United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MISS NATASHA JOFFE (of Counsel) Instructed by: Messrs Fieldhouse & Co LLP Solicitors Suite 6 Regent House 1-3 Queensway Redhill Surrey RH1 1QT
For the Respondent	MR NICHOLAS CHRONIAS (Solicitor) Messrs Beachcroft LLP Solicitors 100 Fetter Lane London EC4A 1BN


 


SUMMARY

Unfair dismissal - Reason for dismissal / Reasonableness of dismissal

The Respondent did not commit a criminal offence contrary to section 8 of the Asylum and Immigration Act 1996 by continuing to employ the appellant while she had a 60 month permission to work, even though she was late applying for a variation of her leave to remain, which expired after 48 months. By virtue of the 60 month permission to work she was "permitted to work under the Immigration Rules" for the purposes of reg 3(3) of the Immigration (Restriction on Employments) Order 2004. Reg 3(3) cannot be construed as applying only where the employee has subsisting leave to remain: on this construction it would be otiose. Appeal allowed on that ground and a finding of unfair dismissal substituted.

The Tribunal's reasons did not adequately address the question whether it was reasonable for the University to dismiss the appellant. If the appeal had not been allowed on the first ground the question whether it was reasonable to dismiss for the purposes of section 98(4) would in any event have been remitted.


 


HIS HONOUR JUDGE RICHARDSON

1. This is an appeal by Dr Colleen Kelly against a judgment of the Employment Tribunal sitting in Southampton dated 26 March 2007. Dr Kelly was employed by the University of Southampton ("the University") as a senior lecturer in the School of Biological Sciences. By its judgment the Tribunal dismissed her claims of unfair and wrongful dismissal.
2. The appeal raises two issues. The first relates to the construction of reg 3(3) of the Immigration (Restriction on Employments) Order 2004, which sets out conditions for the purpose of section 8 of the Asylum and Immigration Act 1996. The second relates to the Tribunal's approach to section 98(4) of the Employment Rights Act 1996 in a case where the reason for dismissal is that the employee could not continue to work in the position he held without contravention of a duty or restriction imposed by an enactment.

The background facts

3. Dr Kelly is a citizen of the United States of America. Prior to January 2001 she held positions at Oxford in the field of biology, first as a research fellow at Merton and then as a lecturer in the Department of Zoology. In 2001 she applied for a post at the University. She was successful – subject to completing the necessary immigration processes. The University's personnel department assisted her with them. Mr Powell dealt with the matter.
4. On 2 January the Overseas Labour Service, part of the Department for Education and Employment, wrote to the University informing them that they were prepared to approve the employment for 60 months. As is the usual practice, the Home Office would then consider whether it would grant leave to remain. On 11 January 2001 the Overseas Labour Service wrote to the University again. In their letter they told the University that permission was given for her employment as a lecturer at the University for 60 months. They also enclosed her passport, saying that it was "endorsed with the Home Office Immigration and Nationality Directorate permission to stay in the United Kingdom". So it was. But the visa granting leave to remain lasted only until 8 January 2005 – that is to say, 48 months not 60 months.
5. In the course of these proceedings there has been no definitive explanation as to why the Immigration and Nationality Directorate issued a visa granting leave to remain for only for 48 months, when the Department for Education and Employment had already given permission to work for 60 months. We were told that the Tribunal was referred to a page on the current government web site for immigration matters, which would suggest that visas granting leave to remain and permissions to work were generally coterminous. On the other hand the University was able to point to other cases where they had not been coterminous. We speculated during the hearing of this appeal as to whether leave might have been granted for 4 years because after that time, as the law then stood, Dr Kelly could apply for indefinite leave to remain based on 4 years' continuous residence and work in the United Kingdom. Whether as Dr Kelly submitted, the length of visa was an administrative mistake, or whether, as the University submitted, there was some other reason for it, was not resolved by the Tribunal. Whichever is the answer, it seems very likely (although the Tribunal do not say so) that the immigration authorities expected Dr Kelly to be able to stay and work for 5 years, even if she had to make some further application to extend her leave to remain in order to do so.
6. The relevant parts of the letter dated 11 January read as follows –

IMMIGRATION ACT 1971 – THE WORK PERMIT SCHEME

APPLICATION BY: UNIVERSITY OF SOUTHAMPTON

Thank you for your application which has been approved by this Department as detailed below……

Permission is granted for the employment detailed below … Ms Kelly should retain this document with her passport.

