United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR THOMAS LINDEN QC (One of Her Majesty's Counsel) Instructed by: Messrs Wragge & Co LLP Solicitors 55 Colmore Row BIRMINGHAM B3 2AS
For the Respondent	MS LOUISE CHUDLEIGH (of Counsel) Instructed by: Messrs Thompsons Solicitors Congress House Great Russell Street LONDON WC1B 3LW

SUMMARY

Statutory Discipline and Grievance Procedures - Whether infringed

Did the Employment Tribunal have jurisdiction to hear claims from certain claimants alleging breach of the Employment Equality (Age) Regulations 2006? The Employment Tribunal held that they did but the EAT upheld the employer's appeal on the grounds that the provisions of the Disputes procedures had not been complied with. The principal issue in the appeal turned on the proper construction of regulation 9 of the Dispute (Resolution) Regulations 2004 and its relationship with section 32(3) of the Employment Act 2002.


 


THE HONOURABLE MR JUSTICE ELIAS (PRESIDENT)

1. The word "rebarbative" entered into the lexicon of employment lawyers via the good offices of Mr Justice Underhill, who in H M Prison Service v Dr Barua [2007] IRLR 4 para. 1 used that adjective to describe the Disputes Procedures laid down by the Employment Act 2002. This appeal yet again demonstrates the aptness of that epithet.

The background.

2. Twenty one Claimants submitted claims that they had been discriminated against on grounds of age, contrary to the Employment Equality (Age) Regulations 2006 ('the Age Regulations'). These Regulations came into force on 1 October 2006.
3. The Claimants all worked for the Respondent company. It had a recognition agreement with the Transport and General Workers' Union (T&G). Mr Gore and Mr Barella were duly elected union representatives of that trade union. The business in which they worked was subject to a transfer of an undertaking. Following that, the company started discussions concerning the closure of the final salary pension scheme. It reached an agreement with the T&G regarding the closure of the scheme. A new scheme, known as the stakeholder scheme, was to be instituted instead.
4. The result of the negotiations was an agreement to pay compensation to those employees ceasing to be members of the final salary pension scheme. The sum was calculated using a matrix which took account of age and years of pensions' contributions. The agreement was reached in late September, very shortly before the date when the Regulations came into force. However, payments pursuant to the agreement were not made until 27 October 2006 (and in a few cases later).
5. Because of widespread disgruntlement about the agreement negotiated, the majority of staff left the T&G and joined the GMB union in November 2006. These included the shop stewards, Mr Gore and Mr Barella. However, they continued in their roles, without any fresh election or appointment. Management were unwilling formally to recognise the GMB but were content to work with its representatives.
6. Mr Walker, the station manager, accepted in evidence that he was willing to recognise Mr Gore and Mr Barella as appointed shop stewards and he treated them in much the same way as when they were representatives of the T&G. The Tribunal found that he expected to use the same collective grievance procedure as had been adopted with the T&G.
7. On about 14 December Mr Walker was left a letter headed "Formal Grievance (Collective)". It was not signed, but the letter ended "Yours sincerely, on behalf of the workplace representatives". Attached to the letter was a list of members. There were twenty two names in all, of which seven subsequently lodged tribunal claims. The letter stated:

"We are writing on behalf of workers to raise a formal collective grievance in respect of the following:

The unlawful discrimination of the attached list of workers contrary to the Employment Equality (Age) Regulations 2006.

We (see attached) feel that the company used a matrix to compensate workers for the loss of the final salary pension scheme that included two discriminatory factors – age and years of contributions to the scheme. We believe that this may have been unlawful because using the factor of age is directly discriminatory and the factor of years and number of contributions is indirectly discriminatory. We do not feel that the payments can be justified and amounts to a breach of the Regulations.

Accordingly we (see attached) ask that you make the necessary arrangements for our workplace representatives to present this grievance on our behalf at a formal meeting and in accordance with the Collective Agreement Procedure."

