Mrs A Cole v The Christmas Decorators (Franchising) Ltd and Mr N Bolton: 2407408/2023

EMPLOYMENT TRIBUNALS

Case No 2407408/2023

Between

Mrs A ColeClaimant

The Christmas Decorators (Franchising) Ltd (1) Mr Nicholas Bolton (2)Respondent

Before

Employment Judge Roper

Date 13 June 2025

JUDGMENT

[1]The First Respondent must pay the sum of £5,060 to the Claimant in respect of her preparation time.

[2]The sum must be paid to the Claimant within 14 days of the date of this order being sent to the parties.

REASONS

[1]By a claim form presented on 14 July 2023, the Claimant brought complaints of unfair dismissal, equal pay, sex discrimination, unlawful deduction from wages and breach of contract. A preliminary hearing took place on 15 November 2023 in the Liverpool Employment Tribunal. The claim was transferred to the South West and a further Preliminary Hearing took place before Employment Judge Roper on 22 April 2024. The case management order and record of that hearing (“CMO”) sets out various case management orders and the list of issues. The hearing was listed for four days at Exeter Tribunal on 7, 8, 9 and 10 October 2024. That hearing was postponed on the first day of the hearing.

[2]The Tribunal noted its duty to consider a costs/preparation time order under Rule 76 of the Employment Tribunal Rules of Procedure (2013) (the “Rules”) in circumstances where a hearing is postponed on the application of a party made less than 7 days before the date on which the relevant hearing begins. Further it may also make such an order where a party has been in breach of an order. The following orders were made in relation to this. 2.1. The Claimant was ordered to write to the Tribunal and the First Respondent by 21 October 2024 with any representations regarding whether the Tribunal should make a preparation time order (pursuant to Rules 76, 78, 80, 81), including specifying how much the preparation time order should be for (Rule 79). 2.2. The First Respondent was ordered to write to the Tribunal and the Claimant by 28 October 2024 with any submissions regarding: 2.2.1. whether a preparation time order should be made; and 2.2.2. if it is determined that the order should be made, whether the order should be against the Respondent (by way of preparation time order) or against Croner (in the form of a wasted costs order pursuant to Rules 80 and 81). THE CLAIMANT’S APPLICATION

[3]The Claimant submitted a preparation time order on 21 October 2024 seeking £51,392.50 based on an hourly rate of £44 per hour. She also sought various expenses totalling £736.79. The Claimant submitted an amended application on 5 November 2024 – this did not change the sums sought but simply sought to replace the excel breakdown of the sums requested. The Claimant relies on the following: 3.1. the late postponement of the four day hearing (on the first day of the hearing on 7 October 2024); 3.2. the Respondent’s breach of the case management orders. These are not set out in the Claimant’s preparation time application, but are set out in the Claimant’s application for strike out dated 5 November 2024 as follows: 3.2.1. failure to prepare and provide the hearing bundle (paragraphs 14 and 15 CMO); 3.2.2. failure to provide witness statements (paragraph 29 CMO); 3.2.3. failure to email the Tribunal to confirm readiness for the hearing until postponement application 3 days before the hearing; 3.2.4. failure to provide the chronology, cast list and list of key documents by seven days before the hearing (paragraph 37 CMO). THE FIRST RESPONDENT’S POSITION

[4]The First Respondent did not write to the Tribunal by the 28 October 2024 (as had been ordered in the hearing and case management order of 7 October 2024) to set out its position regarding the preparation time application. At the time of considering the application, there had still been no response to the Claimant’s preparation time application despite the First Respondent having written to the Tribunal in response to the Claimant’s strike out application on 5 November 2024. The response to the strike out application does not address the Claimant’s position that the Respondent has failed to comply with case management orders set out above, simply saying “The issues the Claimant has raised in this regard have already been dealt with by the Judge at that hearing.”

FINDINGS OF FACT

[5]I repeat the findings I made on 7 October 2024 as follows.

[6]The CMO set out that the parties were ordered to disclose documents to one another by 17 May 2024 and to agree a hearing bundle index by 31 May 2024. The First Respondent was ordered to provide the hard copy to the Claimant by 7 June 2024.

[7]Croner, acting for the First Respondent wrote to the Tribunal at 16.55 on Wednesday 2 October 2024 saying that the Claimant’s disclosure had only been received at the end of the week before due to technical issues and through no fault of the parties. He stated that the was not ready to proceed and requested a postponement.

[8]Regional Employment Judge Pirani directed that the hearing would proceed as listed. Witness Statements must be exchanged as soon as possible. The parties were informed that a failure to comply with Case Management Orders may mean the claim or the response was struck out. This direction was sent to the parties on 2 October 2022.

[9]Following this, at 13.40 on 4 October 2024, the Claimant emailed the Tribunal, copying Ms Beattie of Croner, attaching a bundle of documents including the documents of both parties. Mr Ullah of Croner, for the First Respondent, wrote back at 15.44 stating that the documents could not be opened and making a postponement application on the basis that the Claimant had not been able to review the documents, add their own and prepare witness statements. Employment Judge Pirani refused the First Respondent’s application to postpone. The Tribunal panel and Tribunal staff were all able to open the Claimant’s documents without any problems.

[10]At 8am on the first day of this hearing, the Claimant emailed her witness statements to the Tribunal, copied to Croner.

[11]Mr Henry of Croner attended the Tribunal on behalf of the First Respondent. He made a further application for postponement. He had not been sent the draft Hearing Bundle by his colleagues and could not explain that failure. He had not attended the Tribunal with a laptop so was unable to review documentation electronically. Mr Henry informed the Tribunal that he was not aware that there were even draft witness statements prepared on behalf of the First Respondent. He sought to explain this by saying that the First Respondent required the hearing bundle to prepare witness statements. Mr Henry had only had conduct of the case since approximately 17.30 on Friday 4 October 2024.

[12]The Claimant opposed the postponement application. She and her witness were in attendance at the hearing, had access to the electronic documents and were ready to begin. The Claimant’s position was that the First Respondent had had the majority of the documents since January 2024. The Claimant had made repeated contact with Mr Ullah to seek to agree a hearing bundle. The Claimant had taken on the preparation of it, and had addressed concerns with accessing documents by acquiring Adobe and converting documents to PDF. Mr Ullah had been on holiday for two weeks in September 2024 and the Claimant had liaised with Ms Beattie in his absence. She had included documents in the bundle at Mr Ullah’s request because he had not time to do so before his departure. The Claimant had uploaded her documents to Croner’s upload link on Thursday 26 September 2024.

[13]The Tribunal decided to postpone the hearing. The Tribunal considered that the hearing could have proceeded if the First Respondent had prepared witness statements and had submitted them even on the morning of the hearing (as the Claimant had done). The Tribunal would have allowed the parties reading time for the first day of the hearing and started the evidence on the second day of the hearing. The First Respondent had been tasked with primary responsibility for creating the hearing bundle. The Claimant had done everything that she could to move this task forward (the Tribunal reviewed correspondence between the parties at the Preliminary Hearing which demonstrated this). In any case, the First Respondent had had sufficient time to prepare having received all of the Claimant’s documents by 26 September 2024.

[14]The order requiring the parties to exchange witness statements had been extended to 27 September 2024 with the agreement of both parties, but the First Respondent had made no further application for postponement of that order. It had not complied with it even by the first day of the hearing. Preparation of a witness statement does not require access to the final hearing bundle, it is intended to set out the facts as recollected by the relevant witnesses. Spaces can be left for page numbers if necessary. If there are new documents which need to be commented on, this can be done by way of one or more short supplementary questions at the beginning of the hearing. The Tribunal considered that it might have been possible to hear the First Respondent’s evidence in chief orally, but considered that this would have prejudiced the Claimant who would not be aware of the content of their evidence in advance in order to prepare her cross examination. In contrast the First Respondent would have had the benefit of reviewing the Claimant’s written evidence in advance.

[15]The Tribunal considered that the postponement was required because of the First Respondent’s failure to comply with the Tribunal’s order in relation to witness statements.

THE LAW

[16]Rule 76 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 (the “Tribunal Rules”) provides: 1) A Tribunal may make a costs order or a preparation time order, and shall consider whether to do so, where it considers that – a) a party (or that party’s representative) has acted vexatiously, abusively, disruptively or otherwise unreasonably in either the bringing of the proceedings (or part) or the way the proceedings (or part) have been conducted; or b) any claim or response has no reasonable prospect of success or c) a hearing has been postponed or adjourned on the application of a party made less than 7 days before the date on which the relevant hearing begins. 2) A Tribunal may also make such an order where a party has been in breach of any order or any practice direction or where a hearing has been postponed or adjourned on the application of a party.”

[17]Rule 79 provides: “79.—(1) The Tribunal shall decide the number of hours in respect of which a preparation time order should be made, on the basis of— (a)information provided by the receiving party on time spent falling within rule 75(2) above; and (b)the Tribunal's own assessment of what it considers to be a reasonable and proportionate amount of time to spend on such preparatory work, with reference to such matters as the complexity of the proceedings, the number of witnesses and documentation required. (2) The hourly rate is £33 and increases on 6 April each year by £1. (3) The amount of a preparation time order shall be the product of the number of hours assessed under paragraph (1) and the rate under paragraph (2)..”

