Mrs J Parry v L&D Brothers Ltd: 1600458/2017
JUDGMENT
It is the decision of the Employment Judge sitting alone that:[1]The constructive unfair dismissal claim is upheld;[2]The wrongful dismissal claim is upheld;[3]The claimant is due payment for 4.03 days holiday on termination of employment for the holiday year 2017;[4]The claim for unauthorised deductions in respect of(i) sick pay is dismissed;(ii) keys and iPad is upheld. The claim for compensation is upheld in the following sums:[5]Basic award: £4,984.56 (sum agreed by the parties);[6]Wrongful dismissal: £2,764.24 (sum agreed by the parties);[7]Keys: £19.20 (sum agreed by the parties);[8]Holiday: £15.55 (sum agreed by the parties); 9. iPad: £100;[10]Loss of statutory rights: £500;[11]Loss of earnings to the date of hearing (less mitigation): £5,036.85;[12]Future loss of earnings (less anticipated future earnings): £3,219.30;[13]Uplift of 10% for failure to follow ACAS Code on Disciplinary & Grievance: £1663.97 Recoupment For the purposes of the Employment Protection (Recoupment of Benefits) Regulations 1996 the following information is provided:(a) Grand total £18,303.67(b) Prescribed element £ 5,540.53(c) Period of prescribed element from 10 March 2017 to 7 November 2017(d) Excess of grand total over prescribed element £12,763.14REASONS
[1]My written Judgment was sent to the parties on 16 November 2017. Written reasons were requested by the Respondent on 27 November 2017 by email but the request was not referred to me until 31 January 2018. By the time the referral was made, I no longer had notes of my oral reasoned judgment. The parties were informed and their views sought on whether they still sought written reasons, in light of the fact that they would not be precisely mirror the reasons given at hearing. The Respondent confirmed it wished me to reconstruct reasons from the available material.[2]The parties were invited to send in written notes they had retained. The Respondent provided their notes of the judgment; the Claimant did not.[3]These written reasons were constructed on the first available chambers day, 9 March 2018. They are based on the witness statements, agreed bundle, written submissions of the Claimant, Respondent’s notes of judgment and my own notes of evidence. They reflect, as best I can, the reasons provided at hearing, based on the material available and my recollection.Hearing
[4]I heard evidence from the Claimant. On behalf the Respondent I heard from Mr David Griffiths, managing director and his wife Ms Diann Griffiths and Mr Vittorio Sardella, service manager.[5]In their statements, Mr and Mrs Griffiths made allegations regarding matters discovered after termination of employment (paragraph 45 and 46 of Mr Griffiths’ witness statements and paragraphs 32 – 36 of Mrs Griffiths’ witness statement). These issues were not pleaded by the Respondent and when I raised this, no application to amend the response was made. Accordingly, I did not take them into account.[6]The case was heard over 2 days; oral judgement with reasons was given on day 2. Once my judgment on liability was given, I permitted the parties an adjournment to attempt to agree compensation. The parties were only able to reach limited agreement in the following areas; calculation of the basic award, calculation of the award for wrongful dismissal, the amount due in respect of unauthorised deductions for replacement keys and the amount due in respect of unpaid holiday pay.[7]I proceeded to hear evidence and submissions with regard to the remaining issues of remedy. Following the adjournment to make my decision on remedy, I presented the parties with my calculations for compensation and permitted them time to consider them and make any representations. The parties agreed the calculations of compensation.Law
[8]The relevant law with regard to constructive unfair dismissal, wrongful dismissal and unlawful deduction from wages is well known and I do not repeat it here. The Respondent did not take issue with law as set out in the Claimant’s skeleton argument dated 5 November 2017. Factual findings[9]The Claimant worked for nine years for the Respondent garage as an account manager, dealing with finance related matters including accounts, wages and banking. Her employment started in April 2008 and terminated with her resignation with immediate effect on 10 March 2017 (letter at page 118 – 119).[10]The Claimant was employed under a written contract of employment and subject to a contractual handbook.[11]The Claimant’s office was situated upstairs in the Respondent’s premises, where the physical accounts records were retained. The Respondent had a safe in the office upstairs and also downstairs in its premises, with copy keys located in the safe downstairs.