8. Mr Walker suspected that this came from the GMB rather than the T&G representatives and this was clarified a few days later. Mr Barella confirmed that the grievance had come from his GMB colleagues.
9. Then at some point after this letter was sent but before 27 December, Mr Walker received around 20 questionnaires issued under the Age Regulations. These were in pro forma style, with the party lodging the document merely being required to put his or her name in the appropriate box. It seems a fair inference that these were provided by the union and that those submitting the questionnaire were union members. In each case the Claimants contended that they had been discriminated against. Again there was some dispute as to when these questionnaires were received, but the Tribunal gave reasons for concluding that this number had been lodged by 27 December. The significance of that date was that in order for the Tribunal to have jurisdiction, a grievance has to be lodged and 28 clear days must be left between the lodging of the grievance and the issuing of the ET1. A single ET1 was lodged for all twenty one of these Claimants on 25 January 2007
10. The Tribunal found that many of the signatures on the questionnaires were indecipherable. The employers would have been aware that a large number of GMB members had a grievance about the agreement, but they would not have been able to identify precisely who these were. However the Tribunal was satisfied that the employers could have gleaned from the questionnaires the names of another three persons who subsequently became claimants.
11. In fact, the employers were not given a definitive list by the union of those lodging the grievance until 31 January 2007, after the Tribunal claims had been lodged. At that stage the new list included some twenty five names, all of whom initially were identified in the original tribunal claim (although I am told that some dropped out). The list did not, however, include many of those whose names had been attached to the 14 December letter.

The law.

12. Section 32 of the 2002 Act, so far as is material, is as follows:

"(2) An employee shall not present a complaint to an Employment Tribunal under a jurisdiction to which this section applies if -

(a) it concerns a matter in relation to which the requirement in paragraph 6 or 9 of schedule 2 applies, and

(b) the requirement has not been complied with.

(3) An employee shall not present a complaint to an Employment Tribunal under a jurisdiction to which this section applies if –

(a) it concerns the matter in relation to which the requirement in paragraph 6 or 9 of schedule 2 has been complied with, and

(b) less than 28 days have passed since the day on which the requirement was complied with."

13. It is to be noted that there are two distinct requirements which must be met before the tribunal can exercise jurisdiction. First, the requirement of paragraph 6(or 9) must be complied with. Second, the period of at least 28 days must elapse between the date of compliance and the presentation of the complaint. It is common ground that this provision applies to complaints which allege breaches of the Age Regulations.
14. Paragraph 9 of schedule 2 relates to what is termed "the modified procedure" and is immaterial in this case. Paragraph 6 sets out the standard procedure which was in principle

applicable to these complaints. It reads as follows:

"The employee must set out the grievance in writing and send a statement or a copy of it to the employer."

Subsequent paragraphs then specify that the employer must call a meeting to hear the grievance, and provide for a right of appeal.

15. However, the Act has been supplemented by the Dispute (Resolution) Regulations 2004. Regulations 7 to 10 deal, inter alia, with circumstances where the parties are treated as complying with the grievance procedure even although the conditions specified in paragraph 6 have not been met.
16. The exemption potentially available to these Claimants is found in regulation 9. This, so far as is material, is as follows:

" (i) Where either of the grievance procedures is the applicable statutory procedure, the party shall be treated as having complied with the requirements of the procedure if a person who is an appropriate representative of the employee having the grievance has –

(a) written to the employer setting out the grievance;

(b) specified in writing to the employer (whether in setting out the grievance or otherwise) the names of at least two employees of whom one is the employee having the grievance, as being the employees on behalf of whom he is raising the grievance.

Regulation 9(ii) defines who is an appropriate representative.

17. Regulation 9 therefore has the effect of permitting a claimant to bring a case before an employment tribunal notwithstanding that a formal grievance has not been raised in the manner prescribed by paragraph 6. Compliance with regulation 9 is deemed to be compliance with paragraph 6.
18. It is now conceded that the seven who were named in the December 14 letter and subsequently lodged claims fall within regulation 9. The issue is whether any of the other Claimants do so.

The Tribunal's conclusions.