NAME: COLLEEN KAY KELLY ….

NATIONALITY: UNITED STATES OF AMERICA

LENGTH OF APPROVAL: 60 MONTHS

[The letter then went on to specify Dr Kelly's employment as a lecturer at the University in the School of Biological Sciences]

7. Enclosed with the letter was Dr Kelly's passport. The passport contained the following visa.

Leave to remain in the United Kingdom on condition that the holder maintains and accommodates himself and any dependants without recourse to public funds, does not enter or change employment paid or unpaid without the consent of the Secretary of State for Employment and does not engage in any business or profession without the consent of the Secretary of State for the Home Department is hereby given until 8^th January 2005.

8. The University, in the shape of Mr Powell, wrote to Dr Kelly on 9 February 2001, confirming that she would be issued with a contract of employment for 5 years. In bold print the letter stated:

"Please note that employment beyond 8 January 2005 is dependent on you gaining leave to remain and work in the United Kingdom."

9. Dr Kelly's 5 year contract ran from 1 January 2001 to 31 December 2005. Dr Kelly did notice that the stamp granting indefinite leave to remain ran out on 8 January 2005. She raised it with a professor in August 2001, and was advised to make direct contact with Miss Tribe, the University's expert on work permits and immigration rights. She did not do so. She completed her probationary period satisfactorily, and was in due course promoted to senior lecturer in October 2003, still with the same contractual period.
10. There the matter lay until December 2004. We have already said that it was open to Dr Kelly to make application for permanent leave to remain based on four years continuous residence and work in the United Kingdom. She made enquiries. She learned that the earliest date an application could be made was 11 December 2004 (a month before the 4 years of the permission to work expired). But she was told it could take a long time to process.
11. On 5 January she alerted the University, again in the shape of Mr Powell, to the position, principally concerned that while she made the application she might be without her passport and unable to support a field trip abroad. She mentioned the discrepancy between her work permit and her permission to remain. Mr Powell consulted Miss Tribe. Dr Kelly also contacted Miss Tribe because she required confirmation from her employer that she was still needed in her job. Miss Tribe agreed to help.
12. In this way on 11 January Miss Tribe learned for the first time that Dr Kelly's leave to remain had expired, even though Dr Kelly still had permission to work. She was concerned. She thought that either Dr Kelly's employment might have terminated or the University might be employing her illegally. She held discussions with colleagues. She spoke to Work Permits (UK), an agency of the Home Office now undertaking broadly the functions which the Overseas Labour Service once undertook. On 13 January she wrote to Dr Kelly, suspending her without pay and giving her until 4 February to sort out the matter of her residency. The letter said:

The University therefore has no option but to suspend you from work at this point pending, we hope, approval being granted for your continued stay in the UK. If approval is not granted within a 4 week period ie by Friday 4 February the University will have no option but to terminate your employment at this time, as to continue to employ you would be illegal and would leave the University open to prosecution. If approval is granted within this period you will be re-instated with continuous service and receive backpay for the period from the 8 January 2005.

13. Dr Kelly made her application for indefinite leave to remain as a matter of urgency. It was supported by a letter which Miss Tribe wrote. It was granted on 7 February 2005.
14. In the meantime, however, the University had dismissed her. It seems that on 25 January 2005 the head of the University's personnel department spoke to the University's Head of Legal Services on the telephone. Her advice was that if the academic in question had no right to remain in the UK the University would be breaking the law by continuing the employment. She suggested that a letter be sent ending the employment with immediate effect or (if the University wished to honour the grace period, with effect from 8 February 2005.
15. Subsequently, however, the personnel department decided, with the backing of the legal department, to take an even stricter stance, writing a letter purporting to terminate the contract with effect from 8 January. Miss Tribe wrote the letter, which is dated 27 January. Dr Kelly received no prior warning that the letter was coming. She was given no hearing. The University took the view that its disciplinary procedure, including any right of appeal, was inapplicable because her contract had terminated by operation of law on 8 January.
16. Following the grant of indefinite leave to remain on 7 February Dr Kelly's union asked that she be re-instated. The University's Human Resources Director said that the fact she had a new leave to remain did not change the facts at the point at which employment ended, and that the University had no obligation to re-instate her.