[12]As part of her role, the Claimant had possession and control of the Respondent’s bank card and reader for making payments. Sometimes the Claimant worked from home, which was permitted, for example when caring for her father.[13]Matters came to a head at the work Christmas party on Friday 9 December 2016, at which the Claimant was assaulted by Mrs Griffiths; my finding in this regard is based on the Magistrates Court conviction of assault by beating on 8 May 2017. The standard of proof in the criminal courts is higher than that applicable in the Employment Tribunal and I must take that into account when reaching my conclusion as to whether the assault took place.[14]It is not disputed that the police were called to the Christmas party in light of events following the assault. The Claimant gave a statement to the police on 11 December 2017, indicating that she could not return to work.[15]The Claimant’s complaints in the Tribunal are based on events which follow the assault and how the Respondent handled matters thereafter.[16]The Claimant did not attend for work on Monday, 12 December 2016; she presented fit notes and was absent continuously until her resignation.[17]The Claimant contacted the Respondent’s receptionist to inform her of her absence and asserts that she was told that Mrs Griffiths was upstairs in her office on her computer. I found as a fact that on 12 December 2016 Mr Griffiths instructed his IT support company to prevent the Claimant from accessing work computer systems by changing her passwords, on the basis that she no longer worked for the Respondent (page 66 – 67).[18]On 13 December 2016 Mr and Mrs Griffiths visited the Respondent’s bank manager, who reported that the Claimant had viewed the Respondent’s bank account. It is asserted, although no direct evidence was given, that the bank manager advised removal of the Claimant as a Companies House registered company secretary. Mr Griffiths instructed the Claimant should be removed from Companies House register on 13 December 2016.[19]Mr Sardella spoke with the Claimant on the telephone and produced undated handwritten notes of discussions at the hearing. The notes are not extensive but show that Mr Sardella asked the Claimant whether she was bringing a grievance against Mr Griffiths. An informal meeting was convened on 17 December 2016, at which Mr Griffiths asserted that the Claimant had not been dismissed but asked that she return company property, which he asserted was for continuity of business purposes. The Claimant was supported by her brother at the meeting.[20]Ultimately Mr Griffiths instructed Peninsula’s HR team to investigate the Claimant’s complaints. I concluded that the Respondent’s interpretation of the grievance, as set out in correspondence, failed to capture the totality of the Claimant’s concerns. The Claimant did not attend a grievance meeting but instead sent written submissions. The investigation carried out did not include obtaining signed witness statements. A third-party witness to the assault, Carl Haycocks, did not provide a signed witness statement, instead the words it is said are attributed to him appear in an email which the HR consultant, Ms Walberg, sent to herself. The Respondent asserts that Ms Walberg spoke with Mr Haycocks by phone. Importantly Mr Haycocks’ statement was not put to the Claimant for her comment, prior to Ms Walberg making her findings and rejecting the grievance.[21]Mr Griffiths elected to adopt the grievance report as his findings and sent them to the Claimant on 1 March 2017. The Claimant did not exercise her right of appeal and instead resigned on 10 March 2017, setting out the reasons for her resignation in a two-page letter (page 118 – 119).[22]I was referred to the fact that the Respondent asserted it wish to commence disciplinary proceedings against the Claimant whilst she was absent and I was shown a draft letter that was not sent, dated 13 December 2016, which date, the Respondent asserts, is a typographical error. I accept the Respondent’s evidence in this regard and find that the document should have been dated 13 January 2017.Conclusion
[23]I find that the test for constructive unfair dismissal is satisfied; there was a cumulative breach of the implied term of trust and confidence, the Claimant resigned in response to that breach and has not affirmed the contract.[24]The Claimant identifies the ‘last straw’ in her resignation letter: “still denying that your wife assaulted me and the way that the grievance has been handled”.[25]In reaching my conclusion I note the fact of the assault by Mrs Griffiths; although the Claimant does not rely on the assault itself, rather Mr Griffiths’ conduct thereafter, which included comments to the effect that the Claimant “deserved it”.[26]The fact that Mr Griffiths instructed the IT company to remove the Claimant’s access to the company’s systems on 12 December 2016 indicates a desire to remove the Claimant.