United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR J SEGAN (of Counsel) Instructed by: Messrs Anthony Collins Solicitors 134 Edmund Street Birmingham B3 2ES
For the Respondent	MR O ISAACS (of Counsel) Instructed by: Messrs SA Law LLP Keystone 60 London Road St Albans Hertfordshire AL1 1NG


 


SUMMARY

PRACTICE AND PROCEDRUE

2002 Act & pre–action requirements

Appeal allowed by consent and with approval of Employment Appeal Tribunal. Held: SPG applies to breach of contract claims excluding wrongful dismissal for the purpose of extending time under Reg 15 DR Regs 2004.


 


HIS HONOUR JUDGE PETER CLARK

1. This appeal raises a short point on the three-month extension of time provisions in regulation 15 of the Employment Act 2002 (Dispute Resolution) Regulations 2004 (DRR): Does the extension apply to a claim of breach of contract brought under the Employment Tribunals Extension of Jurisdiction (England and Wales Order) 1994 (the 1994 order)?
2. A Chairman, Ms Anesta Weekes QC, sitting at Watford, on 28 September 2006 held that it did not by a judgment with reasons dated 12 December 2006. Consequently, she held that the Tribunal had no jurisdiction to entertain the Claimant, Mr Mowels, claim of breach of contract brought against his former employer, the Respondent, Vox Displays Limited. Against that part of the judgment the Claimant now appeals with the permission of Mr Justice Langstaff.
3. The Chairman also dismissed his claims of unfair dismissal and disability discrimination. There is no appeal against those rulings.

Consent order

4. Yesterday the appellant's solicitors sent to the EAT a consent order signed by the parties. The agreement reached was that the appeal be allowed, the case remitted to the Employment Tribunal for a merits hearing and that there be no order as to costs. Paragraph 15.3 of the EAT Practice Direction makes clear that where parties agree that an appeal be allowed it is usually necessary for the matter to be heard by the EAT in order to determine whether there is a good reason for allowing the appeal. The reason for this practice is that the EAT will not allow an appeal by consent against the reasoned judgment of an Employment Tribunal without itself being satisfied that there are good grounds for setting aside that judgment and to explain why it has reached that view. An appearance by one or more of the parties is therefore usually required to argue the case for the consent order. This morning I have had the advantage of hearing from both Mr Segan on behalf of the Claimant and Mr Isaacs on behalf of the Respondent.

Background

5. The Claimant was employed by the Respondent as commercial manager from 1 September 2003 until his dismissal effective on 3 November 2005, (the effective date of termination (EDT)). On 30 January 2006 new solicitors acting for the Claimant sent a grievance letter to the Respondent raising issues about his dismissal, disability discrimination and alleged unlawful deductions from his wages. On 2 February 2006 the primary three-month limitation period for all claims expired. On 10 February 2006 his grievances were rejected. On 17 February 2006 he appealed that decision internally. On 28 April 2006 he lodged his Form ET1 at the Tribunal. On 26 June 2006 his internal appeal was dismissed.

The statutory framework

6. Following termination of employment a claim for damages for breach of contract may be brought before an Employment Tribunal by virtue of article 3 of the 1994 Order. The primary limitation period for such claims is three months from the EDT (Article 7(a)).
7. Article 7(ba), inserted by SI 2004/752 with effect from 1 October 2004, provides:

"Where the period within which a complaint must be presented in accordance with paragraph (a) ... is extended by regulation 15 of the Employment Act 2002 (Dispute Resolution) Regulations 2004, the period within which the complaint must be presented shall be the extended period rather than the period in paragraph (a)."

8. Regulation 15 DRR provides, so far as is material:

"Extension of time limits.

(1) Where a complaint is presented to an employment Tribunal under a jurisdiction listed in schedule 3 or 4 (of the Employment Act 2002) and (b) either of the grievance procedures is the applicable statutory procedure and the circumstances specified in paragraph (3) apply, the normal time limit for presenting the complaint is extended for a period of three months beginning with the day after the day on which it would otherwise have expired. The circumstances referred to in paragraph (1)(b) are that the employee presents a complaint to the Tribunal (b) after the expiry of the normal time limit for presenting the complaint, having complied with paragraph 6 or 9 of schedule 2 (to the EA 2002) in relation to his grievance within that normal time limit."

9. A claim for breach of contract is listed in schedule 3 to EA 2002, as is a claim for unlawful deductions from wages under section 23 of the Employment Rights Act 1996. Neither claim is listed in schedule 4. Part 2(2) of EA 2002 is headed "Grievance procedures". Paragraph 6 sets out Step 1 in the statutory grievance procedure (SGP). Paragraph 9 sets out Step 1 in the modified procedure following dismissal:

"The employee must (a) set out in writing (i) the grievance, and (ii) the basis for it, and (b) send the statement or a copy of it to the employer."