[18]Although the Tribunal Rules provide me with the power to make a preparation time order, such awards in Employment Tribunal proceedings are the exception rather than the rule (Gee v Shell UK Ltd

[2003] IRLR 82

[19]Milan v Capsticks Solicitors LLP & Others

UKEAT/0093/14/RN

sets out a structured approach to be taken in relation to an application for costs where the then President of the EAT, Langstaff J, described the exercise to be undertaken by the Tribunal as a 3 stage exercise at paragraphs 52: “There are thus three stages to the process of determining upon a costs order in a particular amount. First, the tribunal must be of the opinion that the paying party has behaved in a manner referred to in [Rule 76]; but if of that opinion, does not have to make a costs order. It has still to decide whether, as a second stage, it is “appropriate” to do so. In reaching that decision it may take account of the ability of the paying party to pay. Having decided that there should be a costs order in some amount, the third stage is to determine what that amount should be. Here, covered by Rule [78], the tribunal has the option of ordering the paying party to pay an amount to be determined by way of detailed assessment in a county court.”

CONCLUSIONS

[20]There are three stages to be applied: 20.1. finding whether the First Respondent has behaved in a manner referred to in Rule 76; 20.2. considering whether it is appropriate to make a preparation time order; and 20.3. considering whether I should exercise my discretion in making such an order.

[21]With regard to the way in which the proceedings were conducted by the First Respondent, it is clear that their conduct is covered by Rule 76(1)(c): the hearing listed to begin on 7 October 2024 was postponed on the application of the First Respondent made on 7 October 2024, which is less than 7 days before the date on which the relevant hearing begins. Further, there have been breaches of case management orders which is relevant conduct under Rule 76(2) as follows: 21.1. a failure to prepare the hearing bundle. The First Respondent had the primary responsibility for doing this. I take into account the First Respondent’s submissions regarding the IT difficulties with the Claimant’s documents. However the bundle was ordered to have been agreed by 31 May 2024 and sent in hard copy to the Claimant by 7 June 2024. There was sufficient time to resolve such issues between May and October. The Claimant had made significant efforts to engage with the First Respondent regarding the bundle, spending significant time converting documents to PDF, and uploading documents to the Croner’s upload link etc. In contrast it appears that responsibility was passed between a number of individuals at Croner, with no explanation why the matter had not been progressed in the four months between May 2024 and the hearing in October. Further, the First Respondent did have the documents on 26 September 2024 but nevertheless did not take steps to prepare the hearing bundle. The Tribunal had no difficulties opening these documents; 21.2. a failure to prepare witness statements. These should be based on the recollection of the witnesses. It is not a requirement that the hearing bundle is complete in order to prepare the witness statements;and 21.3. a failure to prepare a chronology, cast list and list of key documents. In relation to the list of key documents, this could have been prepared on the basis of the First Respondent’s own documents.

[22]Having found that there is conduct on behalf of the First Respondent which falls under Rule 76 of the Tribunal Rules, there is no requirement for this Tribunal to make an award in relation to preparation time.

[23]In this case, I find that it is appropriate to make an award in relation to preparation time against the First Respondent in respect of the conduct outlined above, in particular in relation to the Respondent’s failure to engage with the hearing bundle and witness statement which ultimately led to significant work for the Claimant and the hearing being postponed.

[24]In deciding whether a preparation time order should be made, I am permitted to take into account the First Respondent’ ability to pay. However, there were no submissions or evidence in respect of their ability to pay and, therefore, this does not affect my decision in finding that it is appropriate to make an award in relation to preparation time.

[25]Having found that there was conduct referred to in Rule 76 and that it is appropriate to make an award in relation to preparation time, I am still required to address my mind to whether I should exercise my discretion in making a preparation time order in this matter. In other words, I must decide whether it is just to exercise the power to make an award in relation to preparation time.

[26]The basic principle is that the purpose of an award in relation to preparation time is to compensate the party in whose favour the order is made, not to punish the party ordered to pay the costs. In assessing of the number of hours for the purposes of an order must be based upon both the information provided by the receiving party in respect of her preparation time (Rule 79(1)(a)) and my assessment of what is a reasonable and proportionate amount of time for the party to have spent on preparatory work, with reference to such matters as the complexity of the proceedings, the number of witnesses, and the documentation required (Rule 79(1)(b)).

[27]In relation to the complexity of this matter, the Claimant brings complaints of unfair dismissal, unauthorised deductions from wages (or breach of contract in the alternative in relation to the same sums), and there is one alleged act of direct sex discrimination. There is also an equal pay complaint, which is a more complex type of complaint, but has been deemed straight forward enough for the claim to be managed as a normal open track claim. The Claimant is intending to give evidence and is calling one other witness. The hearing was listed for four days. It is not clear how much documentation is relevant at this stage as there was no final hearing bundle.

[28]The Claimant has stated that she has spent 1,167.5 hours on this matter, effectively over 6 months of working full time hours on this matter exclusively. I consider that a reasonable and proportionate amount of time would be approximately 115 hours for the work the Claimant has undertaken, taking into account the complexity of the claim and number of witnesses. At a rate of £44 per hour, which has been correctly identified by the Claimant, this equates to a preparation time order of £5,060.

[29]I do not make an order for the expenses she has incurred as it is only possible to make either a costs order or a preparation time order, not both.

The Issues

[30]The Claimant’s evidence is that in relation to each KPI, it had been agreed with Mr Gateson that if the BDMs made three requests of a franchisee to comply with the relevant KPI, then it would be considered met for bonus purposes, referred to by the Claimant as the “three strikes rule”. Mr Gateson denied this.

[31]The Tribunal notes that this is raised in the Claimant’s grievance after her employment had ended (page 433) and rejected specifically at appeal stage by Mr Bolton (page 522). The Tribunal was also taken to page 302 in submissions. This was in the format of an email to Mr Gateson and states “the three strikes rule” had been agreed between them. The document is referred to in paragraph 54 of the Claimant’s witness statement, but it is not clear from the statement or the email itself whether it was a note made by the Claimant, a draft or an email actually sent to Mr Gateson which had been copied and pasted (as was said in submissions). The version seen by the Tribunal is an email dated 30 March 2023 forwarded by the Claimant to herself with the heading “June 2022 discussed with Mark”. This was not raised in oral evidence, and evidence cannot be given during submissions. It is unclear from the evidence itself when this note was made by the Claimant (contemporaneously or after the end of her employment in March 2023) or whether it was ever sent to Mr Gateson. As such, we do not put much weight on the email at page 302.

[32]The Tribunal prefers Mr Gateson’s evidence on agreement between the parties regarding the “three strikes rule”. The Tribunal considers that the Claimant’s evidence on this point is inconsistent with her evidence that she required information from Mr Gateson in order to be able to work out whether she had met the KPIs (which was also Mr Cridge’s position), see paragraph 39 of the Claimant’s witness statement. If only three attempts to obtain compliance with the KPI were required to meet the bonus criteria, this would be something within the Claimant’s own knowledge. She would not need information from Mr Gateson (such as whether the franchisee had sent him their accounts) to understand whether the KPI had been met. There are numerous contemporaneous emails in the bundle in which the Claimant asks Mr Gateson for this sort of information so that she can assess whether the KPIs have been met (such as page 304). Further, it is clear that the purpose of the KPIs was to reward BDMs for franchisee performance of the KPIs which is more consistent with Mr Gateson’s account that actual compliance was required.

[33]On 18 March 2022, Mr Gateson emailed the Claimant (page 257), saying: “I have updated the KPI sheet with T/o for MSF submitted, can you do a scoring on the compliance side for us to review next week on how you think they have been and then we can review. I have sat down with Nick and we will be paying the £10,000 based on T/o in this month and sit down and do the compliance review with the aim of the ﬁgure being settled next month.”

[34]The email attached a spreadsheet titled “BDM KPI Form Angela Cole 2021” (page 258). The turnover part of the sheet had been completed with numbers and showed that the Claimant had met the 30% turnover target. All fields were marked “1” in the KPI 2 section as they had not been completed. The Claimant was paid £10,000 in respect of the first part of the 2021 bonus on 23 March 2022.

[35]Eventually on 25 May 2022 a meeting was scheduled to take place between Mr Gateson and the Claimant to discuss whether the KPIs had been met in relation to part 2 of the 2021 bonus. The Claimant was not able to attend the meeting because of a hospital appointment. Mr Gateson filled the KPIs in to show his view of which had been achieved and emailed it to the Claimant on 25 May 2022 (pages 598 to 600):

[36]This showed a score of 107 of a possible maximum of 207 (page 600). The Claimant’s evidence was that this should have shown that all the KPIs had been met because she had chased all of them three times. In light of the Tribunal’s finding on the “three strikes rule” that is not upheld. Except for the three strikes point, the Claimant struggled to answer and ultimately was not able to explain what, if anything else, was incorrect in relation to the scores at page 600 when asked about this in oral evidence.

[37]In the same email of 25 May 2022, Mr Gateson stated that “As discussed car allowance will increase to £300.00 from next month” (page 598).

[38]There was no final review meeting in which the Claimant and Mr Gateson discussed the outcome of the KPIs. The First Respondent did not review the KPIs and determine whether to pay the Claimant a bonus at this time.

[39]In September 2022 Mr Gateson informed the Claimant that because the First Respondent’s busy (Christmas) season was approaching, part 2 of the 2021 bonus and both parts of the 2022 bonus would be settled together in March 2023 (i.e. on payday, 23 March 2023). This finding is based on the Claimant’s evidence (see paragraph 58 of her witness statement). Based on this finding, there was clear agreement that the same bonus scheme would continue to the following bonus year (2022 bonus).