19. The Tribunal concluded that the letter of 14 December constituted a collective grievance. It was satisfied that it had been submitted by "an appropriate representative" and gave detailed reasons for that conclusion. Although initially the appeal challenged that finding, Mr Linden QC, Counsel for the appellant company, has not pursued that point before me. He now accepts, having considered the matter further, that Mr Gore and Mr Barella were approved representatives within the meaning of regulation 9(ii)(b). He also accepts that it mattered not that the letter of 14 December was unsigned.
20. The Tribunal then considered how regulation 9 related to section 32. The employment judge concluded that section 32 does not apply to grievances governed by regulation 9. Accordingly, she found that the date by which a particular grievance must be notified to the respondent was of no consequence to the admissibility of the ET1 for any of the Claimants.
21. She reached this conclusion by noting that section 32 did not mention the collective process stipulated in regulation 9; that the regulation was concerned with a procedure for employee representatives rather than employees; and that the regulation laid down no prescribed timescale for compliance with the collective procedure, in contrast to the requirements for grievances lodged under paragraph 6. She observed that many collective procedures could not be completed within 28 days.
22. In view of these considerations her conclusion was as follows (para 12):

"My conclusion is that section 32(3) only engages where there is an obligation to follow the statutory grievance procedure set out in schedule of the 2002 Act. Section 32(3) applies where paragraph 6 of schedule 2 must be followed but not in this case where a collective procedure rather than the paragraph 6 procedure applies."

23. In the alternative, she held that the three individuals who to the employer's knowledge had lodged questionnaires were caught also:

"If I am wrong in this then the 10 individuals who were already clearly associated with the grievance more than 28 days before the ET1s were lodged …are the only names entitled to go forward to bring a claim."

24. She observed that there were cogent policy considerations in favour of her preferred conclusion (para 11(e)):

"The point of a collective grievance is that it is expected to take its own course outside any statutory minimum procedure and because it is a collective process individuals can join in with it as and when they wish to provided, presumably, that by the time the employer comes to deal with the grievance it knows who is involved. This employer knew exactly who was involved by 31 January 2007 which was well before any action was taken under the grievance procedure and was not inconvenienced by being told who was involved in dribs and drabs."

25. Then the employment judge concluded that quite independently of regulation 9, the two representatives could be seen as agents for those in whose names the grievance had been lodged. In other words, even if this was not a collective grievance, it could properly be seen as a number of individual grievances lodged by the union representatives on behalf of those members who had authorised them to take that step. As individual grievances, however, the time requirements were plainly applicable.
26. The Tribunal held that the three who had sent the questionnaire had associated themselves by their actions with the grievance and could be treated as having lodged their grievance in time. However, this agency analysis did not assist those whose names were not identified until after 27 December because they did not allow sufficient time between lodging the grievance and the claim.
27. The employment judge then considered a further issue raised by the employer, namely whether the claim arose after the Age Regulations came into force on the 1 October. The argument was that the decision to make the payment, and the formula for determining the sum, were determined before the regulations came into force. The actual payment was merely the necessary and inevitable consequence of giving effect to that decision. Since the original decision at the time it was made did not infringe any age discrimination law, the actual payment itself could not do so. The employment judge rejected this argument, for the following reasons (para 14):

"In relation to the question as to whether or not the relevant Age Discrimination Regulations were in force when the cause of action arose I find that it was. Firstly, the Respondent says that although the payments were made to the Claimants after the Age regulations came into force (mainly on 27 October), they already knew what they were going to receive. He says that the claim therefore crystallised before 1 October 2006. I do not agree. Although the claimants were told what they were going to be paid, there was no fait accompli at that point. For example, they were asked to sign a consent form before they were actually paid and so it was only when they received the payment that the cause of action crystallised in a claim that that payment was tainted by discrimination…."

The grounds of appeal.

28. Mr Linden submits that the Tribunal erred in three principal ways. First, it was in error in concluding that the provisions of the section 32 of the 2002 Act were not material; on the contrary, the section plainly required the 28 day moratorium to allow the grievance procedure to operate, and on a proper construction of regulation 9, only the seven specified in the 14 December letter had complied with the terms of that provision within the required time frame.
29. Second, even if the agency analysis could be adopted, that did not assist the three whose identity was gleaned only from the questionnaire since that was insufficient evidence to infer that they had made the union representatives their agents for the purpose of lodging the grievance.
30. Finally, the Tribunal was wrong in law in finding that the cause of action accrued after the Age Regulations had come into force.
31. Ms Chudleigh, Counsel for the Claimants, submits that none of these conclusions demonstrated any error of law.

The collective grievance decision.

