Appeal No. UKEAT/0239/11/CEA
EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
At
the Tribunal
On
9 August 2011
Before
HIS
HONOUR JUDGE RICHARDSON
MS G MILLS CBE
MR S YEBOAH
MR
J FREEMAN APPELLANT
ULTRA
GREEN GROUP LTD (IN CREDITORS VOLUNTARY
LIQUIDATION RESPONDENT
Transcript of Proceedings
JUDGMENT
SUMMARY
VICTIMISATION DISCRIMINATION – Protected disclosure
UNFAIR DISMISSAL – Automatically unfair reasons
The Tribunal erred in law in holding that words spoken at a
meeting by the Claimant did not amount to information for the purposes of
section 43B of the Employment Rights Act 1996. Cavendish Munro
Professional Risks Management v Geduld [2010] ICR 125 applied.
The Tribunal erred in law in considering that retirement
provisions within the Employment Rights Act 1996 and the Employment
Equality (Age) Regulations 2006 inhibited the Claimant’s claim under
section 103A (dismissal on grounds of protected disclosure) or of themselves
limited the compensation payable. Section 98ZD(2) and (3) of the Employment
Rights Act 1996 considered.
HIS HONOUR JUDGE RICHARDSON
1.
This is an appeal by Mr John Freeman
(“the Claimant”) against aspects of a judgment of the Employment Tribunal
sitting in Brighton (Employment Judge Warren presiding) dated 27 January 2011.
By its judgment the Tribunal upheld his claim that he had been constructively
and unfairly dismissed by his former employers Ultra Green Group Limited (“the
Respondent”); however, it rejected his claims that he had been subjected to
detriment and dismissal on the grounds of protected disclosure, and awarded him
only limited compensation because the Respondent complied procedurally with
statutory requirements relating to his retirement. It also rejected a claim
for pay when (on the Claimant’s case) he was available to work at home while
recuperating from an operation.
The background facts
2.
The Claimant was born on 19 July 1944;
accordingly his 65th birthday was 19 July 2009. He was employed by
the Respondent as a financial planner with effect from 1 March 2008 at a salary
of £60,000 per annum. On paper the Company had a retirement policy which
recognised the state retirement age; in fact, however, no steps were taken
prior to 19 July 2009 to retire the Claimant at what was his state retirement
age.
3.
The Respondent worked in the investment
field, specialising in investments relating to the environment. The Claimant
became concerned that he was being asked to prepare financial plans which were
grossly exaggerated. On 20 July 2009 at a meeting he said words to the
following effect
“The calculated return on investment is 4.66 as I have based the
financial model on the 100,000 hectares and I refuse to base it on 2 million
hectares as Tony Blakey has directed. To use the bigger area without proper
costing information and scrutiny will provide investors with false information
and would be misleading. I said that Tony Blakey will have to contact Neville
Burman and sort out the lack of additional financial information.”
4.
On 20 July the Respondent’s Mr Blakey
(who was, we are told, the “Executive Chief Executive”) wrote an email (which
the Tribunal did not cite in its reasons, but may be thought to be of some
significance):
“John
Judging from your refusal to create the model for Hannah (4.66
return is not what we asked for) and your suggestion that I should solve the
problem on Russia, you are too important to do the things I want now.
I guess I need to find another analyst ....”
5.
Only after this did the Respondent
institute a procedure to dismiss the Claimant for retirement. By letter dated
18 September the Respondent purported to terminate the Claimant’s employment by
reason of retirement with effect from 18 March 2010. The Claimant, however,
resigned on 6 October, terminating his employment with effect from 5 January
2010.
The Tribunal’s reasoning on
dismissal and public interest disclosure
6.
The Tribunal dealt with these aspects
succinctly in paragraphs 9 and 10 of its reasons.
“9. Coming now to the public interest disclosure elements, we do
not consider that the words that Mr Freeman sets out at paragraph 24 of his
statement which we set out above in this decision amounts to a disclosure of
information which tends to show a breach or likely commission of a criminal
offence.