Unfair dismissal legislation

17. The relevant provisions of the Employment Rights Act 1996 are the following.

98 (1) In determining for the purposes of this Part whether the dismissal of an employee is fair or unfair, it is for the employer to show-

(a) the reason (or, if more than one, the principal reason) for the dismissal, and

(b) that it is either a reason falling within subsection 98(2) or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held.

(2) (d) .. the employee could not continue to work in the position which he held without contravention (either on his part or on that of his employer) of a duty or restriction imposed by or under an enactment.

(4) Where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer)-

(a) depends on whether in the circumstances (including the size and administrative resources of the employer's undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and

(b) shall be determined in accordance with equity and the substantial merits of the case.

98A (1) An employee who is dismissed shall be regarded for the purposes of this Part as unfairly dismissed if-

(a) one of the procedures set out in Part 1 of Schedule 2 to the Employment Act 2002 (dismissal and disciplinary procedures) applies in relation to the dismissal,

(b) the procedure has not been completed, and

(c) the non-completion of the procedure is wholly or mainly attributable to failure by the employer to comply with its requirements.

18. For the purposes of section 98A(1) the Standard Dismissal and Disciplinary Procedure will have applied in respect of Dr Kelly's dismissal if it was for any other reason than that which is set out in section 98(2)(d): see reg 3(1) and reg 4(1)(f) of the Employment Act 2002 (Dispute Resolution) Regulations 2004.

The Tribunal's decision

19. The Tribunal set out its findings of fact, which we have endeavoured to summarise, in paragraphs 3 to 34 of its Reasons. In paragraphs 35 to 49 of its Reasons the Tribunal set out the principal arguments of the parties. In paragraphs 50 to 57 it discussed relevant provisions of immigration law, to which we shall return.
20. In paragraphs 58 to 61 the Tribunal set out its conclusions on the question of unfair dismissal. This passage occupies less than a page. One of the paragraphs, paragraph 59, is no more than an exposition of unfair dismissal law. We set out paragraphs 58 to 61 in full.

"58. Under Section 94 of the Employment Rights Act 1996, every employee has the right not to be unfairly dismissed. In determining whether a dismissal is fair or unfair, it is for the employer to show the reason for dismissal or if there is more than one reason, the principal reason. The reason for dismissal shown by the employer must be one of the potentially valid reasons specified in Section 98 of the 1996 Act. We are satisfied that the reason shown b the employer in this case is that the Claimant could not continue to work in the position which she held without contravention (either on her part or on the part of the Respondent) of a duty or restriction imposed by under an enactment which is a potentially fair reason under Section 98(2)(d).

59. Once the employer has shown the reason for dismissal, it is then for the Tribunal to determine whether the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissal. That question is to be determined in accordance with equity and the substantial merits of the case and the circumstances to be taken into account include the size and administrative resources of the employer's undertaking. We take as our starting point the words of Section 98(4) of the 1996 Act. We realise that we must assess the reasonableness of the employer's action and we must not substitute our view of the right course of action for that of the employer. We recognise and apply the text that there is a band of reasonable responses to the employee's conduct within which one employer might take one view and be acting fairly and another quite reasonably another view and still be acting fairly.

60. As soon as the Claimant's right to remain in this Country expired on 8th January 2005, she not having applied for its renewal, she was working illegally because her right to remain in the UK had expired. Had the Respondent continued to employ the Claimant beyond the 8th January 2005, they would be acting illegally and would be liable to prosecution under Section 8. As soon as Mr Strike and Ms Wheeler received legal advice from Miss Halliday, the Respondent's Head of Legal Services, they acted to terminate what had become an illegal contract.

61. The reason for dismissal was a breach of statutory duty arising under Section 8 of the Asylum and Immigration Act 1996 which is a potentially fair reason under Section 98(2)(d) of the Employment Rights Act 1996. The statutory dismissal procedures do not apply where the potentially fair reason for dismissal is under Section 98(2)(d) (Regulation 4(1)(f) of the Dispute Resolution Regulations 2004). An employer is legally obliged and entitled to terminate an employment relationship that is not lawful. Such action is within a range of reasonable responses under Section 98(4) of the Employment Rights Act 1996. The dismissal of the Claimant was not unfair.

