Anne Whyte v Two Skies Ltd: 4106707/2018

EMPLOYMENT TRIBUNALS (SCOTLAND)

Case No 4106707/2018

Between

Anne WhyteClaimant

Two Skies LimitedRespondent

Before

Employment Judge M A Macleod

Date 27 March 2019

[1]The claimant presented a claim to the Employment Tribunal on 6 June 2018 in which she complained that the respondent had unfairly dismissed her 30 from her employment with them.

[2]The respondent submitted an ET3 response in which the claimant’s claim was denied. In particular, the ET3 asserted that no dismissal had taken place, and that the claimant had in fact resigned from her employment.

[3]A hearing was fixed to take place commencing on 4 March 2019. The 35 claimant appeared and represented herself. The respondent was represented by Mr Stephen, solicitor. 410 6707/18

[4]Each party produced a bundle of documents, to which reference was made throughout the hearing. For ease of reference, in this Judgment, any document produced by the claimant will be prefixed “AW”, and any document produced by the respondent will be prefixed “R”. There was some overlap between the two bundles and in the event that a document 5 has been produced in both only one reference will be given herein. The claimant gave evidence on her own account.

[6]The respondent called three witnesses:• Adam McIntosh, Managing Director;

• Catriona Sterling, Office Assistant; and

• Dorothy McIntosh, Director.

[7]On the basis that dismissal was not admitted, the claimant led her evidence first.

[8]Based on the evidence led and the information provided, the Tribunal was able to find the following facts admitted or proved. Findings in Fact

[9]The claimant, whose date of birth is 9 September 1964, commenced employment with the respondent on 27 May 2013.

[10]The respondent is a small, family-run business manufacturing jewellery and related articles. 20

[11]The claimant was appointed following interview by the then directors of the respondent, namely Mr McIntosh, Mrs McIntosh (his mother) and Richard Bennett, who was also Operations Manager at that time. She was employed to work as the Office Manager, based at the office at Craigencalt Farm. The claimant’s contract of employment (R29ff) confirmed her job title 25 as Office Manager, and referred to her job description in Appendix 1 to the 410 6707/18 document (which was not produced). She worked four days (32 hours) each week, and received a salary of £17,920 per annum.

[12]The claimant’s duties were mainly bookkeeping, invoicing, responding to emails, maintenance of personnel and financial records and acting as a Personal Assistant to Mr McIntosh. She worked in a small office, in which 5 Mr McIntosh and Mr Bennett were also located. The respondent also had use of a meeting room, known as the Treehouse, which was, literally, a tree house in the grounds of the farm. They also ran a shop on the Royal Mile in Edinburgh.

[13]The respondent was, in the spring of 2018, considering how they could 10 raise funds to purchase the farm buildings, which they currently leased. On 10 April 2018, Mrs McIntosh sent an email to Mr McIntosh, which he, in turn, forwarded to the claimant (AW5), with the heading “Fwd: message from mum”. The message read:

“will discuss with you in 5 mins You will have bills due since there will be a whopping amount to pay on corporation tax if that money is in the account at the end of March. However as long as you act quickly that could really help us. What I would suggest is that you contact Judith urgently and ask her if you can draw down on some of the debt that Two Skies owes you and have that 20 sum backdates for the end of the financial year. If you do a letter requesting this payment dated 28th March then the payment can be included in the annual accounts ending March 2018. Alternatively Anne could do a backdated cheque. I would check what percentage you can take without rocking the boat on any other bills that might be due. If you 25 take £80k out for example (and tax is already paid on this) then you could say to the Hollands that we have already got £80k in the kitty and we are on track for getting a further £80k by the end of the year. We could find £40k between all of us for the remaining amount. If you don’t do this around £25k will be lost to HMRC. 410 6707/18 Obviously it also means that those funds are available to help pay off Richard if we are going down this route but I think we would want to do that in stages. Need to be in touch quickly with Judith.”

[14]“Judith” referred to Judith Pritchard, the respondent’s accountant, from 5 whom advice was to be sought. “The Hollands” referred to the farm owners, with whom some discussion was ongoing about the purchase of the building. The first sentence of the email – “will discuss with you in 5 mins” was the comment added by Mr McIntosh to the claimant; the remainder of the message comprised the forwarded text from his mother.

[15]Mr McIntosh then approached the claimant in the office. He referred to the terms of the email and said that the respondent wished to use their money in the most tax-efficient way. The claimant said words to the effect that she would not be prepared to defraud the Revenue. Mr McIntosh interpreted this as an accusation by her that he was attempting to defraud HMRC (Her 15 Majesty’s Revenue and Customs). The conversation did not last long after that, but was not constructive and Mr McIntosh made clear his unhappiness at what the claimant had said to him. Two other members of staff were present in the office during this conversation, namely William Streeter, Operations Assistant, and Angel Dryland, Retail Lister/Assistant.

[16]At that date, Mrs McIntosh was on holiday in Egypt for some two and a half weeks. She was unable to recall in evidence when she returned from holiday, but following her return, a meeting was set up to take place between herself and Mr McIntosh to discuss a number of matters. That meeting did not take place until 10 May, owing to the difficulties they 25 experienced in co-ordinating their diaries. Mrs McIntosh works three days a week for a different business, in Edinburgh, and is therefore only available on a limited basis; and Mr McIntosh, again unable to recall specific dates, believed that he had gone abroad to India for one of the business trips he would take from time to time to seek new materials for the business. 410 6707/18

[17]A note of this meeting, which took place in the Treehouse on 10 May, was produced at R38 (AW12a). The note was prepared by Mrs McIntosh, who had her laptop with her and took notes during the meeting, tidying them up later.