32. Mr Linden says that if one looks carefully at the relationship between regulation 9 and section 32(3), it is plain that the section is not excluded in circumstances where regulation 9 applies, and that each of the reasons given by the Tribunal for concluding that it was were flawed.
33. Mr Linden submitted that the subsection requires two conditions before a complaint can be presented, the compliance requirement i.e. complying with paragraph 6; and the time requirement i.e. allowing for at least 28 days to elapse prior to presenting the Tribunal claim to allow the grievance to take its course. All regulation 9 does is to provide an alternative form of compliance with paragraph 6. If the conditions of regulation 9 are met, that is deemed to be compliance with paragraph 6. Regulation 9 does not, however, touch the time requirement in section 32(3)(b). So the employment judge's conclusion that the time limits do not apply was misconceived.
34. I agree with that submission. In my judgment, the Tribunal's analysis of the relationship of regulation 9 and section 32(3) is unsustainable. The language is clear; regulation 9 provides an alternative way of complying with paragraph 6. It means that a claimant whose grievance is lodged through a regulation 9 procedure is deemed to have complied with paragraph 6 and therefore can satisfy section 32(3)(a); but the obligation to satisfy 32(3)(b) remains. The fact that section 32(3) does not specifically refer to the collective grievance mechanism, or that no time limits are fixed in regulation 9, is irrelevant.
35. The argument therefore has to be not that section 32(3) does not apply, but rather that in some way there is compliance with the time limit in that subsection for all claimants who in fact share the grievance raised in the collective grievance whether or not their names have been identified specifically in it That is the alternative way in which Ms Chudleigh puts her case. All that regulation 9 requires, she submits, is that at least one claimant is identified in writing, and two persons in all. The latter is necessary simply to identify the fact that it is a collective grievance. Provided two persons are named, and at least one is a subsequent claimant, that suffices to bring all claimants who share the same grievance within the scope of regulation 9. In short, provided the timescale is met with regard to at least one claimant specifically identified as an aggrieved person, it will be met by all claimants equally aggrieved.
36. Mr Linden submits that Ms Chudleigh's primary argument cannot be right. The starting point is that paragraph 6 requires an employee to raise a grievance in writing. Regulation 9 simply permits the grievance to be raised on his or her behalf by a union representative. Where that occurs, the employee need not lodge his or her own individual grievance and the employer can thereafter treat the grievance collectively, without having to call separate meetings for each employee. The collective procedure route therefore benefits both employees and the employer. But it is still fundamental, he contends, that the claimants relying on the provision must be identified as parties to the collective grievance process in writing by the union representatives. The employer must know on whose behalf the collective grievance is being lodged. It is not enough that only one of the claimants has been identified leaving the employer in ignorance of who else might share the grievance.
37. Mr Linden relies upon the fact that the regulation states in terms that the union representative must "specify in writing the names of at least two employees …. as being the employees on behalf of whom they are raising the grievance." That, Mr Linden submits, makes it plain that all subsequent claimants must be identified.
38. I confess that the regulation is not easy to construe. I have some difficulty with understanding what is meant by the phrase "The names of at least two employees, at least one of whom is the employee having the grievance." Read literally, it suggests that a grievance may have been lodged on behalf of two employees, one of whom is an employee who does not have that grievance, which is absurd.


39. However, both Counsel submit, and I accept, that the draftsman's intention must have been that one of the employees at least must be a claimant: "the employee having the grievance" in regulation 9 is the party having to lodge a statutory grievance. The duty to lodge the statutory grievance within the appropriate time only arises in circumstances where the aggrieved party subsequently becomes a claimant. Accordingly, the employee having a grievance is the employee who later makes a claim. The regulations hardly express this in a transparent fashion, but I accept it is difficult to see what else could have been intended.

39. In my judgment Mr Linden's construction is preferable, essentially for the reasons he gives. The natural meaning of the regulation is that the reference to "the party" who is to be treated as having complied with the requirements of the grievance procedure is the same as the "employee who has the grievance" in subparagraph (b). The representative must identify in writing the employees on whose behalf he is raising the grievance, and that must mean all the employees including those raising a statutory grievance who subsequently become claimants.
40. It follows in my judgment that regulation 9 requires the union representative to identify each party who is to be treated as having complied with the statutory grievance procedure, and section 32(3)(b) requires that this must be done within the statutory time frame. If follows that the seven who were identified fall within the terms of the regulation, but not those whose names were only identified after the 27 December. I consider below the position of the three who lodged the questionnaire prior to that date.
41. I would not rule out the possibility that the names could be identified indirectly, such as where the grievance is raised on behalf of a defined group of individuals readily identifiable to the employer, such as all the GMB members in the paint shop. I heard no argument about that, no doubt because it is of no assistance to the Claimants here since no such group definition was provided (and it would have been difficult to do so given the nature of the claim. Some union members benefited from the application of the matrix and some did not.)

