United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MS SALLY ROBERTSON (of Counsel) Instructed by: Free Representation Unit 289-293 High Holborn London WC1V 7HZ
For the Respondent	MR PETER SAVILL (of Counsel) Instructed by: The Treasury Solicitor (Employment 4C) One Kemble Street London WC2B 4TS


 


SUMMARY

UNFAIR DISMISSAL

Contributory Fault

Employment Tribunal erred in law in making deductions from the basic and compensatory award for unfair dismissal in failing to consider whether and if so to what extent the Claimant was guilty of blameworthy or culpable conduct or had control over those events which gave rise to or contributed to the dismissal.


 


THE HONOURABLE MR JUSTICE WILKIE

Introduction

1. This is an appeal by Dr Steven Langston against one element of the Decision of the Employment Tribunal following a hearing at London (Central) on the six days between 15 and 22 April 2008. The Tribunal's decision, which was set out in a judgment dated 23 April 2008, was that: (i) claims made by the Claimant of detriment and dismissal by reason of making protected disclosures failed; (ii) that the Claimant was dismissed for some other substantial reason; (iii) that dismissal was automatically unfair under section 98A(1)(a) of the Employment Rights Act 1996; and (iv) was substantively unfair pursuant to section 98(4). None of these decisions are the subject of any appeal.
2. What is the subject of an appeal is the further decision of the Employment Tribunal to award no compensation, as just and equitable, either by way of a compensatory award or a basic award in respect of their findings of unfair dismissal. The Employment Tribunal, presumably on the footing that their finding of unfair dismissal on the grounds of some other substantial reason might subsequently have been found to have been in error, reached an alternative conclusion, which was that the dismissal was by reason of redundancy but that such dismissal would have been fair.
3. The Respondent, the Secretary of State for Business Enterprise and Regulatory Reform, has not cross-appealed the Decision of unfair dismissal and, accordingly, it is common ground that the alternative conclusion of the Employment Tribunal falls out of the picture. Accordingly, the focus of this Tribunal's concern has been the finding that no award of compensation should be made and no basic award should be made notwithstanding that the reason for the dismissal was some other substantial reason and that the dismissal was unfair.
4. The Tribunal did not furnish its reasons for their decisions until 23 January 2009, some nine months after the last day of the hearing at which they had stated their decision and given some ex tempore reasons. That is an unusually long period of time which may be, in whole or in part explained by the fact that the subject matter of the complaint was governed by Rule 54 and, therefore, the reasons for the Decision had to be subjected to the statutory regime for approval before it was finally promulgated and sent to the parties. No doubt that process must have contributed significantly to the delay, but it has a knock on effect as we will see later on.

