United Kingdom Employment Appeal Tribunal

Appeal No. UKEAT/0582/11/SM

EMPLOYMENT APPEAL TRIBUNAL

FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8JX

  At the Tribunal

  On 9 May 2012

Before

HIS HONOUR JUDGE PETER CLARK

MR D BLEIMAN

MR J R RIVERS CBE

COUNTRYWIDE FREIGHT GROUP LTD APPELLANT

MR A HOBBS RESPONDENT

Transcript of Proceedings

JUDGMENT

APPEARANCES

SUMMARY

UNFAIR DISMISSAL – Polkey deduction

Employer appeal allowed by consent against Employment Tribunal finding of no Polkey deduction based on the balance of probabilities.

Case remitted to same ET to determine percentage chance that Claimant would have remained in employment following a fair procedure.

HIS HONOUR JUDGE PETER CLARK

1.            This case has been proceeding in the Cardiff Employment Tribunal.  The parties are Mr Hobbs, Claimant, and Countrywide Freight Group Ltd, Respondent.

2.            The Claimant was employed by the Respondent, latterly as a Depot Supervisor at their depot in Llandrindod Wells from 1996 until his dismissal by reason of redundancy effective on 13 August 2010.  He presented a complaint of unfair dismissal to the Employment Tribunal.

3.            That claim was resisted by the Respondent and came on for hearing before an Employment Tribunal chaired by Employment Judge Collier, sitting with Mr P N Westwood and Mr A S Screen on 16 and 17 June 2011.  By a Judgment with Reasons promulgated on 27 July 2011 that Tribunal upheld the complaint.  They found the dismissal to be procedurally unfair in the absence of meaningful consultation or a proper selection for redundancy procedure.

4.            The Tribunal then considered the Polkey (Polkey v A.E. Dayton Services Limited [1988] ICR 142) question and concluded at paragraph 21 that on the balance of probabilities the Claimant would have retained employment if a proper procedure had been followed.  They went on to assess the compensatory award, on a full loss basis, in the total sum of £16,024.54.

5.            Against the Polkey finding, but not the finding of unfair dismissal, the Respondent appealed.  The appeal was put on two bases; first, that the Tribunal’s approach, applying the balance of probabilities test to the Polkey question, was wrong in law.  Secondly, they raised a perversity argument.

6.            The appeal was considered by Underhill P on the paper sift and, by an order dated 11 November 11, the appeal was permitted to proceed to a full hearing, for which directions were given.

7.            Pursuant to those directions, the Claimant filed an answer conceding the first ground of appeal, but challenging the second ground.

8.            The matter was referred to Langstaff P who directed, by a letter dated 26 January 2012, that the appeal would be allowed on the first ground, accompanied by short reasons, and the matter remitted to the same Tribunal for further consideration of the Polkey question.  For that purpose the matter would remain in the list for a short hearing at which the parties need not attend unless objection to that course was taken.  There is no objection and the matter now comes before this division for disposal.  We have had the benefit of a skeleton argument lodged on behalf of the Respondent, which we have taken into account.

9.            It seems to us that that course is consistent with paragraph 15.3 EAT Practice Direction, which makes clear that the EAT will not allow an appeal and remit for rehearing by consent of the parties without itself determining whether there are good grounds for making that consent order.

10.         We accept that there are good grounds.  It will be recalled that the effect of the House of Lords’ decision in Polkey was to overrule the principle in British Labour Pump v Byrne [1979] ICR 347 (EAT) that if, on the balance of probabilities, a fair procedure would have resulted in dismissal anyway, that dismissal was fair and to approve the approach which  Browne‑Wilkinson J would have taken in Sillifant v Powell Duffryn Timber Ltd [1983] IRLR 91, had he not felt constrained by the Court of Appeal’s decision in Wass v Binns [1982] ICR 486 to follow the Byrne principle, that is to find the dismissal procedurally unfair but to adjust the compensatory award to allow for the chance, expressed as a percentage, that the employee would have retained his employment following a fair procedure.

11.         It is that question which we remit to Judge Collier’s Tribunal for reconsideration.  The loss of the chance of the Claimant retaining his employment following a fair procedure will fall in the spectrum 0-100%, alternatively, it may be that he would inevitably have lost his employment at some later date had a fair procedure been followed; see Mining Supplies (Longwall) Ltd v Baker [1988] ICR 676.  The correct approach to the Polkey question is set out by Elias P in Software 2000 Ltd v Andrews [2007] ICR 825, paragraph 54; see also Virgin Media Ltd v Seddington & Eland (UKEAT/0539/08/DM 31 March 2009), paragraph 13, per Underhill P.

12.         Finally, as the President provisionally directed in the letter of 26 January 2012, it will be for the Employment Tribunal to determine, following argument, whether or not further evidence on the Polkey question will be admitted at the remitted hearing.

13.         The appeal is allowed on that basis.