21. We must immediately remark on one feature of these reasons. The arguments of the parties – and the list of issues prepared before the hearing – had identified as an issue the question whether Dr Kelly was dismissed at all, or whether her employment had terminated without a dismissal by operation of law. So far as we can detect, the Tribunal has not given any reasoned answer to this question at all. The Tribunal has, however, clearly found that there was a dismissal and stated the reason for it. There is no cross appeal from the Tribunal's finding that there was a dismissal, which will therefore stand.
22. We do not suggest that the Tribunal was wrong in its conclusion on that point. Far from it. But it is surprising that no reasoning whatever is devoted to a point which from the pleadings, the argument and the contemporaneous correspondence was of considerable significance to the case.
23. The Tribunal's laconic conclusions may be summarised as follows. There was a dismissal. The reason for the dismissal was that Dr Kelly could not continue to work in the position which she held without contravention of a duty or restriction imposed by or under an enactment (section 98(2)(d)). The statutory dismissal procedures therefore do not apply. The University was legally obliged and entitled to terminate an employment relationship which was not lawful. The action was within the range of reasonable responses for the purposes of section 98(4).

Submissions of the parties

24. Essentially the submissions we have heard fall under two headings.
25. Firstly Mrs Joffe on behalf of Dr Kelly submits that, on the true construction of section 8 of the Asylum and Immigration Act 1996 and reg 3 of the 2004 Order the Tribunal was wrong to conclude that it was a contravention of statute to employ Dr Kelly. If it was in fact not a contravention of statute to employ Dr Kelly section 98(2)(d) had no application (see Bouchala v Trust House Forte Hotels Ltd [1980] IRLR 382). The dismissal would then be automatically unfair by reason of section 98A. Moreover Dr Kelly would be entitled to claim wrongful dismissal together with pay and benefits from 9 January to 28 January. In answer to this submission Mr Chronias on behalf of the University submits that Mrs Joffe's submissions on the Asylum and Immigration Act and the subordinate legislation are incorrect and seeks to support the Tribunal's reasons.
26. Secondly, Mrs Joffe submits that the Tribunal has misdirected itself as to the scope of section 98(4) of the Employment Rights Act 1996, or else failed to give adequate reasons for its decision. She submits that the Tribunal fell into error in regarding the issue posed by section 98(4) as effectively settled by the mere fact that the employment was illegal. She submits that the Tribunal gave no weight either to the circumstances in which the illegality occurred and its short duration, or to the University's failure to follow any procedures. In answer to this submission Mr Chronias submits that the Tribunal's decision applies the correct test and is adequately reasoned. In his skeleton argument he has also submitted that Ms Joffe has in this respect taken a new point, not argued below and not permissible on appeal, although he did not repeat this submission in his oral argument.
27. These two areas of the case are quite distinct, and we will take them in turn.

Statutory contravention

28. The Tribunal took the view that the University would commit a criminal offence contrary to section 8 of the Asylum and Immigration Act 1996 by continuing to employ Dr Kelly after her leave was no longer valid and subsisting. Both before the Tribunal and on appeal this was the only provision of the immigration legislation relied on as founding the argument that it was a contravention of statute to employ Dr Kelly before the Tribunal or on appeal.
29. Section 8 of the Asylum and Immigration Act 1996 so far as material provided in January 2005 as follows:

(1)     Subject to subsection (2) below, if any person ("the employer") employs a person subject to immigration control ("the employee") who has attained the age of 16, the employer shall be guilty of an offence if—

(a)     the employee has not been granted leave to enter or remain in the United Kingdom; or

(b)     the employee's leave is not valid and subsisting, or is subject to a condition precluding him from taking up the employment,

and (in either case) the employee does not satisfy such conditions as may be specified in an order made by the Secretary of State.

(2)     It is a defence for a person charged with an offence under this section to prove that before the employment began any relevant requirement of an order of the Secretary of State under subsection (2A) was complied with.

(2A)     An order under this subsection may—

(a)     require the production to an employer of a document of a specified description;

(b)     require the production to an employer of one document of each of a number of specified descriptions;

(c)     require an employer to take specified steps to retain, copy or record the content of a document produced to him in accordance with the order;

(d)     make provision which applies generally or only in specified circumstances;

(e)     make different provision for different circumstances.

(3)     The defence afforded by subsection (2) above shall not be available in any case where the employer knew that his employment of the employee would constitute an offence under this section.

(4)     A person guilty of an offence under this section shall be liable—

(a)     on conviction on indictment, to a fine, or

(b)     on summary conviction, to a fine not exceeding the statutory maximum…..

