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United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Sturmey v The Weymouth And Portland Borough Council (Age Discrimination) [2014] UKEAT 0114_14_2908 (29 August 2014)
URL: http://www.bailii.org/uk/cases/UKEAT/2014/0114_14_2908.html
Cite as: [2014] UKEAT 114_14_2908, [2014] UKEAT 0114_14_2908
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EMPLOYMENT APPEAL TRIBUNAL
FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8AE
At the Tribunal
Before
HIS HONOUR JUDGE DAVID RICHARDSON
(SITTING ALONE)
THE WEYMOUTH AND PORTLAND BOROUGH COUNCIL RESPONDENT
Transcript of Proceedings
JUDGMENT
APPEARANCES
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(The Appellant in Person) |
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(of Counsel) Instructed by: Messrs Michelmores LLP Solicitors Woodwater House Pynes Hill Exeter Devon EX2 5WR
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SUMMARY
AGE DISCRIMINATION
The Employment Tribunal did not give sufficient reasons for its conclusions on the question of age discrimination. There was substantial material tending to indicate that the timing of its decision to dismiss the Claimant was wholly or partly because of her age and that she was treated less favourably in this respect than the Respondent would treat others. The Employment Tribunal did not mention this material or say in its reasons how it dealt with it. In a discrimination claim the Employment Tribunal’s reasons were required to address material of this kind.
The Employment Tribunal gave its conclusions on the question of justification by reference to Woodcock v Cumbria Primary Health Care Trust [2012] ICR 1126. It should have reached its own reasoned conclusions on the question of legitimate aim and proportionality. Woodcock was not intended to lay down any general principle that eliding a redundancy or redeployment process because of an employee’s age would always be a proportionate means of achieving a legitimate aim.
HIS HONOUR JUDGE DAVID RICHARDSON
1. This is an appeal by Mrs Sandra Sturmey (“the Claimant”) against part of a Judgment of the Employment Tribunal, sitting in Southampton (Employment Judge Miles presiding) dated 11 November 2013. By its Judgment the Employment Tribunal dismissed claims of unfair dismissal and age discrimination which the Claimant brought against Weymouth and Portland Borough Council (“the Respondent”).
2. The Claimant was dismissed by notice which expired a few days before her 55th birthday, at which she would have been entitled to take an immediate pension. It is her case that the timing of her dismissal was unlawful age discrimination. The question on this appeal is whether the Employment Tribunal addressed the issue properly in its written reasons.
The Background Facts
3. The Claimant had continuous employment from 24 January 1974 when she was just 16 until 9 December 2012, 11 days before her 55th birthday. Her salary was £33,661, above the national average but by no means a high figure. She was employed on Tier 4. She was entitled to three months’ notice of termination of employment. She was entitled, if she was dismissed for redundancy when 55 or over, to take an immediate pension.
4. For most of her career, the Claimant was employed by West Dorset District Council. She was part of its finance team. Her last job title was Risk Management and Insurance Officer. She dealt with issues concerning Risk Management, Insurance and VAT. She had no formal accountancy qualifications. She had, earlier in her career, worked in other departments in a variety of capacities.
5. In 2010 West Dorset District Council and the Respondent entered into a shared service partnership to make savings, improve efficiency and protect frontline services. This entailed a substantial reorganisation in which the Respondent became lead employer. The combined workforce would be about 700 employees. Detailed policies and procedures were agreed with the unions for effecting the amalgamation. These included a redundancy and redeployment policy which made provision for consultation, individual meetings and redeployment. As part of this re-organisation the finance teams of the two councils were amalgamated. It was decided that at the Claimant’s level, Tier 4, the staff would be qualified accountants. Employees were matched into posts. There was no position for the Claimant. At Tier 5 there was a post which encompassed most of her former role. She was unsuccessful in an application for this post.
6. In the result the Claimant was issued with a notice of risk of redundancy on 19 March 2012. After consultation she was placed into the redeployment pool on 2 May 2012. While the Claimant was in the redeployment pool, she was supported and given details of available vacancies. No suitable vacancies were identified. By 6 August she had been in the pool for three months. At this point she was signed off ill with stress. The Respondent arranged for an occupational health report to be obtained. The report, dated 17 August, advised that the Claimant’s symptoms would not alter until the redundancy process currently in play had reached a conclusion. (I will mention later the Claimant’s case about this). A meeting on 5 September decided to make the Claimant redundant. Notice was given by letter dated 6 September.