[40]Around this time, the First Respondent was having financial difficulties. It had a number of COVID loans as well as loans secured against Mr Bolton’s home. Mr Bolton had meetings with an insolvency practitioner to explore options to ensure that the company did not go insolvent and that the business could continue to operate. It was decided that there would be a restructuring within the company to save costs, and a further £150,000 loan was taken out against Mr Bolton’s home. As part of these discussions with the insolvency practitioner, the First Respondent was advised to write off a debt owed by XDEX Ltd, which was a related company. In addition, as part of this exercise, the dividends were issued to set off against the director’s loan account which had remained negative (in effect overdrawn) since 2020. The Tribunal accepts the First Respondent’s evidence that these actions were taken in order to enable the First Respondent to take a commercial loan to improve its cashflow position.

[41]The First Respondent decided to remove the BDM role from the business to reduce costs. A redundancy business case was completed, which is at pages 345 to 348 and set out that: “We are looking to reduce costs of the business to bring them inline with our revenues from the Franchise Network. We added Business Development managers (BDMs) to drive growth and improve the turnover (T/O) of our network, but we have not seen a notable increase in T/O and revenues that we can attribute to the BDMs to justify their costs. We will look to reallocate parts of their role to other Employees based in our Liverpool Office, and when needed as requested by the network bring in external support and look at making this a chargeable service rather than providing it via BDMs. …. The immediate impact will be a reduction in costs of circa £100,000.00 per annum made up of salaries/on costs/ travel etc. This is 17% of the total revenue stream that we bring in as management fees for the network. It will streamline our HQ operation and centralise all staff at HQ apart from 1 sales Director.”

[42]It is not referred to in the business case, but the Tribunal finds, based on Mr Bolton’s and Mr Gateson’s oral evidence, that the First Respondent considered alternatives to making both Mr Cridge and the Claimant redundant. This is also consistent with what Mr Gateson stated in the consultation meeting (page 374), when asked about alternative roles he said that they had thought about this. Alternative options were considered such as having one BDM nationally and they considered whether there were any alternative roles for the Claimant. They concluded that they did not want to have even one national BDM as they felt it did not add value to the business. The other roles potentially available were a marketing role and a Christmas decorations installations role. They considered that the Claimant was not suitable for these roles due to her skills and experience.

[43]The Claimant and Mr Cridge were invited to separate meetings on 27 March 2023 with Mr Gateson and Mr Comerford (page 352) in which they were told that their roles were at risk of redundancy. This was confirmed by letter following the meeting (page 359). The Claimant was told in the meeting that the process would be “done and dusted by Friday” by Mr Comerford.

[44]In the meeting with Mr Cridge, Mr Cridge asked, “Did you say you’re going to make the BDM position redundant” and Mr Gateson replied “Yes, yes, so that’s the plan” (page 356). The meeting was done remotely by video call. Both Mr Cridge and the Claimant were upset to learn during the meeting that another employee had been present in the same room as Mr Gateson during the meeting.

[45]The Claimant was invited to a redundancy consultation meeting with Mr Gateson and Mr Comerford, to take place at 12 noon on 29 March 2023. The Claimant requested that this meeting be delayed to allow her to prepare, but this was refused. The Claimant attended the meeting. Mr Gateson and Mr Comerford explained the background in more detail and answered the Claimant’s questions. Mr Comerford stated, “I'm happy for you to convince me otherwise, I'm more than happy for you to convince me otherwise” (page 371). The Claimant made suggestions for alternatives to redundancy such as being the sole BDM nationally, taking on part time hours or taking on other roles and responsibilities. Mr Gateson and Mr Comerford responded that they had considered these ideas and decided against them. A marketing role was discussed in the meeting, but Mr Comerford highlighted that this required knowledge, skills and qualifications in digital marketing (page 371) and the company was unsure whether the role would be advertised at all1. The Claimant asked about Elizabeth O’Gara’s role and why it had not been pooled with the BDMs. Mr Gateson explained that the role had not been pooled with the BDMs because although she undertook some BDM activities, Ms O’Gara’s role 1 In fact, this role was not recruited or filled until May 2024, although the Claimant produced a job advertisement from Glassdoor dated in 2023, the Tribunal accepts Mr Gateson’s evidence that the First Respondent did not recruit via that site and that the recruitment/appointment was not until May 2024. primarily focussed on training and mentoring for year one franchisees, so the role was distinct from the BDM role (page 371).

[46]The Claimant was not paid any bonus sums on 23 March 2023. On 29 March 2023, the Claimant chased her bonus payments. Mr Gateson wrote back to her on 30 March 2023 saying that: “All bonus payments are discretionary, and the calculation method last year was put in place to calculate the potential bonus available that could be paid out against the 2 parameters network performance and KPI/network behaviour. But even when this calculated ﬁgure is produced, the bonus still remains discretionary and not contractual. We made part payments on bonuses in last year in March at our discretion ahead of ﬁnalising the year end accounts as we had not paid them in the prior years due to covid etc or put any salary increases through across the company. This payment was made at the discretion of the Directors. Any bonus payments due for staff this year will be discretionary and based solely on the performance of the company and only discussed on completion of our year end accounts for Feb 2023.”

[47]On 31 March 2023, the Claimant was told in a meeting that her redundancy was confirmed and her employment would be terminated with immediate effect. The Claimant was told in relation to her bonus “at the moment, Angela, we’re not paying it…we’re not making money… There are no bonuses at this moment in time being paid erm to any staff.” (page 393). The Claimant was told that her two weeks’ notice would be paid in lieu. The Claimant raised that she had a four week notice period. After the meeting, Mr Comerford and Mr Gateson were recorded discussing the Claimant’s contract. Mr Gateson saying: “Well, she had that contract then, didn’t she…. Fuck all we can do about that” and Mr Comerford responding, “It is what it is Mark” (page 399). The Claimant’s dismissal was confirmed in a letter dated 31 March 2023 (page 403).

[48]Following the redundancy, certain elements of the BDM role were done via online reporting by franchisees. Some of the BDM role was undertaken by Ms O’Gara who undertook it in addition to her training and mentoring role. BDM activities comprised around 20% of her role, primarily in the form of mentoring new franchisees in their first and second year (previously she had only done this in relation to the first year). The First Respondent also engaged “Platinum wave”, an external organisation, to provide franchisees with business mentoring/training. This would take place around three times a year with the First Respondent setting up a location and franchisees attending to meet with Platinum wave. This service was not previously provided by BDMs; it was a new provision.

[49]On 7 April 2023 the Claimant submitted an appeal regarding her dismissal and raising a grievance regarding the non-payment of her bonus (page 413). In relation to the dismissal her appeal points were that: “I believe my role still exists below I have included a short summery (sic) of the reason why, which I will go into more detail about in the further supporting evidence I will submit to you in my report. - Liz has taken on the role of BDM for 2nd year franchisees - Liz has been permitted to be the BDM for the north and south 1st and 2nd year franchisees - After I had asked to do the role of north and south BDM in order to save my role but was told geographically this was not possible in my consultation meeting, I had also said I could take on 1st year franchisee to help the company save costs and save my role. - Please note my experience and years of successfully managing franchisees as a regional BDM outweigh Liz quite dramatically - I am also aware a lot of Liz franchisees did not hit their targets 1st yrs /2nd yrs and there have been 1st year franchises that we not successful under Liz’s management that had to stay with her for another year to try to help improve their performances - It was announced that Liz would being taking on the IMS audits for all franchisees, the BDMs (myself and Alan) were supposed to be doing this spring - This was announced before I was made redundant and I had no knowledge - To be told in the redundancy meeting that the company would now get the franchisees support by an outsourced company, again implies my role still exists - The company’s final situation was never disused with me, and I feel I was never given a chance to have any meaningful impact and input to help, which in turn has resulted in the outcome to make me redundant - I asked Mark what the companies’ agendas and business plans were, and he simply said make more money - No business planning or key developments happened or explained - The BDMS were never involved in any of the business planning meetings or ever asked for areas that needed to be invested in to drive growth forward - I had lots of development ideas that were never listened to or taken forward that would have enabled the franchise to become more efficient, add value and growth. - Feeling of undervalued and being kept at arm’s length” (pages 414 and 415).

[50]A redundancy appeal meeting was conducted by Croner, an external HR consultancy. The Claimant’s appeal against her redundancy was dismissed by Mr Gateson, having considered a report composed by Croner (pages 622 to 631) which recommended that the redundancy dismissal be upheld. The Claimant was notified of this outcome by letter (page 498) and was sent a copy of the Croner report.

[51]The Tribunal accepts the First Respondent’s position, in its Grounds of Resistance which was not challenged, that no staff were paid bonusses in relation to the 2022/3 year.

