United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MR IAN KENNEDY (Solicitor) Ian Kennedy WS Glebe End 23 Cramond Glebe Road Cramond Village Edinburgh. EH4 6NT
For the Respondent	MRS TRAYNOR (Representative)


 


SUMMARY

Practice and Procedure: Amendment

Appeal from what was described by a Tribunal as an 'order' granting Claimant leave to amend in the course of the hearing on evidence in a claim for unfair dismissal. Claimant seeking to cross examine in support of an allegation that investigatory and disciplinary procedures unfair, no notice of a case of procedural unfairness having been given in his ET1. Appeal successful. Guidance from EAT as to appropriate approach when a party seeks to raise an issue of which notice not previously given.


 


THE HONOURABLE LADY SMITH

Introduction

1. This is an appeal from what is termed as an 'order' of the Employment Tribunal sitting at Edinburgh, Chairman Ms JM Porter, registered on 31 August 2006, granting leave to the Respondent, who was the Claimant before the Tribunal, to amend his claim.
2. Before the Tribunal, the Respondent was represented by his wife and the Appellants were represented by Mr Ian Kennedy, solicitor and there was the same representation before us.
3. We will refer to parties as Claimant and Respondents.

Background

4. The Claimant was previously employed by the Respondents as a regional security investigator. He was dismissed on either 13 or 29 December 2005 (both dates are referred to by the Tribunal as being the dates of dismissal). The Respondents contend that his dismissal was for a potentially fair reason, namely, misconduct on 3 and 4 December 2005.
5. In his form ET1, which was lodged on 1 March 2006, the Claimant set out his complaint in the following terms:

"I had an unblemished work record with my employers for twenty-four and half years. My honesty and integrity are renowned and have never before been brought into question. The way in which I performed the role of 'Duty Investigator' (an out of hours service, completed on a rota basis) was found to be not of the required standard. I had been performing this role in the same way for three years and this was never before raised as an issue. At no time whilst competing this role were staff or Company assets put at risk due to my actions.

This was the first instance of my performance not meeting the required standard and I was given no opportunity to improve it. I do not believe this is reasonable.

I have appealed this decision unsuccessfully."

6. Thus, he did not set out any case to the effect that there had been procedural unfairness in the Respondents' investigatory or dismissal procedures. His only complaint was that the decision to dismiss him was unreasonable.
7. A hearing on evidence was fixed for 3 and 4 August 2006 and the hearing began on 3 August. A Deputy Security Manager of the Respondents, Mr Reekie, was the first witness. He had become involved on 13 December 2005, had conducted two disciplinary hearings on 19 and 29 December 2005 and had been responsible for dismissing the Claimant. He gave evidence in chief for the Respondents in the course of which he was referred to notes of the disciplinary hearings. Shortly after the beginning of cross examination by the Claimant's wife on his behalf, it became apparent that he was seeking to raise as an issue the fairness or otherwise of the Respondents' investigatory and disciplinary proceedings.
8. Objection to that line of cross examination was taken by Mr Kennedy on behalf of the Respondents on the basis that the Claimant had not given notice of such a case in the ET1. As to what happened then, we refer to what Mr Kennedy and Mrs Traynor told us as it goes somewhat beyond what has been recorded by the Tribunal.
9. The Chairman did not retire or confer with the lay members. She responded to Mr Kennedy by saying something to the effect that he should have 'seen it coming', 'it' being a case that the dismissal was procedurally unfair, given what was in the bundles that had been lodged. She then indicated that the line of cross examination would be allowed. She did not reserve the issuing of reasons for that decision. Mr Kennedy then requested that the Tribunal insist that the Claimant formulate the new aspect of her case that she sought to explore. That request was rejected. Mr Kennedy then asked for an adjournment which he was allowed. He consulted and took instructions which were that he should seek a longer adjournment, which he did. He did not consider that any reasons had been given by the Tribunal for its decision. He did not ask for reasons for the Tribunal's decision at that point as it seemed that the only option open to him was to ask for an adjournment.
10. We should, at this point, deal with a submission that was advanced by Mrs Traynor. She sought to persuade us that the Tribunal did give reasons at the time because it indicated that Mr Kennedy should have 'seen it coming'. Whilst parties are agreed that that was the Chairman's reaction, we do not regard that as a statement of the Tribunal's reasons for allowing the Claimant to amend his claim. We note that in the written reasons that the Tribunal supplied later, it is not suggested that it was.
11. Mr Kennedy subsequently wrote to the Tribunal asking for reasons. He did so on three occasions: 8, 19 and 26 August 2006. He indicated in that correspondence that reasons were sought to enable the Respondents to consider appealing the decision to allow the Claimant to amend.
12. The Tribunal's written reasons were issued to parties on 31 August 2006. They record that Mr Kennedy objected to the line about procedural unfairness on the basis that no notice had been given of it in the ET1. At paragraph 6, they state:

"The line of cross-examination was allowed by the Tribunal. In allowing this line of cross- examination the Tribunal granted leave to the Claimant to amend the ET1 to include an allegation that his dismissal had been procedurally as well as substantively unfair. As such, the amendment was restricted to introducing new factual allegations which expanded upon the basis of the existing claim. The Claimant was not seeking to add a new claim nor to change entirely the basis of his case. It was also clear that the issue of procedural unfairness in the investigation had been raised by the Claimant at the Disciplinary Hearing as evidenced from the passage in the notes of the Disciplinary Hearing found at R33/13, referred to by the Respondents themselves in the evidence of Mr Reekie. Thus, this was not a matter which was entirely unfamiliar to the Respondents. It was also noted that the Claimant was not legally represented when he made his claim or at any point thereafter. The tribunal concluded that, balancing the issue of prejudice to the Claimant if the amendment was not allowed compared to the prejudice to the Respondents if it was allowed, that the balance lay in favour of the amendment being allowed. Any potential prejudice to the Respondents resulting from no notice being given of this allegation could be rectified by granting an adjournment if such was sought to allow further preparation to be undertaken and witnesses to be identified."

13. The Tribunal explains that they granted the Respondents a half hour adjournment at the end of which Mr Kennedy advised that his instructions were to seek to adjourn the proceedings to enable him to ascertain the availability of additional witnesses, a motion which they granted.
14. Whilst the Tribunal records that Mr Kennedy indicated that he intended to seek an order for Further and Better Particulars prior to any continued diet, Mr Kennedy advised us that he requested the Tribunal to require the Claimant to formulate the terms of the amendment to his claim, at the hearing, but his request was refused.
15. It is clear is that the Claimant did not, at the hearing articulate the amendment to his ET1 that he sought to make. No specification was given of the 'new factual allegations' on which he sought to rely. Further, it also seems clear that although the Tribunal granted leave to amend on 3 August, not only did it not indicate what amendment it was allowing but it did not give reasons at the time nor did it indicate that reasons would be provided at a later date. Finally, it does not seem that the Tribunal considered or was, on 3 August, provided with any explanation as to why the procedural unfairness case and the facts on which it was based were not included in the claim set out in the ET1.

The Tribunal's Reasoning

16. The Tribunal's reasoning is at paragraph 6, which we have set out above. It was, accordingly:

- that the Claimant was not seeking to make a new claim

- that the Claimant was not seeking to change entirely the basis of his case

- that the Claimant had complained that the investigation was procedurally unfair,

at the disciplinary hearing

- that the Claimant had not been legally represented when he made his claim or since.

Therefore, the balance of prejudices lay in favour of the Claimant.

17. Having decided that, the Tribunal commented to the effect that if there was any prejudice to the Respondents arising from lack of notice that could be rectified by granting an adjournment for further preparation and the identification of relevant witnesses. They appear thus to have assumed that any relevant evidence would still be available.