The facts found and the decision

5. The Tribunal set out extensive findings of fact between paragraphs 14 and 57 of the Decision. We recite those, we hope, relatively briefly. The case concerned the export control operations of the then DTI. The Claimant has a high degree of specialist technical knowledge in chemical and biological issues, in particular including "nuclear and explosion matters", but he lacks any in-depth management experience or training. He joined the Respondent in March 1998 as a Technical Officer and was promoted to Senior Technical Advisor in Range 9 in 2002, a post which attracted a technical speciality allowance. It was a requirement for that role for him to have DV clearance.
6. The Tribunal went on to make certain detailed findings of fact in relation to issues which the Claimant said involved protected disclosures by him. We need not deal with those save to say that one of the incidents of protected disclosures asserted by the Claimant concerned a visit to Sydney in April 2005. This was his first trip to a distant high profile and sensitive international delegation meeting.
7. The Tribunal found that he was not physically well before he went, suffering a range of physical ailments, and was also under work stress. Nonetheless, he decided to go. The meeting took place at a hotel in Sydney. The Claimant asserted that, during his time at the hotel, his room was broken into without any sign of forced entry, personal papers were read and disturbed, money was stolen and miscellaneous personal goods and items of clothing went missing. He was disturbed at this incident. He said he made his own inquiries, which included discovering that he felt that his room had been broken into by use of a 'Do Not Disturb' card. He felt that he had demonstrated this mechanism to hotel security who, he felt, took his concerns sufficiently seriously to move him to another room and to offer him compensation. He also expressed concern that he was told to keep the matter quiet and not to report it to the British Consulate as would have been normal practice.
8. The Tribunal went on to find that other members of the delegation to Sydney were highly concerned at his reaction to this incident. In reports back to management, he was referred to as showing himself to have characteristics of Walter Mitty and seeing himself as a David Kelly figure with his life at risk.
9. The Tribunal recorded, as a fact, that the Claimant returned to work on 28 April 2005. Mr Williams, his line manager, in light of what had been reported back to him about the Sydney incident, saw the Claimant on 29 April, the following day. He decided at that stage that the Claimant should be deprived access to sensitive documents whilst further investigations were undertaken. The Tribunal found, as a fact, that Mr Williams at that stage had a genuine concern as to the Claimant's state of mind. He was demonstrating overreaction, being erratic and obsessive.
10. The Tribunal also accepted that Mr Williams' view was that these emotions were extremely serious and put at risk the reputation both of BEER and her Majesty's Government. Against the background of concern expressed by his colleagues and reflected by Mr Williams views, a meeting was planned for 5 May. In fact that meeting did not take place because of the hospitalisation of the Claimant for a physical ailment. However, as a result of a further discussion between Mr Williams and the Claimant on 4 May, to confirm the postponement of 5 May, Mr Williams' concerns that the Claimant was showing himself to be unbalanced were enhanced. On 9 May there was a meeting at which the Claimant was suspended by Mr Williams for welfare and security reasons. Investigations continued but, because it was considered undesirable to maintain a precautionary suspension for too long, on 2 June a formal suspension was put in place for security and health investigations. It was, specifically, not of a disciplinary nature.
11. The Claimant obtained a report from a psychiatrist which was referred to the Respondent's medical advisor who also met the Claimant on 15 June and who sought two reports from the Claimant's GP. That resulted in the Respondent's medical advisor providing a report dated 13 July. The Tribunal cites certain key passages from that medical advisor's report as follows:

"Although the psychiatrist has not been able to identify any active ongoing psychiatric condition, the history provided and indeed, the altering perception of events in Australia, suggests at least the possibility of what is described as an acute transient psychotic disorder secondary to what is described by the psychiatrist as the stress he was under at work.

In my opinion it has to be at least a possibility that there might be further similar episodes, whatever that episode might have been, particularly if Dr Langston finds himself in a stressed environment. In saying this, I fully recognise that, as Dr Langston indicates, his role is by its very nature, inherently one with an unusual degree of stresses associated with it."

12. A case conference of key players in the Respondent took place on 19 July. At that conference the following appears within the minutes:

"It was agreed that, in Sydney and immediately on his return, SL appeared to have reacted disproportionately to the alleged theft, behaved erratically, disrupted the work of the rest of the UK delegation, engaged inappropriately with the hotel management, and genuinely drawn attention to himself as an employee of HMG engaged in sensitive work and with the ability to pick locks, etc. Other members of the UK delegation had been concerned about both his health and his conduct."

13. At that stage, it was felt that the Claimant's DV clearance should continue to be suspended. However, the minute went on:

"RB [Mr Branch] agreed that SL could not return to his current ECO post because the MA [Medical Advisor] could not rule out a recurrence of the problem."

14. It was concluded that the absence of DV clearance, and the fact that the Claimant had lost the trust of his colleagues and management, meant that he could not continue to do the job. The minutes of the meeting went on:

"It would be difficult to sustain the suspension beyond a couple of weeks because the MA had assessed that there was no ongoing medical problem. The only options were therefore putting him into the Moves Pool or finding him another post in XNP."

