Slaven v Thermo Engineers Ltd [1991] UKEAT 568_91

EAT
Slaven v Thermo Engineers Ltd
[1991] UKEAT 568_91 · 1991-11-04
MR JUSTICE WOOD (PRESIDENT): This so far as I am aware is the first appeal from a Reinstatement Committee to the Umpire under the Reserve Forces (Safeguard of Employment) Act 1985 - a consolidating Act. Its provisions relate to the reinstatement in civil employment of members of the reserve and auxiliary forces who have been called into whole-time service and "for the protection of the employment of those liable to be called into such service." The statutory provisions from which most of this Act derive are contained in Sections 35 et seq. of the National Service Act 1948. I have not been referred to any earlier decisions under that Act nor have I discovered any relevant cases in my somewhat limited researches.I have been appointed Umpire under the provisions of the 1985 Act and have sat with two assessors to whom I would express my appreciation for their assistance.Let me turn to the structure and wording of the Act. The primary obligation to reinstate is contained in Section 1. Subsection 1 describes a person who has entered "whole-time service" and subsections 2 to 4 define the former employers obligation to reinstate. They read:
"(2) Where such a person applies to his former employer to be taken into his employment, the former employer shall, so long as the application remains in force, be obliged to take the applicant into his employment - (a)in the occupation in which the applicant was last employed by the former employer before the beginning of his whole-time service and on terms and conditions not less favourable to him than those which would have been applicable to him in that occupation had he not entered on such service; or (b)if it is not reasonable and practicable that the applicant should be taken into employment in that occupation and on those terms and conditions, in the most favourable occupation and on the most favourable terms and conditions which are reasonable and practicable in his case.
(3) That obligation is to take the applicant into employment as mentioned above at the first opportunity (if any) at which it is reasonable and practicable for the former employer so to do on or after such date as may be notified to him in accordance with section 4 as the date on which the applicant will be available for employment.(4) A former employer's obligation is discharged if after giving reasonable notice to the applicant he makes such employment available to him at that first opportunity, except that -(a)an opportunity for taking the applicant into his former employer's employment shall not be deemed for the purposes of subsection (3) and this subsection to have arisen if - (i)the former employer makes employment available to the applicant, but the applicant has, or reasonably believes that he has, reasonable cause for not taking it; and(ii)the facts on which the applicant relies as constituting the reasonable cause are notified in writing to the former employer by him or by some person acting with his authority as soon as may be after he has been notified by the former employer that the employment is being made available to him; and(b)in no case shall the former employer be under any obligation under this section to take the applicant into his employment after six months have elapsed from the end of the applicant's whole-time service."Section 5 deals with priorities and subsection (1) reads:
"It shall not be treated for the purposes of the foregoing provisions of this Act as reasonable and practicable for the former employer to take the applicant into his employment, or to employ him as provided by section 7, either at all or in any particular occupation or on particular terms and conditions, if it can only be done by discharging some other person who - (a)was employed by the former employer before the relevant date, and (b)had been so employed before the relevant date for a longer period than the applicant, and (c)was so employed in employment of a kind that was not less permanent in character than the applicant's employment, or by refusing to take into employment, in accordance with section 1, some such other person as mentioned above who has entered upon a period of whole-time service and has duly made an application under section 1; and in this subsection `the relevant date' means the beginning of the applicant's whole-time service, or, where the other person as well as the applicant has entered on a period of whole-time service, the beginning of the other person's whole-time service, whichever is the earlier."
The structure of these two sections indicates that under Section 1(2) the primary obligation is the reinstatement of the applicant in his former occupation and under conditions no less favourable unless the employer can show that it is not reasonable and practicable, in which case it must be the next best option. The obligation is to be exercised at the first opportunity at which it is "reasonable and practicable".Section 5 provides certain defences open to the employer. Section 1(4) provides certain ground upon which the applicant can refuse the offer of reinstatement.The wording clearly indicates that if an employer is to avoid his primary obligation, he must establish that it was not reasonable and practicable to offer reinstatement either on the particular facts of the case or in reliance upon the provisions of Section 5.Once an applicant has been reinstated the employers obligations are those set out in Section 7(1):
"(1) Where an applicant has been taken into the employment of his former employer in pursuance of section 1, the former employer is under an obligation to employ the applicant for the following 26 weeks, subject to subsection (2), or for so much of that time as is reasonable and practicable (a)in an occupation not less favourable to him than that in which, and on terms and conditions not less favourable to him than those on which, the applicant is so taken into employment; or (b)if, at any time during the period for which he has under this section to be employed, it ceases to be reasonable and practicable for the applicant to be employed in that occupation and on those terms and conditions, in the most favourable occupation and on the most favourable terms and conditions which are for the time being reasonable and practicable in his case."