The three who lodged the questionnaires.

42. Theoretically, there are three possible ways in which the three who lodged questionnaires might be deemed to have complied with the statutory requirement to lodge a grievance in time.
43. The first is by being associated in some way with the collective grievance. The second is by being deemed to have lodged their own grievance in their own name. Third, is by having lodged a grievance through the union representatives as their agent.
44. As we have seen, the Tribunal considered that they were not barred from pursuing their claims either because they fell within the collective grievance, or because the union representatives had acted as their agents.
45. I can see no proper basis on which they can be treated as being part of the collective grievance. The requirement is that the union representatives must identify the names of the employees subject to the grievance and they have not done so. These three were not identified by the representatives who lodged the grievance; they simply lodged their own questionnaires in their own name. (I appreciate that one of them, Mr Barella, was in fact the union representative, but he was not acting in that capacity when lodging the questionnaire.) Indeed it is not even clear that the union representatives would have known which members were lodging the questionnaire.
46. Accordingly, I do not see how it can be said that these three were unilaterally associating themselves with the collective agreement when the union representative taking responsibility for pursuing the grievance had never identified them.
47. One additional ground on which Mr Linden sought to exclude these three from the collective grievance was based on a submission that all the names must be identified on, or at least with, the original grievance.
48. I do not agree and would not have excluded the Tribunal from exercising jurisdiction on that ground. I see no reason in principle why it would be inappropriate or otherwise an infringement of regulation 9 for the union to identify in writing after the grievance itself was lodged, but still within the statutory time frame, the names of others who it is intended to include in the grievance (or indeed to redefine the relevant group, if identification of the employees is permitted in that way.) The words in brackets "whether in setting out the grievance or otherwise" support that analysis. However, this does not ultimately assist these three claimants since it does not overcome the requirement that it should be the union representatives identifying their names.

Can the three be said to have lodged their own grievances?

49. On the face of it, it might have been thought that they could since they have presented the employer with a questionnaire which in terms identifies that grievance. However, the Claimants accept that that is not sufficient. The reason is that regulation 14 provides in terms that where a person aggrieved questions a respondent under various statutory provisions, which include the Age Regulations, "those questions shall not constitute a statement of grievance under paragraph 6 ….". Moreover, the regulation cannot be circumvented by contending that the grievance identified in the preamble to the questions can be treated as not being part of the questionnaire itself: see Holc-Gale v Makers UK Limited [2006] IRLR 178
50. The third basis is adopting the agency route. The Tribunal found that the three had by lodging the questionnaire sufficiently associated themselves with the collective grievance as to constitute the union representatives their agent for the purpose of lodging their own grievance. Mr Linden submits that this analysis is legally erroneous also. He correctly points out that the union representatives do not act as agents of their members, save where there is clear evidence that they have specifically been authorised to do so. That is plainly so. Clearly these representatives were not intending to raise a grievance on behalf of all GMB members, some of whom would no doubt be happy with the matrix adopted.
51. The question, therefore, is this: given the absence of any express authorisation, can authorisation be implied or inferred? The relevant evidence is that the three lodged questionnaires which demonstrated that they shared the same grievance as that already lodged; that the questionnaires were of a pro-forma kind produced by the trade union; and that they were union members.
52. In my judgment a reasonable employer would appreciate from that that these individuals would have anticipated that their claims would now be dealt with through the collective process (albeit that the requirements of regulation 9 were not complied with). I think an employer would reasonably anticipate that, at least for GMB members using this pro-forma questionnaire, their union representatives would thereafter be dealing with the grievance on their behalf.
53. I appreciate that on this analysis, there must be compliance with paragraph 6. This requires that the employees must lodge a copy of the grievance with the employers, and of course it must be done within the relevant time. In this case none of these individuals personally lodged a copy. However, there is nothing in paragraph 6 which prevents the grievance being lodged before the name of the employee is identified. All that is required is that a copy of the grievance must be lodged within the timeframe specified in the statute.
54. In a case such as this, where it is plain that those union members lodging the grievance share precisely the same grievance as those already covered by the collective grievance, I see no reason why the grievance already lodged by the union representatives cannot be treated as the relevant copy of the grievance for the purposes of paragraph 6. It would be futile to require the same grievance to be lodged again.
55. Accordingly, I think the Tribunal was entitled to find that the union representatives were acting as agents for these three individuals and had lodged a grievance on their behalf. In my judgment that analysis is consistent with the observation of the EAT in Canary Wharf Management Limited v Edebi [2006] IRLR 416 para.24, that the regulations must not be construed in an unduly legalistic or technical manner.
56. It follows that these three have complied with the statutory requirements. It is not a question of their being treated as having done so by virtue of falling within regulation 9, but rather of a grievance having been lodged by representatives on their behalf, in compliance with paragraph 6.
57. However, the other eleven cannot pursue their claims. This conclusion gives me no satisfaction whatsoever. It is little short of absurd that otherwise properly drafted claims cannot be pursued because of this highly technical rule. I entirely agree with Ms Chudleigh that there is no purpose in requiring other employees formally to put in a grievance and allow 28 days for its resolution in circumstances where the collective grievance has been lodged and will in practice determined what the outcome of any later grievances will be.
58. However, I have to give effect to the regulations as drafted and not as I think they ought to be. I can see no sensible construction of regulation 9, read with section 32(3) and paragraph 6 that would justify the conclusion that any except the seven could be treated as having been parties to the collective grievance and presented their claims within the specified time frame.