Further Facts and Issues
7. Thus far the facts which I have set out appear from the Employment Tribunal’s Reasons. But, in order to understand the argument which I have received on the appeal, it is necessary to add significantly to the narrative and also to mention two policy documents provided to the Claimant.
8. The Respondent produced a document entitled “Redeployment Pool – Frequently Asked Questions”. This included the following question and answer.
“13. How long will I be on the redeployment register?
A minimum of 4 weeks, then a review will be carried out by Management Team to determine the likelihood of suitable alternative employment becoming available in the foreseeable future. This will then determine whether the review period should be extended or other action taken, which could involve a recommendation that a redundancy notice is issued. Before any notice was issued, you would be invited to an individual consultation meeting with your Service Manager, HR and union or fellow worker rep (if required) to discuss your situation.”
9. The Council also produced a guidance note which said the following:
“How long will I remain in the redeployment pool
HR reports regularly to Management Team on the position of those in the redeployment pool and the prospects of suitable vacancies coming forward. The intention is not to leave staff in the pool for extended periods where opportunities for redeployment into suitable alternative employment are unlikely.
Where redeployment is unlikely, or the individual makes the request, Management Team will consider whether or not redundancy should now be confirmed. In reaching its decision Management team will weigh up the financial costs, including any pension costs, operational need, personal circumstances, fairness and consistency and risks.”
10. On 14 June 2012 Miss Julie Strange produced a draft confidential report which dealt with the Claimant’s position. It stressed the “significant pension costs” if termination did not take place before 19 December. It also contained the following paragraph:
“Given that few redeployment opportunities will be identified until after the Olympic period, an early decision is therefore important in order to avoid potential additional costs.”
11. The reference to the Olympic period was to an eight-week moratorium period on recruitment during the period of the Olympic Games. Sailing events were being held close to the Respondent’s area. Before me the parties could not give precise dates, but they believed the period to run up to the Paralympic sailing competition at the beginning of September.
12. In August there was an exchange of e-mails between members of the Respondent’s staff. It is plain from these e-mails that they were conscious of the onset of the Claimant’s 55th birthday. On 17 August it was said that the “absolute deadline” for giving notice would be 19 September. There was discussion as to whether there needed to be another meeting before issuing notice. One manager wrote:
“I am inclined to invite Sandra to participate in a 4th consultation meeting before issuing notice even if this is at her house. Although I agree with Gill F that this meeting does not change the position or the options we have available I would prefer to stick to the process as far as we are able.”
13. The Occupational Health report said that the Claimant was fit to attend a meeting. The Respondent invited her to attend a meeting on 28 August. The Claimant telephoned to say that she was unwell. The Respondent, by letter dated 28 August, re-arranged the meeting for 4 September, informing her that if she did not attend or submit her comments, the management team would have to report on her current employment status without the benefit of her comments. It said that an option would be to terminate her employment on grounds of redundancy.
14. On 4 September the Claimant did not attend the meeting. However, her husband attended, and she was represented by her trade union. Representations were made on her behalf including a representation that she should have a further four weeks in the redeployment pool before a decision was taken.
15. On 5 September the Respondent’s Miss Strange produced a report for the relevant management team meeting. It contained the following passage:
“4 Financial implications
4.1 Sandra is aged 54 and has been employed by WDDC since 24 June 1974. Sandra has total local government service of 38 years.
4.2 The cost of a redundancy payment would be circa £37,635. There is no pension cost provided that the termination date is before 19 December 2012.
4.3 Sandra is entitled to a 12 week notice period and we would like Management Team to consider pay in lieu of notice or garden leave during this period as the majority of Sandra’s work has already been handed over. The cost for this would be circa £7,746, although the usual employer on-costs would not accrue if payment in lieu of notice is paid.
4.4 The current salary costs for the post are £33,661 + on costs.
5 Recommendations
5.1 At this time I am unaware of any suitable alternative vacancies that are likely to arise which would enable Sandra to be redeployed. As there is no offer of the creation of a post for Sandra, I would recommend bringing the process to a conclusion is in the best interests for all parties concerned.