It is not a disclosure of information and we do not consider it
complies with the requirements of section 43B of the Employment Rights Act
1996.
Even if we had found that it was a public interest disclosure
the reason for Mr Freeman’s dismissal by the respondents by reason of retirement
is just what it says. The claimant accepts that the respondents went
scrupulously through the procedures required of them under the Age Regulations
and if an employer does that then the reason for dismissal is retirement and an
Employment Tribunal cannot look behind that. It is clear having gone through
that procedure then the reason was retirement and it is not open to the
Tribunal to find that it was any other reason. Even if we had found there was
a public interest disclosure dismissal would not have been unfair under section
103(a) of the Employment Rights Act.
10. Turning now to the unfair constructive dismissal, we accept
on the evidence from the claimant that pressure was being put on him to create
financial models that were inaccurate and which over stated the potential
benefit which investors were likely to obtain were they to invest in the
respondents projects. That we find amounts to a breach by the employer of the
implied term of trust and confidence, so entitling the claimant to terminate
his employment.”
7.
The Tribunal proceeded to assess
compensation for the period of 39 days after 5 January 2010. This was
appropriate (allowing for some unpaid leave which the Claimant was intending to
take) if the Claimant’s loss was restricted to 18 March 2010. In his witness
statement for the Tribunal, however, the Claimant had claimed compensation
substantially beyond that date, on the basis that it had always been intended
to employ him for longer.
Was there a disclosure of
information?
8.
On behalf of the Claimant Mr Andrew
Watson of the Free Representation Unit first submits that the Tribunal was
wrong to hold that the Claimant had not made a disclosure of information for
the purposes of the public interest disclosure provisions of the Employment
Rights Act 1996. We agree with him. Our reasons are as follows.
9.
Section 43B(1), so far as relevant,
provides –
“(1) In this Part a ‘qualifying disclosure’ means any disclosure
of information which, in the reasonable belief of the worker making the disclosure,
tends to show one or more of the following –
(a) that a criminal offence has been committed, is being
committed or is likely to be committed,
(b) that a person has failed, is failing or is likely to fail to
comply with any legal obligation to which he is subject.”
10.
Section 43L(3) provides –
“(3) Any reference in this Part to the disclosure of information
shall have effect, in relation to any case where the person receiving the
information is already aware of it, as a reference to bringing the information
to his attention.”
11.
In Cavendish Munro Professional
Risks Management v Geduld [2010] ICR 125 the Appeal Tribunal (Slade J
presiding) pointed out that the statutory provisions drew a distinction between
the mere making of an allegation (not covered by the public interest disclosure
legislation) and the provision of information (which is). A helpful
illustration was given. She said:
“Further, the ordinary meaning of giving “information” is
conveying facts. In the course of the hearing before us, a hypothetical was
advanced regarding communicating information about the state of a hospital.
Communicating “information” would be: “The wards have not been cleaned for the
past two weeks. Yesterday, sharps were left lying around.” Contrasted with that
would be a statement that: “You are not complying with health and safety
requirements.” In our view this would be an allegation not information.”
In that case the Claimant relied
on a solicitor’s letter written on his behalf; but the letter contained nothing
which could be described as information.
12.
In this case the Tribunal said that there
was no disclosure of information. We have no doubt that the Claimant made a
disclosure of “information”. He stated that he had based the financial model
on 100,000 hectares; that Mr Blakey had directed him to base it upon 2,000,000
million hectares; that he had refused to do so; that there was no proper
costing information or scrutiny for the basis which Mr Blakey directed him to
use; and that to use that basis would provide investors with false information
and would be misleading. The Tribunal’s view appears to be that this was a
mere allegation. We do not think that view is tenable.
13.
If the Tribunal had any other reason for
holding that the disclosure of information did not fall within section 43B(1),
it has not articulated it and we cannot see what it was.
The impact of retirement
14.