[52]Mr Gateson held a grievance meeting with the Claimant on 7 July 2023 in relation to the bonus. The Claimant was not permitted to be accompanied by Mr Cridge because he was no longer an employee of the company. Mr Gateson rejected the Claimant’s grievance regarding the bonus. He stated that the bonus was discretionary, that the network turnover had not increased by 30%, setting out a list of the relevant franchisees and saying which had increased by 30%, but not giving total figures. He also referred to substantial debts from the network for the financial year ending February 2023 and legal expenses incurred in 2022 impacting overall profitability, saying “[w]hilst I acknowledge that these two facts are not within your remit or ability to control, they do have a substantial impact on profitability and our ability to award discretionary bonuses, which is the reason any bonus payments are at the discretion of the directors and shareholders as it is based on the ability of the company to award and pay them. This of course is also directly related to any discretionary bonus payment from the 2021 Christmas trading season” (page 516). He went on to say that “based on the explanations above, I regret to inform you that I have exercised my discretion not to award any further discretionary bonus payment” (page 516). He did not review all the KPIs relevant to part 2 of the bonus for 2021 or 2022 to give a view of the Claimant’s performance against the KPIs.

[53]The Claimant appealed on 28 July 2023. Mr Bolton dismissed the appeal, saying (page 523): “The trigger to award any discretionary bonus has always been based on the achievements of personal objectives, in other words KPI’s and, the overall profitability of the company which would allow the directors to award and pay any discretionary bonus. The total turnover in 2021 of the regional network which you were managing, was £2,197,007. The KPI was a minimum increase of 30% which should have resulted in a minimum turnover for 2022 of £2,856,109. The turnover achieved was £2,743,673 which is circa 4% below the minimum required increase of 30%. Additionally, 4 experienced franchisees out of a network of 11 franchisees in your area of responsibility, substantially underperformed below the minimum accepted turnover. The KPI’s for compliance were also not achieved in 2021 or 2022, it is not correct that you have successfully performed your duties because you have asked a franchisee to comply with a contractual obligation 3 times without success, after 3 requests, the non-compliance should have been elevated by either bringing the issue to the attention of one of your superiors or the issuance of a default notice to try and obtain compliance.” The Law: Unfair Dismissal

[54]The Respondent’s position is that the reason for the dismissal is redundancy which is a potentially fair reason for dismissal under section 98 (2) (b) of the Employment Rights Act 1996 (“ERA 1996”). Section 98 of ERA 1996 sets out the following: “(1) ... 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. (2) A reason falls within this subsection if it- ...

[55]For the purposes of the ERA, “redundancy” is defined by section 139, as follows: “(1) ... an employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to- ... (b) the fact that the requirements of that business- ... (ii) for employees to carry out work of a particular kind in the place where the employee was employed by the employer, have ceased or diminished or are expected to cease or diminish.”

[56]The approach to redundancy as a reason for dismissal was summarised as follows by Mrs Justice Eady in Marston (Holdings) Ltd v Mrs A Perkins:

[2025] EAT 20

. “50. As Lord Irvine of Lairg LC observed in Murray and anor v Foyle Meats Ltd

[1999] ICR 827

, at p 829G-H, this provision makes clear that the ET must answer two questions of fact:(1) whether a particular state of economic affairs exists (relevantly, whether the requirements of the business for employees to carry out work of a particular kind in a particular place have ceased or diminished, or are likely to do so);

(2) whether the dismissal was attributable (wholly or mainly) to that state of affairs. 51. In addressing the first question, it would be insufficient to satisfy section 139(1)(b)(ii) that a particular kind of work in a particular location ceases or diminishes; it is necessary that there is a reduction in the need “for employees” to carry out that work in that place (see the discussion in Safeway Stores plc v Burrell

[1997] ICR 523

, at p 530C-F). As for what is “work of a particular kind”, that is a question of fact that will require the ET to look at the tasks undertaken and the skills involved, which are not to be simply elided with the person undertaking the work or the qualifications they might hold (see the discussion in BBC v Farnworth

[1998] ICR 1116

EAT, at pp 1122G-1123E) 52. Turning to the reason for dismissal, that is a question of causation, and, again, one of fact for the ET (per Murray v Foyle Meats). The burden of establishing the reason for the dismissal, and whether it is capable of being fair for the purposes of section 98 ERA, is on the respondent and if it fails to discharge that burden the ET will be bound to find the dismissal was unfair. Where no issue has been taken with the reason pleaded by the respondent, however, it can be an error of law for the ET not to approach the question of fairness under section 98 on the basis of that reason, see per Wood J at pp 5H-6B Post Office (Counters) Ltd v Heavy

[1990] ICR 1

EAT; albeit, whether a failure to do so will impact upon the fair hearing of the case will depend on whether the difference between the reason relied on by the respondent and that found by the ET is one of substance or merely of labelling, Hannan v TNTIPEC Ltd (UK) Ltd

[1986] IRLR 165

EAT at paragraph 22, and Secretary of State for Justice v Norridge

UKEAT/0443/13

at paragraph 31.”

[57]If it is established that redundancy is the reason for dismissal, the Tribunal must then determine whether the dismissal was fair or unfair pursuant to section 98 (4) of ERA which provides that: “…. 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”.

[58]The Tribunal must apply the range of reasonable responses which was summarised by Mr Justice Browne-Wilkinson test in Iceland Frozen Foods Ltd v Jones

1983 ICR 17

, EAT: “We consider that the authorities establish that in law the correct approach for the… tribunal to adopt in answering the question posed by [S.98(4)] is as follows: 1. the starting point should always be the words of [S.98(4)] themselves; 2. in applying the section [a] tribunal must consider the reasonableness of the employer’s conduct, not simply whether they (the members of the… tribunal) consider the dismissal to be fair; 3. in judging the reasonableness of the employer’s conduct [a] tribunal must not substitute its decision as to what was the right course to adopt for that of the employer; 4. in many (though not all) cases there is a band of reasonable responses to the employee’s conduct within which one employer might reasonably take one view, another quite reasonably take another; 5. the function of the… tribunal, as an industrial jury, is to determine whether in the particular circumstances of each case the decision to dismiss the employee fell within the band of reasonable responses which a reasonable employer might have adopted. If the dismissal falls within the band the dismissal is fair: if the dismissal falls outside the band it is unfair.”

[59]The correct approach is to consider together all the circumstances of the case, both substantive and procedural, and reach a conclusion in all the circumstances.

[60]In Polkey v A E Dayton Services Ltd

[1988] 1 ICR 142

, Lord Bridge stated that “in the case of redundancy, the employer will normally not act reasonably unless he warns and consults any employees affected or their representative, adopts a fair basis on which to select for redundancy and takes such steps as may be reasonable to avoid or minimise redundancy by redeployment within his own organisation”.

[61]Guiding principles given by the appellate authorities in relation to consultation were summarised by His Honour Judge Beard in Haycocks v ADP RPO UK Ltd

[2023] EAT 129

as follows: “a. The employer will normally warn and consult either the employees affected or their representative; Polkey. b. A fair consultation occurs when proposals are at a formative stage and where adequate information and adequate time in which to respond is given along with conscientious consideration being given to the response; British Coal. c. Whether in collective or individual consultation, the purpose is to avoid dismissal or ameliorate the impact; Freud. d. A redundancy process must be viewed as a whole and an appeal may correct an earlier failing making the process as a whole reasonable; Lloyd v Taylor Woodrow. e. The ET’s consideration should be of the whole process, also considering the reason for dismissal, in deciding whether it is reasonable to dismiss; Taylor v OCS. f. It is a question of fact and degree as to whether consultation is adequate and it is not automatically unfair that there is a lack of consultation in a particular respect; Mugford. g. Any particular aspect of consultation, such as the provision of scoring, is not essential to a fair process; Camelot. h. The use of a scoring system does not make a process fair automatically; British Aerospace. i. The relevance or otherwise of individual scores will relate to the specific complaints raised in the case; British Aerospace.” [22]

[62]The employer must also take reasonable steps to find the employee alternative employment (Polkey). The standard to be applied in order to determine whether a respondent has discharged that obligation is the standard of a reasonable employer: British United Shoe Machinery Co Ltd v Clarke

[1977] IRLR 297

[63]Gwynedd Council v Barratt and anor

2021 IRLR 1028

, CA: in redundancy cases the absence of an appeal does not of itself make the dismissal unfair. Direct Discrimination

[64]The Claimant has made a complaint of direct discrimination, under section 13(1) of the Equality Act 2010 (“EqA”): “13 Direct discrimination (1) A person (A) discriminates against another (B) if, because of a protected characteristic, A treats B less favourably than A treats or would treat others.”

[65]As set out in Ayodele v Citylink Ltd & Anor

[2017] EWCA Civ 1913

, the following three issues may arise in respect of any specific complaint of discrimination: “(1) Did the alleged act occur at all? (2) If it did occur, did it amount to less favourable treatment of the claimant when compared with others? (3) If there was less favourable treatment, what was the reason for it? In particular, was that reason discriminatory? Accordingly, there may be cases in which the tribunal never has to address question (3), because it is not satisfied that it has been proved on the evidence that the alleged act took place at all; or it may not be satisfied that there was less favourable treatment.”

[66]Direct discrimination is based on comparative treatment. It must be established that the claimant was treated “less favourably” than someone else, who will be either an actual person or a hypothetical person.

[67]In order to establish less favourable treatment, like must be compared with like. The actual or hypothetical comparator must be in materially the same circumstances as the claimant, save that they do not share the protected characteristic. This is set out in section 23 EqA: “23 Comparison by reference to circumstances(1) On a comparison of cases for the purposes of section 13, 14, 19 or 19A there must be no material difference between the circumstances relating to each case.