Were the Age Regulations in force?

59. Mr Linden's second principal submission is that the cause of action had accrued prior to the Age Regulations coming into force, and that the Tribunal had erred in finding otherwise. If that is right, then it is a defence to all of these claims, including the seven covered by the collective grievance. The point was attractively advanced, but I am not persuaded by it. I recognise that it may appear harsh for the employer, having reached agreement with the T&G when it was apparently lawful to do so, to be subject to an attack that the payments made pursuant to that agreement are discriminatory. However, the only issue is whether a cause of action arose after the 1 October. I am wholly satisfied that it did.
60. In support of the Tribunal's decision, Ms Chudleigh relied upon the case of Gloucester Working Men's Club v James [1986] ICR 603. In that case the EAT held, in the context of alleged discriminatory dismissal which took effect after notice was given, that the "act complained of" within the meaning of section 76 of the Sex Discrimination Act 1975 was not the giving of notice – and a fortiori, not when the decision to give notice was taken – but was a dismissal itself. Accordingly, a complaint lodged within three months of the actual dismissal, but more than three months after the notice of dismissal was given, was nonetheless in time. The employers had contended, rather as in this case, that the dismissal was the inevitable consequence of the notice and the latter should be treated as the relevant discriminatory act.
61. In rejecting that submission, it is pertinent to note that Popplewell J, giving judgment for the EAT, observed that the giving of notice might indeed constitute a detriment within the meaning of the relevant legislation on the grounds that it may be a detriment to have the threat of dismissal hanging over one's head, but that the complaint about the dismissal was a separate and distinct complaint. We think that analysis is applicable here.
62. It may be that in principle the letter offering the discriminatory terms could be seen as a detriment within the meaning of regulation 7(2)(d) of the Age Regulations, but the complaint here is about the actual payment. In my judgment that is a distinct and separate complaint under regulation 7(2)(b), namely that the employee has received a discriminatory benefit.
63. Mr Linden sought to distinguish James on the grounds that it was concerned with time limits, but I see no justification for concluding that there is a separate rule for time limits and for liability. He also drew attention to the fact that in this case there is the unusual feature that the Age Regulations were not in force when the matrix was adopted and the letters were sent to the individual employees. That is true, and of course it would prevent any complaint in this case that the offer letters constituted a detriment to the employees. However, that fact cannot affect the conclusion that the act of payment was itself a separate action giving rise to a distinct complaint.

Disposal.

64. The appeal succeeds to the extent that a tribunal has jurisdiction only to hear those claims from Claimants who had been identified satisfactorily to the employers by 27 December. As I have said, that covers ten of the Claimants, but the Tribunal does not have jurisdiction to deal with the other eleven.