Mrs F Kilburn v Reynolds and Reynolds Ltd: 1300037/2019
JUDGMENT
The proceedings are dismissed following a withdrawal of the claim by the claimant. RESERVED JUDGMENT OF THE EMPLOYMENT TRIBUNAL HELD AT Birmingham ON EMPLOYMENT JUDGE Richardson Representation For the Claimant: For the Respondent: JUDGMENT The judgment of the Tribunal is that 1) The dismissal was fair.[2]The claim is dismissed.REASONS
[1]The claimant was a trusted employee for over 20 years with the respondent. Her husband, John Kilburn, was also employed by the respondent, in a sales capacity for 15 years. In July 2017 the claimant’s husband resigned his post. He filed tribunal proceedings against the respondent for constructive unfair dismissal and disability discrimination. There was a negotiated outcome through ACAS in about March 2018. He commenced employment with Titan, another company in the same automotive industry sector as the respondent, in a sales capacity in April 2018. In September 2018 the claimant was dismissed for some other substantial reason, namely the perceived risk of a breach of confidential information posed to the respondent by the claimant’s husband working for a competitor. The claimant and the respondent had divergent opinions on whether the claimant’s husband’s new employer was a competitor to the respondent and the claimant accordingly claims unfair dismissal. There were no claims of sex discrimination or victimisation.Issues
[2]The issues were agreed as follows:(i) Did the respondent have some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held?(ii) Was the fact that from April 2018 the claimant’s husband had worked for Titan such a reason. Was the respondent unaware of this until 19th July 2018?(iii) Did the respondent act reasonably or unreasonably in treating John Kilburn’s employment with Titan as a sufficient reason for dismiss the claimant?(iv) Did the respondent fairly investigate the matter and any alternatives to dismissal?(v) Did the respondent fairly consider and attach appropriate weight to:a. The claimant’s length of service;b. The claimant’s employment record;c. Whether alternative employment or safeguards were properly explored;d. Whether Titan was in fact a competitor to the respondent and was such a determination capable of being reached based on facts establish by the dismissing office and the appeal hearing officer;e. The actual risks of an inadvertent disclosure of confidential information;f. The actual risks of an deliberate disclosure of confidential information;(vi) Did the decision to dismiss for that reasons fall within the range of reasonable responses open to the respondent?(vii) In all the circumstances was the decision to dismiss a commercial decision taken by the respondent which was nonetheless unreasonable; a commercial decision being one that included seeking protection against a prospective threat that it might lose customers and/or fail to secure new customers and/or put its connection with its customers/potential customer at risk in any way by virtue of the existence of the determined conflict of interest between the claimant the respondent?Evidence
[3]I was provided with an agreed bundle R1. I read the witness statements of the claimant, Ms Adele Feeney and Mr Christopher Bill all of whom were cross examined.Findings of Fact
[4]I make my findings of fact on the basis of the material before me taking into account contemporaneous documents where they exist and the conduct of those concerned at the time. I have resolved such conflicts of evidence as arose on the balance of probabilities. I have taken into account my assessment of the credibility of witnesses and the consistency of their evidence with surrounding facts and documents. There were no credibility issues with any of the witnesses who answered at times difficult questions honestly and directly.[5]My findings of fact relevant to the issues which have been determined are as follows.5.1 The claimant who at the date of the hearing was 53 years old, worked with the respondent latterly as a Sales Administration Supervisor from 1st July 1998 until the termination of her employment on 11th September 2018. She had just over 20 years’ service.5.2 The claimant’s husband, John Kilburn, joined the respondent as a sales account manager; he had approximately 15 years’ service with the respondent. Mr Kilburn had health issues. He resigned his post on 10th July 2017 and bought proceedings against the respondent in the Employment Tribunal. These were concluded in about March/April 2018 through ACAS. On 4th April 2018 Mr Kilburn joined a company named Titan which was a supplier of Dealer Management System (DMS) software in the UK. Titan were a subsidiary of a larger Australian company.5.3 Mr Andrew Partridge, in-house counsel for the respondent, was involved in the settlement negotiations with Mr Kilburn who disclosed during the settlement negotiations that he was working for Titan. The information was in Mr Kilburn’s schedule of loss. Mr Partridge did not recognise Titan as a competitor and did not notify either of the respondent’s senior managers of that fact.5.4 In January 2018 the claimant was given a positive review for her work in 2017 by Ms Feeney. Her work objectives were reviewed and agreed with Ms Feeney.5.5 On 11th April 2018 Ms Feeney and Mr Dan Agan her line manager in the US were considering salary increases. Mr Agan queried why the claimant was receiving a proposed increase in salary because she was already over compensated in comparison to others. Ms Feeney responded by informing Mr Agan that “Despite her husband, she’s actually had a good year and continues to add a lot of value”. 5.6.1 Ms Feeney recommended the claimant for a £8000 bonus. Discovery that Mr Kilburn worked for Titan 5.7 On 19th July 2018 Ms Feeney emailed her co-director Mr Craig Moss, and her line manager in the US, Mr Dan Agan. She informed them that she had just been informed that Mr Kilburn had joined Titan who were actively trying to grow their footprint in the UK. Ms Feeney expressed a concern about any deals in which they are in competition with Titan because his wife, the claimant, was the person who created all their sales (POWER) proposals and that she also had access to the entire customer and prospect data base. Ms Feeney expressed the view they should remove from the claimant the responsibility of creating bids for work but invited the views of her senior colleagues. 5.8 On 21st July 2018 Ms Feeney emailed the sales team informing them that John Kilburn had joined Titan DMS in a sales capacity. She requested that they report back immediately if they became aware of any activity from Titan in any of the respondent’s accounts or prospects. She added that Titan have a very limited footprint in the UK so she did not see them as serious competition, but that the company should take the threat of an ex-employee approaching its customers very seriously. 5.9 On 22nd July 2019 a member of the sales team emailed Ms Feeney querying whether he should put his pricing request through the claimant (as he normally would). He stated that he wasn’t too comfortable doing so in view of Mr Kilburn working for Titan and commented “What a horrible situation.” 5.10 On 26th July Ms Feeney wrote to Mr Agan. On 27th July 2018 Mr Agan responded to Ms Feeney’s email. As the email exchanges illustrate the honest view of Ms Feeney and Mr Agan, I set out the narrative in the question/answer format that occurs in their email conversation on the matter: Ms Feeney:“I have deliberated over this and I don’t think we have an option other than to let her go. She has access to too much information that in the wrong hands could be damaging. I’ve already had a sales person say that he doesn’t want her putting his POWER pricing proposals together for one of his prospects, I can totally understand this view point. I certainly don’t want to make any more donations to the Kilburn retirement fund, so whatever we do we need to minimise the chances of them winning a tribunal, or us having to make another considerable out of court settlement. Mr Agan: so you’d rather keep her, that risk paying a settlement? Is that correct? Ms Feeney: No. I’d rather we terminate her and it cost us nothing because we are on sound legal grounds. If we elect to reach a settlement with her then fine, that would make sense to avoid the time and cost of going through a tribunal. Mr Agan: How valuable is she? Ms Feeney: She does a good job, of that there is no doubt. Mr Agan: how hard will it be to replace her? Ms Feeney: She has 20 years of knowledge so not easy, but in the end of the day it’s an administrative role so it would be possible. There are a couple of ladies in Paul’s area that would be perfect if they were interested at all. Mr Agan: how much risk do you believe there is in her having access to customer and pricing details, and her sharing that with John? Ms Feeney: Large. And it’s much more than customer and pricing details. She knows of potential cancellations, unhappy customers, contract term end dates, prospects, as she puts the POWER pricing proposals together. Mr Agan: if tomorrow she quit, would you be happy or sad? Ms Feeney: Neutral, although if she goes once things settle down, happy because following the John situation the atmosphere in the office at times is awkward. 