[27]With regard to any measures to protect her on her return to work, the Respondent did not acknowledge the assault had taken place and so did not provide any assurance.[28]I found that Mr Griffiths had access to online banking and did not accept the Respondent’s assertion that it requested the return of company property for business continuity purposes as being genuine.[29]I rely upon the fact that Mr Griffiths instructed the removal of the Claimant from Companies House register on 13 December 2017 and that there was no reasonable and proper cause for doing so; no satisfactory explanation was provided for her removal.[30]The Claimant submitted an ulterior motive in that Mrs Griffiths wanted her job and I note that she has been employed by the Respondent since May 2017; it appears that Mrs Griffiths was present on the Respondent’s premises quite a lot. I did not find it necessary however to express my opinion regarding Mrs Griffiths’ intentions in order to make my findings.[31]I note that the Tesco vouchers purchased for all staff as a ‘thank you’ were not given to the Claimant, and are still in the Respondent’s safe, and conclude only that this is indicative of the poor relations between the parties.[32]I did not accept the Respondent’s assertions with regard to the Claimant allegedly deleting files within dropbox, this assertion was unsupported by documentary evidence or oral evidence from an IT specialist.[33]I do not criticise the fact of the HR investigation into the grievance but the process of investigation was flawed in that signed statements were not obtained and, in particular, Mr Haycocks’ statement was not put to the Claimant for her comment. I conclude that the grievance outcome added something to the events that preceded it and that was sufficient as a last straw.[34]The Respondent submitted that trust and confidence would have been gone by 11 December 2016 in light comments made in the Claimant’s police witness statement; I consider the comments made were an expression of the Claimant’s feelings at that point in time, made shortly after an assault by an individual who at that time did not work for the Respondent. The Claimant was willing to give Mr Griffiths, whom she had known for a long time, the opportunity to put things right.[35]I did not accept that there was reasonable and proper cause for the Respondent’s conduct. I’m satisfied that the breaches of contract identified above were the effective cause for the Claimant’s resignation and that there was no affirmation; it was reasonable to allow the grievance process to conclude once commenced by the Respondent.[36]The complaint of constructive unfair dismissal is upheld. It follows that the complaint of wrongful dismissal is also upheld. Sick pay[37]The handbook refers to the payment of statutory sick pay only. The Claimant asserted entitlement to payment of contractual sick pay by custom and practice but did not present any cogent evidence to support this assertion.[38]I conclude that the correct amount of sick pay has been paid to the Claimant and this claim is dismissed. Unauthorised deductions iPad[39]There is a dispute over whether Mr Griffiths gave the Claimant an iPad as a gift. The Claimant used the iPad to access work emails from home and also retained personal photographs on it. The iPad was bought from Tesco and the Claimant presented the receipt for it in the bundle. Mr Griffiths does not recall what he said when giving it to the Claimant. In an email of 16 January 2017, page 84, the Claimant asserts “I do not have a company IT tablet, only an iPad which you gave to me without any reference of it belonging to the company.”[40]I found on the balance of probabilities that it was given as a personal gift to the Claimant. On the basis of the Claimant’s evidence about purchase price of second hand iPads, I concluded that it was worth £100. Keys[41]The Respondent asked the Claimant for the return of office keys. The Claimant did not return them but instead invited the Respondent to collect them from her home address. This did not happen. Deduction was made from her salary for copying six keys when, in fact, she retained only two.[42]An unauthorised deduction was made in respect of the cost of copying keys that the Claimant had not retained. Mitigation[43]The Respondent did not discharge the burden on them to demonstrate the Claimant had failed to mitigate her losses and I awarded future loss for the period claimed (less deductions for paid work). Uplift failure to follow ACAS Code (grievance)[44]I concluded that there was an unreasonable failure to carry out necessary investigation to establish facts relevant to the grievance, in particular not putting Mr Haycocks’ statement to the Claimant, was a failure warranting a 10% uplift on compensation.Conclusion