[18]Under the heading “Anne”, it was noted:

“Adam informed Dory [Mrs McIntosh] that there had been an incident with Anne where she had accused Adam, in front of the other staff, of defrauding HMRC. Adam outlined what had happened – that confidential financial information relating to his affairs had been raised publicly in relation to a query about extracting some of the money in his director’s loan account. Adam said that this is not the first time that Anne discusses confidential matters. Junior staff have complained to him that Anne frequently discusses confidential salary information. Staff have also complained about a number of other issues relating to Anne: • General negativity – saying that Etsy is a waste of time and demeaning the work that Angel carries out. Also complaining hwo boring her work is and affecting the moral (sic) of the office • Critical about the work of other staff members – particularly Natalie – in front of others • Complaining about lack of help and then complaining about Hannah being hired and saying that she was not needed • Singling out members of staff (Cat) and discussing her in front of others. Cat subsequently resigned because of this and a number of similar incidents. • Setting a bad example inappropriate complaining – and using her personal phone which is against the company rules. It was agreed that the latter points are performance issues and should have been raised as a warning at the time. 410 6707/18 It was agreed that her behaviour over Adam’s query about extracting some of his funds was entirely inappropriate. If she had concerns over this she should have raised them privately with one of the directors who would have reassured her that there was nothing untoward and that Judith had been fully consulted. It was agreed that this warranted at least a written warning.”

[19]Ms Pritchard is then noted to have joined the meeting, and discussions took place about the financial state of the company, the prospects of being able to purchase the farmhouse and the valuation placed by Mr Bennett on his shareholding, for which he wished compensation.

[20]Finally, the issue of the claimant’s conduct was raised with Ms Pritchard:

“highlighted the position of Anne with Judith. Discussion on whether this constituted gross misconduct and disciplinary policies consulted. Agreed that this was a serious breach and Anne should be made aware of the seriousness of the allegations in case she wanted to would prefer to walk 15 away with a clean record. Judith said she could do payroll and bookkeeping if there was need for help during any disciplinary process (ie suspension).”

[21]Mr McIntosh then called the office and asked the claimant to attend at the Treehouse to meet with himself and Mrs McIntosh. She had anticipated that she would be meeting with them that day, in order to discuss staff pay rises, 20 cost of living increases, GDPR issues and the resignation of Catriona Sterling. She did not know that she was to be asked about the issues which were raised with her in relation to her conduct.

[22]A note of that meeting was taken by Mrs McIntosh, largely following the meeting rather than during it (R41/AW12b). The notes state: “The directors felt that this [the planned meeting about the list of items expected by the claimant] could not take place since the issues that were raised in the director’s meeting about Anne’s conduct had to be dealt with. Adam explained to Anne said (sic) that we had serious concerns because of breaches of confidentiality. These constituted: 410 6707/18

[1]An incident on the 10th April where Anne had publicly discussed Adam’s private finances in front of other staff and made a defamatory accusation that Adam was attempting to defraud HMRC.

[2]Adam also said that he had received complaints from staff that Anne had openly discussed confidential staff salaries and conditions in front of 5 others.

[3]That Anne had discussed Cat’s job in front of other staff members in a way that distressed Cat. Anne denied the allegation that she had made the accusation about defrauding HMRC. She did not deny breaches of confidentiality. Adam said that this accusation, together with disclosure of his finances, had been made in front of him and other staff so there was sufficient evidence to go down the disciplinary route and, given the nature of what had happened, we would be taking this very seriously. Anne was given two options. She was asked whether she would prefer us to go ahead with the disciplinary 15 process or where (sic) she would prefer to resign with a clean record. She opted to resign and handed over her keys and computer passwords.”23. Mr McIntosh started the meeting quite calmly, but during the course of his remarks he became agitated and started to speak about other matters unrelated to what they had agreed would be discussed. He became red in 20 the face. Mrs McIntosh intervened to suggest that he calm down and only discuss those matters which were relevant.

24. During the course of the meeting, Mr McIntosh referred to the allegations as amounting to gross misconduct, or possibly gross “miscontract”. He accepted he suffers from an occasional tendency to mix up his words, which 25 may have led to his use of this phrase when meaning gross misconduct.

25. Following the meeting, the claimant returned to the office. Catriona Sterling was in the office when she entered. She told Ms Sterling that she had “quit”. Ms Sterling, who at that point was working her notice of termination, replied that that made “two of us”. The claimant said that it did, but that she 410 6707/18 would not be working her notice. She left her keys and her password, and went home.

26. Shortly afterwards, soon after 5pm, Mr McIntosh was in the office when the claimant’s husband and daughter arrived and entered. The claimant’s husband spoke to Mr McIntosh in a manner he found threatening, 5 suggesting that if the claimant were not given a redundancy payment they would take the company to court. He sought to persuade Mr McIntosh to confirm that he had “fired her”, several times. He denied this and assured him that if the claimant wished to return the following morning she would be welcome to do so. He also said that he could not discuss confidential staff 10 matters with a member of her family but that her position was open. Mr McIntosh was shaken by this encounter.

27. At 8.58pm that night, the claimant emailed Mr McIntosh (AW9): “Further to our unscheduled meeting at 4pm today, 10th May 2018, I write to advise that I am NOT accepting being dismissed for Gross Misconduct from 15 my five year employee position as Office Manager at Two Skies Limited. I have spoken to my solicitor this evening and have copied her in to this email. I await your response. Anne Whyte”

28. Mr McIntosh replied to that email at 10.42pm the same evening (AW10): “Dear Anne, Today’s meeting had been