United Kingdom Employment Appeal Tribunal

(a) Mr Stephen Atkinson (“the First Respondent”) and Mr Nicholas Marrison (“the Second Respondent”) had been unfairly dismissed by the Appellant;

(b) each Respondent through his own misconduct had contributed to their dismissal, such that it was just and equitable to reduce any compensation awarded to each of them by 60% in respect of both their basic and compensatory awards; and that

(c) each Respondent had been dismissed in breach of his contract of employment when he was summarily dismissed without notice.

The Decision of the Employment Tribunal

(a) The appellant is a large national haulage and logistic company with some 30,000 employees of whom approximately 6,500 were drivers;

(b) The First Respondent had been employed by the Appellant as a driver for 19 years and the Second Respondent had been employed for 9 years;

(c) They both worked out of the Hull Depot on a specialised haulage contract for Air Products, which required them to have in addition to the normal HGV licence, an ADR licence for this contract so as to enable them to carry dangerous loads;

(d) Both Respondents had good work records with the Appellant and each was aged more than 45 years of age;

(e) Under the statutory licensing regime laid down under the Road Traffic legislation, each HGV licence had to be renewed by its holder every five years from the age of 45 until the age of 65 and thereafter annually. This renewal entailed passing a medical test;

(f) The Appellant would pay for the medical test for their lorry drivers but  it would leave it up to the drivers to attend to the actual licence renewal while the Appellant itself arranged for the ADR licence to be renewed paying all the fees involved and providing the necessary specialist training;

(g) The Driver and Vehicle licence regimes were operated by the DVLA while the Operator’s licence, which was required by the Appellant in order to run its haulage company was issued by VOSA;

(h) In order to ensure compliance with the necessary regulatory standards, the Appellant audited their drivers’ licences every six months or so, because experience showed that some drivers might have acquired points driving their own vehicles, which thereby potentially put their HGV licences at risk.  So the Appellant required its drivers to produce both their counterpart and photo-card licences to their depot managers every six months;

(i) During one such routine check in June/July 2009, it was revealed that two of the drivers at the Hull depot had failed to renew their HGV licences. In the case of the First Respondent, the renewal had fallen due in June 2009 and so he had driven without a licence for the previous month or so, while in the case of the Second Respondent, the renewal had fallen due in January 2009 and so he had therefore been driving illegally without a licence for the previous five months;

(j) Both Respondents were horrified to discover that their licences had lapsed and they immediately accepted first that it was their fault and second that it had been their responsibility to have their licences renewed. The Respondents were both suspended as they could not be allowed to continue to drive without their proper licence.  Both Respondents put arrangements in place to apply for their licences to be renewed and this entailed attending the appropriate medical;

(k) The Appellant subsequently considered it appropriate to hold investigatory meetings with both drivers so as to establish the basic facts and their suspension was continued with both of them being invited to attend disciplinary meetings;

(l) At the disciplinary meetings, both the Respondents accepted their responsibility for their misconduct in failing to get their licences renewed and they urged the Appellant to exercise leniency. Mrs Westley, who conducted the disciplinary hearings on behalf of the Appellant, listened carefully to the points advanced and she then decided in the light of “the potentially serious adverse impact” [6] to the Appellant of the Respondents’ conduct, the dismissal was justified;

(m) The Respondents appealed and at the appeal hearing before Mr Taylor, the Respondents advanced an argument based on a precedent relating to a Mr Preston, who had made a similar error some six years earlier when he had allowed his licence to lapse. When this matter came to light, the relevant Depot Manager of the Appellant simply contacted the DVLA informing them of the situation and asking them to expedite the renewal of Mr. Preston’s licence.  In the meantime, the Depot Manager had sent Mr Preston on holiday, because he could not continue to drive his lorry until his licence was renewed.  Mr Preston returned to lorry driving once his licence came through and no disciplinary action of any type was taken against him;

(n) Mr Taylor was not persuaded that this was an appropriate precedent, but he took the view first, that it had happened six years before when the regulatory regime was somewhat laxer than the applicable regime in 2009 and second, that in any event the Depot Manager did not have the authority to act as he did at the time.  Mr Taylor researched his own precedents and with the assistance of the Appellant’s Human Resources Department, he discovered three other cases of lorry drivers, who lost their HGV licences and who were then dismissed; and

(o) Mr Taylor felt this was a persuasive indication of the appropriate precedent to be followed in relation to both Respondents and he therefore upheld Mrs Wesley’s dismissal of the respondents.