5.2 Should MT decide to issue notice of redundancy, vacancies will continue to be sent to Sandra during the notice period whilst we continue to look for suitable alternative employment, therefore still enabling Sandra access to any redeployment opportunities.”
16. The letter dated 6 September 2012 by which the Claimant was given notice of termination of employment, dealt with various points which had been put forward at the meeting on 4 September.
17. It is also important to mention a document which was before the Employment Tribunal, to which it was referred and which was the subject of cross-examination. This document set out in tabular form what happened to other employees who had been the subject of “at risk” notices or otherwise had been redeployed. These employees were relied on as comparators. The document is headed “Summary of impact of restructure as at 21 January 2013”, but it appears to continue beyond that date.
18. Seven or eight employees had been in the redeployment pool for six months before being redeployed. Those six-month periods appear to me mainly to be periods which did not include the eight-week Olympic moratorium.
The Employment Tribunal’s Hearing and Reasons
19. It is important to keep in mind that the Employment Tribunal was concerned at the hearing with a wide raft of issues including the reasons for dismissal and whether the Claimant should have been appointed to a Tier 4 post or at least included in a Tier 4 pool. Age discrimination was, however, plainly an issue. Both parties were represented. The Claimant’s case was that the timing of the dismissal was affected by the fact that she was approaching the age of 55. The Respondent’s case was that the timing of the dismissal was not affected in this way.
20. The Employment Tribunal found that both the Claimant and the Respondent were well aware of the eligibility to take a full pension at the age of 55 and that there would be a serious or significant cost to the Respondent. It expressly stated, however, that it was making no finding as to the actual cost involved. It appears that the Employment Tribunal had no evidence of the actual sums involved and no evidence as to the manner in which the Respondent approached an issue such as this. There appears to have been no evidence, and there was certainly no findings, as to whether there was any budget for the costs of employees who were approaching or reaching the age of 55, whether the budget had been exceeded, and whether any specific consideration was given at a policy or councillor level to the treatment of persons approaching or already within the 55 age band who would have been considered for redundancy. It is plain from the table to which I have referred that potentially a significant number of employees were affected.
21. The Employment Tribunal was required, by issues concerned with unfair dismissal that are not the subject of this appeal, to make detailed findings over the whole of the redundancy exercise. The findings of fact most relevant to the appeal are in paragraphs 51-54, which as I have remarked, do not include reference to a significant part of the narrative including the decision to hold a meeting on 4 September or the meeting itself:
“51 On 6 August the claimant was signed off through ill health. She was subject to stress. The respondent quickly arranged for an Occupational Health report to be produced and that was available on 17 August 2012. The medical advice indicated that the claimant’s symptoms would not alter until the redundancy process currently in play had reached a conclusion.
52. Ms Strange was responsible for preparing monthly reports to the management team and these became specific to individuals when their case was to be discussed. In a report dated 4 September 2012 Ms Strange highlights the cost of making the claimant redundant although neither the pension contribution nor the benefit figures were mentioned. However the management team meeting had Mr Vaughan as Finance Officer among its members and the Tribunal finds that the management team was at least aware that the pension cost to the respondent could indeed be substantial. Although the Tribunal make no finding of fact as to the actual cost, a figure of £70,000 had been mentioned before us.
53. The respondent gave evidence to say that cost was a factor in their deliberations. Mr Vaughan said there were two other factors at play: one was the state of the claimant’s health which remain in jeopardy whilst the process continued and the second was the fact that there was no prospect of the claimant being offered a suitable vacancy given that the claimant had been in the redeployment pool for four months and would remain so for the period of notice.
54. The management team who met on 5 September determined that it was appropriate to issue a redundancy dismissal which was done by letter date 6 September.”
22. The Employment Tribunal, in a brief section on relevant law, quoted section 13(1) and (2) of the Equality Act 2010 and noted that the parties had referred to Woodcock v Cumbria PCT [2012] ICR 1126. The Employment Tribunal’s conclusions on this aspect of the case are in paragraphs 70-72.