The wording of this section is very similar to that of Section 1(2) and in my judgment the obligation continues for the period of 26 weeks unless an employer can show that it was not reasonable and practicable for it so to do.Applications to Reinstatement Committee are governed by Section 8(1) and (2):
"(1) A person - (a)who has, or claims to have, entered upon a period of whole-time service, and (b)who claims that he has rights under sections 1, 3, 4, 5 and 7 (the `relevant sections') which are being or have been denied him.
may, within the prescribed time, apply to a Reinstatement Committee for the determination of any question relating to his rights, if any, under the relevant sections, and the Reinstatement Committee shall determine that question.(2) Where the Reinstatement Committee are satisfied that default has been made by the applicant's former employer in the discharge of his obligations under the relevant sections, the Reinstatement Committee may make either or both of the following orders as is in their opinion appropriate, having regard to all the circumstances of the case and the nature and extent of the default -"It is for the applicant to prove that he has rights under the Act and thereafter it is for the employer to establish an exception or the termination of those rights. Having considered the whole case both the claim and the defences the Committee will decide whether there has in fact been a default by the former employer in the discharge of his obligations.It was argued on behalf of the employers that at every stage of the hearing the burden was upon the applicant. I find myself unable to accept that. This is an Act aimed at the protection of employment and the primary obligation upon the former employer is to reinstate the applicant in his former occupation. That is what the applicant really wants and that primary obligation in the employer can only be escaped if he can bring himself within Section 1(2)(b) or Section 5. If an offer is made which an employer submits is reasonable and practicable the applicant can challenge that but only in accordance with Section 1(4). However under Section 7 if the employment has been terminated within the statutory 26 weeks, it is for the employer to show why and that he was entitled to terminate it. In the present case the reason must fall within Section 7(1)(a) or (b), that it was not reasonable and practicable to continue it.The word "practicable" could well cover such matters as redundancy or reorganisation or relocation, and "reasonable" could include the issue of dismissal for misconduct or capability. An employee might suffer a nervous breakdown as a result of experiences during his service in the Forces.That being the legal background to these cases let me turn to the present. The applicant William James Slaven was born on the 13th October 1968. In July 1985 he joined the Navy. He was trained in and involved in engineering and engineering maintenance. He served both at shore and at sea. He left the Navy on the 10th October 1990. On the 15th October he joined Thermo Engineers Ltd. On the 29th January 1991 his whole-time military service began on recall. That service terminated on the 15th April 1991. He resumed employment with Thermo Engineers Ltd on the 22nd April 1991. On the 27th June of that year he was made redundant with one week's pay in lieu of notice.The Reinstatement Committee found against him and he now appeals. My powers are covered by Section 9(2) and (3):
"(2) The umpire or deputy umpire may on any such appeal make any determination or order which a Reinstatement Committee might make under section 8, or may dismiss the appeal, and his decision shall be final.
(3) In considering how to exercise his powers under subsection (2), the umpire or deputy umpire shall, where there has been any change in the relevant facts since the date of the hearing before the Reinstatement Committee, have regard to the facts existing on the date of the hearing before him."As I read those subsections the hearing before me is a re-hearing and if the facts had altered I could have called further evidence on the matter. There is no suggestion in this case that the facts are not the same as those at the hearing before the Committee and I am therefore content to accept the facts as found by them.I would refer to some paragraphs in the Decision of the Committee:
"37. At no stage was the applicant warned of impending redundancy, nor was he told of the method of selection for redundancy, nor did he receive any warnings about his ability or lack of enthusiasm.