(7)     An order under this section shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament

30. We note in passing that the form of section 8 contained in the Appeal Tribunal's bundle was the form in force prior to 1 May 2004; but since the amendments related to the remit of delegated legislation it seems to us that they are not material to the precise question we have to decide. We also note in passing that section 8 will be repealed by section 26 of the Immigration Asylum and Nationality Act 2006 when it comes into force, after which an employer's criminal liability in such matters will be governed by section 15 of that Act.
31. The relevant Order, laid pursuant to section 8(7), is the Immigration (Restriction on Employments) Order 2004. This Order performed two separate functions in relation to section 8. Firstly, it identified the documents which an employer must see before the employment began if it was to take advantage of the defence afforded by section 8(2): see section 8(2A). It is not necessary to set these provisions out in detail. Suffice it to say that for a person in Dr Kelly's position it would generally be necessary for the employer before employing her to see both a work permit "or other approval to take employment issued by Work Permits UK" and a passport or other travel document showing that she had leave to enter, if it were subsequently to rely on the statutory defence: see Schedule 2, Part 2.
32. The second function the 2004 Order fulfilled was to set out conditions for the purpose of section 8(1). These conditions were set out in rule 3 of the Order which provided –

3 Conditions specified under section 8(1) of the 1996 Act

(1) The set of conditions in paragraph (2) and the condition in paragraph (3) are specified for the purposes of section 8(1) of the 1996 Act (no offence committed in employing a person who satisfies such conditions).

(2) The set of conditions are that--

(a) the employee had limited leave to enter or remain in the United Kingdom which did not preclude his taking the employment in question;

(b) the employee applied to the Secretary of State for variation of that leave; and

(c) the employee is within the period during which an appeal could be brought or has a pending appeal under Part 5 of the Nationality, Immigration and Asylum Act 2002, against refusal of that application.

(3) The employee is permitted to work under the Immigration Rules.