15. The Tribunal found that, against that background, the decision of the meeting was that: the Claimant should be told that he could not return to his current post; he should be told about the removal of his security clearance; and he should be offered a temporary R8 post whilst he looked for a permanent post, with the possibility of gardening leave if he was not keen on taking up a temporary R8 post. It was also formally recorded that disciplinary action was not appropriate because his actions had not been malicious.
16. The Tribunal described in some detail what happened subsequently and, in particular, in relation to the applications which the Claimant made for alternative long term posts. The Tribunal's conclusion was that those unsuccessful applications were carefully considered, whether at sift stage or at interview. The Tribunal did not find any evidence that the failure to obtain an alternative permanent post was on account of bias. It accepted the evidence from the Respondents' HR professionals that, in his applications, there was an absence of clear evidence of a number of qualities: team leadership; delivering results through others; prioritisation of and focus on core activities; effective verbal comments; decisiveness; judgment; and resilience under pressure.
17. By Autumn 2006, although the Claimant had made a number of job applications, he had not been successful. By that stage, the climate in the DTI had changed significantly. There had been a decision to move to compulsory redundancies and to press on with achieving the required headcount reduction by compulsory means, such reduction not having previously been achieved by voluntary means. Against that background, the Claimant was first told that he would be given notice of compulsory redundancy on 1 October. That was postponed but he ultimately received six months notice on 30 October 2006 to expire on 30 April 2007. The Claimant did not appeal against that decision, although informed of a right of appeal, nor had he appealed against the removal of his DV security clearance, though informed of his right to appeal.
18. The Tribunal set out the relevant law. Amongst the statutory provisions which it recited are sections 122(2) and 123(1) and (6) of the Employment Rights Act 1996. The former deals with the circumstances in which a basic award can be reduced and the latter deals with the compensatory award, but makes provision for a reduction in the amount of the compensatory award having regard to contribution.
19. The Tribunal also set out the relevant statutory provisions in respect of automatic unfair dismissal in relation to procedural matters and in relation to the other issues which had been raised. They referred to a number of reported cases in respect of some of the issues but did not refer to any reported cases in respect of reduction of an award on grounds of contribution. They recorded the respective submissions of the parties and their conclusions.
20. In relation to the protected disclosure claim, the Tribunal concluded that the things that happened to the Claimant after the Sydney incident occurred because of the serious concerns of others and because of the medical opinion of the Respondent's medical adviser and not by reason of what he had said about that incident. Thus it found that the Sydney incident did not give rise to a successful "protected disclosure" claim.
21. It turned, in paragraph 91, to the claim for unfair dismissal. The Tribunal concluded that the Claimant had lost his DV clearance which was a security decision taken by Mr Branch and not for them to second-guess. They did not have all the facts which were taken into account and, in any event, the claimant had not sought to challenge that decision by internal means. The Tribunal accepted that the consequence of his loss of DV clearance was that he could not maintain his current Range 9 post as it required DV clearance. Furthermore, the circumstances of the loss of DV clearance created a situation where there was very little prospect of the Claimant retaining that status. Accordingly, he was in a precarious position.
22. The Tribunal was clear that, at the point where these steps were taken, September 2005, compulsory redundancy was not then envisaged, although there was already within the DTI pressure and an obligation to reduce headcount. The Tribunal recorded that, shortly after that decision, his Range 9 post was eliminated. It was the Tribunal's unhappiness about the way in which the two threads of the case: the removal of the security clearance; and the elimination of his erstwhile post, were linked together. As a result, the Tribunal found that the dismissal, which they found was for "some other substantial reason" was unfair.
23. They recorded, in paragraph 97, how that "some other substantial reason" was to be formulated. It came down to the fact that the dismissal was the delayed, but direct, consequence of the Claimant's behaviour in Sydney, leading to the removal of his DV clearance in 2005. Dismissal in 2006 was a direct, though unexpected, consequence of it.
24. It concluded that the dismissal was automatically unfair under section 98A(1)(a) for lack of any step (1) statement, or step (2) meeting, or step (3) appeal. It also recorded that, pursuant to section 98(4), it was substantively unfair because of the lack of procedural clarity. The good intentions behind placing the Claimant elsewhere on a temporary basis in light of the loss of his DV status, was overtaken by a downturn in the economic situation, which led to the unforeseen and unplanned consequence of the compulsory termination of his employment.
25. In paragraph 100 the Tribunal says as follows:

"Although the view was that the dismissal was unfair, the conclusion was that this was an exceptional case in which it was appropriate to make a 100% reduction in the compensation by reference to the joint effects of Sections 123(1) and 123(6) of the Employment Rights Act. The reasons for this conclusion were as follows: The Claimant's behaviour in the sensitive secret environment of the Sydney visit was bizarre and misjudged and it destroyed trust and confidence. The behaviour destroyed the possibility of the Claimant continuing in the kind of sensitive role he had occupied to date. To be added to that was the medical advice that a recurrence was a risk. The net result was that the Claimant was unemployable in that role or in an equivalent role involving sensitive issues and DV clearance."

