United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR JAMES LADDIE (of Counsel) Instructed by: Messrs Dundas & Wilson North West Wing Bush House London WC2B 4EZ
For the Respondent	MR MATTHEW BOYDEN (of Counsel) Instructed by: Cummins Solicitors Gateway House Penman Way Grove Business Park Enderby Leicester LE19 1SY


 


SUMMARY

UNFAIR DISMISSAL – Reasonableness of dismissal

Claimant dismissed for redundancy following a reorganisation, having been interviewed for, but not offered, an alternative job – Tribunal holds dismissal to have been unfair because there was inadequate consultation and because the criteria applied in interviewing for the potential alternative role were unsatisfactory, in particular because they were "subjective".

HELD, allowing the appeal, that there was no basis for the finding of inadequate consultation; and that the Tribunal's criticisms of the interview process for the alternative role were not such as to render the dismissal unfair (observations in Morgan v Welsh Rugby Union [2011] IRLR 376 applied) and that it had wrongly substituted its own judgment of the Claimant's suitability for the role for the Appellant's.


 


THE HONOURABLE MR JUSTICE UNDERHILL (PRESIDENT)

INTRODUCTION

1. This is an appeal against the decision of an Employment Tribunal sitting at London South, chaired by Employment Judge Tsamados, that the Claimant was unfairly dismissed and awarding him £64,722 by way of compensation. The Tribunal sat over two days in September 2010. The Judgment and Reasons were sent to the parties on 10 November. We will refer to the parties as the Claimant and the Appellant. The Appellant has been represented before us by Mr James Laddie and the Claimant by Mr Matthew Boyden, both of counsel. Mr Boyden, but not Mr Laddie, appeared below.

THE FACTS

2. The Claimant started employment with the Appellant on 15 January 2008. He was initially employed as "Head of Reseller – Print", with responsibility for two business channels – Office Automation ("OA") and IT. In January 2009 the Appellant decided to split the Claimant's job between the two channels. He became "Head of OA Reseller" and lost responsibility for IT. The Appellant contended below that the split was as a result of dissatisfaction with the Claimant's performance; but the Tribunal, which heard evidence from his then manager, Geoff Slaughter, who was very complimentary about the Claimant's performance, found otherwise. The Claimant was one of four senior managers who reported to the Head of Print.
3. In the autumn of 2009 the Appellant initiated a reorganisation of its Print Division. This was planned to occur in two stages. First, the four senior roles referred to above would be combined into a single position of "Head of Sales – Print". At the next stage, and under the leadership of the new Head of Sales – Print, several new managerial roles were to be created, reporting to him. There was also to be a reorganisation of the sales team itself. The decision was communicated to the Claimant and the other affected managers in individual meetings with Mr Long, the Head of Print – Europe, and Ms Bean, a Senior HR Adviser, on 29 October. The same day Ms Bean wrote to the Claimant as follows:

"Dear Keith

Potential Redundancy

I am writing to you following our meeting today on behalf of Samsung Electronics UK Ltd (the Company) to confirm our discussions.

As you are aware, in order to remain competitive within a challenging trading environment, it is necessary for the Company to ensure its costs and headcount are kept to the lowest practical level. Consequently, it is currently proving necessary for the Company to consider critically possible headcount and cost reductions on an ongoing basis and therefore to restructure the entire sales team for SEUK Print.

I regret that one of the possible consequences of this perpetual review process is that your current position has been identified as one which the business may be unable to justify in the current climate. It is with regret therefore that we have to confirm that we are considering making your current position redundant.

The proposal that we discussed in our meeting today, is to merge the three Head of Department manager roles into one new role, Head of Sales – Print. With that in mind, we would like to invite you to apply and be interviewed for this new role. An interview has therefore been scheduled for Thursday 5^th November 2009 at 16.00. This interview will be held in Graham Long's office and the interview will be held with Graham and David Diamond the HR Manager.

Naturally we will seek to respond to any questions you may have before this interview and it may be that we will need to meet more than once. However, we currently envisage the period of consultation ending on 13^th November 2009 when a decision will be made as to the successful applicant.

Should you choose not to apply for this new role, following the period of consultation you are welcome to take an Account Manager position on the same terms and conditions.

Please not that this letter does not constitute notice of redundancy. It is intended to advise you that, as was discussed during out meeting today, your employment is potentially at risk.