(2) The circumstances relating to a case include a person's abilities if— (a) on a comparison for the purposes of section 13, the protected characteristic is disability”

[68]Identifying a comparator is a question of fact for the Tribunal: Hewage v Grampian Health Board

[2012] UKSC 37

[69]In Dr Nicholas Jones v The Secretary of State for Health and Social Care:

[2025] EAT 76

HHJ Tayler set out the questions which may arise in relation to a direct discrimination complaint as follows: “35.1. What is the relevant treatment 35.2. Was that treatment different to that of another person 35.3. Were there any material differences between the circumstances of the claimant and any such other person? (where there are no material differences in circumstances the other person is an actual comparator – where there are material differences, but the circumstances are sufficiently similar in a more general sense, the other person may be an evidential comparator, whose treatment may assist in deciding whether to draw an inference of discrimination) 35.4. Was the claimant treated differently to how another person would have been treated? (in such circumstances that theoretical person is often described as a hypothetical comparator) 35.5. Are their facts from which the Employment Tribunal could conclude, in the absence of any other explanation, that the respondent breached the EQA 35.6. If so, has the respondent shown that it did not contravene the EQA”

[70]Even if the Claimant is treated less favourably than an appropriate comparator, it must have been because of the protected characteristic. This requires the Tribunal to determine the “reason why” the Claimant was treated less favourably. This does not mean that the comparator issue is a threshold to be crossed before “the reason why” is addressed. “[T]his sequential analysis can give rise to problems because sometimes the less favourable treatment issue cannot be resolved without, at the same time, deciding the reason why issue. The two issues are intertwined” [8]: Shamoon v Chief Constable of the Royal Ulster Constabulary

[2003] UKHL 11

[71]Discrimination is only made out if the protected characteristic had a “significant influence on the outcome”: Nagarajan v London Regional Transport [1999] 4 All E.R. 65. Nagarajan also made clear that subconscious intention is sufficient in relation to direct discrimination.

[72]Lord Nicholls in West Yorkshire Police v Khan

[2001] ICR 1065

made clear that the “reason why” is very different to the question of causation. The Tribunal must make a finding of fact about why the person acted as they did: “29…..Causation is a slippery word, but normally it is used to describe a legal exercise. From the many events leading up to the crucial happening, the court selects one or more of them which the law regards as causative of the happening. Sometimes the court may look for the “operative” cause, or the “effective” cause. Sometimes it may apply a “but for” approach…The phrases “on racial grounds” and “by reason that” denote a different exercise: why did the alleged discriminator act as he did? What, consciously or unconsciously, was his reason? Unlike causation, this is a subjective test. Causation is a legal conclusion. The reason why a person acted as he did is a question of fact.”

[73]In relation to a direct disability discrimination complaint in Cordell v Foreign and Commonwealth Office [2012] I.C.R. 280, it was found that the disability itself must be the reason for the treatment, not something related to a disability. Burden of Proof

[74]The provisions relating to the burden of proof are to be found in section 136 EqA: “136 Burden of proof(1) This section applies to any proceedings relating to a contravention of this Act.

(2) If there are facts from which the court could decide, in the absence of any other explanation, that a person (A) contravened the provision concerned, the court must hold that the contravention occurred.

(3) But subsection (2) does not apply if A shows that A did not contravene the provision.”

[75]Efobi v Royal Mail Group Ltd

2021 ICR 1263

, SC: the claimant is required to prove, on the balance of probabilities, facts from which, in the absence of any other explanation, the Tribunal could infer an unlawful act of discrimination.

[76]Igen v Wong

[2005] EWCA Civ 142

remains the leading authority in relation to the application of the burden of proof set out in section 136 EqA in relation to discrimination cases. It is not sufficient for the claimant simply to prove facts from which the tribunal could conclude that the Respondent “could have” committed an unlawful act of discrimination. It is clear that the claimant must prove facts from which the Tribunal could conclude, in the absence of an adequate explanation, that the respondent did commit an unlawful act of discrimination it can.

[77]It is not sufficient to shift the burden of proof (in relation to a direct discrimination complaint) for a claimant to show only a difference in status and a difference in treatment. These are bare facts which only indicate a possibility of discrimination. They are not, without more, sufficient material from which a tribunal “could conclude” that, on the balance of probabilities, the Respondent had committed an unlawful act of discrimination: Madarassy v Nomura International Plc

[2007] EWCA Civ 33

[78]Madrassy further sets out that “could conclude” “must mean that ‘a reasonable tribunal could properly conclude’ from all the evidence before it. This would include evidence adduced by the complainant in support of the allegations of sex discrimination, such as evidence of a difference in status, a difference in treatment and the reason for the differential treatment. It would also include evidence adduced by the respondent contesting the complaint. Subject only to the statutory ‘absence of an adequate explanation’ at this stage (which I shall discuss later) the tribunal would need to consider all the evidence relevant to the discrimination complaint”.

[79]In Artem Limited v Edwins

[2024] EAT 136

this was also emphasised by HHJ Tayler, who stated that in relation to considering whether there was sufficient evidence to shift the burden of proof “an Employment Tribunal should not ignore evidence that suggests discrimination. However, I should also add that it is important that Employment Tribunals do not ignore evidence that suggests there has not been discrimination. What must be ignored at the first stage is any exculpatory explanation for the treatment.”

[80]HHJ Tayler considered the interrelationship between the use of comparators and the shifting burden of proof in Virgin Active v Hughes

[2023] EAT 130

: “61. In many direct discrimination claims the claimant does not rely on a comparison between his treatment and that of another person. The claimant relies on other types of evidence from which it is contended that an inference of discrimination should be drawn, the comparison being with how the claimant would have been treated had he had some other protected characteristic. 62. In other cases, the claimant compares his treatment with that of one or more other people. There are two ways in which such a comparison may be relevant. If there are no material differences between the circumstances of the claimant and the person with whom the comparison is made (the person is usually referred to as an actual comparator), this provides significant evidence that there could have been discrimination. However, because there must be no material difference in circumstances between a claimant and a comparator for the purpose of section 23 EQA it is rare that a claimant can point to an actual comparator. The second situation in which a comparison with the treatment of another person may provide evidence of discrimination is where the circumstances are similar, but not sufficiently alike for the person to be an actual comparator. The treatment of such a person may provide evidence that supports the drawing of an inference of discrimination, sometimes by helping to consider how a hypothetical person whose circumstances did not materially differ to those of the claimant would have been treated (generally referred to as a hypothetical comparator). Evidence of the treatment of a person whose circumstances materially differ to those of the claimant is inherently less persuasive than that of a person whose circumstances do not materially differ to those of the claimant. … 67. If anything more is required to shift the burden of proof when there is an actual comparator it will be less than would be the case if a claimant compares his treatment with a person whose circumstances are similar, but materially different, so that there is not an actual comparator.”

[81]Per Igen, in which the Court of Appeal approving the revised “Barton Guidance” if the burden of proof has moved to the respondent: “10) It is then for the respondent to prove that it did not commit, or as the case may be, is not to be treated as having committed, that act. 11) To discharge that burden it is necessary for the respondent to prove, on the balance of probabilities, that the treatment was in no sense whatsoever on the grounds of [the protected characteristic]... 12)That requires a tribunal to assess not merely whether the Respondent has proven an explanation for the facts from which such inferences can be drawn, but further that it is adequate to discharge the burden of proof on the balance of probabilities that [the protected characteristic] was not a ground for the treatment in question.” [76] Time Limits in relation to discrimination complaints

[82]Section 123 EqA provides that: 123 Time limits (1) Subject to section 140B proceedings on a complaint within section 120 may not be brought after the end of— (a) the period of 3 months starting with the date of the act to which the complaint relates, or (b) such other period as the employment tribunal thinks just and equitable. … (3) For the purposes of this section— (a) conduct extending over a period is to be treated as done at the end of the period; (b) failure to do something is to be treated as occurring when the person in question decided on it. (4) In the absence of evidence to the contrary, a person (P) is to be taken to decide on failure to do something— (a) when P does an act inconsistent with doing it, or (b) if P does no inconsistent act, on the expiry of the period in which P might reasonably have been expected to do it.”

[83]Section 140B EqA permits an extension of time where ACAS early conciliation is undertaken: “In this section—(a) Day A is the day on which the complainant or applicant concerned complies with the requirement in subsection (1) of section 18A of the Employment Tribunals Act 1996 (requirement to contact ACAS before instituting proceedings) in relation to the matter in respect of which the proceedings are brought, and

(b) Day B is the day on which the complainant or applicant concerned receives or, if earlier, is treated as receiving (by virtue of regulations made under subsection (11) of that section) the certificate issued under subsection (4) of that section. (3) In working out when the time limit set by section 123(1)(a) or 129(3) or (4) expires the period beginning with the day after Day A and ending with Day B is not to be counted. (4) If the time limit set by section 123(1)(a) or 129(3) or (4) would (if not extended by this subsection) expire during the period beginning with Day A and ending one month after Day B, the time limit expires instead at the end of that period. (5) The power conferred on the employment tribunal by subsection (1)(b) of section 123 to extend the time limit set by subsection (1)(a) of that section is exercisable in relation to that time limit as extended by this section.