“70. Turning to the claim for discrimination because of the protected characteristic of age, pension cost inevitably imports age as an issue. However the claimant does not say the decision itself was discriminatory. The claimant puts her case squarely on the issue of timing. The Tribunal find that the claimant was not dismissed ‘because of’ her age. A person of younger age in the position of the claimant would also have been dismissed in comparable circumstances. The claimant was not therefore treated less favourably than an appropriate comparator. We must ask why the claimant was dismissed: her job was redundant and she had no real prospect of redeployment. Redundancy was the reason for dismissal. The claimant’s age had nothing to do with it.
71. Alternatively if the timing of the decision was potentially discriminatory it is clear that redundancy is potentially a legitimate aim. It is certain law that cost alone is not sufficient to justify discrimination. Whilst the Tribunal are satisfied that cost was a factor considered by the management team, it was however one of a number. We do not criticise the timing of the respondent’s decision in the circumstances where redundancy was apparent because there was no suitable alternative employment available or in prospect, as was the fact that it could save the Council and their tax payers’ significant sums. The respondent would have faced criticism had it delayed a dismissal when it was clear that redundancy was inevitable.
72. The analysis of the case of Woodcock (above) shows remarkable similarities with the facts of this case. There was consultation – unlike Woodcock where that had been shortened to save cost. Moreover the process worked and was accepted as working at Tier 5 level.”
Statutory provisions
23. It is unlawful for an employer to discriminate against an employee by dismissing her or subjecting her to any other detriment (see sections 39(2)(c) and (d) of the Equality Act 2010. Section 13 defines direct discrimination in the following terms:
“Direct discrimination
(1) A person (A) discriminates against another (B) if, because of a protected characteristic, A treats B less favourably than A treats or would treat others.
(2) If the protected characteristic is age, A does not discriminate against B if A can show A’s treatment of B to be a proportionate means of achieving a legitimate aim...”
24. Section 13(2) contains a provision relating to justification, which is, as regards direct discrimination, unique to the protected characteristic of age. This provision effectively contains its own burden of proof. The burden is on the employer. Section 13(1) contains the general definition of direct discrimination. In respect of section 13(1) the burden of proof provision is found in section 136(2). If there are facts from which the court could decide, in the absence of any other explanation, that the employer contravened the provision concerned, the court must hold that the contravention occurred unless the employer shows that it did not contravene the provision.
The Timing Issue
25. I will first consider the timing issue, by which I mean whether the Employment Tribunal’s reasoning on the question whether the Respondent treated the Claimant less favourably than it treated or would have treated others because of the Claimant’s age can be upheld.
26. The Claimant has represented herself today, with the assistance of the Notice of Appeal which had been prepared on her behalf. She submits that the Employment Tribunal did not properly address the key issue about timing. In its findings of fact it did not mention any of the evidence which indicated the potential pension costs or which tended to show that timing was the predominant and driving factor in the decision to dismiss. There was, she said, oral evidence from Miss Strange and Mr Vaughan that pension costs, as opposed to merely costs in general, were a factor in the decision. The evidence of the treatment of other employees had been relied as comparators. The last individual consultation meeting, she submitted, should have followed a recommendation that a redundancy notice would be issued. In any event, if it were not for the impending deadline of 19 September, the Respondent would not have rushed to take Occupational Health advice so quickly or have required an employee who was unwell with stress to attend a meeting on such an important subject. She explained to me her case as to the reason she had suffered stress was that, during the three-month redeployment period, she had been in a room on her own with nothing to do. She was able, however, to apply for and would have been fit to take alternative employment. Indeed she had applied for an alternative post at the end of August.
27. On behalf of the Respondent Mr Roberts submits that the Employment Tribunal plainly did address the key question about timing. It recognised in paragraph 70 that timing was squarely the issue. It stated a conclusion that “a person of younger age in the position of the Claimant would also have been dismissed in comparable circumstances” so that “The Claimant was not...treated less favourably than an appropriate comparator”. Mr Roberts accepts that the Employment Tribunal has not set out all the evidence on the question. He points out that it plainly understood and referred to the fact that the Respondent took costs into account. Mr Roberts submits that a sufficient account of the evidence has been given and that the Employment Tribunal’s Reasons sufficiently explain its conclusions.