[1]It is the decision of the Employment Judge sitting alone that the Respondent is ordered to pay the Claimant £5,340.00 in respect of costs under Rule 76 of the Employment Tribunal Rules of Procedure 2013. Reasons were given orally at the hearing.[3]Judgment having been sent to the parties on 21 April 2018 and reasons having been requested by the respondent on 20 April 2018, these written reasons are provided in accordance with Rule 62(3) of the Rules of Procedure 2013:[4]The hearing start time was delayed until 11.30am following a request from the parties for time for settlement discussions which did not prove fruitful.[5]I was presented with a bundle of documents containing the Claimant’s written application for costs sent to the Tribunal on 20 November 2017 and the Respondent’s written response dated 27 November 2017.[6]The Respondent provided a ‘Skeleton Argument as to Costs’ (undated) which I read prior to the hearing and I heard oral submissions from both representatives.[7]At tabs 6 and 7 of the bundle were my enquiry of 31 January 2018 and the Claimant’s email response of 13 March 2018. In the response the Claimant confirmed that she did not seek detailed assessment of costs (the amount in the Schedule of Costs exceeded £20,000) and confirmed her solicitor’s rate (£177) and PQE (5 years) by reference to the ‘Guideline figures for summary assessment of costs’.[8]Mr Roberts confirmed that the case of Mardner v Gardner UKEAT/0483/13 was not relied upon (as had previously been signaled by the claimant). I indicated to the parties that the hourly rate paid by the insurers was £100 (page 2 of the application for costs); Mr Roberts confirmed that the Claimant sought payment on the basis of the hourly rate actually paid and not on any higher rate.[9]The hearing was considered in 2 stages; firstly, the question of whether I would exercise my discretion to make an order for costs and, if so, secondly, dealing with quantum. Whether to exercise my discretion to make costs order[10]In summary the Claimant’s submissions were that there had been unreasonable conduct by the Respondent in defending the claims, which it was contended were plainly going to succeed and that there were no prospects of success for the defence. Somewhat less forcefully, it was submitted that this behaviour could be considered vexatious. In outline the first submission related to the incident of assault by Mrs Griffiths against the Claimant at the Christmas party; it was inevitable that the Tribunal would reach the decision that it did because of the Magistrates Court conviction in May 2017.[11]The Claimant submitted with regard to the broader case, that the breaches of contract were so obvious (including the removal of IT access/passwords and the removal of the Claimant from Companies House register) that there were no reasonable prospects of defending the claim. I was also referred to those matters of conduct which the Respondent intimated had been discovered post termination of employment and were set out in Mr and Mrs Griffiths’ witness statement but were not pleaded in the ET3 response and were not proceeded with at the hearing.[12]Finally, I was referred to an approach by the Claimant with regard to settlement, but Mr Roberts rightly conceded that there was no evidence before me of this approach and Mr Smith could not assist as he was not aware of it.[13]In summary the Respondent’s submissions were to remind me that cost orders in the Tribunal are the exception rather than the rule. That there was no costs warning or application for a Deposit Order or strike out made on behalf of the Claimant and that the Respondent had been successful in some elements of its defence (the claim for contractual sick pay and with regard to the number of keys for which a deduction from wages was made). As regards the assault, Mr Smith submitted that different evidence was presented to the Employment Tribunal; the email at page 106 - the statement it is alleged Carl Haycocks made to the HR professional investigating the grievance. Mr Smith submitted that there was no suggestion that its contents were fabricated and I had been invited to reach a different conclusion with regard to the assault, based on this email evidence which was not available at the Magistrates Court hearing.[14]With regard to constructive dismissal Mr Smith referred me to the first two parts of the legal test; whether there had been a fundamental breach of contract (in this case the implied term of trust and confidence) and secondly whether the Claimant had affirmed the breach. He submitted that satisfying the test was not contingent on whether the Respondent accepted the assault had taken place and the question of each alleged breach and whether it had been affirmed was something that needed to be decided by me at the hearing, which needed to proceed regardless of whether the assault had taken place. Mr Smith also submitted that I had not made any findings of dishonesty in my liability Judgment (although Mr Roberts in response submitted that dishonesty was implied because of my findings).