During the period of consultation, should you require some time to prepare for the interview, please let me know and this will be given due consideration.

If you have any questions please do not hesitate to contact me on … "

4. The Claimant applied for the job of Head of Sales – Print. The interview took place, as scheduled in the letter, on 5 November 2009. He made a presentation and was asked questions. He was scored according to the ten competencies which were routinely used by the Appellant in the annual assessment process. These were: creativity, challenge, speed, strategic focus, simplicity, self-control/empowerment, customer focus, crisis awareness, continuous innovation and teamwork/leadership. A score of at least 75 was required.
5. The Claimant was not successful. The appointee was a Mr Mark Porter. He initiated the second stage of the reorganisation. There was a meeting on 19 November 2009 for all affected staff, which included the Claimant. The proposed new structure was explained and all those attending were given packs which included job descriptions and person specifications for all the positions in the new structure. A copy of Mr Porter's presentation was circulated following the meeting.
6. On 23 November the Claimant e-mailed Joanna Bean to apply for one of the new roles, Business Region Team Leader. He believed that that role was almost identical to what he had been doing as Head of OA Reseller and that he was accordingly the obvious choice. He stated that he did not wish to apply for any other role. Ms Porter and Ms Bean told all the applicants for new jobs that they would be available on a "drop-in" basis for discussion about the new role on 20 November and 2 December; but the Claimant chose not to avail himself of that opportunity.
7. There was one other candidate for the Business Region Team Leader role, Mr Bullock. Both he and the Claimant were interviewed on 3 December. They were scored on the same basis as for the Head of Sales – Print post. Neither candidate came close to the required score of 75: the Claimant was scored 55 by Mr Porter and 62 by Ms Bean. The Appellant decide to look outside and shortly afterwards engaged a Mr Offin on a consultancy basis. It is convenient to mention at this point that it was part of the Claimant's case before the Tribunal that his dismissal – and more particularly his failure to get the job of Business Region Team Leader –was engineered in order to get the job for Mr Offin, who was said to be a friend of Mr Porter. The Tribunal rejected that case, finding that "the appointment of Mr Offin was above board" (see Reasons, para. 83).
8. The Claimant was not told the outcome at once because the Appellant wanted to announce all the new appointments together. But Mr Porter and Ms Bean met him on 17 December, with the intention not only of telling him the outcome but giving him feedback. There is some dispute as to how exactly the meeting went but there is no dispute that he was given a list of other vacancies and encouraged to consider applying for them. He was handed a letter (dated the following day) confirming the decision and that he was consequently at risk of redundancy. Details of his redundancy entitlement were given but he was assured that no decision to dismiss had been made and he was asked to consider the list of available vacancies and get back to Ms Bean by 24 December.
9. The Claimant asked to see Ms Bean on 23 December. He handed her a letter challenging the decision not to appoint him as Business Region Team Leader or to give more detailed feedback. He said that he did not wish to make any decision until he had a response. Ms Bean said that she could not respond until Mr Porter was back from leave. She and Mr Porter met the Claimant on 11 January 2010. On 13 January she wrote to the Claimant at some length addressing the points made in his letter of 23 December, which had of course also been discussed at the meeting. The letter explained the basis of the decision not to appoint him. It also notified him that since he had applied for no other role he would be dismissed for redundancy with effect from 31 January. The Claimant wrote on 18 January making further points but his dismissal proceeded.