10. Regulation 6 DRR is headed, "Application of the grievance procedures". Regulation 6(1) provides:

"The grievance procedures apply, in accordance with the paragraphs (2) to (7) of this regulation, in relation to any grievance about action by the employer that could form the basis of a complaint by an employee to an employment Tribunal under a jurisdiction listed in schedule 3 or 4, or could do so if the action took place."

11. By regulation 6(5):

"Neither of the grievance procedures applies where the grievance is that the employer has dismissed or is contemplating dismissing the employee."

12. Schedule 3 EA 2002 is headed, "Tribunal jurisdictions to which section 31 applies". Schedule 4 is headed, "Tribunal jurisdictions to which section 32 applies". Section 31 EA is concerned with adjustments to awards for failure to comply with the statutory procedures and is not material in this case. Section 32, limited to the jurisdictions listed in schedule 4, is concerned with the separate issue as to when failure by a Claimant to comply with the SGP deprives the Tribunal of jurisdiction to entertain such a complaint. It follows that section 31 applies to jurisdictions listed only in schedule 3 but not schedule 4. It is to be noted that, for example, unfair dismissal is included in both schedule 3 and 4. Another example is a claim of detriment short of dismissal under the whistle blowing provision of ERA section 48.

The Tribunal decision

13. The Chairman's reasoning on the present issue is contained at paragraph 6 of her reasons. I shall not repeat it in this judgment. She found that: The DDP(sic) did not apply to the Claimant's breach of contract claim and thus the extension of time afforded by regulation 15 DRR was not engaged.

Discussion

14. Having considered the submissions of counsel on paper and orally, I am satisfied that the Chairman reached the wrong conclusion in law. In my judgment Mr Segan is correct in submitting that the SGP applies to a claim brought under the 1994 Order in certain circumstances so that, on the facts of this case, the grievance lodged by the Claimant on 30 January 2006 within the primary limitation period, complying as it did with Step 1 of the modified grievance procedure (EA schedule 2(9)), had the effect of extending the primary limitation period by three months until 2 May 2006. Consequently, the Form ET1 lodged on 28 April 2006 was submitted in time by virtue of regulation 15(1)(b) read with regulation 15(3)(b) DRR. In forming that view, I am not prejudging any question as to whether all of the matters raised in the Form ET1 were properly presaged by the grievance letter of 30 January 2006. Any issue as to that must be resolved by the employment Tribunal. My reasoning is as follows.
15. The Claimant did not argue that the DDP (Dismissal and Disciplinary Procedure) applied to the breach of contract claim, rather that the SGP did (see the reference to regulation 15(1)(b) erroneously referred to as regulation 15(1)(3) at paragraph 6.2 of the Chairman's reasons).
16. True it is that sections 31 and 32 relate to different matters. However, some claims appear in both schedules 3 and 4, others in one only. I accept Mr Segan's submission that neither section 31 nor 32 are relevant to the limitation extension provided for in regulation 15 DRR.
17. Specifically, section 32 is concerned with a failure to comply with the SGP, depriving the Tribunal of jurisdiction in certain circumstances. However, that bar on proceedings applies only to the jurisdictions listed in schedule 4 not to those only listed in schedule 3. It therefore appears that a failure to comply with the SGP bars out a claim of constructive unfair dismissal although not one of actual unfair dismissal (see regulation 6(5)), which is covered by the DDP.
18. In my view, section 32 is immaterial to the present question the answer to which is as follows: regulation 6(1) speaks of claims listed in schedule 3 or 4; either will do. Although a claim for breach of contract under the 1994 Order can only arise after termination of employment, in the present case the grievance is not about dismissal (compare regulation 6(5)). It is about the Respondent's failure to pay bonuses and expenses thus the SGP is not disapplied by virtue of regulation 6(5). It would, in my view, be otherwise if the claim for breach of contract was a common law claim for wrongful dismissal. In those circumstances the SGP would be disapplied by virtue of regulation 6(5) and the Claimant could not rely on the extension of time under regulation 15.
19. This interpretation is further supported, as Mr Segan points out and Mr Isaacs agrees, by the insertion of article 7(ba) into the 1994 Order at the same as the DRR came into force.

Disposal

20. It follows that I shall allow this appeal and substitute a declaration that the Claimant's breach of contract claim i.e. in respect of bonuses and expenses, should now proceed to a merits hearing subject to any necessary case management directions or pre-hearing review issues to be determined by the Employment Tribunal.