26. In paragraph 101 it deals, in a little more detail, with the search for alternative employment after removal of DV clearance. It refers to the fact that the situation was exacerbated by the Claimant's unwillingness to give up his pay enhancement. The Tribunal concluded, at the end of paragraph 101, that this was not a case where it could be said that the Respondent was under a positive obligation to create a role, as might be required as a reasonable adjustment in a disability discrimination case. In paragraph 102 it says as follows:

"Those then were all the reasons why, although they had concluded that the dismissal for this reason was unfair, they had also concluded that it was not appropriate for compensation to be awarded. It was not just and equitable to make a compensatory award, by reference to the section 123(1) Employment Rights Act test of loss attributable to action taken by the employer. The Claimant had furthermore caused his dismissal by his behaviour in Sydney and afterwards, for the purposes of section 123(6) and section 122(2) Employments Right Act, reinforcing the inappropriateness of either a compensatory or basic award of compensation."

The Appeal

27. The main ground of appeal in respect of that aspect of the Decision is that the Tribunal is said to have erred in law in that it misdirected itself in its treatment of contribution. It is said that it failed to comply with, or direct itself, on the settled approach to identifying the "culpable and blameworthy" conduct necessary to found a decision on contribution for purposes of section 122(2) and section 123(6). It is said that it took into account matters which were neither "culpable" nor "blameworthy".
28. Reliance is placed by the Appellant on the well known passages in the case of Nelson v BBC (No 2) [1980] ICR 110 at page 120D, at page 121D to F and in the decision of The Employment Appeal Tribunal in Gibson v British Transport Docks Board [1982] IRLR 228 at paragraph 29. Those passages have been relied upon, and cited, in subsequent cases including Sidhu v Superdrug Stores Plc UKEAT/0244/06 at paragraph 23 in which a yet further Decision of the EAT British Steel Corporation v Williams to similar effect is cited. In addition, reliance is placed on the EAT Decision in Kraft Foods Limited v Fox [1978] ICR 311 at page 313D. Insofar as it might be said that there is a different approach in relation to section 122 and 123(1) and (6), reference is also made to Charles Robertson (Developments) Limited v White [1995] ICR at 389.
29. The effect of all these authorities is that, insofar as section 123(6) is in play, it is necessary for a Tribunal, when considering and making a reduction in a compensatory award by virtue of contributory conduct, to address the question, and make findings, of "culpable or blameworthy conduct" before making such a deduction. What amounts to "culpable and blameworthy conduct" is not closely defined but that the conduct has to have that quality. Putting it another way, if the matters said to contribute to the dismissal are outside the person's control they cannot be said to be culpable or blameworthy so as to found a reduction on the grounds of contribution.
30. The test in respect of the basic award is different, reflecting the different statutory language, but it is equally said that it is well established that, in order for it to be "just and equitable" to reduce the amount of the basic award there must also be, if the conduct of the claimant is relied on, some element of culpability or blameworthiness.

