United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR A SOLOMON (of Counsel) Messrs Sodexo UK & Ireland Legal Services Solar House Stevenage Leisure Park Kings Way Stevenage SG1 2UA
For the Respondent	No appearance or representation by or on behalf of the Representative


 


SUMMARY

PRACTICE AND PROCEDURE: Perversity

The Claimant, the Respondent's shop manager, was responsible for bagging takings for collection. She was shown on CCTV turning the CCTV off during that process. There was a substantial cash shortage. The Employment Tribunal held she was unfairly dismissed because it regarded the Respondent's investigation as inadequate and because of a perceived inequality of treatment compared with another employee who had been present. Held: the decision was perverse. The Tribunal had substituted its own view as to the adequacy of the investigation. There was no disparity of treatment. The Respondent could not bring disciplinary proceedings against the other employee because she had already left the Respondent's employment.


 


HIS HONOUR JUDGE REID QC

1. This is an appeal against two decisions of an Employment Tribunal held at Exeter. By the first on 4 April 2009 the Tribunal determined the Claimant had been unfairly dismissed. By the second on 16 May 2009 the Tribunal dealt with the matter of remedy. The Respondent employer appeals against those decisions.
2. The background of the case is that the Claimant had been employed for some years, since 1999, by Sodexho Defence Services Ltd at one of their largest convenience stores. Latterly she had been in the position of manager of that store. She was dismissed on 11 September 2007 on the basis that she was guilty of gross misconduct, in that she was responsible for the theft of substantial sums of money from the store.
3. The system that the store had was that money was bagged up in the store and then collected by Securicor. Before the money was bagged up it was counted by two members of staff in an office in which there was CCTV. The Claimant was on all relevant occasions one of those responsible for the counting and bagging up. Her signature was on all the relevant entries relating to the bagging up of the money. About £10,000 appears to have gone missing over four dates between April and July. There was an inquiry by the Respondent which determined, so far as the Respondent was concerned and the Employment Tribunal appears to have accepted, that the money had not gone missing whilst it was in the care of Securicor.
4. The investigation carried out by the Respondent led it to the conclusion that the Claimant had turned off the CCTV tape which covered the counting and bagging process whilst that process was being carried out by the Claimant and a Mrs Saunders during the instance when money went missing in July. There was then a gap of some 30 minutes and the CCTV was then turned on by somebody else, by Mrs Graham, who had been in the room when it was turned off, but was not one of those responsible either for the counting or the signing. By this time a Miss Bartlett was also in the room.
5. The Claimant and Mrs Graham were both suspended. Mrs Saunders was not. Miss Bartlett, it emerges, had only come on duty after the bagging up process and was therefore not concerned. The investigation carried out by the Respondent was carried out by Mr Fagin. Although Mrs Saunders was interviewed about some matters at an early stage she then dropped out of the picture. The reason that she dropped out of the picture was that she left the employment of the Respondent. This was common ground, so far as the material before the Employment Appeal Tribunal is concerned. All we know is that she had left before Monday 30 July, as is revealed by an answer given by the Claimant in the course of an investigative interview where she said Rachel [i.e. Mrs Saunders] had left as her husband was relocated.
6. The Claimant admitted that the money bags could not be reopened once they had been sealed without it being obvious they had been reopened and that it was she who bagged and sealed the bags. She accepted, in the course of the disciplinary hearing, that she should have kept the tape running when it went off, given that she was counting the money at the time and given there had been previous discrepancies.
7. The position so far as the tape going off was concerned, was that the Tribunal did not see the tape but there was uncontroverted evidence as to what was shown at the point where it went off, namely that the Claimant was seen approaching the camera and it then ceases to operate. The Respondent formed the view that this demonstrated her going to turn the camera off. The Tribunal record that view. They also record the Claimant's assertion that the camera from time to time malfunctioned and started winding itself back. She suggested that this was an occasion when the camera might have started to malfunction, by randomly stopping and starting to rewind, and that her movement could be interpreted as her responding to that happening.
8. The Tribunal, in fact, made no finding as to which of those explanations it preferred. What is should of course have been asking itself was whether the Respondent's interpretation was a reasonable one. In fact, it is obvious that the Claimant's interpretation must be nonsense. If she was reacting to the camera having turned itself off and started to rewind, she could not be shown approaching the camera in order to see what was happening. By that time the camera would have ceased to record.
9. The Respondent, having conducted its investigations, conducted a disciplinary hearing and dismissed both the Claimant and Mrs Graham who, it will be recollected, had been in the room at the time, though not participating in the counting and bagging. Mrs Graham appealed and on appeal her dismissal was overturned. The employer Respondent concluded on appeal that the Claimant had signed and sealed the money bags, that they could not thereafter be tampered with without it being obvious, that the money must have gone missing whilst on the Respondent's premises. Because the Claimant had signed slips on the bags themselves the money must have already gone missing at that point and the Claimant must have either taken the money or seen who did. The Claimant herself at the disciplinary hearing had confirmed that she would have known if the money in the bags was short.
10. The Employment Tribunal was asked, amongst other things, to consider the apparent disparity and treatment between the Claimant and Mrs Graham. But the difference in treatment so far as Mrs Graham was concerned was a difference in treatment that the employer was entitled to make.
11. The Tribunal appears to have regarded the difference in treatment between the Claimant and Mrs Saunders as being "wholly irrational and wholly undermines the third limb of Birchall":

"In terms of the difference in treatment between the claimant and Mrs Graham, we are satisfied that the respondent was entitled to distinguish them in the way that they did and that there is not any disparity of treatment between them that is unreasonable in the sense that the decision to reinstate Mrs Graham creates any unfairness to the claimant. It doesn't do so. However, we are satisfied that the disparity in treatment between the claimant and Mrs Saunders is wholly irrational and wholly undermines the third limb of Birchall."