[84]If the claim is brought outside of the primary time limit (the three-month time limit plus the extension ACAS conciliation), the Tribunal must make a determination in relation to section 123(1)(b) EqA: whether the claim has been brought within “such other period as the employment tribunal thinks just and equitable”. Equal Pay

[85]This is governed by section 66 EqA which sets out that: “66 Sex equality clause (1) If the terms of A's work do not (by whatever means) include a sex equality clause, they are to be treated as including one. (2) Where this section applies by virtue of section 64(1), a]1 sex equality clause is a provision that has the following effect—(a) if a term of A's is less favourable to A than a corresponding term of B's is to B, A's term is modified so as not to be less favourable;

(b) if A does not have a term which corresponds to a term of B's that benefits B, A's terms are modified so as to include such a term.” 8. In this case, it is agreed between the parties that the only issue in dispute is the material factor defence. “69 Defence of material factor (1) The sex equality clause in A's terms has no effect in relation to a difference between A's terms and B's terms if the responsible person shows that the difference is because of a material factor reliance on which— (a) does not involve treating A less favourably because of A's sex than the responsible person treats B, and (b) if the factor is within subsection (2), is a proportionate means of achieving a legitimate aim. (2) A factor is within this subsection if A shows that, as a result of the factor, A and persons of the same sex doing work equal to A's are put at a particular disadvantage when compared with persons of the opposite sex doing work equal to A's. … (6) For the purposes of this section, a factor is not material unless it is a material difference between A's case and B's.”

[86]In Glasgow City Council and others v Marshall and others

[2000] ICR 196

, HL Lord Nicholls explained the following. This relates to the predecessor legislation but is also applicable to section 69 EqA. “The scheme of the Act is that a rebuttable presumption of sex discrimination arises once the gender-based comparison shows that a woman, doing like work or work rated as equivalent or work of equal value to that of a man, is being paid or treated less favourably than the man. The variation between her contract and the man's contract is presumed to be due to the difference of sex. The burden passes to the employer to show that the explanation for the variation is not tainted with sex. In order to discharge this burden the employer must satisfy the tribunal on several matters. First, that the proffered explanation, or reason, is genuine, and not a sham or pretence. Second, that the less favourable treatment is due to this reason. The factor relied upon must be the cause of the disparity. In this regard, and in this sense, the factor must be a 'material' factor, that is, a significant and relevant factor. Third, that the reason is not 'the difference of sex'. This phrase is apt to embrace any form of sex discrimination, whether direct or indirect. Fourth, that the factor relied upon is or, in a case within section 1(2)(c), may be a 'material' difference, that is, a significant and relevant difference, between the woman's case and the man's case. When section 1 is thus analysed, it is apparent that an employer who satisfies the third of these requirements is under no obligation to prove a 'good' reason for the pay disparity. In order to fulfil the third requirement he must prove the absence of sex discrimination, direct or indirect. If there is any evidence of sex discrimination, such as evidence that the difference in pay has a disparately adverse impact on women, the employer will be called upon to satisfy the tribunal that the difference in pay is objectively justifiable. But if the employer proves the absence of sex discrimination he is not obliged to justify the pay disparity.”

[87]A factor is “material” if it is a significant and relevant factor. Lord Keith explained it as follows in Rainey v Greater Glasgow Health Board

1987 ICR 129

, HL. “The difference must be "material," which I would construe as meaning "significant and relevant," and it must be between "her case and his." Consideration of a person's case must necessarily involve consideration of all the circumstances of that case. These may well go beyond what is not very happily described as "the personal equation," i.e. the personal qualities by way of skill, experience or training which the individual brings to the job. Some circumstances may on examination prove to be not significant or not relevant, but others may do so, though not relating to the personal qualities of the employee. In particular, where there is no question of intentional sex discrimination whether direct or indirect (and there is none here) a difference which is connected with economic factors affecting the efficient carrying on of the employer's business or other activity may well be relevant.”

[88]The Court of Appeal in Department of Justice v McGrath 2021 NICA 44, NICA accepted the following as an accurate statement of the applicable principles regarding the material factor defence. “Once a difference in terms is identified, a rebuttable presumption passes to the employer who must then explain the reason (the material factor) for the difference between the claimant and her comparator. It does not matter whether the explanation is a good one or whether the Employment Tribunal agrees with it. What does matter is that it is a non-discriminatory reason for the difference; in other words that it is nothing to do, directly or indirectly, with sex. In addition, the employer must show:(i) that this was the real reason for the difference and is not a sham or pretence, … the reason still has to be a genuine one;

(ii) that the reason was causative of the difference between the comparator's term and the term in the claimant's contract;

(iii) that there is a significant and relevant difference between the woman's case and the man's case;

(iv) the difference is not a difference of sex." [85] Time limits in relation to equal pay complaints

[89]Different time limits apply in relation to equal pay complaints. The time limits are set out at section 129 EqA as follows. “129 Time limits(1) This section applies to— (a) a complaint relating to a breach of an equality clause or rule; (b) an application for a declaration referred to in section 127(3) or (4).

(2) Proceedings on the complaint or application may not be brought in an employment tribunal after the end of the qualifying period.

(3) If the complaint or application relates to terms of work other than terms of service in the armed forces, the qualifying period is, in a case mentioned in the first column of the table, the period mentioned in the second column, subject to section 140B. Case Qualifying period A standard case The period of 6 months beginning with the last day of the employment or appointment. A stable work case (but not if it The period of 6 months beginning with the is also a concealment or day on which the stable working incapacity case (or both)) relationship ended. A concealment case (but not if The period of 6 months beginning with the it is also an incapacity case) day on which the worker discovered (or could with reasonable diligence have discovered) the qualifying fact. An incapacity case (but not if it The period of 6 months beginning with the is also a concealment case) day on which the worker ceased to have the incapacity. A case which is a concealment The period of 6 months beginning with the case and an incapacity case. later of the days on which the period would begin if the case were merely a concealment or incapacity case.

[90]Under section 130(3), a stable work case is defined as follows. “(3) A stable work case is a case where the proceedings relate to a period during which there was a stable working relationship between the worker and the responsible person (including any time after the terms of work had expired).”

[91]As with direct discrimination above, section 140B EqA permits an extension of time where ACAS early conciliation is undertaken. Bonus

[92]Where a bonus clause includes a discretionary power, this can be challenged by an employee on the basis that it has been exercised perversely, irrationally or capriciously. In Clark v Nomura International plc

2000 IRLR 766

, QBD set out that “the right test is one of irrationality or perversity (of which caprice or capriciousness would be a good example) i.e. that no reasonable employer would have exercised his discretion in this way.”.

[93]Nomura was cited with approval by the Court of Appeal in Horkulak v Cantor Fitzgerald International

2005 ICR 402

, CA where it was also stated in relation to the bonus provision being considered that “This provision emphasises the obligation of CFI to consider the question of payment of a bonus (and amount) as a rational and bona fide, as opposed to an irrational and arbitrary, exercise when taking into account such criteria as CFI adopt for the purpose of arriving at their decision. Failure so to construe it would strip the bonus provision in clause 3(b)(ii) of any contractual value or content in respect of the employee whom it is designed to benefit and motivate.”. Unauthorised deduction from wages

[94]The Claimant also claims in respect of deductions from wages which she alleges were not authorised and were therefore unlawful deductions from her wages contrary to section 13 of the Employment Rights Act 1996 which sets out the following. “(1) An employer shall not make a deduction from wages of a worker employed by him unless—(a) the deduction is required or authorised to be made by virtue of a statutory provision or a relevant provision of the worker's contract, or

(b) the worker has previously signified in writing his agreement or consent to the making of the deduction.”

[95]Section 27(1) of the Employment Rights Act 1996 defines “wages” as “any sums payable to the worker in connection with his employment”, including “any fee, bonus, commission, holiday pay or other emolument referable to the employment”. By virtue of S.27(5), payments or benefits in kind are not to be treated as wages.

[96]Section 23(2) of ERA sets out that “Subject to subsection (4), an [employment tribunal] shall not consider a complaint under this section unless it is presented before the end of the period of three months beginning with (a) in the case of a complaint relating to a deduction by the employer, the date of payment of the wages from which the deduction was made”.

[97]Section 23(4) of ERA sets out that “Where the [employment tribunal] is satisfied that it was not reasonably practicable for a complaint under this section to be presented before the end of the relevant period of three months, the tribunal may consider the complaint if it is presented within such further period as the tribunal considers reasonable.”

[98]As with the discrimination claims, the primary limitation period has been amended by the ERA, section 207A. The effect of section 207A is that there is an extension to the primary limitation period so that there is at least a month between the date of the issue of the EC certificate and the deadline for a claim. Contract Claim

[99]Under article 3 of the Employment Tribunals Extension of Jurisdiction (England and Wales) Order 1994 (the “Order”), contractual claims can be brought in the Employment Tribunal as follows. “3. Proceedings may be brought before an employment tribunal in respect of a claim of an employee for the recovery of damages or any other sum (other than a claim for damages, or for a sum due, in respect of personal injuries) if— (a)the claim is one to which section 131(2) of the 1978 Act applies and which a court in England and Wales would under the law for the time being in force have jurisdiction to hear and determine; (b) the claim is not one to which article 5 applies; and (c) the claim arises or is outstanding on the termination of the employee’s employment.”

[100]Under article 10 of the Order “[a]n employment tribunal shall not in proceedings in respect of a contract claim, or in respect of a number of contract claims relating to the same contract, order the payment of an amount exceeding £25,000.”. Terms and Conditions

[101]Under section 1(1) of ERA, “[w]here a worker begins employment with an employer, the employer shall give to the worker a written statement of particulars of employment….”. Section 1(4)(a) of ERA states that the required particulars include “the scale or rate of remuneration or the method of calculating remuneration”.