5.11 Mr Agan expressed the view that Ms Feeney’s and Mr Moss’s view on whether to terminate the claimant’s employment was more important than his as they were in a better position to assess her contribution and impact if she were to leave and the risk the respondent faced in allowing her to remain. Meeting and letter 31st July 2019 - suspension 5.12 On 31st July 2018 Ms Feeney called a meeting with the claimant in Ms Feeney’s office at about 5pm. The purpose of the meeting was to establish the facts surrounding the claimant’s access to sensitive information and the potential risk of her access to it. There are no formal minutes of the meeting. The claimant wrote up a detailed note afterwards. I do not set out the full conversation save to say that Ms Feeney expressed the view that the company believed that because of the claimant’s husband’s new position with a competitor, the claimant was seen as having a potential conflict of interest. Ms Feeney thought that it was possible that the claimant could inadvertently disclose information innocently to her husband at home, for example stating that one of the respondent’s employees was in Bristol tomorrow (or some other location) and that might prompt a question from her husband “is [name of company] still a Reynolds customer?” to which the claimant would answer her husband honestly. The point being made was that given Mr Kilburn’s knowledge of the respondent’s even the slightest information could be valuable to a competitor. Ms Feeney was of the view that the claimant was the biggest potential risk (of a breach of confidentiality based on knowledge of the respondent’s business) apart from herself. 5.13 The claimant defended her position and confirmed that she did not discuss work at home and that she didn’t believe that there was any information she could give her husband that he didn’t already know. 5.14 The claimant said she didn’t think at the time that it had been necessary to inform Ms Feeney about her husband’s new role at Titan and because of the settlement documentation and the fact that other employees knew about John working at Titan she had not thought it necessary. She and her husband had not seen the need to discuss it as Titan was a very small start-up operation in the UK and Reynolds was much larger. 5.15 The claimant stated that she “felt massively offended” that her honesty and integrity could be questioned when she had been with the company for so long and that her record of employment was exemplary. She told Ms Feeney that her job was more important to her than anyone else’s job including her husband’s and she would for a second put her job at risk. 5.16 Ms Feeney handed the claimant a letter dated 31st July 2018 confirming that she had recently become aware that the claimant’s husband, John, was now employed by Titan Dealer Management Solutions as Senior Business Development Manager. She stated that Titan is a competitor to Reynolds. 5.17 Ms Feeney stated that in view of the claimant’s role in the respondent’s sales operations, and the sensitivity of the business information she had access to, that it was a concern that there was a potential and significant conflict of interest which could exist between John’s new employment with a direct competitor and the claimant’s employment with the respondent which put the claimant in a difficult or potentially impossible position. 5.18 The claimant was suspended and Ms Feeney invited the claimant to a meeting on 14th August 2018 to discuss Ms Feeney’s concerns and explore the situation. The claimant was invited to bring a work colleague with her or a TU representative, although Ms Feeney stressed that this meeting was not a disciplinary meeting. Ms Feeney stated: “The suspension is to allow you to fully prepare for the meeting and isolate you from the information to which you normally have access until the Company has made a decision upon your future role.” 5.19 In the letter, Ms Feeney summarised the potential outcomes of the meeting. They were:(i) potentially a decision that there was no risk;(ii) that the risk could be mitigated or(iii) that a suitable alternative role is identified and offered to the claimant to avoid any risk. If none of those three options were suitable for the company then as a last resort, the fourth option was that the claimant’s role could be terminated. The claimant was invited to attend the meeting to express her views and make a contribution to the determination of the situation. Alternative work search 5.20 On 2nd August 2018 Mr Partridge emailed three senior managers in the respondent’s organisation to ask if they had any current or forthcoming vacancies for a senior sales administrator. He explained that due to a potential conflict of interest, this person’s current role may be untenable and the Company must consider any possible alternative position. Meeting on 29th August 2019 5.21 At the claimant’s request and after a period of sickness absence the meeting planned for 14th August was arranged for 29th August 2018 at which the claimant, Ms Feeney, Mr Partridge and a note taker were present. 5.22 At the meeting it was explained to the claimant that Mr Partridge was aware in March from the litigation documentation that Mr Kilburn worked for Titan, but Mr Partridge had not been aware at the time that Titan was a competitor in the DMS market. He had believed that they were a car parts manufacturer. Not realising Titan’s true situation he had not informed any of the senior managers in the UK. 5.23 The claimant had asked for the disclosure of emails referred to in the meeting on 31st July by Ms Feeney in which she was told by Ms Feeney that several sales staff had expressed disquiet about Mr Kilburn working for Titan. No emails were provided. Ms Feeney stated that what others thought was not the point, it was what was the Company’s perspective. 5.24 Again the exchanges between the claimant, Ms Feeney and Mr Partridge are recorded in detail. I do not repeat all that was said in a lengthy exchange of views. In summary, the claimant claimed that it was nothing more than an assumption that she would drop information into a conversation with her husband at home in the evenings which would be useful business intelligence to Titan. Although information such as when an existing or potential client is in the buying cycle or what a competitor is proposing is vital information, the claimant believed that such information could be passed to her husband by other employees who are still friends and in touch with her husband. She avowed that she had no intention of disclosing any information to her husband and had not done so in the 12 months since her husband had resigned from the respondent in July 2017. Her husband would not put her under pressure by asking for information and that in any event she does not know people and prospects. 5.25 There was a discussion on the extent to which the claimant had access to critical business information and what data the claimant did or did not have access to. Ms Feeney was of the view that the claimant had access to information in the company that nobody else had access to except Ms Feeney. The claimant took the view that she had no in depth or working knowledge of the information she sees, only product codes; so there was no risk. 5.26 Ms Feeney and the claimant discussed what information could be removed from the claimant’s role to mitigate risk. The claimant stated that if all access to the information and systems was removed to minimise risk, then her job would not exist and it comes down to trust. Ms Feeney took a different approach. She felt that it was not about trust but about perceived risk. 5.27 The claimant did not believe that Titan were a competitor – it was a company that had no manufacturer interfaces, approximately a dozen customers and six members of staff operating from a rented office. She did not understand or accept that Titan could be a competitor of the respondent. 5.28 Ms Feeney exclaimed that the claimant was being very naïve. I set out her words: “ We have seen small new entrants to the market take business off us and most recently Pentana, before that, Ebon Dacs, before that Pinewood. Pinewood were, at one stage, six people in someone’s front living room. So Titan, probably more so that one of the mainstream competitors are a bigger threat to our legacy base because they will be out there trying to buy business because they need to get a footprint otherwise Titan will end up pulling out of the market like Pentana are probably gonna do. So our customer base are absolutely beautiful targets for Titan. Well they are to everyone, but they particularly are to those guys. 5.29 The claimant replied that it depended on whether Titan had manufacturer interfaces – they couldn’t sell to car dealer that they don’t have interfaces for. Ms Feeney responded that Titan were already saying they were going to build the manufacturer interfaces. 5.30 The claimant protested that she had never, over all the years she and her husband had worked with the respondent, shown him any favouritism. She did not believe there was any conflict and saw no correlation between Titan and the respondent. 