33. Before the Tribunal two arguments were taken on the question whether the University committed a criminal offence by continuing to employ Dr Kelly once her leave to remain had expired. The first argument related to the statutory defence. The Tribunal rejected it and it is not the subject of appeal. The second argument related to the statutory conditions. This is the argument with which we are concerned on appeal.
34. The argument runs as follows. The University would commit a criminal offence if and only if it is proved both that Dr Kelly's leave to enter is not subsisting and valid and that she did not satisfy the conditions specified for the purpose of section 8(1). While it is true that her leave to enter lapsed on 8 January 2005, nevertheless she continued to satisfy the condition specified in paragraph 3(3) – for, in the unusual circumstances of her case, she still had permission to work lasting until 11 January 2006. Therefore she was "permitted to work under the Immigration Rules". Therefore, whatever her own immigration status might be, her employer did not commit an offence under section 8(1) (which, as we have said, was the only provision relied on by the University).
35. In response to this argument two main submissions were made by Mr Chronias on behalf of the University.
36. First, he submitted that the conditions in the 2004 Order effectively added nothing to the provisions of section 8 of the 1996 Act. We understood him to say that section 8(1) was to be read as if it were only necessary to establish the condition set out either in section 8(1)(a) or section 8(1)(b). We had difficulty following this submission. The Act is quite clear; to prove a contravention it is necessary to establish (1) either the state of affairs set out in section 8(1)(a) or that set out in section 8(1)(b) and (2) in either case that the employee does not satisfy the conditions specified in an order by the Secretary of State. We do not see how the statute can be read in any other way. It will not always be a criminal offence to employ someone who has no valid and subsisting leave to remain. If the person satisfies a specified condition, then even if he has no valid and subsisting leave to remain it will not be an offence to employ him.
37. Secondly, he submitted that Dr Kelly was not "permitted to work under the Immigration Rules". This submission requires more careful consideration. We hope we will do justice to it if we summarise its elements in the following way.
38. (1) In immigration law and practice there is a distinction between, on the one hand, a work permit or a permission to work, and, on the other hand, leave to enter or remain. The one does not follow from the other. The grant of a work permit or a permission to work does not guarantee that leave to enter or remain will also be granted. Permission to work is granted by a statutory agency (which, at the time of Dr Kelly's application, was the Overseas Labour Service) under a framework of policy. Leave to enter or remain is dealt with by the Home Office through its Immigration and Nationality Directorate under a framework which includes primary immigration legislation and the Immigration Rules.
39. (2) In immigration law and practice there is a further distinction between a work permit and "permission to work" in a broader sense. A work permit is a document granted to a person who at the time of the application is outside the United Kingdom. Where a non-EEA (European Economic Area) national is already in the United Kingdom no work permit is issued. Rather the appropriate agency makes a recommendation to the Immigration and Nationality Directorate of the Home Office, which will then take a decision as to whether the individual can remain in the United Kingdom to take up the employment.
40. (3) The Immigration Rules are concerned with "Work Permit Employment": see Part 5, Section 1 of the Immigration Rules. These rules, Mr Chronias submitted, are entirely inapplicable to the situation in which Dr Kelly found herself. The mere fact that the Overseas Labour Service recommended, in January 2001, that she should be able to work until January 2006 did not at any time amount to her being "permitted to work under the Immigration Rules" for the purposes of the 2004 Order.
41. (4) If Dr Kelly had applied for a variation of her leave to remain prior to its expiry, then her leave to remain would have extended until her application was determined: see section 3C of the Immigration Act 1971 as substituted by section 118 of the Nationality Immigration and Asylum Act 2002. She did not do so; therefore her leave to remain expired.
42. (5) Parliament cannot have intended, Mr Chronias submitted, that an employer who knows that an employee's leave to remain has expired may continue to employ her merely because she had a subsisting permission to work, or a work permit. Once leave to remain has expired the permission to work or work permit can no longer be regarded as permission to work under the Immigration Rules.
43. We have considered these submissions with all the more care because the Employment Appeal Tribunal is a specialist body whose remit generally does not run to immigration law.
44. We accept that there is, within immigration law and practice, a fundamental distinction between, on the one hand permission to work or a work permit, and on the other hand leave to remain. Thus, we accept point (1) in the argument of Mr Chronias as we have summarised it.
45. We further accept that "permission to work" and the grant of a work permit are not coterminous concepts. The latter is a document granted for specific purposes. We do not propose, in this judgment, to set out the provisions of the Immigration Rules extensively, but it is clear that "a valid Home Office work permit" is generally required where a person wishes to come to the United Kingdom to take employment, and he will generally not be granted leave to enter for employment without it: see for example, rules 128 and 129 of the Immigration Rules. Thus we accept point (2) in the argument.
46. We part company, however, with the argument at point (3). We do not think the Immigration Rules are only concerned with work permits as such. They are also concerned with other forms of permission to work. Thus, when considering an application for an extension of stay for work permit employment, although there must originally have been a work permit the document which is envisaged for an extension is "written approval from the Home Office for the continuation of his employment": rule 131 of the Immigration Rules. Subsequent rules applicable to particular classes of applicant envisage that the applicant will hold "a valid Home Office immigration employment document for employment": see for example rule 131A. Such a document is defined in rule 6 of the Immigration Rules –

"Immigration employment document" means a work permit or any other document which relates to employment and is issued for the purpose of these Rules or in connection with leave to enter or remain in the United Kingdom