The Respondent's submissions and our reasons

31. The Respondent to the appeal presents two arguments in opposition to these submissions. First, it says that if, and to the extent that, the Tribunal was reducing the amount of the award made on just and equitable grounds under section 123(1), there was no need for the Tribunal to make any finding in respect of culpability or blameworthy conduct because section 123(1) focuses exclusively on the loss attributable to action taken by the employer. It is said that there are passages in the reasons, in particular paragraph 102, where it might be said that the Tribunal was making a judgment under section 123(1) exclusively.
32. As to this argument, even if it might be right in some cases, in our judgment it is not an answer to the Appellant's argument in this case. It is plain, from paragraph 100, that the Tribunal was, addressing the combined effect of section 123(1) and 123(6) and, furthermore, described the reasons for the 100 per cent reduction in compensation, in such a way that, if not exclusively, certainly in large measure concerned the conduct of the Claimant, not the actions taken by the employer.
33. Therefore, in our judgment the Employment Tribunal was applying section 123(1) in combination with section 123(6), either in whole or in part, in performing the exercise which it conducted.
34. The second argument of the Respondent to the appeal is that, insofar as the Tribunal was conducting such an exercise, it did not have to state in terms that it was concerned to identify conduct which was blameworthy or culpable on the part of the Claimant. Those principles, it was said, are so long and well established that they do not need to be recited by the Tribunal provided it is clear from the rest of the Decision that they were applying such principles in reaching their decision.
35. Reliance is placed on certain of the passages in the narrative recital of the facts, to which we have referred, which, on the face of it, do focus on the Claimant's conduct as opposed to his mental state, caused by or contributed to by mental illness if that be the case, or medical factors, if that be the case.
36. In our judgment whilst that is, strictly speaking, accurate in terms of the narrative, it cannot amount to an answer, either whole or in part, to the main complaint which the Claimant makes. It is clear that the Tribunal made findings of fact in relation to the events in Sydney, the views of Dr Langston's colleagues about that, and the views taken by Mr Williams about him and the manifestations of his mental state immediately upon his return. So concerned were they all about the medical condition of Dr Langston that it was no surprise that he obtained a psychiatric report nor that it was referred to the Respondent's medical advisor, nor that he sought two further reports from his GP, nor that the medical advisor of the Respondent submitted a full and detailed report to the decision taking meeting of 19 July. In that report, the Respondent's own medical advisor made it perfectly clear that one possible explanation for the behaviour, with which they were all concerned, was an acute transient psychotic disorder secondary to the stress Dr Langston was under at work. Furthermore, it was the possibility that there might be further similar episodes which informed the decision not simply to suspend his DV clearance, but to form the view that it was highly unlikely that he would ever get it back again.
37. The Tribunal in making its 100 per cent deduction, as it has recorded in paragraph 100 to 102, totally failed to address the well known and fundamental proposition which is that if it is proposed to reduce compensatory award on the grounds of contributory conduct, the Tribunal has to address the question, to what extent the contributory conduct relied on is within the control of the employee, or is blameworthy, or culpable. Had it done so in the context of the facts that it had found, in our judgment it could not properly have concluded that a 100 per cent reduction, or anywhere near it, was appropriate.
38. Similarly, the Tribunal, considering the possible reduction of the basic award pursuant to section 122(2) on the grounds that it would be just and equitable to reduce it, failed at all to address the question of culpability or blameworthy conduct which, given the facts that it had found, had it been considered, would, in our judgment, have resulted in nowhere near 100 per cent reduction in the award.
39. At one stage, having regard to the detailed findings of fact made by the Tribunal, we wondered whether there were sufficiently detailed findings of fact to enable us to perform the exercise which the Tribunal ought to have, but failed to, perform. We are persuaded by the stance taken by both Claimant and Respondent that we do not have the evidence necessary properly to enable us to conduct that exercise.
40. In our judgment, the Decision of the Employment Tribunal, in respect of the reduction by 100 per cent of both the compensatory award and the basic award, arose as a result of the Tribunal misdirecting itself in law and, therefore, cannot stand. That element of the Decision must, therefore, be overturned. We are not in a position to substitute our judgment for that of the Employment Tribunal. Therefore, this aspect of the case must be remitted to a Tribunal. We have considered whether it would be just and/or practical and/or sensible for it to be the same Tribunal panel. We note that it is now getting on for two years since the hearing, which took place in April 2008. We have already indicated that there were nine months from the date of the hearing to the date when the full written reasons were produced. There was then an attempt by Dr Langston to review the Decision, which failed, and we are now almost two years on from the hearing.
41. In addition, it is also plain from certain passages in the Employment Tribunal's decision that it may well be that Dr Langston does not have the greatest confidence in this particular Tribunal panel. It seems to us that the issues which we have identified are discrete and could, with proper case management, be dealt with within a relatively limited compass, both in terms of time and any further evidence which might be required. We doubt very much whether it would be practicable for the same Tribunal panel to be reconvened after this length of time. Furthermore, after this length of time, whatever memory the lay members would still have, they not having been so directly involved in the subsequent events, it is unlikely that they would have any great detailed memory after two years. Furthermore, it seems to us that, in the interests of justice, this case ought to be remitted to a differently constituted Tribunal for consideration of the issue whether there should be any deduction from either the basic or compensatory award and, if so, how much. That, therefore, is our order.