5.31 A significant part of the conversation covered the claimant’s access and intimate knowledge of the respondent’s systems. Ms Feeney was of the view even if the claimant did not hold the information in her head, it would take her two seconds to find it. The issue was the claimant’s access to the respondent’s valuable business information, both electronic and in hard copy, not that the claimant had already committed any breach. 5.32 The unanimous conclusion was that the claimant’s role in the company was inextricable with the company’s data. 5.33 The claimant was indignant that Ms Feeney and Mr Partridge were implying that the claimant would not make only an inadvertent slip but were actually concerned that she would deliberately disclose information. She was adamant that she had no intention of doing that. 5.34 Ms Feeney asked the claimant how she would feel if she knew that her husband her taken out two of the respondent’s DMS customers. How would she face her work colleagues who had lost a customer to the claimant’s husband? Ms Feeney believed it wasn’t the case that the claimant’s husband would not put her under pressure, as he already had by accepting a job with a 5.35 Mr Partridge summarised the situation: “…..Clearly there is a concern that you may choose to pass information. It’s not that, it’s that knowing what information you have and the damage it could do to the company. What you have said about how unlikely it is that you would ever say anything is obviously now what needs to be taken into account It’s just that sales in this business are so few and far between and the potential value of sales to a member of a sales team, it’s a temptation that is difficult to accept, well it is a temptation, it has to be a temptation. I know you say it is gross misconduct but the decision the company has to make have we faith and confidence that we can mitigate, put in to place mitigating steps so that risk doesn’t have to occur or are we looking out, because if we leave it and something does happen the we have lost a sale and that has a significant impact upon the company.” 5.36 The claimant accepted that there was nothing the respondent could do to remove the risk and the issue was the company’s trust in the her. She summarised that the company seemed to have decided that the claimant was a risk and that she was going to do something in the future. Ms Feeney stressed that company perceived a risk. 5.37 The meeting ended with the claimant being informed that it would take a few days before a decision would be made as the information would have to be fed back to the US. 30th August 2018 email exchange Ms Feeney and the US management 5.38 On 30th August 2018 Ms Feeney emailed Mr Agan informing him about the meeting with the claimant on 29th August 2018. Ms Feeney stated: “throughout the meeting she a) failed to understand or accept our concerns. She doesn’t see Titan as a competitor because they are small. b) stated how she’s worked for the company for 20 years and she’s never done anything to lead us to believe she wouldn’t be trustworthy c) stated her and John never talk about work so she wouldn’t inadvertently drop information out that might assist him. There is nothing she said through the meeting that changes my mind. I could not categorically say she would or would not pass information on to him. What I can say is that the temptation to do so is too great in my mind, and therefore the risk to our business is one I for one wouldn’t want to take.” Invitation to meeting 11th September 2019 – risk of dismissal 5.39 By letter dated 10th September 2018 Ms Feeney invited the claimant to a meeting on 11th September 2018. Ms Feeney summarised the findings of their previous meeting: - John Kilburn is employed by a DMS supplier, Titan, in a sales capacity. The claimant routinely handles information of potential value to a - The information could be broken down into two groups: first, general information such as who the respondent’s customers are and what prices the respondent charges. Mr Feeney stated that this information is known to the claimant’s husband but his knowledge will be stale and becoming increasingly out of date. It was established that the claimant could not perform her role without access to this information. - The second class of information was of the most concern to the respondent. This related to customers in the purchasing cycle and the prospects generated by the respondent’s sales activities. Information relating to customer retention would be potentially the most valuable information for the claimant’s husband as he will know a lot of the clients, knows the company’s strengths and weaknesses and, given that it was anticipated that Titan would be ‘buying’ business in the early days, knowing how much the company bills and where the customer could be in the change cycle based on knowledge of their termination dates, would make the respondent’s POWER client base a perfect target for the claimant’s husband. 5.40 Ms Kilburn reiterated that that she made no suggestion that the claimant had acted anything other than appropriately. Nevertheless there was a concern as a business that potential information gained by the claimant during the course of her duties, could be passed to her husband, knowingly or inadvertently. 5.41 Ms Feeney stated that the claimant’s continuing employment placed her in an unenviable and almost impossible position balancing her conflicting duties to her employer and her loyalty to her husband. Ms Feeney did not think it a risk that current sales staff who spoke to the claimant’s husband would pass on information as they would be aware of the value of the information and would stand to lose both professionally and personally if they passed on information. 5.42 Ms Feeney warned the claimant that the potential outcome of the meeting would be dismissal. The claimant was invited to bring a companion to the meeting. 5.43 On 10th September 2018 Mr Partridge chased up responses to his question to senior managers that he put to them on 2nd August 2018 – whether there was any vacancy for a senior administrator. The response from all was negative. Dismissal Meeting 11th September 2018 5.44 At the meeting on 11th September 2018 Mr Partridge reported to the claimant that a request had gone to senior managers asking for any potential vacancies which might suit the claimant. The response had been negative. Mr Partridge also handed the claimant a list of vacancies in the company. 5.45 The conversation covered much of the ground already discussed in the previous meeting on 29th August. The claimant strongly disputed that she was any risk to the company. She said that her job was of greater value than her husband’s job at Titan. Ms Feeney asked, why in that case, was that not considered when the claimant’s husband took the job at Titan. The claimant said they had not considered it to be a conflict. 5.46 Ms Feeney summarised that there was nowhere to go with the situation – the risk was there all the time, whether deliberate or inadvertent. It was not a sustainable position for the claimant. The claimant disagreed. She hoped her 21 years’ service meant something. Ms Feeney confirmed that the claimant’s service and performance were not being brought into question. They had been exemplary. 5.47 Ms Feeney felt there was no option but to terminate the claimant’s employment. The claimant said she had expected it but nevertheless begged to differ with the respondent’s view. The decision was confirmed by Ms Feeney in writing in a letter dated 11th September 2018 but no reasons were given; the claimant was merely informed of her notice and holiday pay and was informed of her right to appeal. Dismissal reasons – letter 13th September 2018 5.48 Ms Feeney wrote again to the claimant on 13th September 2018 and set out her reasons for the decision to dismiss the claimant. She referred to the list of vacancies that the claimant had been provided with and which they had not discussed. 5.49 Ms Feeney referred to the claimant’s husband visiting a current customer the previous week and that she had received copies of marketing emails from Titan referring to “manufacturer integrations are key to Titan’s innovative DMS” including the logos of all manufacturers active in the UK. Ms Feeney confirmed that she found it difficult to accept in a relationship of husband and wife that there would be no discussion about work related matters, whether inadvertently or intentionally. Even the most innocuous comment such as the locality a member of the sales force had visited could alert a rival to a prospect. The current rate of conversion was such that the company could not accept any risk of any information upon sales activity falling into the knowledge of a competitor. 