THE TRIBUNAL'S REASONS

10. The Tribunal started by considering whether the Appellant had shown that there was (to use the usual shorthand) a redundancy situation of the kind described at section 139 (1) (b) of the Employment Rights Act 1996. It professed some difficulty with the detailed analysis because of the two-stage process which the Appellant had adopted; but it eventually concluded (see para. 78 of the Reasons) that "the redundancy occurred at stage 1 of the reorganisation and … stage 2 was merely the process of offering the Claimant alternative employment". We are not sure, with respect, that the distinction is quite as problematic as the Tribunal found it. A decision to dismiss for redundancy will necessarily involve (a) the original decision to remove the employee from his job (either because the job itself is being dispensed with or because numbers doing that job are being reduced and he is selected) and (b) a separate decision to dismiss, which involves a decision that no alternative employment is available. Since the end product is dismissal, the process as a whole has to be fair – though the particular questions at each stage are inevitably different. Mr Laddie submitted that the Tribunal attached undue importance to the distinction between "stage 1" and "stage 2": we return to this below.
11. At paras. 79-80 of the Reasons the Tribunal reminded itself of the well-known guidelines in Williams v Compair Maxam Ltd [1982] IRLR 83. At paras. 82-83 it made a finding, unchallenged before us, that the Claimant's dismissal was indeed due to the redundancy situation which it had found – and specifically, as already noted, that it was not engineered in order to find a job for Mr Offin.
12. The core of the Tribunal's reasoning, so far as concerns this appeal, is at paras. 84-112 of the Reasons, where it considers the reasonableness of the decision to dismiss the Claimant under three headings – "Failure to Consult"; "Selection"; and "Alternative Employment". We take them in turn.
13. Failure to Consult. This is dealt with at paras. 84-90. Paras. 84-87 contain some general discussion of the requirements of adequate consultation. Mr Laddie had some criticisms of this, and in particular of the references which the Tribunal introduced to collective consultation, which were irrelevant in this context; but the discussion is generally unexceptionable. The only paragraphs that address the facts of the case are 88 and 90. In para. 88 the Tribunal finds that "at stage 1 of the reorganisation … the consultation process undertaken was not fair or adequate". It continues:

"Mr Long identified what he wished to do in late September early October 2009, there was a meeting on 29^th October 2009 and a letter sent out on that date (R1 page 47-48). This provided little more than a warning to the Claimant of what was going to happen. The 'consultation' is only in the sense of identification of the management decision already made and what will then happen. But it is informing rather than consulting. This is not consultation as identified within the case law and there is no communication at this stage beyond the meeting and the sending of that letter. In particular there is no consultation as to the approach to be taken beyond this stage or as to the adoption of the selection criteria to be used at the interviews. To put it in context, the meeting took place and the letter was sent on 29^th October, the interviews for the Head of Sales – Print role took place on 5^th November and 'consultation' ended on 13^th November 2009, it after the interview dates."

Para. 90 reads as follows:

"At stage 2, which we have decided falls beyond our remit as to being a redundancy situation, the evidence we heard sounded more like a process of on the face of it meaningful consultation in that meetings were to be held with individuals. However, the Claimant did not attend the consultation meetings and beyond the evidence we heard at the hearing which was limited we were not provided with copies of any of the documentation referred save for an e-mail dated 16^th November 2009 at R1 page 49 and an e-mail dated 20^th November 2009 at R1 page 50, ie we did not see the 'pack of documentation' referred to at paragraph 42 of Ms Bean's witness statement, any documentation relating to the individual consultation meetings at paragraph 44 of her witness statement and the slides for the 'presentation' referred to within paragraph 18 of Mr Porter's witness statement and referred to as attached to the e-mail at page 50. We therefore cannot reach a view that this consultation provided any more information than that at stage 1."

14. Selection. This is dealt with at paras. 91-93. The discussion again distinguishes sharply between "stage 1" and "stage 2". The Tribunal accepts that the Claimant's non-selection for the job of Head of Sales – Print at stage 1 could not be challenged, noting that he himself accepted that he was not the best candidate. It declined to consider the position at stage 2 because that was concerned not with redundancy but with the offer of alternative employment. We should note, however, that the Tribunal advanced as a proposition that an employer can only fairly select for redundancy on the basis of criteria which can be "objectively measured".
15. Alternative Employment. This is dealt with at paras. 94-109. The Tribunal directed itself that in a case like the present, where there was more than one candidate for an alternative role, it was not appropriate to apply precisely the same criteria as in judging selection for the original redundancy, but that nevertheless

"… there has [to] be a degree of objectivity as to the criteria and their application otherwise the process would be unreasonable, applications must be considered properly and the exercise carried out in good faith …"

(para. 97). Applying that approach, it said that it would not itself have allowed other members of the team to apply for the job of Business Region Team Leader because it was so close to the Claimant's previous role; but it acknowledged that the decision was potentially reasonable and that it could not substitute its own view (para. 100). It then proceeded at paras. 101-109 to make a number of criticisms of the process which had been followed in assessing the Claimant's (and Mr Bullock's) suitability for that job. These are summarised at para. 110 as follows:

"110. So in summary we find that the Respondent:

110.1 Used core competencies although [it] would have been better to have used the person specification because the core competencies [were] better suited to the appraisal process

110.2 It did not define those core competencies in advance beyond the headings

110.3 The panel members did not have a common definition of the criteria beyond the headings giving rise to our serious concerns as to their objectivity

110.4 The panel members say they did not consider past performance so as to rule out subjectivity

110.5 However at interview it was apparent that past performance was considered but not in an objective or reasonable way

110.6 At the appeal stage it was expressly clear that the past performance was considered and could have changed the outcome had it been considered in a reasonable manner."