The Tribunal seems to have thought that,
since the Respondent operated retirement provisions derived from the Employment
Equality (Age) Regulations 2006 (“the Age Regulations”), the Claimant was
unable to rely on section 103A of the Employment Rights Act 1996 and
that the Claimant’s compensation was limited to the date of retirement. Mr
Watson submits that the Tribunal was wrong in this respect; and we agree with
him.
15.
The Age Regulations (now in effect
repealed and replaced by the Equality Act 2010) inserted at the relevant
time a series of provisions into Part X of the Employment Rights Act 1996.
These provisions are lengthy and labyrinthine; we hope we will be forgiven for
not setting them out extensively in this judgment. They are no longer in
force.
16.
Under those provisions retirement is
taken to be the only reason for dismissal in certain circumstances where
dismissal is at or after the age of 65 or a normal retirement age: see, for
example, section 98ZB(2), section 98ZD(2) (which appears most apposite in this
case) and section 98ZE(4). If retirement is taken to be the reason for
dismissal, and certain procedural requirements have been satisfied, the
employee will not be regarded as unfairly dismissed: see section 98ZG. These,
we think, must have been the provisions which the Tribunal had in mind.
17.
However, none of those provisions apply
in this case. This is because those provisions apply only where the contract
of employment terminates on the intended date of retirement. In this case it
did not. The intended date of retirement was 18 March. The contract
terminated by reason of constructive dismissal before that date. In such a case
retirement shall not be taken to be the reason for dismissal: see section
98ZB(3), section 98ZD(3) (which appears most apposite in this case) and section
98ZE(5).
18.
There was, in our judgment, nothing in
the retirement provisions to prevent the Tribunal from dealing normally with
this case. It could and should have considered section 103A (see generally as
to the relationship between section 98 and section 103A Kuzel v Roche
Products Limited [2008] ICR 799).
19.
Nor was there anything in the retirement
provisions which necessarily required the Tribunal to restrict the award of
compensation to the date of intended retirement given by the Respondent. The
Tribunal should have awarded such compensation as was just and equitable. If
the Respondent subjected the Claimant to detriment and dismissal by reason of
his protected disclosure by imposing retirement provisions when they would not
otherwise have been imposed then the Tribunal was certainly not bound to limit
compensation to the date of retirement.
20.
Mr Watson would, if necessary, have
sought leave to amend the Notice of Appeal to argue that the retirement
provisions ought to be read down as being incompatible with the rights of the
Claimant under article 10 of the European Convention. In view of our conclusions
the application to amend is unnecessary; Mr Watson has correctly not pursued
it.
Pay
21.
On 5 October 2009 the Respondent wrote to
the Claimant:
“In line with your contract of employment we would like you to
work from the Brighton office twice a week commencing on 22nd
October 2009. We would suggest that for that week you attend on 22nd
and 23rd October. For all future weeks, we would request that you
attend on a Monday and Friday of each week and you will need to produce a
weekly report of work carried out over the three days you work remotely.”
22.
In November 2009 the Claimant underwent a
knee operation. He was discharged home on 17 November 2009. As he told the
Respondent, the doctors confirmed that he would be unfit for travel for 6 weeks
but was fit to work from home. He did not attend work and was not paid.
23.
Part of the Claimant’s case is that he
was entitled to work remotely for 3 days per week; that he was therefore
entitled to be paid for those 3 days even if he was not fit to attend the office.
The Tribunal appears to have understood his claim to be a claim for sick pay,
and to be defeated by a provision in the contract of employment stating that
such pay was discretionary. But it was also his case that he was entitled to
payment for 3 days per week because he was ready, willing and able to work for
those three days. The Tribunal has not dealt with this part of the case. We
do not think the Claimant’s case is straightforward, but it depends on findings
of fact as to what happened in October, November and December 2009 which the
Tribunal has not made.
Conclusions
24.
The appeal is allowed. The matter will
be remitted to a freshly constituted Tribunal for the Tribunal to hear it in
accordance with this judgment.