5.50 With regard to deliberate passing of information by the claimant, Ms Feeney accepted that prospect was low, but that it was not fair or reasonable for the claimant to be placed in an unenviable and impossible position where she was potentially in possession of information which could result in a significant benefit to her husband and family by way of a significant commission payment to her husband. For those reasons she considered it was not possible for the claimant to remain in the company’s employment and that with regret there was no alternative but to terminate the claimant’s employment. Grounds of Appeal 5.51 The claimant appealed on 19th September 2019. Her grounds of appeal were comprehensive and detailed. They covered not just those grounds which had been covered extensively in the previous meetings with Ms Feeney and Mr Partridge, but also new grounds challenging the respondent’s grounds for dismissal, introducing further arguments which had not been raised previously. 5.52 The claimant referred to her belief that the decision to dismiss her had been predetermined; she believed that the perceived risk was not based on fact; she ridiculed the examples of how inadvertent disclosure of information might occur; she criticised the speculative and unsustainable position the respondent had taken on Titan being a competitor and that their assumptions were incorrect. She believed that she was being singled out and the company’s conduct was verging on discrimination and possible victimisation. The claimant disputed that Titan was a competitor and challenged the respondent’s assessment that it was a competitor. She pointed out that the respondent had taken a considerable period of time to reach the conclusion that Titan was a competitor. She submitted that the marketing email had no relevance to the UK market and wanted to know why it was relied upon. 5.53 The claimant complained that the company were aware of the potential for a conflict of interest in March 2018 but had taken no action for a year. Nor had they attempted to rely on the restrictive covenants in her husband’s contract of employment. The alleged conflict of interest was not the real reason for dismissal – it had not been important enough to act swiftly. The real reason was the claimant’s husband’s resignation and taking the respondent to the employment tribunals. Titan e-marketing to respondent’s customer 5.54 On 19th September 2019 one of the respondent’s customers forwarded to Ms Feeney a copy of an email he had received from Titan entitled “Cutting edge Technology is at the design forefront of Titan’s DMS”. Appeal hearing 5.55 Mr Christopher Bill was appointed the appeal hearing manager. He is the Managing Director of the respondent UK Technology division and one of the three members of the UK senior leadership team, the other two being the Financial Controller Mr Moss, and Ms Feeney. Mr Bill contacted the claimant by email on 21st September and invited her to an appeal hearing. The claimant chose to attend the hearing on 3rd October 2018. 5.56 On 21st September 2018, by email, the claimant challenged Mr Bill as to whether his appointment was in accordance with the Employee Handbook which referred to the appeal being conducted by a manager more senior that the manager who conducts the disciplinary meeting. Mr Bill replied on the same day that he was a senior manager in the UK business who is independent of the Sales and Operations Organisation. Mr Bill confirmed that he had not had any previous involvement in the matter. No further point was raised in response by the claimant. 5.57 I found Mr Bill to be an honest witness, acknowledging criticism of his conduct of the appeal hearing and accepting that there was room for improvement He had had no training at all in conducting disciplinary and appeal hearings. Despite his lack of training in disciplinary procedures, I had no doubt that he approached the task of conducting the appeal hearing with integrity and an open mind. 5.58 Mr Bill considered the appeal grounds and decided to make further investigations concerning the claimant’s claimant that Titan did not compete with the Respondent. He contacted Ms Feeney on 21st September 2018 for more information about Titan and whether they could pursue entry into the UK market or whether it was impracticable given the multi-franchise nature of most UK dealers. Ms Feeney provided Mr Bill with copies of Titan’s further marketing eshots. She had a conversation with Mr Bill. 5.59 Mr Bill sought independent third party information from Woods & Seaton on Titan in the UK market. He discovered that Titan had entered the UK market in 2012/2013 and had made positive progress with 15 installations in the networks of Ford, JLR, Honda and Subaru. From the e-shots provided by Ms Feeney, Mr Bill concluded that Titan were targeting Reynolds customers/franchises. He did not agree with Ms Feeney that Titan were making any impact in Europe. 5.60 On 3rd October 2018 Mr Bill conducted the appeal hearing. Mr Bill took the claimant through her grounds of appeal. Mr Bill had no note taker with him. His manuscript notes are scant. The typed notes of 37 pages in R1 are the transcript of a covert recording taken by the claimant at the appeal hearing. 5.61 After the meeting with the claimant Mr Bill requested further information from Ms Feeney. On 5th October Ms Feeney sent Mr Bill an email and a list of Hyundai dealers confirming that the value of the Hyundai franchise, if all clients with the Hyundai franchise were lost, would be £551,926 per annum. 5.62 Mr Bill did not provide the additional information he had obtained from Ms Feeney and Woods & Seaton to the claimant for comment. 5.63 18th October 2018 Mr Bill wrote to the claimant with the outcome of her appeal. He set out over four pages the principle points of appeal and his responses. In summary Mr Bill’s conclusions were: - That Mr Partridge had no market knowledge in March 2018 and did not pass on the information about Titan to senior managers. - The claimant’s husband’s restrictive covenants had been rendered void by reason of the settlement he received. - Titan are a competitor to the respondent in the UK whether or not they had taken any business off the respondent to date. They may not be a present threat but they have an established Australian parent company to protect them financially and commercially. It was clear they wished to invest in manufacture integrations in the UK Market. Mr Bill considered it likely that Titan would grow to become a more serious threat in the future. He did not believe that John Kilburn as an experienced sales person would have taken a role with Titan if he did not believe there was potential in the company. - It was acknowledged that the claimant had an exemplary record. The claimant worked in close proximity to sales peoples in the company and had access to product pricing, price book, contract information including contract end dates and amendments, billing information and third party agreements and costs. - If the claimant’s husband asked her for information it would put the claimant in an invidious position. Whilst it was acknowledged that the claimant has stated that she would not knowingly provide sensitive information, and the risks associated with inadvertent provision of useful information are small, the question still arises whether the respondent would wish to continue to employ the claimant in a senior commercial role and take the risk. It was a matter for the company to decide. 5.64 Mr Bill noted that the claimant had been provided on 11th September 2018 with a list of other vacancies in the respondent’s business. 5.65 Mr Bill asked the claimant whether she had been asked whether there was anything that had not been considered and she replied: “no, not really’. He asked the claimant if she wished to be reinstated and she replied that she believed that she was not wanted in the company and Adele Feeney had said no one wanted to work with her. The matter was not discussed further. 5.66 Mr Bill dealt with other two points of complaint relating (i) to unprofessional behaviour of a manager discussing with another person the claimant’s conflict of interest and the prospect of the claimant leaving. The conversation had overheard and reported to the claimant. (ii) the claimant believed she was put under pressure to train a junior member of staff to take over the claimant’s role and that the claimant had not been given a pay increase when the junior member of staff had. Mr Bill found there was no intention to terminate the claimant’s employment in October 2017. 5.67 Mr Bill found that the company had acted correctly and did not uphold the appeal. Titan sales activities 5.68 Between 12th September and 3rd October 2018 Titan sent marketing emails to one of the respondent’s customers each dealing with a different aspect of Titan’s services, each of which were competitive with the respondent’s business activities. 5.69 On 30th October 2018 Titan sent an invitation to the same customer inviting them to the Titan DMS stand at a major exhibition for automotive management at the NEC, Birmingham. Commencement of proceedings 5.70 The claimant entered into early conciliation on 15th November 2018. Her claim form was filed on 4th January 2019. 5.71 The claimant covertly recorded the dismissal and appeal hearings. Her transcripts exceeded in detailed content the respondent’s notes, however there was no material contradiction of the recording transcripts from the respondent’s notes where they existed. Submissions[6]I heard submissions from both counsel and written submissions in addition from Mr Gidney. I am grateful for the clarity of the submissions. I have read and re read the submissions and deal with them in my conclusions as appropriate.Law