The particular criticisms there made need to be understood by reference to the points made in the preceding paragraphs, but it will be more convenient to address those points when we consider the grounds of appeal.

16. Thus, as the Tribunal goes on in para. 112 to state explicitly, the decision to dismiss the Appellant was held to have been unfair on two bases – (a) inadequate consultation and (b) flaws in the selection process for the job of Business Region Team Leader.
17. The question of remedy is dealt with at paras. 113-125. The compensatory element in the award of £64,722 was arrived at by accumulating 24 weeks' loss of earnings up to the date of the decision (on top of eleven weeks' pay already paid in lieu of notice) and a further 26 weeks' future loss. It is common ground that the Appellant had in submissions contended that there should be no, or no substantial, award for loss of earnings because the outcome would have been the same even if a fair procedure had been followed. The Tribunal did not address that argument. Reasons were sought under the Burns/Barke procedure. On 27 April 2011 the Employment Judge responded:

"The Tribunal's conclusion is not expressly set out in our Judgment, but nevertheless flows from paragraphs 94 to 112 thereto and in particular paragraph 108. Our conclusion was that given the selection process for alternative employment was so fundamentally flawed, no Polkey reduction was to be applied. The Claimant was bound to have been successful in obtaining the position of Business Region Team Leader had a reasonable selection process been adopted and applied. This was the basis on which we then went on to calculate the compensatory award."

THE APPEAL

18. We consider in turn the two bases on which the Tribunal held the Claimant's dismissal to be unfair.

(A) ADEQUACY OF CONSULTATION

19. Mr Laddie's overarching submission is that

"… the ET created a false distinction between "stage 1" and "stage 2" of the redundancy process and thereby failed to consider whether consultation, viewed in the round, was reasonable or adequate. The ET expressly disavowed any reliance upon "stage 2" consultation. Had the ET applied the law correctly, it would have considered the totality of the consultation before determining whether the dismissal was fair under ERA s.98(4)."

20. The first stage in the reorganisation consisted of the decision to remove the four jobs reporting to the Head of Print, including the Claimant's. The merits of the reorganisation as such were not a matter for consultation. What the Claimant was entitled to be consulted about was how it affected him. The Appellant relied on the meeting and letter of 29 October: see para. 3 above. The Tribunal held at para. 88 that that was inadequate because it constituted "informing rather than consulting". We cannot accept that that is a legitimate criticism. Certainly the letter, which reflected what the Claimant was told face-to-face, gave him information, but there is nothing wrong with that: giving information is the first stage in any consultation. But the Appellant went further. The Claimant was told not only what was happening, and why, but what his options were – namely, to apply for the new top job and, if unsuccessful, to apply for one of the new "Account Manager" roles. He was told when and where the interviews would be and offered time to prepare. He was encouraged to raise any questions. All that seems to us to be good consultation practice. The Tribunal does, however, have two more specific criticisms, namely (a) that the Claimant was not told what "selection criteria" would be used at the interview (that is, if he applied for the new job) and (b) that he was not consulted about "the approach to be taken beyond this stage". We do not regard those as valid criticisms. Taking them in turn:

(a) We start by observing that "selection criteria" is not quite the right language. This was not, as the Tribunal itself had noted, a situation where one or more of several job-holders was being selected for redundancy: rather, the Claimant's job was being abolished but he was being offered the chance to apply for a different job. However, the issue does not turn on terminology. The real question is whether it was unfair that the Claimant was not told in advance of the interview what scoring method would be used in assessing him against any other candidate. We cannot see that it was, and the Tribunal does not explain why it should be. The Claimant himself did not, either at the time or in his evidence to the Tribunal, complain of any unfairness in this regard.

(b) There was no need to consider at that stage the details of what would happen if the Claimant did not get the top job, i.e. beyond the fact that he would then be able to apply for one of the four new posts. He would need to be told more only if and when the situation arose.

