Tribunal expressly found at Paragraph 9.20 that even if it was wrong in concluding there was no ETO reason the Claimant's dismissal failed to satisfy the reasonableness test pursuant to Section 98(4) both procedurally and substantively.
19. In the circumstances this Tribunal dismisses this appeal on all the grounds put forward.