[7]The law in this case is to be found in sections 98(1), (2) and (4) of the Act, which state: “(1) In determining for the purposes of this Part whether the dismissal of an employee is fair or unfair, it is for the employer to show —(a) the reason (or, if more than one, the principal reason) for the dismissal; and(b) that it is either a reason falling within subsection (2) or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held. (4) Where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer)- (a) depends on whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and (b) shall be determined in accordance with equity and the substantial merits of the case”[8]The Tribunal must also take into account the ACAS Code of Practice on disciplinary and grievance procedures when coming to a judgment. Conclusions Date of a knowledge of disclosure risk and delayConclusions
[9]I first determine whether the respondent was on notice from March 2018 that Mr Kilburn worked or was going to work for Titan. This is a point that has exercised the claimant in that it suggested to her that for the several months that her husband was working for Titan, the respondent was aware of it but did not perceive any risk to its business. The claimant therefore concluded that the real reason for dismissal was because her husband had brought proceedings against the respondent and obtained a settlement, not because there was a potential risk to the respondent.[10]In about late March 2018 Mr Partridge saw a reference to Titan in the schedule of loss in Mr Kilburn’s employment tribunal litigation with the respondent. Mr Partridge was unaware that Titan provided DMS software and believed they sold automotive spare parts. He had a Titan roof rack on his car. He therefore did not recognise the need to pass on the information to Ms Feeney. The claimant did not directly dispute that explanation during her meetings with Mr Partridge and Ms Feeney.[11]It is not disputed that the claimant did not mention to Ms Feeney, her line manager, the fact that her husband had joined a Titan in early April 2018. Her reason for not doing so was that she and her husband had not considered Titan to be a competitor. She said they had not discussed it. I find that was an error of judgment. In the light of the Mr Kilburn’s litigation with the respondent, the claimant’s failure to recognise the potential for her line manager to be concerned that Mr Kilburn had commenced working for Titan, was naïve and surprising given the value the claimant placed on her employment with the respondent. It would have been prudent and an act of good faith for the claimant to have raised the subject with Ms Feeney either before the claimant’s husband took the Titan vacancy or very soon afterwards even if she did not believe Titan was a competitor. Knowing that other employees knew indirectly about Mr Kilburn working for Titan did not adequately explain why the claimant did not inform her line manager of that fact or even ask her line manager in advance of Mr Kilburn taking the Titan job whether it was potentially a problem for the respondent.[12]Ms Feeney claimed that she did not become aware that Mr Kilburn had joined Titan until July 2018 when she was notified of it by a member of staff who had seen it on Linked In. I accept her evidence. As soon as Ms Feeney became aware of it, she notified her sales staff of that fact and reported it to her line manager. Ms Feeney was deeply troubled by the information concerning Mr Kilburn. I have no doubt that had she discovered the fact of him working for Titan in March/April 2018 she would have taken the same action then and not waited for five/six months. Ms Feeney was unaware of Mr Kilburn’s new employment before 19th July 2018 and when she became aware she reacted quickly and took action as set out above in my findings of fact. There was no delay between March – July 2018.[13]I find that the operative date for the respondent’s knowledge of Mr Kilburn working for Titan was 19th July 2018 when Ms Feeney was informed of the fact by a member of staff.[14]The claimant also complained of the alleged delay of some ten days between Ms Feeney discovering the fact of Mr Kilburn working for Titan on about 19th July and raising it with the claimant on 31st July. The claimant claimed this as a further example of the respondent not believing there was an issue with Mr Kilburn working for Titan.[15]I do not accept that assertion as having validity. Since discovering that Mr Kilburn worked for Titan on 19th July, Ms Feeney made inquiries and discussed the matter with her line manager in the US and legal counsel in the UK. It was appropriate that she did not give a ‘shoot from the hip’ response without reflecting on the situation, making inquiries and discussing it with her line manager. Was there an ulterior motive for dismissal?[16]The claimant alleges that Ms Feeney had an ulterior motive for dismissing her; she believed that it was the litigation between Mr Kilburn and the respondent. She believed her ‘cards were marked’ since that time. The evidence does not support that allegation. Despite Mr Kilburn’s departure in July 2017, Ms Feeney had been supportive of the claimant in January 2018 when reviewing the claimant’s achievements in 2017 and her goals for 2018. On 19th January 2018 she stated in an email to the claimant “Thank you for another solid year” and “Your work on the PAF projects is noted, and appreciated. Thank you for all you have done in 2017 and I look forward to another successful year working you in 2018”.[17]Also in her private email correspondence with her line manager in the US, Mr Agan, when discussing salary reviews, Ms Feeney was supportive of the claimant. On 11th April 2018, after Mr Kilburn’s employment tribunal proceedings were settled, Ms Feeney stated in response to a query about the claimant from Mr Agan concerning a proposed salary increase: “Despite her husband, she’s actually had a good year and continues to add a lot of value”.[18]Ms Feeney had also recommended the claimant for an £8,000 bonus.[19]There was nothing in the evidence that indicated Ms Feeney intended to dismiss the claimant prior to July 2018 and the discovery that Mr Kilburn was working for Titan. Even in July 2018 when Ms Feeney was raising concerns about the claimant’s potential conflict of interest, she described the claimant in positive terms: “she does a good job, of that there is no doubt.”[20]I find that the claimant’s allegation was speculative and had no factual basis. The risk of disclosure of information as the reason for dismissal is supported by sufficiently persuasive documentary evidence. The documentary evidence does not point to an intention to dismiss prior to July 2018. The reason for dismissal[21]I then consider what was the reason for the claimant’s dismissal and does it amount to some other substantial reason within section 98(1) Employment Rights Act 1996. The burden of proof is on the respondent. Was Titan a competitor?[22]To answer that question I must determine whether it was reasonable for Ms Feeney to conclude that Titan was a competitor of the respondent? The claimant was vehement that Titan was not a competitor and that the respondent had no real basis to conclude that it was. Essentially there was a difference of opinion between the claimant and her employer as to whether(i) Titan was a competitor and(ii) if so, whether the claimant was a risk to her employer.[23]The claimant did not only refuse to accept that Titan was a competitor but also did not accept even if Titan were a competitor, that the mere fact of competition, whether or not any business was won from the respondent by Titan, was not sufficient risk to justify her dismissal because any business won would be of insignificant proportions. The claimant vehemently objected to her dismissal as it undermined her integrity which had never been challenged before.[24]I look for the evidence to support Ms Feeney’s opinion that Titan was a competitor. The first documentary evidence in R1 that Ms Feeney was aware of Mr Kilburn’s engagement with Titan was an email on 19th July 2018 in which Ms Feeney informed Mr Moss, Mr Agan and Mr Partridge that Mr Kilburn had joined Titan who she said were “actively trying to grow their footprint in the UK”.[25]Ms Feeney stated in her email 2 days later on 21st July 2018 to the sales team that John Kilburn had joined Titan DMS in a sales capacity. She requested that they report back immediately if they became aware of any issues but reassured them that Titan had a very limited footprint in the UK so she did not see them as serious competition, although the company should take the threat of an ex-employee approaching its customers very seriously.[26]It is clear that Ms Feeney regarded Titan as a competitor from the very beginning of the sequence of events commencing on 19th July 2019 although at that stage not one of the major competitors. What evidence did she have and what was her basis for believing Titan was a competitor?