47. We have already noted that for the purposes of the statutory defence under section 8(2) the employer must have had produced to him "a work permit or other approval to take employment issued by Work Permits UK". This to our mind supports the view that permissions to work for the purposes of the 1996 Act are not restricted to work permits as such.
48. The letter dated 11 January 2001 is certainly a permission to work; it expressly describes itself as such. The question then arises as to whether the person holding it is "permitted to work under the Immigration Rules" for the purposes of reg 3(3). In one sense, of course, no form of permission to work, including a work permit, is granted "under the Immigration Rules", for the Immigration Rules themselves do not set out the criteria under which such applications are granted. The Rules are concerned with subsequent applications for leave to enter or remain. But we do not think reg 3(3) can be construed so that it only applies if an employee has a subsisting grant of leave to enter or remain; that is covered by section 8(1) of the Act, and reg 3(3) would be otiose, and would add nothing to section 8(1), if it could only be satisfied by an employee who had a subsisting grant of leave to enter or remain. Statutory provisions which give rise to criminal liability cannot be construed in such a way unless it is quite impossible to give another meaning to them. To our mind it is straightforward to give meaning to reg 3(3). An employee who holds a subsisting work permit or other formal grant of permission to work by Work Permits UK or its predecessor the Overseas Labour Office is "permitted to work under the Immigration Rules" for the purpose of reg 3(3).
49. We accept that Dr Kelly could (and should) have applied for variation of her grant of leave to remain before it expired, and if she had done so her leave to remain in this country would not have expired. Thus we accept point (4) in the argument as we have summarised it above.
50. However, we part company with the argument at point (5). We do not think that the 1996 Act and the 2004 Order proceed on the basis that a permission to work ceases to be such when leave to remain lapses. If it were so, as we have already said, the condition in reg 3(3) would have no application. Rather we consider that Parliament did not intend to impose criminal liability on an employer in the (relatively rare) circumstance that the employee continues to have a valid permission to work even though leave to remain may have ceased. This seems to us to be the most natural reading of the 2004 Order. Moreover, it is important to bear in mind that section 8 is directed to the criminal liability of the employer. It will usually be reasonable to expect an employer to supervise or police the continuing existence of a permission to work. But leave to remain may be granted subject to a variety of conditions which it may be quite unreasonable to expect the employer to supervise or police. It does not seem to us at all improbable that Parliament intended an employer to check the employee's immigration status and permission to work prior to the start of the employment (as the employer will have to do in order to take advantage of the statutory defence) but did not intend to make the employer criminally liable thereafter so long as the employee had permission to work.
51. We therefore conclude that, since Dr Kelly was permitted to work under the Immigration Rules, even though her leave to remain had expired the University did not commit a criminal offence under section 8 by continuing to employ her.
52. For the sake of completeness, we record two other matters. Firstly, it was not argued before us, although it may have been argued below, that section 8 imposed criminal liability only at the first moment of employment, rather than continuing liability thereafter. Secondly, we received no argument relating to the set of conditions contained in paragraph 3(2) of the 2004 Regulations.
53. As we have said, the University's case in the Tribunal and on appeal was that Dr Kelly could not continue to work in her position without contravention of section 8 of the 1996 Act. Since we have rejected this argument it follows that the University's case under section 98(2)(d) of the Employment Rights Act 1996 must fail: see Bouchala v Trust House Forte Hotels Ltd (1980) IRLR 382. Although the University might have little difficulty in establishing a genuine belief in the existence of the contravention, which might amount to some other substantial reason for the purposes of section 98(1)(b), the dismissal would still be automatically unfair by reason of section 98A(1). It follows, accordingly, that the appeal will be allowed and a finding of unfair dismissal substituted.

The reasonableness of dismissal

54. Although the appeal will be allowed on the first ground, we think it is important also to address the second ground, not least because the matter will have to be remitted to an Employment Tribunal to deal with questions of remedy, and any subsequent Tribunal ought to know whether the view of the existing Tribunal on the section 98(4) question was upheld.
55. The question whether a dismissal is fair or unfair depends crucially on whether the employer acted reasonably in treating it as a sufficient reason for dismissing the employee. That question is to be determined in accordance with equity and the substantial merits of the case. It is well known that the test to be applied is whether the decision was within the range of reasonable responses of an employer in the circumstances.
56. It might at first be thought that if the reason for the dismissal is that the employee could not continue to work in the position which he held without contravention of a duty or restriction imposed by an enactment, it must always be reasonable to dismiss. But a moment's thought, and a review of the cases, shows that this is not the position.
57. Firstly, it may be unreasonable to dismiss because the position has resulted from some past conduct or omission of the employer.
58. In Sandhu v Department of Education and Science and another [1978] IRLR 208 Mr Sandhu was employed by the local authority as a probationary teacher. He was dismissed because the Department of Education and Science found him to be an unsuitable teacher. The applicable legislation prohibited the employment of such a person. The Tribunal said that the requirements of what is now section 98(4) were met by the employers saying it must be reasonable for them to comply with the law. The Appeal Tribunal allowed Mr Sandhu's appeal and remitted the case to a differently constituted Tribunal.
59. As Phillips J observed, if it were always reasonable for the employer to dismiss in such a case, it would be reasonable to dismiss even if the Department of Education's decision was brought about by some malicious act of the local authority. That, he said, was too narrow a view of what is now section 98(4).
60. Phillips J said –

9. …[the Tribunal's] function was not to consider whether he could continue to be re-employed or reinstated, but rather whether the employers, judged in the terms of para. 6(8), objectively against the standard of the reasonable employer, had acted reasonably in dismissing him, and whether, for example, --this is not meant to be exhaustive – what a reasonable employer would have done would have been to discuss the matter with him, with the Department of Education and Science, and see whether what had gone wrong could be put right, so that he could have a fair trial and a fair opportunity to prove himself."