[102]Under section 4(1) of ERA, “[i]f, after the material date, there is a change in any of the matters particulars of which are required by sections 1 to 3 to be included or referred to in a statement under section 1, the employer shall give to the worker a written statement containing particulars of the change.”

[103]Under section 38 of the Employment Act 2002 “38 Failure to give statement of employment particulars etc. (1) This section applies to proceedings before an employment tribunal relating to a claim by a worker under any of the jurisdictions listed in Schedule 5. …. (3) If in the case of proceedings to which this section applies— (a) the employment tribunal makes an award to the worker in respect of the claim to which the proceedings relate, and (b) when the proceedings were begun the employer was in breach of his duty to the worker under section 1(1) or 4(1) of the Employment Rights Act 1996, the tribunal must, subject to subsection (5), increase the award by the minimum amount and may, if it considers it just and equitable in all the circumstances, increase the award by the higher amount instead. (4) In subsections (2) and (3)— (a) references to the minimum amount are to an amount equal to two weeks' pay, and (b) references to the higher amount are to an amount equal to four weeks' pay. (5) The duty under subsection (2) or (3) does not apply if there are exceptional circumstances which would make an award or increase under that subsection unjust or inequitable. (6) The amount of a week's pay of a worker shall— (a) be calculated for the purposes of this section in accordance with Chapter 2 of Part 14 of the Employment Rights Act 1996 (c. 18), and (b) not exceed the amount for the time being specified in section 227 of that Act (maximum amount of week's pay).”

[104]The list of jurisdictions set out in Schedule 5 includes unlawful deductions from wages, unfair dismissal, breach of contract, discrimination and equal pay. Discussion and Conclusions Unfair dismissal

[105]The Tribunal considers that there was there a genuine redundancy situation. The company had decided that it wanted to reduce costs, and the proposal was that it would therefore no longer have anyone doing a BDM role. The Claimant disagreed with the First Respondent’s position that the BDM role did not add value to the business. If an employer makes a genuine business decision that they want to structure their business in a certain way, it is not for the Tribunal to substitute its own view as to what is best for the business. The legal test for redundancy does not require the First Respondent to prove that there is less work of a particular type, only that fewer employees are required to do that work. In this case, two fewer employees were required to do the work. Further, it is normal for employers in this situation to re-allocate some of the work undertaken by those being made redundant. This does not undermine the redundancy situation. In this case some of the work was allocated to another employee, and other parts of the work were no longer being provided by the First Respondent to its franchisees at all. Instead, different services were provided by Platinum Wave, a third party.

[106]The Tribunal finds that the Claimant’s dismissal was attributable to that redundancy situation. Both of the BDMs were dismissed because of the decision to remove this role from the business.

[107]The First Respondent warned and consulted the two BDMs in relation to the redundancy proposal. Whilst the Claimant criticised the speed of moving from the redundancy business case to the consultation process, the First Respondent must consult whilst the proposal is at a formative stage.

[108]In considering the fairness of the consultation, the Tribunal has taken into account that the Claimant consultation took place during the course of one week. Whilst the Claimant requested more time to prepare for the consultation meeting and was not given it, she was not able to point to any practical effect for her of not being permitted to have more time to prepare. Whilst the time frame was short, the Tribunal considers it was adequate time for the Claimant to prepare in the circumstances. The Tribunal also notes that the meeting was not held in private which was not appropriate.

[109]The Claimant was given adequate opportunity to, and did, put forward suggestions regarding alternatives for redundancy. The Claimant’s suggestions were matters which had already been considered in advance by the First Respondent and reasons were given in the meeting regarding why these suggestions had been discounted.

[110]Taking all of the circumstances into account, the Tribunal finds that the consultation was reasonable.

[111]The Tribunal does not uphold the Claimant’s assertion that the process was pre-determined. A reference to there being a “plan” to remove the BDM role, is simply a statement that there is a redundancy proposal. The Tribunal does not consider this to be evidence of pre-determining the outcome. The comment that the process would be done and dusted by the end of the week was simply a reference to how long the process would last and again is not upheld as evidence of a predetermined outcome. As part of this challenge, the Claimant also referred to the fact that Ms O’Gara had been asked to undertake an audit task shortly before the redundancy consultation took place. Whilst this is factually accepted, it was not a core part of the BDM role, and the Tribunal does not consider that this is evidence of pre-determination of the outcome.

[112]The Tribunal considers that the First Respondent adopted a reasonable selection decision, including its approach to a selection pool. The First Respondent did not pool Ms O’Gara with the two BDMs on the basis that her role was primarily training and mentoring and so was sufficiently different to that of the BDM role. Ms O’Gara’s role only had about 20% of BDM work. The Tribunal finds that this the selection of the two BDM roles as a pool of two is within the reasonable range of what a reasonable employer might do.

[113]The Tribunal is satisfied that the First Respondent considered alternatives to redundancy, including a single BDM and whether there were other suitable roles for the Claimant and reasonably concluded that these alternatives were not suitable.

[114]The decision to dismiss was within the range of reasonable responses open to a reasonable employer when faced with these facts.

[115]The mistake regarding the amount of notice pay due to the Claimant does not affect the fairness of the dismissal, nor do the comments made by Mr Gateson and Mr Comerford on realising that they had made a mistake regarding the Claimant’s notice terms. The Tribunal notes the Claimant’s complaints regarding calculations of the pay owed to her following termination, but after interactions between the parties this was corrected, and it does not affect the fairness of the dismissal.

[116]The appeal decision was taken by Mr Gateson who also made the dismissal decision with Mr Comerford. An appeal should not be decided by the same person who made the original decision. However, as set out in the case law, the absence of an appeal in a redundancy dismissal is not determinative of fairness, it is just a factor to take into account. The same reasoning must therefore apply if there is a flaw in the appeal process. The original dismissal decision is considered by the Tribunal to be fair, and the appeal decision was based on recommendations made by an external consultant. The Tribunal must consider the whole process when assessing fairness. Taking all the circumstances into account, the Tribunal considers that this flaw in the process does not render the dismissal procedurally unfair.

[117]The Claimant made these specific challenges to fairness:

[118]The unfair dismissal complaint is not well founded and is dismissed. Equal Pay

[119]Submissions were made by Mr Henry that the equal pay complaint was out of time in relation to the car allowance because the position as between Mr Cridge and the Claimant had been equalised in July 2022.

[120]In analysing time limits, we treat this as a stable work case because there was a stable working relationship between the parties: the Claimant was employed for a continuous period by the same employing entity. In relation to stable work cases, time begins to run on the day on which the stable working relationship ended. In this case, the six month time limit began to run on 30 April 2023 (the date of the employment ending) and ended on 29 October 2023. The claim was presented on 14 July 2023. Even without taking into account the extension in respect of early conciliation, the complaint is made in time.

[121]The equal pay complaints in relation the 2021 and 2022 bonus fall away because the Tribunal has found that the Claimant and Mr Cridge had the same contractual term in respect of these.

[122]The Claimant therefore complains of a difference in terms in relation to overtime pay/time off in lieu and in relation to her car allowance. The only point in dispute between the parties is the material factor defence. It is important to note that the burden of proof is on the employer to prove (by sufficiently cogent and particularised evidence) that the factor relied on explains the difference in pay complained of.

[123]The First Respondent’s position is that the fact that two different people drafted the contracts of the Claimant and Mr Cridge constitutes a material factor defence.

[124]The Tribunal accepts the First Respondent’s evidence that two different individuals drafted the contracts. However, it is not satisfied that the First Respondent has discharged the burden of proof to show that this was genuinely causative of the difference between the comparator's term and the term in the Claimant's contract. In circumstances where Mr Gateson was aware of the amount of the Claimant’s car allowance and could have discovered (simply by looking at documents which were in his possession) what the contractual clause was that related to overtime/time off in lieu, the Tribunal considers that the difference between the terms was in effect, arbitrary. It might just as easily have happened if Mr Gateson had historically drafted the Claimant’s contract, rather than anyone else, and he had simply not reminded himself of the terms.

[125]The Tribunal considers that, as an explanation, the fact that two different individuals drafted two different employees’ contracts does not meet the threshold of being a significant and relevant difference between the Claimant’s case and Mr Cridge’s case. This is an explanation which could likely be given by any large employer. The Equality Act operates to shift the burden of proof to the First Respondent to prove that the difference in terms was in no way discriminatory. They have not succeeded in doing so. Arbitrarily giving a male and female different contracts is not a significant and relevant difference between the two individual’s cases.

[126]The First Respondent has not established a material factor defence and the Tribunal upholds the Claimant’s equal pay claim. Direct sex discrimination

[127]The Claimant has made an allegation that she suffered direct sex discrimination in relation to the 2021 bonus. The Claimant asserts that she was treated less favourably than Mr Cridge because he only had to work a few months in order to receive £10,000 for his 2021 bonus, whereas the Claimant had to work the whole year to get the same amount. She asserts that when their bonuses were considered pro-rata to the amount of the year that they each had to work, her bonus was less favourable.

[128]This complaint is out of time. The act complained of (the decision to put the new bonus scheme in place) took place in August 2021 and the claim was presented on 14 July 2023, nearly two years later. In relation to the reason for not bringing the claim earlier, the Claimant stated she did not know she could bring a claim. The Respondents did not make any submissions regarding practical prejudice to the Respondents if time was extended. The Tribunal can take merits into account when deciding whether to extend time. The Tribunal takes the following into account.