[27]From the first interview (the suspension meeting) with the claimant on 31st July 2018 Ms Feeney was of the opinion that Titan was a competitor because they were a DMS supplier. They were targeting non franchised dealers/single dealers -business who were also targeted by the respondent.[28]On 29th August 2018 Ms Feeney stated to the claimant: “We’ve seen small new entrants to the market take business off us and most recently Pentana, before that Ebon Dacs, before that Pinewood. Pinewood were at one stage six people in someone’s front living room. So Titan probably more so that one of the mainstream competitors are a bigger threat to our legacy base because they will be out there trying to buy business because they need to get a footprint, otherwise Titan will end up pulling out of the market like Pentana are probably gonna do. So our customer case are absolutely beautiful targets for Titan”.[29]She also stated: “Are you telling me that Titan are going to just sell to used car supermarkets? I don’t think so because I know where they are active already and that is not the case and they are out there saying they will build said interfaces.”[30]On 11th September 2018 Ms Feeney informed the claimant that Mr Kilburn had visited a customer of the respondent, a franchised dealership (James & Jenkins) in the previous week. She stated that Titan were targeting the respondents’ customer based and there is a large section of the respondent’s customer base that would be very attractive to Titan. Ms Feeney explained to the claimant: “…..the reality is that Titan are a competitor of [the respondent] which has been bourn [sic] out by the fact that John has been contacting our clients….. that’s the reality of it. I know other people at Titan, they are a competitor. They wouldn’t be entering the UK market just to target non-franchised dealers because they will not succeed and they will never be able to sustain a business. They have wider aspirations than that and they have shown that in other European markets. You couldn’t build a business flogging to nonfranchised dealers. You couldn’t! Impossible![31]Ms Feeney also stated: “Pentana started in the same position and they took business off us. They took business off CDK with the promise of what they can do. Whether they or whether Titan manage to deliver in the future remains to be seen but that’s the sales tactic a company trying to get a foothold in the market will do. You know, they will buy business. They will commit to develop things. We did the same thing – I am still trying to deliver on contracts I signed seven pissing years ago about what I am gonna deliver and we haven’t finished yet, you know we have done. We commit that we will do x, y an z. They will do the same thing. They would be crazy not to. I am just trying to explain that I don’t agree that they are not a competitor because they absolutely are. I said that at the last meeting and I will say it again and, for sure, they are and the very fact that John has called on clients we know, that it’s the same target market. I don’t know how relevant going into that any more is but it is very relevant that we see them as a competitor because that is the crux of this. If they weren’t a competitor, if they were selling motorbike parts then we wouldn’t give a shit but they don’t”. 31. There was no hard documentary evidence in R1 that Titan were targeting the respondent’s clients at the point at which the claimant was dismissed but Ms Feeney was aware of one example of Mr Kilburn using his knowledge of the respondent’s customer base to visit one of them.[32]In her witness statement Ms Feeney described her state of knowledge of Titan in July 2018. It was an Australian company who had begun to appear at trade events in the UK and that she knew they had achieved sales in the UK market but at the point when Mr Kilburn joined them they probably had fewer that ten franchised customers in the UK. To have launched in the UK, they must have intended to grow their customer base and to do this they would necessarily have to develop a suite of interfaces.[33]Ms Feeney said that it was inconceivable that Titan would not target franchised dealers; there was simply insufficient revenue without this sector to support a growing business. She said that the respondent also targets single site dealerships and dealerships for which the respondent cannot offer any interfaces. That places Titan in direct competition with the respondent.[34]Despite there being no documentary evidence prior to 11th September 2018 in the hearing bundle that Titan was a competitor, I find that Ms Feeney held a genuine belief that Titan was a competitor, albeit a small competitor, at the date she dismissed the claimant, 11th September 2018, and that her belief was based on her actual knowledge of Titan, her expert knowledge of the industry sector and the UK market in which the respondent was one of the larger players. She based her opinion on Titan’s current status in the market and the potential for growth on her own experience of 20 years developing the respondent into a major player. Her own experience informed her that the only way for Titan to grow was to target franchised dealerships and to offer software solutions which they currently couldn’t provide but would develop in the future as they grew their business. Targeting a client of the respondent had occurred on one occasion to Ms Feeney’s knowledge in the week prior to the meeting with the claimant on 11th September 2018. Titan was a competitor. Was there a conflict for the claimant as a result of Mr Kilburn’s engagement by Titan?[35]Was Ms Feeney’s belief based on her professional expertise and experience and the knowledge of Titan she held at that time, sufficient to consider that the claimant had a conflict because her husband worked for Titan? Ms Feeney was so confident in her belief that Titan was a competitor that she did not focus on proving that it was, but on the risk to the respondent as a result of Mr Kilburn’s recruitment to Titan and the consequential invidious position she believed the claimant was in with the potential for split loyalties.[36]The assessment of risk to the respondent is an executive commercial decision. It is not for the tribunal to make a dissenting decision on risk and substitute it for the respondent’s decision. It suffices if the respondent acted reasonably and had reasonable, genuine grounds to believe that there was a risk of a breach of confidentiality.[37]A member of the sales team emailed her to say that he was uncomfortable requesting prices for a sales prospect from the claimant once he was aware that her husband worked for Titan. Ms Feeney’s evidence was that other members of her sales team were concerned when they learned of Mr Kilburn’s new position and had asked Ms Feeney whether they should interact with the claimant because of a concern that confidential information could be passed to a competitor. A lack of confidence and cohesion in the sales force was not a matter which Ms Feeney could have ignored. The claimant challenged Ms Feeney on this alleged concern by the sales force, not believing it to be true as many members of the sales force were still friends with Mr Kilburn.[38]Ms Feeney also explained that the respondent’s sales team members are prohibited from giving any indication of their movements on social media or their location on Foursquare or Facebook because competitors could potentially work out which prospect they were visiting. The DMS market was small and any tiny piece of information could in correlation with a competitor’s market intelligence, reveal an opportunity that the respondent may have been developing for several years.[39]Ms Feeney stated that the sales team would not divulge information which damaged their own sales prospects and therefore it was irrelevant whether they still had contact with Mr Kilburn.[40]Ms Feeney was of the view that given the difficult market in which the respondent operated, and given Mr Kilburn’s sales experience and his historic knowledge of the respondent’s client base, that even an innocuous, innocent comment by the claimant to her husband could be a useful sales tip even if the claimant had not intended to impart any such information. Ms Feeney did not at any point believe that the claimant had already disclosed information to her husband. She had two premises on which she approached the problem of confidentiality. The first was the inadvertent disclosure of information; the second was the potential for the claimant to disclose deliberately information because she had an intimate knowledge of the company’s systems, clients, pricing, sales cycles, and sales prospects, to disclose information at a later date deliberately. She saw both as a risk to the respondent’s business. Such information would assist the claimant’s husband in being successful in his role at Titan. The claimant asserted that she would never disclose any information, knowing that it was wrong and gross misconduct to do so. Ms Feeney believed that the claimant could be put in an invidious position where her loyalties would be divided if her husband were to ask her for information.