28. I will begin with the Employment Tribunal’s legal approach. To my mind, the Employment Tribunal plainly addressed the correct question in paragraph 70 of its Reasons. It found that a person of younger age than the Claimant would also have been dismissed in comparable circumstances. It made that finding against an express recognition that the question related to the timing of the dismissal. I therefore see no error of law in paragraph 70 of the Reasons, nor am I in any position to say that the Employment Tribunal’s conclusion was perverse by the high standard required before an appellate body can find an error of law.
29. The real question, to my mind, relates to the sufficiency of the Employment Tribunal’s reasons. I explained to Mr Roberts that this was the way I regarded the appeal. To my mind, the Grounds of Appeal sufficiently covered this question and require no amendment; and Mr Roberts did not ask for any.
30. It is a striking feature of the Employment Tribunal’s otherwise quite detailed findings that it omits entirely significant elements of what happened in the last few weeks prior to the decision to dismiss. There is no mention of the quite specific indications in contemporaneous e-mails that the Respondent’s employees were concerned about timing. There is no mention of the fact that during eight weeks of the redeployment pool period there was a moratorium on recruitment and Miss Strange was nevertheless evidently anxious to bring the matter to a conclusion, though redeployment opportunities would largely not arise until after the Olympic period. Moreover there is no mention, still less any finding, as to the number of employees who were in the redeployment pool for six months prior to redeployment. It might be thought surprising that, when others were retained in the redeployment pool for 6 months the Claimant was kept there for a much shorter period during 8 weeks of which there was a moratorium on recruitment. It is simply not possible to see how the Employment Tribunal reasoned or took into account the issues to which this material gives rise.
31. An Employment Tribunal is obliged to give reasons for its Judgments. Thus in Meek v City of Birmingham District Council [1987] IRLR 250 Bingham LJ stated that, although Tribunals are not required to create “an elaborate formalistic product of refined legal draftsmanship”, their Reasons should:
“...contain an outline of the story which has given rise to the complaint and a summary of the Tribunal's basic factual conclusions and a statement of the reasons which have led them to reach the conclusion which they do on those basic facts. The parties are entitled to be told why they have won or lost. There should be sufficient account of the facts and of the reasoning to enable the EAT, or on further appeal, this court to see whether any question of law arises...”
32. An appellate court must, of course, be careful not to set too high a standard in the reasons required. The standard of reasoning will vary with the subject matter of the proceedings. It is, I think, particularly important in a discrimination claim to provide reasoning on points of substance. Employers are not inclined to admit discrimination, even age discrimination. The Respondent would of course say that it took its decision to dismiss because it thought there was no realistic prospect of redeployment. But where, as here, there was significant evidence to suggest that timing may have a critical issue and that the treatment of the Claimant on the question of timing may have been less favourable than that received by others because of age, the Employment Tribunal was entitled to bring that material into account in its reasons and explain how it dealt with it. In a case of this kind, depending on the Employment Tribunal’s finding of primary fact about the material, the burden of proof provision might be of real significance: there is no mention of it in the Employment Tribunal’s reasons. I do not think the Employment Tribunal has properly grappled with the material before it and I do not think its reasoning suffices.
The Justification Issue
33. The Claimant submitted to me that reliance on Woodcock was misplaced because the circumstances here were different. She referred to a variety of circumstances asserting that the possibility of redeployment remained open, that there was less consultation than in Woodcock, and that the Claimant was prepared to consider posts at a different level and salary, as evidenced by her willingness to accept such a post expressed in an e-mail on 31 August.
34. Mr Roberts submits that the Employment Tribunal did not err in law in any of these ways and that reliance on Woodcock was apposite.
35. Where the issue of justification arises, it is for the Respondent to place before the Employment Tribunal the material on which it relies to show that its less favourable treatment because of age is justified: that is to say, that the treatment was a proportionate means of achieving a legitimate aim. The treatment means the less favourable treatment because of age. If, therefore, an employer wishes to omit or elide stages in a redundancy and redeployment process because of age, what it must justify is not the redundancy itself but the discriminatory treatment. It is not the game it must justify; it is the moving of the goalposts.
36. I do not think Woodcock sets out, or was intended by the Employment Appeal Tribunal or the Court of Appeal to set out, any general principle as to whether omitting or eliding stages in the redundancy process to save pension costs will always achieve a legitimate aim or will always be a proportionate means of doing so.