We have had great difficulty in understanding what the Tribunal could have meant by that. There was no disciplinary procedure against Mrs Saunders for the very good reason that by the time the disciplinary hearing was conducted Mrs Saunders had left the Respondent's employ. There was therefore no disparity in treatment because there was and could be no treatment of Mrs Saunders. That, in itself, entirely undermines that limb of the Tribunal's decision.

12. The Tribunal further went on and held that it accepted that the Respondent believed that the Claimant was guilty, but there were no reasonable grounds because there was a failure to investigate. Then, rather contradicting that, it held that the Claimant was made a scapegoat. We had difficulty in seeing what the Tribunal meant by that because if the Respondent believed that the Claimant was guilty, reasonably or not, she was not being made a scapegoat. Holding that she was a scapegoat necessarily entailed a suggestion that the Respondent did not honestly believe her to be guilty, which is something the Tribunal do not suggest.
13. The grounds of appeal started with a suggestion that the finding of the Tribunal was perverse. The hurdle to be cleared for a successful appeal on this basis is a high one. We need not refer in any detail to the well-known decision of Yeboah v Crofton [2002] EWCA Civ 794, but we take the view that that hurdle has been cleared.
14. Here was a case where the Claimant, as store manager, was the most senior employee, she was in charge of cashing up and only she and Mrs Graham were responsible for banking. On this occasion in July it was the Claimant who was responsible. The Respondent reasonably concluded that the Claimant had deliberately turned off the CCTV surveillance camera. There was no alternative explanation which could have made that conclusion unreasonable. As we have already indicated, the Claimant's explanation was necessarily nonsense. The Tribunal did not seek to judge the reasonableness of the Respondent's conclusions. Rather, it appears to us, that it slipped, as it is very easy to do, into the mode of substituting its own views, "the substitution mindset," as it is referred to by Mummery LJ, in London Ambulance Service NHS Trust v Small [2009] EWCA Civ 220 at paragraph 343.
15. As we have pointed out already, there are irreconcilable findings as between the Claimant being a scapegoat and the bona fide belief in guilt. In the present circumstances, we take the view that any employer was fully entitled to take the view that the Claimant was guilty and the investigation that was conducted, throwing up the matters we have referred to, was entirely adequate. There was clearly an act of serious misconduct, there was no legitimate reason for turning off the CCTV tape, and indeed the Claimant herself had admitted there was error in not turning the tape back on.
16. In those circumstances, both by reference to the overall perversity and also by reference to the disparity point, we take the view that this decision cannot stand.
17. There is a separate point that is raised which goes both to the liability hearing and to the remedies hearing relating to the failure of the Tribunal at the remedies stage to make any deduction because of the Claimant's contribution to her dismissal. The position in relation to that is that the remedy necessarily falls away in the light of our findings on the liability appeal. However, Tribunals must be aware now, in particular following the decision of the Employment Appeal Tribunal in Swallow Security Services Ltd v Millicent [2009] UK/EAT/1297/08/JOJ, judgment handed down on 19 March 2009, that there is a statutory obligation on the Tribunal to consider the issue of contributory fault by reason of section 123(6) of the 1996 Act. We would refer in particular to paragraph 27 of that decision and note that the issue of contributory fault is something the Tribunal is statutorily required to consider, whether or not is has been raised by the employer. In this particular case it had not been raised by the employer. The difficulty the employer had was that by the time of the remedies hearing it did not yet have the reasons for the liability judgment.
18. Whether in any particular case it is appropriate to deal with the question of the element of contribution at the liability stage or whether it is better merely to make the findings of fact and leave the precise determination as to the amount of liability at the remedies hearing must be a matter of judgment for each Tribunal. However, it is important, given the statutory obligation on the Tribunal to consider the question of contribution, that by the time of the remedies hearing the parties should know what the findings of fact by the Tribunal are, so that they can properly address the Tribunal at the remedies hearing on those matters which they say are relevant to the issue of contribution. It is unsatisfactory that a party should be left in ignorance as to what the findings are and thereby hampered as to making any submissions as to the extent or limit of any contributory fault on the part of the employee.
19. However, that said, because of our finding that this decision on liability was perverse, we need say no more about the appeal in relation to remedy. We take the view that the appropriate course in this case is to set aside the determination at the Tribunal that the Claimant was unfairly dismissed and to substitute a finding that she was in fact fairly dismissed. Following on from that, we set aside the award made at the remedies hearing.