[15]I take as my starting point that cost orders are a relatively rare occurrence and a matter of discretion for me under Rule 76.[16]Tribunals make findings of fact as to whether they prefer one version of events over another on a daily basis, so the concept of implied dishonesty, suggested by Mr Roberts, where I have preferred one version of events to another could be applied to a huge number of the cases dealt with in Tribunal every day yet costs are not awarded in each such case. I also note that high bar for concluding there has been vexatious conduct.[17]Turning now to the particular matters I was referred to starting with the assault, I reminded myself of the email evidence presented at page 106. The Respondent’s representatives must have known that this document alone would be extremely unlikely to persuade an Employment Judge to make a different finding to that that was reached in the Magistrates Court, where the standard of proof is higher. The Respondent should have known or been advised that without hearing evidence from Mr Haycocks in person at the hearing, a Tribunal would place little weight on a written document. Particularly this document; I note there is no suggestion that this content is fabricated, but the email does not even emanate from Mr Haycocks himself, it was sent by the HR professional to herself. To that extent, I consider that the defence regarding the assault had no reasonable prospect of success and furthermore it was unreasonable for the Respondent to persist in denying the assault had taken place in light of the criminal conviction and the way in which it sought to contest that at the Tribunal liability hearing.[18]I do not consider, however, that the Respondent’s actions were vexatious, that is a high hurdle, rather they are indicative of an intransigent stance where the personal relationships had broken down to such an extent as they have between the parties in this case.[19]I am mindful that the Claimant’s claim was not based on the assault itself, rather I was asked to consider the Respondent’s response towards the Claimant following the assault. Although, to an extent, the issues are intertwined in that there was no acknowledgment by Mr Griffiths of the assault and therefore he made no assurance with regard to her safe return to work. The fact of the assault was the catalyst to the claim, rather than being an issue central to its determination.[20]Turning now to the case more generally, and notwithstanding my comment that ‘implied’ finding of dishonesty being something that could be a very regular feature of Tribunal decisions, I do consider that the Respondent’s defence was unreasonable in one respect; Mr Griffiths position with regard to the removal of the Claimant’s access to email and computer systems. The documentation at page 66 and 67 of the original bundle was strongly persuasive evidence that he had instructed the IT company to remove the Claimant’s access to the computer systems, but he sought to deny this in the defence, contrary to those documents. This seems to me to have been an unreasonable position to adopt in light of that documentary evidence to the contrary and his failure to call evidence from the IT support team in person.[21]Mr Roberts submitted that had the Claimant resigned at the point that her IT access was removed and she was removed from Companies House register that hers would have been an ‘open and shut’ plain case of constructive dismissal. The submission was well made but it takes me to the submissions of Mr Smith when he referred me the test for constructive dismissal. The fact is that the Claimant did not resign at that point in time. Perhaps understandably in light of her length of service, she instead elected to remain in employment, although on sick leave, whilst the grievance process was ongoing. Where an individual chooses not to react to a breach of contract by resigning immediately, they run the risk that their actions could be interpreted by a Tribunal as having affirmed the employment contract and waived the breach. I cannot say in the particular circumstances of this case that there was no reasonable prospect of success with regard to this line of defence; there was a need for a Tribunal to consider the evidence and to reach conclusions based upon it.