[41]Ms Feeney was fully aware of the claimant’s lengthy, impeccable service history with the respondent. She believed that that was retrospective and did not have relevance to the future risk because of Mr Kilburn’s sales role with a[42]Was Ms Feeney’s approach reasonable in the circumstances? Ms Feeney checked with Mr Partridge whether the restrictive covenants in Mr Kilburn’s employment contract would be effective in controlling Mr Kilburn’s competitive sales activities but he had resigned and claimed constructive unfair dismissal. Therefore without court proceedings to establish the enforceability of the restrictive covenants, the respondent took the view they could not be relied upon.[43]Ms Feeney and Mr Partridge considered whether the claimant could be isolated from the sensitive commercial information she dealt with to mitigate the risk. They concluded and the claimant agreed, that in doing so she would be left with no job at all.[44]Ms Feeney was aware that the claimant sometimes took work home and worked on her lap top. This was another potential source of an information leak although it was not one that was put to the claimant as an issue or a matter which was raised in mitigation – ie no working at home.[45]Ms Feeney was concerned that if she accepted the claimant’s assurances that there would be no leakage of information, inadvertent or otherwise, to Mr Kilburn, that circumstances may change. The risk would remain.[46]Taking an overview of the evidence, on the balance of probabilities, I find it was enough to justify Ms Feeney’s concern that one member of the sales force expressed a concern about working with the claimant because of her husband’s engagement by Titan. I find that Ms Feeney was entitled to reach an executive decision that the respondent could not bear the risk of a breach of confidentiality that was created by the claimant’s position in the respondent and her husband working in sales for a competitor. At the point of dismissal, Mrs Feeney had some evidence of Mr Kilburn’s competitive activity. She had her own industry knowledge and experience on how Titan were going to develop its foothold in the UK market. She was motivated to protect the respondent in a difficult market.[47]I find those are sufficient reasonable grounds for her reaching the conclusion that the claimant’s continued employment was a risk to the respondent. I find that it was naïve of the claimant to believe and expect the respondent to implicitly trust that her loyalty to her employer could and would exceed and extinguish any risk of sensitive information financially beneficial to her husband being passed to him, whether deliberately or inadvertently.[48]The decision taken by Ms Feeney was a commercial decision which was taken to protect the respondent in the future. It was her duty as a director to act as she did. It was a reasonable decision to make. The decision to dismiss falls within S98(1) as some other substantial reason. Fairness[49]I then turn to the question of fairness. It was submitted, and it was also the claimant’s evidence, that she had been misled by Ms Feeney; that Ms Feeney and Mr Partridge had led her to believe that they did not think she would deliberate divulge sensitive information to her husband when, in truth, they were harbouring the belief that she might deliberately divulge information to him.[50]The claimant was deeply offended at the implication that she would deliberately divulge sensitive or useful information to her husband deliberately. Her words were that she was “massively offended”. It is not surprising therefore that Ms Feeney and Mr Partridge found it difficult to state frankly that they were concerned about the risk that the claimant might deliberately pass information to her husband. It was clear that if they did so it would be grossly offensive to the claimant and very confrontational. They therefore couched their concerns in less provocative terms. However I have no doubt that the claimant was aware that the respondent was concerned about inadvertent and deliberate disclosure of commercially sensitive information.[51]At the meeting on 29th August when the claimant referred to her research on conflicts of interest and what she believed was a conflict of interest (relatives working in the same department), she stated that never in all of her years with the respondent did she give them any indication that she was that way inclined – to prioritise her husband’s work over another employee. Mr Partridge responded: “I don’t believe there is any concern that you would do something like that although there is, it would be wrong to say there is no concern…..”[52]Later in the conversation Ms Feeney states: “but you have access to all of the prospect details. You can see, and again we are not saying that you would, but whether you continue to put them together or not, you would have access to everything. You could run one report – give me everything that is going on with X (prospect) numbers”.[53]Ms Feeney also refers to hard commercial information rather than an inadvertent innocent comment being made. She stated: “so what we are saying is that the company sees a potential risk because of your access to information and, as Andrew says, no one is saying you have done anything but that is the perceived risk, that information could be very, very valuable to John and other people in his organisation.”[54]The claimant states in response to a discussion about her access to all the respondent’s information systems: “”so we are, again, back to the point that we are not talking about an inadvertent slip, you are talking about me saying to John “we have just quoted £42,000 to so and so. That is gross misconduct. I wouldn’t do that. I have never ever done anything that would jeopardise my role or my work with the company.”[55]The discussions at the suspension meeting and the dismissal meeting were repetitive and discursive. There are more examples where Mr Partridge and Ms Feeney expressed their view that they accepted that the claimant had not acted inappropriately to date but that there was the potential whether inadvertent or deliberate for information to be passed to the claimant’s husband.[56]In the dismissal letter of 10th September 2019 Ms Feeney writes to the claimant: “You forcefully expressed your own honesty. We made it absolutely clear we make no suggestion that you have acted in any other manner than entirely appropriately. The concern for us as a business is the potential for information gained in your capacity as an employee of this Company to be passed to John, either knowingly or inadvertently over the dinner table for example.” [My emphasis][57]I find that the claimant was aware throughout of the fact that Ms Feeney was concerned about a deliberate leak of information by the claimant to her husband (which she found massively offensive) as well as an inadvertent disclosure. The claimant expected the respondent to trust not only her, but also her husband, now an ex employee, not to place the claimant in a difficult position and present her with a dilemma of split loyalty.[58]With regard to procedural fairness, I find there was none. The claimant was a senior employee. The respondent held lengthy discussions with the claimant at both the suspension and dismissal meeting. She was clear about the issues. She was aware her job was at risk. She was able to state her case fully. Ms Feeney consistently explained to the claimant her perspective against which the claimant was able put counter arguments. It was established that there was no available mitigation to isolate the claimant from sensitive information. The fact is that the claimant refused to acknowledge the respondent had any cause for concern. The claimant was offered an appeal.[59]It was also submitted that that Ms Feeney had made up her mind in advance that the claimant must be dismissed and therefore that Ms Feeney was misleading the claimant and that the meetings were a sham. The true state of Ms Feeney’s mind was set out in the email to Mr Agan on 30th August, ten days before the claimant’s dismissal. She said “There is nothing she said throughout the [suspension] meeting that changes my mind. I could not categorically say she would or would not pass information on to him. What I can say is that the temptation to do so is too great in my mind, and therefore the risk to our business is one I for one wouldn’t want to take.”[60]Without question Ms Feeney was deeply concerned about the claimant continuing to work for the company. She also did not wish to negotiate an exit. With hindsight and perhaps the cost of litigation, perhaps she might reflect on that. However, I have considered whether Ms Feeney’s mindset rendered the dismissal unfair – that the outcome was predetermined.