The Proceedings before the Employment Tribunal

“(4) [In any other case 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”

(i)    It was a criminal offence to drive without a licence as both Respondents knew and that driving without a licence could also potentially invalidate the Appellant’s insurance policy;

(ii)  “The consequences of [a respondent] driving a lorry loaded with dangerous goods as in this case but without insurance are horrific to contemplate” ([9]);

(iii)          There were also potentially serious consequences for the Appellant commercially because if the Regulators were minded to take action over the breach caused by an employee driving without a HGV licence, as such conduct could jeopardise the Appellant’s Operator’s licence and although this was a regional license, it affected six other contracts as well as the particular contract for Air Products on which the Respondents were engaged;

(iv)Furthermore, if it became known that employees of the Appellant had been driving lorries without having valid HGV licences, as it would have if the Regulator took some form of regulatory action against the Appellant, then news of such a development would damage the Appellant’s standing in an increasingly competitive market because the Appellant competes nationally with other haulage companies for large contracts.  For those reasons, the reputation of the company for complying strictly with the regulatory requirements was important; and that

(v)  The good long service record of each of the Respondents with the Appellant and their good records whilst employed by it were taken into account by the Appellant’s relevant decision-makers but they concluded both at first instance and on appeal that dismissal of the Respondents was called for.

“there was no suggestion that VOSA were considering moving the appellant from the current green light status, which it then enjoyed to an amber status, let alone to red on the VOSA warning system” [17].

“Nor were we told that there had been any change in the regulatory regime relating to the procedures for renewing drivers’ licences, or the severity with what was viewed, as opposed to a tighter scrutiny of the Operator’s licence more generally”. [18]

“23. The range of reasonable responses test must have some limits, otherwise it would amount to a blanket immunity for employers dismissing in these circumstances.  Those limits are widely set.  Management is given considerable leeway by the test.  The hurdle for claimants is a high one.  In our view, no reasonable management weighing the character of the misconduct against the actual risk and consequences to the company could have come to this decision.  In reaching that decision we are not identifying the limits of the band, we are simply saying that this decision falls outside it.  We are aware of the danger in reaching our decision that we have fallen into the trap of deciding what we would have done in the circumstances; so far as we can, we have consciously reminded ourselves of that danger and guarded against it.”

The submissions

(A) On the issue of whether the Respondents were unfairly dismissed, the Employment Tribunal failed to consider properly the crucial question which was whether the decision of the Appellant to dismiss the Respondent fell within one of the reasonable range of responses for the Appellant in dealing with the Respondents as it erred in considering as decisive or in attaching too much weight to:-

(i)    the failure of the Respondents to renew their licences had actually no adverse effect on the Appellants while regarding as unimportant the accepted fact that such failures had the potential for causing very serious problems and financial losses for the Appellant (“The Potential Risk Issue”);

(ii)  the case of Mr Preston and incorrectly regarded the Appellant’s treatment of him as imposing the accepted tariff (“The Tariff Issue”); and

(B) Its decision to find the Appellant had unfairly dismissed each Respondent was perverse;

(C) If the Respondent had been unfairly dismissed, the Employment Tribunal, should have found each Respondent 100% to blame; and

(D) In respect of the claim for wrongful dismissal, the Employment Tribunal should have found that the Respondents were guilty of serious misconduct and then decided that the Appellant was entitled to dismiss the Respondents summarily or alternatively its decision was perverse (“The Wrongful Dismissal Issue”).

[14] “The weight to be attached to any evidence in any case is a matter for the Tribunal determining the facts. It can never be for an appellate Tribunal concerned only with errors in law, to take upon itself the task of deciding what weight should be attached to particular facts.”

“listened carefully to the points advanced, weighed them and decided that given the potentially serious adverse impacts for the company dismissal was justified” [7].

“your actions, whilst you claim as being a genuine mistake could have amounted to serious repercussions on the company and the general public.  For example the vehicles you were driving would have been uninsured for use, due to the fact that you did not have a valid licence had you been involved in a serious accident, then the worse case scenario your actions could have resulted in Corporate Manslaughter against yourself, individual senior managers within [the appellant] and the company as a whole.  Also had you been caught, the company’s Operators Licence would have been at risk which could have put the future of the company and all of its employees in jeopardy.  This was a fundamental breach of statutory requirements and goes against the whole ethos of the company and the logistics industry as a whole, all of which you are fully aware of”.