[22]As for the alleged misconduct which it was said was discovered post termination of employment, these matters were not pleaded rather they were raised in the witness statements of Mr and Mrs Griffiths. I identified at the very start of the liability hearing that they had not been pleaded, Mr Smith confirmed that there was no application to amend the Response and accordingly those parts of the witness statement did not feature in the evidence and I did not take them into account. There was no evidence submitted on behalf of the Claimant to counter those allegations by way of a supplementary statement. In circumstances where the Claimant’s representatives had not identified this issue prior to the liability hearing and it was dealt with as a preliminary issue as the hearing commenced, I do not consider it would be appropriate for me to base a decision on a costs order on this aspect of the Respondent’s defence.[23]Mr Smith referred me to the fact that there was no cost warning or application for deposit order or strike out; that is not a conclusive factor either way.[24]I considered it appropriate to exercise my discretion to make a costs order with regard to the matters I identified as satisfying the test in Rule 76.[25]At this point in the hearing, I heard submissions from both sides with regards to quantum and the Schedule of Costs. Amount of costs order[26]The Claimant seeks an order for the entirety of her costs and does not identify a particular period in time from which point she says costs should be payable.[27]I set out a brief chronology of events; ACAS Early Conciliation started on 16 March 2017, the EC certificate was issued on 16 April 2017, the criminal conviction for assault took place on 8 May 2017, ET1 was submitted on 4 July 2017, the ET3 on 4 August 2017, exchange of witness statements on 25 September 2017 and the Tribunal hearing was heard on 6 and 7 November 2017. From this chronology it is clear that the outcome of the criminal trial was known prior to Tribunal litigation commencing.[28]There will be a limitation on the amount of costs awarded for the reasons I have already given; I could not say there was no reasonable prospect of success with regard to aspects of the defence and a hearing was needed to determine factual disputes. Additionally, the Respondent was successful in minor elements of its defence; sick pay and a deduction with regard to a number of keys. The costs order that I make should reflect costs incurred in dealing with only those matters that I have identified as having no reasonable prospect of success or where the Respondent has acted unreasonably.[29]Costs are compensatory in nature. My primary consideration when looking at summary assessment of costs is proportionality, that is key, even if it is reasonable and necessary to have incurred a cost those costs must be proportionate. The Schedule of Costs as originally presented exceeded £23,000 in a case where the total amount of compensation awarded was £18,303. The legal costs claimed in the Schedule were not proportionate to the value of the claim.[30]I am also mindful that the approach in summary assessment is a broad brush and in light of my reasons for making a costs order, it was not terribly instructive for me to go through the Schedule of Costs item by item because the Schedule relates to all costs for all aspects of the case, perhaps including some pre-litigation work.[31]I am grateful for the pragmatic suggestions from Counsel as to how I might approach this exercise by ordering a proportion of the total amount, but I reject that suggestion because the Schedule of Costs relates to the whole case. I cannot discern which costs have dealt with those particular aspects that I have found to be unreasonable or having no prospects of success. However, in light of the strong evidence that an assault had taken place, and the documentary evidence with regard to removal of access from IT systems, I imagine relatively little because the Claimant’s solicitors can have been assured that they had a strong case.[32]When it comes to Counsel’s fees, I am persuaded that a hearing would have taken place and I am mindful that the assault was not one of the reasons relied upon by the Claimant but rather the catalyst that sparked the events which led to the claim. However, I am persuaded by the submission on behalf of the Claimant that had there been acceptance of the assault as a fact at an early stage after conviction, that may well have changed the approach to litigation, possibly reducing the number of witnesses and meaning the case could be dealt with in 1 day rather than 2. I concur with Mr Smith that the liability hearing was relatively tight for time, but that was on the basis that all matters were ‘up for grabs’. That said, the case was not overly complicated and if fewer issues remained live for determination I consider a shorter hearing would have been possible.[33]The amount of costs ordered is £5,340, on the basis that costs are compensatory and the sum ordered is equivalent to the amount that was paid by the Claimant personally (including VAT) prior to claiming legal expense insurance and half of Dr Ahmed’s Counsel’s fees (to reflect the shorter hearing that would have been possible).