37. On the contrary, the exceptional features of that case were emphasised. See, as to the question of proportionality, paragraphs 70 and 71 of the Judgment of Rimer LJ, which set out his essential conclusions:
“70 In my view that consideration goes, however, only to the proportionality of the treatment adopted by the Trust. That required the striking of an objective balance between the discriminatory effect of the treatment of Mr Woodcock and the needs of the Trust. The ET found that, in the circumstances, the treatment was proportionate (paragraphs 83 and 84 of its reasons). It was ground 2 of Mr Woodcock's appeal to the EAT that focused exclusively on proportionality, and it relied upon the fact that the Trust's procedure deprived him of his right to consultation in advance of the dismissal notice. Underhill J explained why, in what he described (and I agree) as the 'very particular' circumstances of the case, the EAT agreed that that consideration did not undermine the proportionality of the Trust's treatment. I have explained the EAT's reasoning at [35] and [36] above.
71. Mr Gilroy submitted that the Trust's action in removing Mr Woodcock's right of consultation so as to save costs was so patently a disproportionate action that the Trust cannot get home on the proportionality element of the exercise. I am not persuaded by that. Both the ET and EAT explained why, in the very particular circumstances to which Underhill J referred, the Trust's treatment was proportionate to the effect upon Mr Woodcock. The issue for us is whether, in making the proportionality assessment that it did, the ET erred in law. I agree with the EAT that it did not. On the contrary, I regard its decision as a well judged one. Ultimately, the essence of the case is (a) that the Trust was fully entitled, and had effectively resolved, to terminate Mr Woodcock's employment prior to his 50th birthday; (b) the implementation of that intention was delayed through no fault of its own but through a chapter of accidents; and (c) whilst the consultation 'corner cutting' in theory deprived Mr Woodcock of an opportunity, in fact it deprived him of nothing of value, because, as the ET found, consultation would have achieved nothing.”
38. It is easy to see why the treatment in Woodcock was proportionate. The costs of providing the additional sum for pension costs was truly enormous and the potential need for it resulted, in effect, from a chapter of accidents which had worked in the employee’s favour. This case, to the contrary, is concerned with an employee of more ordinary financial status as part of a general re-organisation where one might expect budgetary allowance to be made for those who happen to be 55 or reach the age of 55 during the process. It is not obvious that there was any “series of accidents” in her case. It just happened that she was in her 54th year when the re-organisation struck.
39. In my judgment the Employment Tribunal ought to have considered and given reasons for its conclusion on proportionality without effectively saying that Woodcock was decisive. To my mind, the Employment Tribunal did not make the findings and did not reason through the question of justification, as it was required by the legislation to do. Its reliance on Woodcock was not apposite. The conclusion of the Court of Appeal in Woodcock, expressly recognised by Rimer LJ to depend on “very particular circumstances” cannot be read across to all other circumstances: compare, for example, O’Brien v Ministry of Justice [2013] IRLR 315 at paragraph 70.
40. It follows from what I have said that the appeal must be allowed. The Employment Appeal Tribunal is not in a position in a case of this kind to reach its own conclusion on these questions. It follows that the matter must be remitted for rehearing.
41. I have heard submissions on the question whether remission should be to the same Employment Tribunal or to differently constituted Tribunal – a decision which the Employment Appeal Tribunal takes in accordance with criteria set out in Sinclair Roche Temperley v Heard [2004] IRLR 763. In this case I have no doubt that remission should be to a freshly constituted Employment Tribunal. The existing Employment Tribunal has expressed itself trenchantly on the question of age discrimination without, for reasons I have explained, really addressing the key issues. It would not be conducive to fairness to remit to the same Employment Tribunal.
42. However, I make it clear that the remitted hearing should not start from scratch. The remitted hearing can take the findings of the existing Employment Tribunal up to and including 2 May when the Claimant was placed in the redeployment pool. Her claim of age discrimination relates to matters which occurred after that date. From that date, the Employment Tribunal should hear evidence, submissions, and reach conclusions entirely afresh. So far as unfair dismissal is concerned, the remitted Employment Tribunal should not re-open unfair dismissal unless it finds the case of unlawful age discrimination to be established. If it finds unlawful age discrimination to be established, it is easy to see that it may impact on the finding of unfair dismissal. However, if it does not find unlawful age discrimination to be established, there is no reason to disturb the finding of unfair dismissal.