21. The next stage in the process, as it affected the Claimant, was the opportunity to apply for one or more of the four new posts. As to that, we have set out at paras. 5 and 6 above what information and consultation were offered. On the face of it what the Appellant did seems fair and to have given the Claimant the information that he needed and the opportunity for further discussion. The Tribunal's criticism at para. 90 does not relate to the substance but is simply that it was not itself provided with the slides used by Mr Porter at the meeting on 19 November or with a copy of the pack. But that did not justify the conclusion that the information in question was inadequate. No such point was taken by the Claimant, and it is hard to see how it could have been since he chose not to attend either of the individual consultation meetings offered.
22. We accordingly do not accept that this basis for the Tribunal's finding of unfairness can be sustained.

(B) ALTERNATIVE EMPLOYMENT

23. We should start by setting out the principles applicable in considering the situation where a redundant employee is interviewed for an alternative position. We gratefully adopt the lucid summary of the relevant principles in the judgment of this Tribunal (HH Judge Richardson presiding) in Morgan v Welsh Rugby Union [2011] IRLR 376: see at paras. 23-36 (pp. 379-381). In that case it had been submitted, by reference to the earlier decision in Ralph Martindale & Co v Harris (UKEAT/0166/07), that "the selection criteria must at least meet some criteria of fairness" and in particular that they must be "objective". Judge Richardson made it clear that there were no such specific rules and that Ralph Martindale was not authority for any general principle. He also followed a number of earlier decisions that make it clear that the guidance given in the authorities about the procedures to be adopted, and the criteria to be applied, in selecting an employee for redundancy cannot be transposed to the process for deciding whether a redundant employee should be offered an alternative position: the two situations are different. He said, at para. 36:

"… [A] tribunal considering this question must apply s. 98(4) of the 1996 Act. No further proposition of law is required. A tribunal is entitled to consider, as part of its deliberations, how far an interview process was objective; but it should keep carefully in mind that an employer's assessment of which candidate will best perform in a new role is likely to involve a substantial element of judgment. A tribunal is entitled to take into account how far the employer established and followed through procedures when making an appointment, and whether they were fair. A tribunal is entitled, and no doubt will, consider as part of its deliberations whether an appointment was made capriciously, or out of favouritism or on personal grounds. If it concludes that an appointment was made in that way, it is entitled to reflect that conclusion in its finding under s. 98(4)."

Applying those principles, it was held that the employment tribunal had not in that case acted unreasonably in offering a post to an employee who it judged to be better able to fulfil the role than the claimant, notwithstanding that it had departed to some extent from the published interview process: that defect, of which the tribunal had been critical, could be taken into account in making the overall assessment of fairness required by section 98 (4) of the 1996 Act but it was not decisive.

24. Morgan had not been decided at the time of the decision of the Tribunal in this case. In its self-direction on the law it referred to Ralph Martindale at some length (Reasons para. 98). It is not clear precisely what conclusion it drew from it, but it quoted the phrase about "meeting at least some criteria of fairness" and recorded the decision as having approved the finding of the employment tribunal that the dismissal in that case had been unfair because the employer had "[dealt] with the re-selection criteria for the alternative employment in an entirely subjective way".
25. The Tribunal's reasons for its finding that the decision not to offer the Claimant the job of Business Region Team Leader was unfairly arrived at are summarised in para. 110 of the Reasons. The points there made essentially fall into two groups – 110.1-3, which principally criticise the "subjectivity" of the exercise, and 110.4-6, which concern the assessment of past performance.

(1) "Subjectivity"

26. The explicit point made at para. 110.1 is that the ten "core competencies" used to assess the Claimant for the role (see para. 4 above) were designed not for what was in effect a recruitment exercise but for the annual appraisal process. The Tribunal does not, however, say in terms – either in this sub-paragraph or in the preceding paragraphs which it summarises – why that makes them unsuitable for use in such an exercise. We understand the real criticism to be that the criteria were "nebulous" and liable to "subjective" interpretation, and that inadequate steps were taken to mitigate those deficiencies: that is the gist, in particular, of paras. 102-103. In this connection we should also note what the Tribunal says at para. 109, which reads as follows:

"Although we were told that after the presentation that standard questions were asked of each applicant, the questions were not provided to us and Mr Porter stated that he did not sit down with Ms Bean in advance to determine the answers. This gives rise to concerns as to how the answers could then be scored consistently or objectively. There were also questions arising from the presentation which of course would be customised for each candidate. Mr Porter said that the answers were all recorded in the assessment form and Ms Bean's notes. However these clearly did not set out in full the questions asked and the answers given. This was hardly a transparent process and gives rise to concerns as to its fairness."