“This was not a major incident for the company. No regulator did anything as a result.  No client was inconvenienced to any extent.  The company’s reputation was not put in jeopardy.  On the facts known to management at the time of dismissal, the company had previously taken no action against a driver in directly comparable circumstances, Mr Preston, with no adverse consequences following at all.  The adverse consequences feared were entirely speculative.  Management took no steps for example by contacting VOSA, to find out whether they were as bad as they feared.  The comparators relied on at the appeal stage to justify dismissal were in quite different categories.  We find that this employer acted unreasonably in treating this admitted serious misconduct as a sufficient reason for the dismissal.  We are fortified in that conclusion when we consider the second limb of Section 98(4), whether that decision is in accordance with equity and the substantial merits of the case.  This is not a case where the substantial merits call for an all or nothing approach.  It is obvious from the outset that the Claimants have contributed to a significant degree to their dismissal; but is their innocent mistake, serious and stupid as it was, sufficiently serious to justify their dismissal when it has had no adverse effect on the company?”

“ …In our view, no reasonable management weighing the character of the misconduct against the actual risk and consequences to the company could have come to this decision.”

“…(4) contravention of statutory obligations, or the rules of their company..

(iv) wilful or seriously negligent behaviour causing ..potential damage to the property of the company its customers or third parties.”

The tariff issue

“…“24. … Firstly, it may be relevant if there is evidence that employees have been led by an employer to believe that certain categories of conduct will be either overlooked, or at least will be not dealt with by the sanction of dismissal. Secondly, there may be cases in which evidence about decisions made in relation to other cases supports an inference that the purported reason stated by the employers is not the real or genuine reason for a dismissal. …Thirdly,… evidence as to decisions made by an employer in truly parallel circumstances may be sufficient to support an argument, in a particular case, that it was not reasonable on the part of the employer to visit the particular employee's conduct with the penalty of dismissal and that some lesser penalty would have been appropriate in the circumstances.”

“25 …We should add, however, as counsel has urged upon us, that Industrial Tribunals would be wise to scrutinize arguments based upon disparity with particular care. It is only in the limited circumstances that we have indicated that the argument is likely to be relevant and there will not be many cases in which the evidence supports the proposition that there are other cases which are truly similar, or sufficiently similar, to afford an adequate basis for the argument. The danger of the argument is that a Tribunal may be led away from a proper consideration of the issues raised by s.57(3) of the Act of 1978. The emphasis in that section is upon the particular circumstances of the individual employee's case. It would be most regrettable if Tribunals or employers were to be encouraged to adopt rules of thumb, or codes, for dealing with industrial relations problems and, in particular, issues arising when dismissal is being considered. It is of the highest importance that flexibility should be retained, and we hope that nothing that we say in the course of our judgment will encourage employers or Tribunals to think that a tariff approach to industrial misconduct is appropriate. One has only to consider for a moment the dangers of the tariff approach in other spheres of the law to realise how inappropriate it would be to import it into this particular legislation.”

“35…ultimately, the question for the employer is whether, in particular case dismissal is a reasonable response to the misconduct proved. If the employer has an established policy applied for a similar misconduct it would not be fair to change the policy without warning.  If the employer has no established policy but has on other occasions dealt differently with misconduct properly regarded as similar, fairness demands that he should consider whether in all the circumstances, including the degree of misconduct proved more serious disciplinary action is justified.”

The wrongful dismissal issue

“29. In this case, on the employer’s evidence, the breach had occurred through an innocent mistake by the employee.  As we have found above the employees had nothing to gain by that mistake and everything to lose.  In those circumstances we cannot see any intention on the part of the employees to disregard the fundamental obligations of their employment.  It was a serious breach but one which could be remedied relatively easy and quickly, though it would no doubt inevitably lead to a period of suspension until their licences were regained.  In those circumstances we find that this was not a fundamental breach of contract.  It may well in contract law have entitled the employer to dismiss.  Indeed, the employer always has the right to dismiss on notice; but these should have been dismissals on notice.”