61. This does not, of course, mean that an employer can never dismiss an employee if he has brought about or contributed to the contravention which leads to the dismissal. The yardstick is whether it is reasonable to dismiss, having regard to all the circumstances.
62. Secondly, it may be unreasonable to dismiss because something can readily be done in the future to remedy the position.
63. In Sutcliffe & Eaton Ltd v Pinney [1977] IRLR 349 Mr Pinney was employed as a trainee hearing aid dispenser. The normal period allowed for him to pass his exams was 5 years, but the period could be extended by the Hearing Aid Council. At the end of the fifth year he passed the viva exam, but not the written exam. It was a criminal offence then to employ him as a dispenser. His employers dismissed him. He then applied for and was granted an extension of time to pass the written exam. A tribunal found his dismissal to be unfair. The Appeal Tribunal dismissed the appeal. Bristow J said:

"11 In our judgment it was for the Tribunal to decide whether it was unreasonable or not, and the fact that to continue to employ someone could be a breach of the Act is not of itself conclusive. In this case, for example, because of the timing, it was almost inevitable that even if the Council granted an extension there would be a period in which the employers must be in breach, unless the extension was granted before Mr Pinney took his exam in 1976, and we do not know whether the Council would have considered an application till after he had failed. Had an extension been applied for on 28 June it might not have been considered till weeks later, and meanwhile an offence would be committed on every day after 29 June.

12 But it does not follow that action would be taken, and, if it were, provided everyone was doing his best to get over the difficulty caused by the timing the Tribunal might, we think, justifiably take the view that any court would be likely to dispose of the proceedings, especially if an extension had been granted or the employee had been dismissed directly it had been refused, by way of an absolute discharge. It is for them to decide."

64. Mrs Joffe very properly drew to our attention the criticism of Sutcliffe by the learned editor of Harvey on Employment Law at section D.1, paragraph 1807. But we think the legal approach set out in Sutcliffe, which we ought in any event to follow, is correct. Contraventions of the law come in many shapes and sizes. Some are of the utmost seriousness and require immediate action; others are matters which can readily be put right for which no prosecution is ever likely and no prosecution would ever be just. No doubt it will usually be reasonable for an employer to dismiss; but there is no automatic right to do so.
65. Thirdly, we would say a word about matters of procedure. As we have already observed, the statutory dismissal and disciplinary procedures do not apply where the reason for dismissal falls within section 98(2)(d). That is not surprising: there could hardly be a rule that an employer always had to follow a dismissal procedure where there is a statutory contravention of the kind to which section 98(2)(d) applies. But this does not mean that matters of procedure are irrelevant. Whether the alleged contravention is so clear and so serious that it is reasonable for an employer to dismiss peremptorily without following normal procedures will depend on the circumstances of the case. There are no doubt cases where procedural steps can be dispensed with prior to dismissal. But even if it is reasonable to proceed speedily to dismissal, there is no reason why provision should not be made for an appeal. This may be of particular importance in a case where the illegal state of affairs is disputed, or is technical, or arises from some kind of oversight which can be remedied by the time an appeal would have been heard. Failure to follow a reasonable procedure may in itself make the employer's action in dismissing the employee unreasonable, unless the employer can establish that he would have dismissed if he followed a fair procedure: see section 98A(2).
66. In this case it seems to us that Dr Kelly had a powerful argument for saying that it was unreasonable to dismiss her. The University had given her time to resolve the position and supported her application for indefinite leave to remain. That was a reasonable stance to take and it is arguable that to resile from it without warning was wholly unreasonable. There is also an argument that to provide Dr Kelly with no hearing, and no appeal, was unreasonable. In the end, however, arguments of this kind are for the Employment Tribunal, as arbiter of all questions of fact, to weigh up. The reasoning of the Tribunal in this case entirely fails to do so. Either the Tribunal proceeded on the basis that it would always be reasonable to dismiss if it was a contravention to employ the employee, which is not the law, or the Tribunal failed to gave any proper reasons for its conclusion on this question. We would therefore have allowed the appeal on this ground also; although if this had been the only ground we would have remitted the matter for re-hearing.

Conclusion

67. For the reasons we have given the appeal will be allowed. A finding will be substituted that the dismissal was unfair by operation of section 98A(1). All questions of remedy will be remitted to be heard by a freshly constituted Tribunal.