27. We take first the reference to subjectivity. "Subjectivity" is often used in this and similar contexts as a dirty word. But the fact is that not all aspects of the performance or value of an employee lend themselves to objective measurement, and there is no obligation on an employer always to use criteria which are capable of such measurement, and certainly not in the context of an interview for alternative employment: cf. the observations of HH Judge Smith in Ball v Balfour Kirkpatrick Ltd (EAT/823/95) quoted in Morgan at para. 32 (p. 381). Given the nature of the Claimant's job, we see nothing objectionable in principle in his being assessed on "subjective" criteria. Although the Tribunal says that it would have been better to use the person specification as the basis of assessment we are unclear how that would have avoided subjectivity.
28. We see more force in the criticism that the particular criteria adopted were nebulous. We would be hard put ourselves to assign a clear meaning to some of the terms used in the assessment (itemised at para. 4 above). But lawyers must be wary of assuming that terms that look to them like mere management–speak have no meaning to their regular users. Most large modern businesses have adopted systems of appraisal, often with the active co-operation of employee organisations, which, it must be assumed, they find valuable but whose language would not score highly in an essay competition. Tribunals must not allow a disdain for such terminology to lead them into treating such systems as necessarily worthless.
29. If, therefore, the Tribunal was saying that these competencies should not have been used as the basis for assessing the Claimant's suitability for the job of Business Region Team Leader because they were subjective or vaguely expressed, we do not believe that the criticism is fair. But at the end of the day the real point is not whether our view about that is preferable to the Tribunal's. It is trite law that an employer is not to be held to have acted unreasonably merely because the tribunal thinks that another course would have been better: that is the vice of "substitution". The Tribunal does not go so far as to say that the use of the core competencies as the basis of assessment was unreasonable. It says only that the use of the person specification "would have been better". We note also that it says in para. 101 that the core competencies "to us were better suited to … internal appraisal processes". That is not a sufficient foundation for a finding that the process of considering alternative employment was unfair, and even less so given that this was not a redundancy selection exercise; and if and to the extent that the Tribunal intended to find that the use of the core competencies by itself rendered the dismissal unfair, that was illegitimate.
30. We are not, however, sure that that does indeed fairly reflect the Tribunal's reasoning. It may be that sub-para. 110.1 was not meant to be taken in isolation but was intended to lay the foundation for sub-paras. 110.1-2. In that case the real criticism is that, given the weaknesses of the core competencies as an assessment tool, they could only fairly be used if Mr Porter and Ms Bean had a common understanding as to their use. The underlying finding is at para. 101, which reads as follows:

"Reference was made to other documents relating to the performance appraisal scheme …, but there were no documents in relation to the use of these competencies for staff selection purposes. Ms Bean gave evidence that she had not sat down with Mr Porter before the interviews to define the criteria and there was no guidance for them as to their use. It was down to their own individual interpretation."

The Tribunal continued, at para. 102:

"The danger of such an approach is that it is all too easy for inconsistencies to occur and subjective considerations to arise. This is particularly so when using what appear to be nebulous criteria not spelt out and without having sufficient working knowledge of the candidates or more objective measures of assessment available."

31. We have no problem with the proposition that it is good practice for interviewers to discuss with one another before an interview the approach to be followed. It may well be sensible, as part of that process, for them to discuss what they understand by any specified assessment criteria. Likewise we can accept that it may be a good idea for interviewers to discuss in advance what would be "good" answers to the questions asked, as suggested in para. 109, though there will be limits to the extent to which such discussion can provide a complete uniformity of approach (even assuming that to be desirable). In a perfect world it may perhaps also be ideal, to pick up the point made in para. 109, be ideal for all questions and answers to be recorded in full – though we doubt whether the ideal is attainable in practice. But we cannot accept that failure to take these various steps will, of itself, render the interview decision – and still less any eventual dismissal – unfair, any more than the failings of process which were found in Morgan did. The fairness of a decision to dismiss in cases of this kind cannot depend on whether the minutiae of good interview practice are observed. In the present case, an arguable case of unfairness would only have been raised if it had been found, on the basis of proper evidence, that the failures in process identified had led to some serious substantial unfairness to the Claimant. Subject to the particular point considered below about assessment of past performance, the Tribunal made no such finding, and there seems to us no basis on which it could have done so. In fact we observe that the scores given to the Claimant by Mr Porter and Ms Bean, both factor-by-factor and overall, were pretty similar.