Relevant Law

18. An Employment Tribunal has power to grant leave to a Claimant to amend his claim under rule 10(1) and (2)(q) of the Employment Tribunals (Constitution and Rules etc) Regulations 2004 Sch 1. Where a new ground of claim is advanced, time bar issues may arise. This is not such a case. However, time bar is but one of the issues that are relevant to a Tribunal's consideration of such an application. Here, the Claimant claimed that he had been unfairly dismissal in his ET1 form and that would remain the position after the amendment sought. However, the factual basis was to be changed so as to allow the Claimant to add to his case that the decision to dismiss was not reasonable a case that his dismissal was procedurally unfair. That addition to his case would, if granted, be at a very late stage.
19. Once a case incorporates an allegation of procedural unfairness, particular matters of law arise. The first is whether or not it can be shown that even if there was a procedural failure, the employee would probably have been dismissed in any event (Employment Rights Act 1996 s.98A(2)). The second is whether, even if it cannot be shown that the employee would probably have still been dismissed, was there a chance of dismissal in any event so as to give rise to a Polkey deduction (Polkey v AE Dayton Services [1988] AC 344)? The onus is on the employer in respect of both of these matters. It is, thus, plainly important that, if procedural unfairness is being alleged, the employer has fair notice of the allegation so as to enable him to prepare his case to overcome it, if he can. Fair notice involves clear and cogent notice that the matter is being relied on by the employee in his Employment Tribunal claim. That involves giving notice in his Tribunal claim of the factual allegations on which the employee's case of procedural unfairness is based. It is not enough that he relied on the concept or the facts alleged in the course of his pre-dismissal dealings with the employer whether in the course of a disciplinary hearing or otherwise. As was commented by Lord Justice Waller in the case of Ali v Office of National Statistics [2005] IRLR 201:

"39………. …a general claim cries out for particulars and those are particulars to which the employer is entitled so that he knows the claim he has to meet. An originating application which appears to contain full particulars would be deceptive if an employer cannot rely on what it states."

20. When considering an application for leave to amend a claim, an Employment Tribunal requires to balance the injustice and hardship of allowing the amendment against the injustice and hardship of refusing. That involves it considering at least the nature and terms of the amendment proposed, the applicability of any time limits and the timing and the manner of the application. The latter will involve it considering the reason why the application is made at the stage that it is made and why it was not made earlier. It also requires to consider whether, if the amendment is allowed, delay will ensue and whether there are likely to be additional costs whether because of the delay or because of the extent to which the hearing will be lengthened if the new issue is allowed to be raised, particularly if they are unlikely to be recovered by the party who incurs them. Delay may, of course, in an individual case have put a respondent in a position where evidence relevant to the new issue is no longer available or is of lesser quality than it would have been earlier. These principles are discussed in the well known case of Selkent Bus Co Ltd t/a Stagecoach Selkent v Moore [1996] IRLR 661. Further, as was also observed by the President, Mummery J, as he then was, in Selkent at paragraph 26:

"……an application for amendment made close to a hearing date usually calls for an explanation as to why it is being made then, and was not made earlier, particularly when the new facts alleged must have been within the knowledge of the applicant at the time he was dismissed and at the time when he presented his originating application."

21. Even more must it be the case that an application to amend in the course of a hearing calls for a full explanation as to why it was not made earlier.
22. Further, any judgment that an Employment Tribunal makes in respect of any application made must be a reasoned one. We are satisfied that notwithstanding the Tribunal's description of the operative effect of their decision being an ' order' that it was in fact a 'judgment' since it was a final determination of an issue which arose in the proceedings before it ( rule 28(1)(a) of the 2004 Rules). It was not an order. 'Order' is defined in rule 28(1)(b) of the 2004 Rules as being something which:

"……..may be issued in relation to interim matters and it will require a person to do or not do something."

and the Tribunal's decision on the contested issue raised was not an interim matter nor did it require either party to do or not do anything.