38. The respondents unfortunately did not call any evidence of those who actually made the selection for redundancy, and therefore they could not explain why Mr Mason, who appears to have had difficulty in attending on time, gained 10 out of 10 points for attendance.39. The respondents called no evidence to substantiate the assessment on page 16 and therefore we do have some disquiet about the actual selection process. Such disquiet might well have been fatal in a case of unfair dismissal, but these considerations are not overriding when considering an application under Sections 7 and 8 of the Act.. ......................................43. The question therefore is whether an intervening redundancy renders it not "reasonable and practicable" for the employer to comply with the obligation to continue to employ the applicant for the whole of the period of 26 weeks.44. Although we have certain disquiet, as already mentioned, over some aspects of the selection procedure, this disquiet is not so serious as to lead us to support that it was reasonable and practicable for the applicant to have been retained for the remainder of the 26 weeks. Therefore the application must fail and we refuse to make an order under Section 8(2) of the 1985 Act."The appellant's case has been admirably presented by his father. There is no issue on the existence of a redundancy but it is argued that the selection of this applicant for dismissal was not reasonable.The Company are manufacturers of specialist heat exchangers and have some 169 employees. This number which existed at the beginning of 1991 has been substantially reduced and by September 1991 the figure was 122. This reduction was due to redundancies.The applicant was engaged on architectural metal work until Christmas 1990 and thereafter on foam stations until he went on whole time service. On his return and for the last ten weeks of his employment he did work on heat exchangers.It was clear at the beginning of June 1991 that further redundancies were required and the Managing Director so advised. He asked all his managers in the various departments to advise him on savings and what redundancies could be made. The applicant was employed in the Production Department with 60 other employees but the question which arose was whether some fitters should be made redundant.On the day of the hearing a document referred to as Document 16 was produced by the respondents for the first time. It showed details of an assessment for possible redundancy amongst the fitters in that Department. There was a policy for redundancy within the Company which stated that where other factors were equal length of service would be taken into account. However the way in which this assessment was carried out was highly subjective. The Managers and Supervisors had no specialist training other than that they had gained through experience. There was no prior warning of the impending redundancy and the whole exercise took about half an hour. The applicant did not know and was not told about the basis upon which he had been selected nor if there had been any criticism of his work during the time that he had been employed. It is right that the applicant did score less than some others but there was one fitter who was retained and who was consistently five or ten minutes late on parade although he was given full marks under the assessment for "attendance". None of those responsible for the assessment were called before the Committee and as this document was produced only on the day of the hearing Mr Slaven had no opportunity to test the evidence.The three fitters who were selected for redundancy were called to a meeting with the Manager on the 27th and were asked to leave immediately, after seeing the Personnel Officer Mrs Cole. When the applicant saw Mrs Cole he pointed out that he was entitled to 26 week's work following reinstatement. He was asked to bring the leaflet in the following day which he did.It is quite apparent, and indeed I believe it to be conceded, that the Company were unaware of its obligations under Section 7 of the Act.The fitter who was retained, a Mr Mason, was in fact made redundant at the end of August 1991 and this could be relevant to compensation, but the issue is whether the termination of the applicant's employment on the 27th June was because continuation was neither reasonable nor practicable. There is no issue on "practicable", but in order for it to be "reasonable" not to continue the applicant's employment it must be reasonable to terminate it and that in my judgment involves the consideration and application of reasonable principles to that termination.As we have seen the Reinstatement Committee were clearly most critical of the method of selection. Those sitting with me have assisted me on the technical aspects of selection for redundancy and support my own experience from sitting in the Employment Appeal Tribunal. The procedures in the present case were not reasonable.I am therefore satisfied that the selection of Mr Slaven and indeed his dismissal on the 27th June was not reasonable. If this were the only way in which the claim was put then the compensation would terminate at the end of August 1991 when Mr Mason was made redundant.However, Mr Slaven Senior, puts his case secondly, on the basis of Section 7(1)(b). It seems to me clear that if the termination of employment seems likely in the occupation to which the applicant has been reinstated, there is an obligation upon an employer to look elsewhere in other departments and to see whether there is an opportunity to employ the applicant
"in the most favourable occupation and in the most favourable terms and conditions which are for the time being reasonable and practicable in his case"
Because the Company did not appreciate the terms of the legislation, no evidence was called nor sought to be presented on that score nor indeed do I understand that any investigation in fact took place.It follows therefore that there was a default in the discharge of the obligations of this former employer and that compensation is payable for the full period of the remainder of the 26 weeks.This Appeal is allowed and unless the parties can reach agreement this matter is remitted to the Committee for assessment of compensation.