(2) Past Performance

32. We start by setting out in more detail the basis of the criticisms summarised at sub-paras. 110.4-6 of the Reasons.
33. The Appellant had said that it would not in interviewing for the four new roles consider "past performance", as demonstrated from annual appraisals. The Tribunal was critical of that decision. It held, at para. 103, that:

"it would have been reasonable, given the lack of direct experience of the Claimant by both Ms Bean and to a slightly lesser extent Mr Porter to have looked at those materials."

(Ms Bean had not worked with the Claimant at all. Mr Porter had done so only to a limited extent.)

34. The Tribunal believed that, despite the approach professed to have been adopted, Mr Porter and Ms Bean had in fact had regard to the Appellant's past performance, though not by reference to his past appraisals. At paras. 105-106 of the Reasons it identifies comments made in the interview notes which refer, implicitly if not explicitly, to the Claimant's performance in his previous role; and further indications are discussed in the first part of para. 108. It found that, since the interviewers did not consult past performance appraisals, those references could only have been based on Mr Porter's "rather limited involvement with the Claimant over the previous 5 months" and in particular on (a) a bad impression that he had formed of him in relation to a transaction with a customer called Danwood in which they had both been involved and (b) his belief that the Claimant had lost his responsibility for IT in the earlier split (see para. 2 above) because Mr Slaughter had been dissatisfied with his performance: see Reasons para. 105. As to the Danwood episode, the Tribunal heard evidence about this. In bare outline, the Claimant had consulted Mr Porter about the transaction in circumstances where Mr Porter believed it was unnecessary for him to do so: he thought that this showed that the Claimant was indecisive and unwilling to take responsibility. In the course of its factual findings the Tribunal held that the Claimant had been justified in the course that had been taken and that "there seemed to be no logical basis for Mr Porter's view" (Reasons para. 59). As to the split in the Claimant's earlier role, the Tribunal, which, as we have noted, heard evidence from Mr Slaughter, held that Mr Porter's belief was unfounded.
35. At para. 108 the Tribunal said:

"This anomaly is highlighted by the letter from Ms Bean in response to the Claimant's request that the Respondent reconsider its decision not to appoint within her letter to him dated 13^th January 2010 … . This paragraph indicates that past performance was considered and could have changed the outcome. But this was based on Mr Porter's own view and not hers. However, the letter contains no indication of how the Claimant's previous experience in a similar role had been considered beyond Mr Porter's own view that it was. Mr Porter did not work with the Claimant and only knew him for the previous 5 month period working within different departments and this was predominantly confined to the Danwood incident. If this view had been formed by looking at his previous experience by an examination of performance review and appraisal and possibly by speaking to Mr Slaughter, then it seems unlikely this would have resulted in the assessment made that the Claimant was not the best person for the job. Particularly so given that the only other candidate, Mr Bullock, had no management experience and no experience of OA. Indeed the consultant had a little or no experience of OA. We can judge this from the evidence given to us in the bundle which was available to the Respondent had they looked at it at the time. The Claimant had past experience in a similar role. He was doing the same job. He was in reality the best person for the job, given that there were only two candidates and the other person had other weaknesses. It did not help that Mr Porter had formed an unfounded view as to why the Claimant was moved from his original job to OA and as to the Danwood incident. However a consideration of his performance and appraisal would have assisted."

(Counsel agreed that the "however" at the beginning of the final sentence was redundant.) The reference to "the consultant" is to Mr Offin.