23. The identification of the nature of the operative part of their decision is important because rule 30 provides:

"(1) A tribunal must give reasons (either oral or written) for any –

(a) judgment

(b)

(c) order, if a request is made before or at the hearing at which the order is made.

(d)

(2) Reasons may be given orally at the time of issuing the judgment or order or they may be

reserved to be given in writing at a later date…………….."

24. In the case of a judgment in the course of an evidential hearing as to whether or not a Claimant is to be allowed to amend his claim, we would expect a Tribunal to apply the rule so as to give reasons for its decision at the time it is made. It would be unusual for its reasoning to be reserved until a later date.

The Appeal

25. Mr Kennedy submitted that the Tribunal had fallen into error. It failed to hear parties on the issue raised. It never had before it the terms of the amendment proposed. It failed to balance all relevant considerations in accordance with the Selkent guidance. The significance of the challenge to the line of evidence seemed to be lost on the Chairman. It was irrelevant to rely on a view that the Respondents should have seen this line coming. The point was that it had not been founded on in the ET1. The Respondents were, accordingly, entitled to proceed on the basis that the Claimant had quite specifically departed from any earlier criticism of their procedures. The Claimant's representative, his wife, was not a wholly uninformed layperson. She had previously been employed by the Respondents as a very senior manager who was experienced in their disciplinary and appeal procedures. Had the Respondents had the chance to address the Tribunal on the issue of whether or not amendment should be allowed, they would have referred to that fact and it would have qualified the simplicity of the statement that the Claimant did not have legal representation. The Tribunal's references to balancing prejudice were but form, not substance.
26. Mr Kennedy stressed that the Respondents still do not know the terms, scope or nature of the amendment proposed and, apparently, allowed. That put the Respondents in a very difficult position.
27. Regarding the giving of reasons, Mr Kennedy's position was that no reasons were given at the hearing, there was no express reservation of the giving of reasons, and the giving of reasons late in the day, once the Tribunal knew of the prospect of an appeal, was unsatisfactory particularly where it had not considered relative prejudices, had not considered why the procedural unfairness case was not stated earlier, had not considered the implications in terms of the delay that would ensue if the amendment was allowed, had not considered the question of expense (possibly irrecoverable) that would be occasioned thereby (e.g. the cost of Mr Kennedy having to go to London to precognosce relevant witnesses). He referred to the case of English v Emery Reinbold and Strick Ltd [2003] IRLR 710 but added that this case went further since it was not just a matter of the Tribunal not having given reasons, it had not, he submitted, actually considered the relevant factors prior to making its decision.
28. For the Claimant, Mrs Traynor, as we have explained, sought to submit that the Tribunal had given reasons at the time. So far as her own knowledge and background was concerned, she explained that she was an experienced area manager with the Respondents for six years, with dismissing authority and familiarity with the integrity of the Respondents' disciplinary procedures. She knew 'full well', she said, employment law up to dismissal level. She had, though, no direct experience of Employment Tribunals as none of the cases she had handled had been taken to a Tribunal. Her Tribunal experience had been confined to sitting in and observing. She had had no idea what she required to put into her husband's ET1. She did not know she would not be able to expand on it at a later stage. It was clear from documents in the bundle that procedural irregularities had been challenged at the Claimant's disciplinary hearing. She had thought that the evidence in chief was seeking to pre-empt the matter when the documents relating to that hearing were referred to. (Mr Kennedy explained to us that the documents had been referred to as background in an effort to demonstrate the thoroughness of the Respondents' procedures.)
29. On the matter of delay, Mrs Traynor observed that there would have been less delay if the Respondents had not appealed.