[129]The Respondents agree that Mr Cridge is a statutory comparator for the purposes of this complaint.

[130]The Tribunal puts to one side whether, in fact, the Claimant was treated less favourably. On one analysis it would have been more difficult for Mr Cridge to achieve the performance targets as he had a shorter time period within which to do so. On the other hand, he worked for seven months and received £10,000 and the Claimant worked for 12 months and got the same amount of money.

[131]In oral evidence, the Claimant was asked why she thought Mr Bolton was motivated by her being a woman, whether consciously or subconsciously. The Claimant could only point to the difference in treatment. She could not identify anything else which showed discriminatory motivation.

[132]The Tribunal considered whether the burden of proof would have shifted to the Respondents. The Tribunal notes that the case law sets out that a mere difference in treatment is not sufficient to shift the burden of proof in every case. The Tribunal considered that there were no facts from which it could properly conclude (ignoring the Respondents’ explanation) that discrimination had taken place in order to shift the burden of proof. There was no evidence at all of any conscious or subconscious discriminatory motivation.

[133]The Tribunal went on to consider the “reason why” for the treatment complained of. The Tribunal finds, based on Mr Bolton’s evidence, that the vast majority of the work undertaken by the First Respondent was in the period from September to Christmas. Mr Bolton’s evidence was that the First Respondent did not really work in years but in Christmases. So, from his perspective, bonuses were really related to 2021 Christmas, 2022 Christmas and so on. Mr Cridge having joined before the Christmas season, was able to earn the bonus for that year. The Tribunal considers that this establishes a non-discriminatory reason for the treatment complained of. Therefore, even if the Claimant had succeeded in shifting the burden of proof, this would have been discharged.

[134]The complaint of direct sex discrimination is not well founded.

[135]The Tribunal must weigh the balance of prejudice when considering whether to extend time. The Tribunal takes into account the Claimant’s lack of knowledge, and the fact that no practical prejudice was put forward on behalf of the Respondents. It also considered that little prejudice would be suffered by the Claimant if she could not pursue a complaint which had little merit. On that basis, the Tribunal determined that it was not just and equitable to extend time. The complaint of direct sex discrimination is out of time and is dismissed for want of jurisdiction. Bonus

[136]The Tribunal notes that Mr Cridge’s bonus claim against the First Respondent is included in the bundle. Issue estoppel is only binding where an issue has been decided between the same parties. Mr Cridge’s case related to him, and this case has different parties. Therefore, given it is a first instance case, this Tribunal considers it is not bound by the decision of that Tribunal.

[137]The First Respondent’s pleaded case was that the Claimant had no contractual right to a bonus. The position put forward in submissions was somewhat more nuanced: there was a contractual bonus scheme, but it gave the First Respondent discretion as to whether the bonus would be paid or not.

[138]The Claimant’s original bonus wording stated “The company operates a discretionary bonus scheme. You will be entitled to participate in the scheme at a rate of 10% of base salary. Awards under the scheme will be made annually, following the submission of the year end accounts and will be based on company financial performance and the achievement of personal objectives. Payments from the scheme are not guaranteed and the company reserves the right to change the scheme each year. The calculation of actual payments from the scheme are at the discretion of management.”.

[139]The scheme was amended for bonus years 2021 and 2022 so that the Claimant and Mr Cridge could earn up to £20,000.

[140]The negotiations between the parties must be understood against the background of the bonus clauses. Mr Cridge’s clause as well, which stated: “The company operates a discretionary bonus scheme. Awards under the scheme will be made annually, following the submission of the year end year. The calculation of actual payments from the scheme are at the discretion of management. Key Performance Indicators will be set on an annual basis with Bonus amounts agreed, and maximum bonus potential for 2022 FYE will be £20,000.”

[141]The Tribunal finds that the contents of the letter at page 242 from Mr Cridge reflects what had been verbally discussed and agreed between Mr Gateson, the Claimant and Mr Cridge in relation to the “personal objectives” referred to in both the Claimant’s and Mr Cridge’s bonus clauses. The Tribunal considers that this is what would be reasonably understood when taking the bonus terms together with the letter at page 242.

[142]The First Respondent retained a discretion in relation to whether to award a bonus based on “company financial performance” and achievement of the “personal objectives” and in relation to the calculation of the bonus. “Company financial performance” was not a defined term in the contract, and this Tribunal considers that to refer to the First Respondent’s financial performance generally rather than to the parameters set out in part 1 of the objectives (as determined in the Cridge decision). Part 1 of the objectives related to the performance of the franchisees managed by the Claimant (i.e it was tailored to her work). The performance of franchisees was referred to throughout the documents and oral evidence by both parties as “network performance”, not “company” performance. The natural meaning of “company” performance in an employment contract is a reference to the performance of the employer, not its clients (here the franchisees). The Tribunal considers this is also demonstrated by the fact that in the first year of employment, the First Respondent performed badly and consequently the Claimant’s 10% bonus was not paid. The Tribunal considers that both parts 1 and 2 of the letter at page 242 were the personal objectives referred to in the bonus clause, and did not relate to “company” performance.

[143]The First Respondent never finalised its review of the Claimant’s performance for the bonus year 2021. The Claimant was told that the First Respondent intended to pay part 2 of the 2021 bonus subject to meeting the KPIs (see the email from Mr Gateson on 18 March 2022 at paragraph 33 above). The review of the Claimant’s performance against KPIs never took place and the payment date was deferred a number of times, eventually to 23 March 2023. The First Respondent then simply did not pay the bonus saying in the grievance decision that it had exercised its discretion not to pay it.

[144]The Tribunal must consider whether the First Respondent acted perversely, irrationally or capriciously by reference to the test set out in Clark v Nomura International Plc (see above). We must consider whether no reasonable employer would have exercised their discretion in this way.

[145]The Tribunal has found that the bonus was to be awarded pro-rata if the Claimant achieved a proportion of the KPIs. We find that, in the absence of any evidence to the contrary and having not upheld the “three strikes rule”, that the Claimant’s score for the 2021 bonus year was that set out in Mr Gateson’s spreadsheet, emailed to the Claimant on 25 May 2022. The Claimant scored 107 out of 207, so approximately 51.7%. In relation to company performance for the 2021 bonus year, there was no evidence that the company had performed badly. The Claimant had been told that the bonus would be paid subject to review of her performance of the KPIs, and that was her reasonable expectation. For the First Respondent to later change the position and say that no bonus would be paid at all was a perverse exercise of its discretion. On review of the grievance outcome letter (page 516) which solely referred to factors after the end of the 2021 bonus year and based on the Respondent’s conduct of stating it would be settled and then withdrawing this, it appears the decision to withhold the bonus was related to the company’s performance in 2022. That is clearly irrelevant to the payment of the bonus for a different bonus year (2021). Taking irrelevant factors into account in this way after the payment had been confirmed is perverse in the finding of this Tribunal. A reasonable employer would only take relevant factors into account. The Tribunal finds that the Claimant should have been paid the relevant pro-rated amount in relation to the 2021 bonus year.

[146]In relation to the bonus year 2022, the situation was different. The Tribunal has made a finding that the First Respondent was on the brink of insolvency. Mr Bolton was required to take a further £150,000 loan secured on his personal home in order to ensure the company could continue to operate. The First Respondent had made the difficult decision to make two employees redundant as a result of the financial position of the company and the First Respondent’s assessment of the value the role added to the business. The legal test of perversity is a high bar to meet. In the financial circumstances of the First Respondent, it is not possible for this Tribunal to find that no reasonable employer would have exercised its discretion not to pay bonuses. We have also taken into account that the position at the time, as expressed in the redundancy dismissal meeting, was that no employees would be paid bonuses: this was not a decision relating solely to the Claimant and Mr Cridge. It is not disputed by the Claimant that no employees were paid a bonus in relation to 2022. Therefore, the complaint in relation to the 2022 bonus is not well founded and is dismissed.

[147]In relation to time limits, the Tribunal has found that the parties agreed to delay the payment date of the 2021 bonus to 23 March 2023. On that basis, the complaint is not out of time.

[148]The Tribunal upholds the Claimant’s complaint of unauthorised deduction from wages in relation to the 2021 bonus and dismisses it in relation to the 2022 bonus. Written Particulars of Employment

[149]The First Respondent failed to provide any written notification of the bonus terms. The Tribunal considers that this relates to the “method of calculating remuneration” and finds that the First Respondent has therefore breached section 4 of ERA in relation to the obligation to provide a written statement of the particulars of a change to remuneration. The breach continued until the date of presentation of the Claimant’s claim.

Remedy

[150]The basis for the remedy calculations is set out in the footnotes to the judgment sent to the parties on 25 June 2025. The only aspect which was not agreed between the parties related to the uplift for a failure to provide written particulars of employment.

[151]In relation to whether it was appropriate to award four weeks’ pay, the Tribunal considered that it was relevant that the First Respondent had provided written terms of employment and that there was only one element where it did not comply with the obligation to provide written particulars. The breach was inadvertent and not deliberate. Therefore, an increased award was not appropriate.

[152]In relation to whether it was appropriate to reduce the award to nil, the Tribunal considered that it was relevant that the uncertainties regarding the bonus terms had made the conduct of this claim more difficult and complex. It was not appropriate to reduce the compensation to nil. Approved by