[61]Ms Feeney and the claimant had lengthy discussions. Ms Feeney heard the claimant’s counter arguments at length. She was not persuaded by the claimant. The claimant was likewise not persuaded by Ms Feeney’s logic and counterarguments. I do not find that the decision to dismiss was arbitrary. The claimant was given an opportunity to fully state her case. The facts were such that the claimant was genuinely perceived as a risk. Ms Feeney had perceived the claimant as a risk to the business from the first date of knowledge about Mr Kilburn working for Titan. The decision of how much risk the respondent was prepared to take was an executive decision. It cannot be said that the respondent failed to disclose the problem it faced and failed to hear the claimant’s arguments. The claimant’s lack of success in persuading Ms Feeney to ignore that the claimant’s husband worked for a competitor and accept that the risk of a breach of confidentiality whether deliberate or inadvertently was in the claimant’s opinion infinitesimally small and therefore inconsequential, does not mean that Ms Feeney had acted arbitrarily or unfairly. Ms Feeney gave the claimant every chance to bring Ms Feeney around to her way of thinking. That the claimant failed to do so, does not mean that Ms Feeney was arbitrarily holding to her opinion. It means that the claimant did not have a good enough case.[62]It was submitted that the respondent had failed to make an adequate attempt to find alternative employment. The respondent did an internal search with managers prior to dismissal, to identify any suitable vacancy for someone of the claimant’s seniority and skills. There were no suitable vacancies.[63]A list of vacancies of lesser positions was provided to the claimant at the dismissal meeting but there was no further discussion. The failure to discuss the detail of these potential roles with the claimant was a procedural failing. The claimant did not respond. The matter was raised again at the appeal. Does this render the dismissal process unfair?[64]The vacancies were lesser roles. The claimant had held a senior position for many years. In the context of the events I have found, the lack of exploration of the vacant minor roles within the respondent was not sufficient to render the dismissal procedurally unfair. The claimant was an articulate and confident in voicing her point of view. Had she been remotely interested in inquiring and discussing a lesser role in the respondent’s organisation I have no doubt she would have put it forward as a point for discussion. She did not. In the circumstances I do not find that the failure to actively press a discussion on alternative roles with the claimant was a fatal procedural flaw.[65]In summary on the question of whether the dismissal was fair or unfair, to be clear, I am clear that it was for the respondent to make an executive decision on the degree of risk that it faced. That decision had to be supported by reasonable grounds. I find that Ms Feeney had a reasonable belief the claimant posed a risk to the respondent and that belief was based on reasonable grounds. The dismissal was fair. The decision was one that any reasonable employer in a similar position to the respondent might have taken. The appeal[66]In case I am wrong on my decision that the dismissal was fair, I consider the appeal conducted by Mr Bill. There was a serious procedural flaw in the Mr Bill’s conduct of the appeal hearing although I found that Mr Bill approached the task of appeal hearing officer with integrity. I also found him to be a honest witness. He had no prior knowledge of the issue Ms Feeney raised about Mr Kilburn and Titan.[67]It was submitted that Mr Bill was influenced by Ms Feeney and not sufficiently independent because he was at the same level of seniority to Ms Feeney. He was one of the three senior managers in the UK. He was not involved in sales.[68]Mr Bill was not involved in sales. Mr Bill rightly conducted further investigations to satisfy himself whether or not Titan was a competitor. The procedural flaw was that he did not disclose to the claimant the additional information he had gathered; he did not ask for her comments before he reached his conclusion to uphold the dismissal.[69]What information did Mr Bill receive? He asked Ms Feeney for more information. She provided him with copies of marketing emails sent by Titan to the respondent’s clients – one of which was the day following the dismissal. In response to a question from Mr Bill about the potential loss of business to the respondent, Ms Feeney stated that the loss of the Hyundai franchises would be over £500,000.[70]The marketing information passed to him by Ms Feeney showed that Titan were approaching the respondent’s customers and franchises both directly and at trade shows. Titan were make bold claims about their capabilities.[71]Mr Bill also made his own inquiries about Titan with a respected and well known market research firm, Woods & Seaton. He took that information into account to reach his view that Titan was a competitor. He set out in the appeal outcome letter the following grounds for reaching that view: “- Mike Seaton notes in one of his reports that [Titan] entered the UK market in 2012/2013 and have a positive progress, with 15 installations in the networks of Ford, JLR, Honda and Subaru.[72]Mr Bill acknowledged in robust cross examination that he made procedural flaws including a failure to take detailed notes and having a note taker with him through the meeting.[73]Mr Bill accepted he had failed to conduct the appeal transparently from the claimant’s point of view. Having held lengthy and detailed discussion with the claimant who was given every opportunity to express counter arguments, Mr Bill reached the unequivocal view that the Titan was a competitor. He gave detailed reasons for his decision to find that Titan were a competitor. They were: - “Mike Seaton notes in one of his reports that they entered the UK market in 2012/2013 and have made positive progress, with 15 installations in the networks of Ford, JLR, Honda and Subaru. Their largest customer to date has 3 locations with 60 users of a single Titan DMS. - Titan DMS are actively marketing to Reynolds and Reynolds customers, including those outside the Hyundai franchise, and stating that there are no additional fees to the dealer for manufacturer integration. They are clearly investing in manufacturer integrations and will no doubt commit to develop these in order to make a sale. - They are targeting Reynolds and Reynolds by making unfavourable comparisons between their Windows based platform and our technology. - They are targeting Reynolds and Reynolds in-house customers using a SaaS offering with no upfront hardware costs or subsequent upgrade costs. - Although they only run a small number of UK personnel currently, they are recruiting into software implementation/training and helpdesk roles. - They exhibited at AM Live in 2017 and will do so again in 2018. - Reynolds and Reynolds is currently competing direct with Titan DMS for a prospective customer.[74]Having found Mr Bill to have approached his role as appeal hearing officer with integrity and with no prior knowledge about whether Titan truly were a competitor, I had the benefit of hearing Mr Bill’s evidence and I found Mr Bill to have sufficient independence as an equal of Ms Feeney’s, to be able to disagree with her if he felt it appropriate to do so. I believe that Mr Bill did try to conduct a fair examination of the appeal grounds. I had no concern as to his integrity as the appeal hearing officer. I do not believe that Mr Bill was influenced by Ms Feeney. I find that he had reached his own views.[75]In all the circumstances, the critical question answered by Mr Bill was whether Titan were a competitor and was it appropriate to consider the claimant a risk to the respondent’s business because of her husband’s employment by that competitor? Mr Bill had sufficient evidence to reach the reasonable conclusion that the answer was yes to both questions. I find it highly unlikely that had she been presented with the additional information that Mr Bill had obtained, the claimant would have had anything further of significance she could say to disprove or undermine Mr Bill’s opinion that Mr Kilburn was competing with the respondent. Mr Bill was of the opinion on that basis that it was for the respondent to decide what degree of risk it was prepared to take. He found that Ms Feeney’s decision was an appropriate decision.[76]For completeness I consider the procedural question of whether Mr Bill had the status to conduct the appeal hearing. The respondent’s disciplinary procedure referred to an appeal hearing officer being at a higher level of management than the dismissing officer. Mr Bill and Ms Feeney were at the same level of seniority in the UK business.[77]Despite the statement in the disciplinary procedure, there was no precedent in the UK business for a dismissal appeal to be forwarded to the US line management to conduct. The comparison relied upon by the claimant was Mr Kilburn’s grievance appeal. That was heard by a US manager because Ms Feeney had been involved at the grievance hearing level. I find that not referring the disciplinary matter to the US management did not render Mr Bill’s conduct of the appeal hearing unfair. It does suggest that the respondent should revisit both the training of appeal hearing managers and the disciplinary policy.[78]In summary, the dismissal was fair. I have considered the appeal hearing for the sake of completeness although I do not find that it needs to be taken into account save that it confirmed beyond any doubt that the reason for dismissal was fair. Signed by