Discussion and Decision

30. We are persuaded that this appeal is well founded. The Tribunal seems, unfortunately, to have jumped too far too fast. What, in our view, it required to recognise before making its decision was as follows:
31. Firstly, the Claimant had not, it seems, actually made any application to amend the ET1. The decision recorded in the written reasons is a decision to allow a line of cross examination which was manifestly not foreshadowed in the Claimant's statement of his case in his ET1. The line which the Claimant sought to pursue was plainly a separate issue in law, as discussed, and involved different facts from any of which notice had been given in the ET1, albeit that it would not take the case outwith the 'unfair dismissal' umbrella. That being so, the allowance of the line of cross examination would have been extremely difficult to justify in the absence of amendment.
32. Secondly, the Tribunal thus did need to turn its mind to the matter of amendment but the question is how? We see no difficulty in a Tribunal in such circumstances enquiring of the Claimant or his representative whether he seeks to amend the ET1 in the light of the line of evidence which he appears to seek to explore.
33. Thirdly, if the answer to that enquiry is that the Claimant does seek to amend, then the Tribunal requires to enquire as to the precise terms of the amendment proposed. If it does not do that, then it cannot begin to consider the principles that apply when considering an application to amend, as discussed above. Further, unless it does so, the fair notice obligations referred to in the quotation from Ali, above, will not be complied with.
34. Fourthly, it may be advisable, if not necessary, to allow the Claimant a short adjournment to formulate the wording of the proposed amendment.
35. Fifthly, it is only once the wording of the proposed amendment is known that the Respondent can be expected to be able to respond to it.
36. Sixthly, once the wording of the proposed amendment is known, the Tribunal requires to allow both parties to address it in respect of the application to amend before considering its response.
37. Seventhly, the Tribunal's response requires to be that of all members and requires to take account of the submissions made and the principles to which we have referred. The Chairman and members may require to retire to consider their decision.
38. Eighthly, the Tribunal requires to give reasons for its decision on an application to amend. Those reasons can be shortly stated and, as we have indicated, we would expect them to be given orally. They must, however, be indicative of the Tribunal having borne in mind all relevant considerations and excluded the irrelevant from its considerations.
39. This Tribunal does not appear to have had regard to any of the above. Its decision is fatally flawed by the lack of there having been any articulation of the detail of the amendment that was being proposed. That is immediately evident from the 'Order' which allows leave to amend in a vacuum which is explained in the body of reasons as being allowance of the inclusion of an allegation that the dismissal was procedurally unfair. That simply begs the questions of how, in what way and in what respects? Those are questions to which the Respondents were entitled to know the answer before any motion to amend was presented, debated and decided on. They were also questions that the Tribunal needed to know the answers to before it could pronounce any sensible order in respect of the amendment application which it decided that it had before it.
40. The Tribunal's decision is further flawed by its having been influenced by a view that the Respondents should have ' seen it coming' because of what was in the documents and then, as explained in their reasons, that the Respondents were ' not entirely unfamiliar' with the matters raised because criticisms of procedural irregularity had been raised at the disciplinary hearing. If the first of these propositions was correct, then parties would require to prepare for cases on the basis that their opponent will be able to rely on any case that could be made against them out of the material in the documents lodged whether or not it is foreshadowed in the ET1 or 3. That would not be fair or just. Each party is entitled to approach the hearing on the basis that the case they have to meet is that of which notice is given in the ET1 or 3. As regards the second of these propositions, whether or not the Respondents were familiar with the facts that the Claimant sought to rely on was not the point. The point was that it was not until in the course of the hearing, some eight months after the dismissal and some five months after the receipt of the ET1, that the Respondents were being made aware that the Claimant sought to rely on those facts for a distinct purpose, so as to present a case of which, hitherto, no notice had been given. Knowing the facts is quite different from knowing that a Claimant is seeking to rely on them.
41. Separately, as we have observed, the procedures adopted by the Tribunal for dealing with the matter went 'off the rails' in this case and that is of itself, sufficient reason for our setting aside the decision made.
42. We will, accordingly, uphold the appeal, set aside the Tribunal's 'Order' of 31 August 2006 and remit the case to the same Tribunal to proceed as accords.