36. Mr Laddie submitted that that reasoning involved the Tribunal impermissibly substituting its own view for that of the Appellant not only about how to conduct the interviews for the post of Business Region Team Manager but also about what the outcome should have been. He also submitted that if the Tribunal did in fact mean to find that the Appellant's decisions were unreasonable (in the sense recognised in the authorities) such a decision involved a departure from the approach confirmed in Morgan. Mr Boyden in response submitted that the Tribunal was doing no more than its job of deciding whether the Appellant had acted reasonably, which inevitably involved it in expressing its own view; and it had reached a legitimate decision that it had not.
37. We have not found this part of the case altogether straightforward. There is force in Mr Boyden's point that a tribunal should not be convicted of substitution simply because it has expressed its own view about how the employer should have proceeded: if it is clear that expressing its own view is simply a step to answering the crucial question of whether the way the employer in fact proceeded was unreasonable, that is unexceptionable. But in the end we feel constrained to agree with Mr Laddie that the Tribunal here did cross the line, as of course we have found that it had already done in relation to the issue of the use of core competencies. The following points particularly weigh with us.
38. First, as regards para. 103 of the Reasons (see para. 33 above), we note that the Tribunal found that "it would have been reasonable" to use past performance appraisals, not – which is the relevant question – that it was unreasonable not to do so. We are reluctant to convict the Tribunal of substitution on what may be a mere verbal inexactitude, though it is a bad start. The real point, however, is that if the Tribunal did in fact mean say that it was unreasonable of the Appellant not to use past performance appraisals, we do not believe that that decision was open to it. What assessment tools to use in an interview of this kind – which is not, we should repeat, a redundancy selection exercise – is prima facie a matter for the discretion of the employer. If the tools used had been plainly inappropriate that might be influential in the issue of the fairness of the dismissal, but we do not believe that that could be said here. The Appellant regarded Business Region Team Leader as a new job, whatever similarities it might have had with the Claimant's previous role; and it is understandable that it should choose to interview for it on a forward-looking basis (cf. the observations of Judge Richardson in Morgan, at para. 30). It is true that the criticism made in this paragraph is not clearly picked up in para. 110, which summarises the Tribunal's reasons for finding the process unfair: this focuses on the Appellant's apparent use of other (less reliable) indicators of past performance. But it is hard to say that it did not form part of the Tribunal's reasoning.
39. Secondly, the Tribunal's forthright finding at para. 108 that the Claimant "was in reality the best person for the job" is inaccurately formulated because the decision which the Appellant was considering was not whether he was better than Mr Bullock but whether either was good enough for the job: in the event it decided that neither was (see para. 7 above). But, even as adjusted to meet that point, it would only be material if what the Tribunal meant was that the Appellant could not reasonably have scored the Appellant below 75 being the "pass-mark" - or, if it did not feel committed to the scoring system, that the Appellant could not reasonably have failed to find that the Claimant matched its requirements. Those would be remarkable findings, particularly since the Tribunal had expressly ruled out bad faith (see para. 7 above). Good faith assessments of an employee's qualities are not normally liable to be second-guessed by an employment tribunal: cf. Inchcape Retail Ltd v Symonds (UKEAT/0316/09), per HH Judge McMullen QC at para. 29.
40. Thirdly, the Tribunal did not accept the validity of Mr Porter's judgment of the Claimant's performance in relation to the Danwood transaction. In principle it would be entitled to take that into account if it found not simply that Mr Porter's judgment was wrong but that it was a judgment which he could not reasonably have reached. We note that it did in fact use the phrase that there was "no logical basis" for Mr Porter's view. We are not sure that that was meant to come to the same thing; but, even if it was, we do not believe that an adequate basis for such a finding is established.

Conclusion on the Alternative Employment Issue

41. For the reasons given above, we believe that the Tribunal took the wrong approach to the question whether the Appellant's decision not to appoint the Claimant to the role of Business Region Team Leader rendered his dismissal unfair. If it had avoided the vice of substitution, and had followed the approach now helpfully re-stated in Morgan, we do not believe that it could have found the dismissal of the Claimant to be unfair on that basis. The Appellant's suitability for the job was assessed in a formal interview process by two senior managers, who applied identified criteria and made a systematic evaluation of his suitability in good faith. To the extent that there were flaws in the process, they were in no sense egregious or such that the Appellant, who was the victim of a genuine redundancy situation, can complain that his dismissal was unfair.

THE "POLKEY" ISSUE

42. Our conclusion on the issue of liability means that this issue does not now arise. We would only say that if the conclusions in paragraph 108 of the Reasons had been unimpeachable, it seems to us that the Tribunal would have been entitled to make no Polkey deduction.

CONCLUSION

43. The appeal is allowed and the Claimant's claim of unfair dismissal is dismissed.