Chard v Hartlepool Borough Council [1992] UKEAT 202_91_0412

EAT

Chard v Hartlepool Borough Council

[1992] UKEAT 202_91_0412 · 1992-12-04

JUDGE J HICKS QC:

This is an appeal from the Industrial Tribunal against its decision on 30 November 1990, dismissing the Appellant's application made on grounds of unfair dismissal. The Appellant was dismissed on 27 May 1990, after two postponements of the original notice of redundancy, from the post of administrative assistant under the Respondent Authority, the Hartlepool Borough Council, having been employed by the Respondents since 1979. The employers' case was that the reason was redundancy; the Tribunal found that that was so and that finding is not challenged.

The substantial issue before the Industrial Tribunal was whether the employer acted reasonably or unreasonably in treating redundancy as a sufficient reason for dismissal within the terms of Section 57(3) of the Employment Protection (Consolidation) Act 1978. A number of complaints about the conduct of the employers were made before the Industrial Tribunal and considered by them. Two concerned the absence of discussion with the Appellant or her trade union and as to those complaints the Tribunal found that:

"2(g) ..... on the evidence it appeared apparent that there had been no prior discussion with the applicant before notice of redundancy was given to her by the Council on 9 March nor had there been any meaningful discussion with her trade union (NALGO) prior to the letter of 4 May 1990 enclosing a copy of the Officers' report to the Planning Committee."

There was also a complaint concerning the absence of notification to the Appellant of her right to appeal, as to which the Tribunal found that:

"2(k) On the evidence which was produced to the Tribunal, they were satisfied that at no time during her discussions with Mrs Maughan or in the various letters which she received from Mrs Maughan was the applicant's attention drawn to her right of appeal."

What was perhaps the most serious complaint concerned a post with the employers for which the applicant applied on 2 April 1990, as to which the Tribunal found that:

"2(h)(i) ..... Amongst those vacancies [notified to her] was an estate assistant in the Council's housing department. The applicant applied for this post, which was designated as estates advisor, and although the applicant's application should have been considered at the short-list stage, by reason of the fact that she was an employee facing possible redundancy, the department concerned was not made aware of this and a letter dated 2 April 1990 was sent to the applicant notifying her that her application had been unsuccessful. This letter, which was posted by second class post on 3 April 1990 did not reach the applicants until 6 April 1990, the day after the short-listed applicants were being interviewed. It was only by chance that the applicant discovered at lunch-time on 5 April 1990 that the interviews were taking place that day. Although the applicant was invited to attend and was interviewed she was unsuccessful. On the evidence given to the Tribunal, confirmed by a letter of apology written by Mrs Maughan, the Head of Personnel and Performance Management, to the applicant on 9 April 1990, the Tribunal were of the unanimous view that the applicant had a very justifiable complaint both in regard to the manner in which her application had been dealt with and the procedure at her interview."

However, the Appellant was then offered the post of Clerical Assistant Scale (1) in the Community Charge Section under the Finance Department of the Council. That was first drawn to her attention at an interview with Mrs Maughan on 6 April; a job description was sent to her by letter dated 9 April; she was interviewed by Mr Emmerson of the Finance Department at some unspecified date between then and 12 April, when Mrs Maughan wrote to her confirming the offer of that post. In that letter she briefly describes the duties (and it was not suggested that they were unsuitable to the Appellant's experience or status) and she says:

"2(h)(ii) ........ Since you are currently on Scale (2) point 12 the post if offered to you with salary protection at this level so that no reduction in salary would ensue. This post, as all posts involved in Community Charge, can be offered for a 12 month temporary contract only and the position with regard to the possibility of its becoming permanent is as explained in my previous letter. I realise that you would prefer a permanent post but accepting this post will not prevent you from applying for other suitable posts if they arise in the next few weeks or during the 1 year contract."

The letter to which she referred back was that of 9 April, in which she had said:

"...... all contracts of employment for staff in this area were arranged to run up to the date when a review of staffing levels is to have been completed."

The implication was, plainly, that twelve months was all that could be guaranteed, but that there were - prospects of its either being extended or - becoming permanent.

The Appellant declined that offer, and the Tribunal found - and this is not in dispute - that she declined it because it was on a temporary basis. In a further letter to the Appellant of 13 April, Mrs Maughan said:

"I do understand your feelings about this but still think that since accepting this post would not in any way debar you from being considered for others arising, it might be wise to consider accepting this as "insurance" against your possibly ending up without a post. If you wish to change your mind then you can let me know before Friday when we will proceed to advertise the post."

The Appellant did not change her mind. She was offered the opportunity of applying for other posts, but they do not enter into the decision of the Tribunal or any matter advanced on appeal. It was not suggested to us, and does not seem to have been suggested to the Industrial Tribunal, that the Appellant had any other reason for rejecting that offer than the one stated. Therefore, subject to that point the Tribunal were plainly entitled to find that the post offered was suitable, as they did.

On those findings the Tribunal expressed its conclusions in paragraph 5 of its Reasons as follows:

"5 ......... Having carefully considered the evidence and submissions of the solicitors for both parties the Tribunal were of the unanimous view that the applicant's case was on all fours with the facts in the case of Morganite Crucible Co Ltd v Street in which Sir John Donaldson stated "In the present case the offer, being on any view for 12 to 18 months, was an offer of regular re-employment. In our judgment, save in exceptional cases, if the offer is of regular employment, the time which it is anticipated that that employment will last is irrelevant either under the heading of "suitability" or "reasonableness". There may be exceptional cases which would qualify that general rule, but we are satisfied that that should be the general rule". Had it not been for the clear message handed down in that case the Tribunal would have been inclined to the view that on the basis of decision in Polkey vAE Dayton Services Ltd the procedural deficiencies and errors made by the Council in the handling of the applicant's redundancy were such to have satisfied a claim that the applicant's redundancy was unfair. However, in reaching their decision the Tribunal were reinforced by the judgement of Mr Justice Scott in the case of Elliott v Richard Stump Ltd in which he stated:-

"One of the critical matters in that regard was the offer of alternative employment. There was plainly a job of sorts available to the applicant if he chose to accept it. That job was offered to him by the employer; if that job was offered to him on reasonable terms, then in our view, his refusal and consequent dismissal on the grounds of redundancy could not be said to be unfair. But, if that employment was offered to him on terms which were not reasonable then that would prima facie, in our view justify the conclusion that the dismissal was unfair. The industrial tribunal, therefore, had or ought to have had in mind that the question for decision by them was whether the offer of employment put before the applicant was an offer on reasonable terms or on terms which, viewed in the round, were unreasonable".

It is the Tribunal's unanimous view that the offer of the job in the Community Charge section of the Council's treasurers department was an offer on reasonable terms, and accordingly, with the reluctance to which they have referred, they dismiss the applicant's claim on the grounds of unfair dismissal."

Mr Winteler, for the Appellant, attacked that decision on the following grounds, first, that the Morganite case is to be distinguished on its facts. There is a distinction in one sense, and this is the distinction upon which Mr Winteler relies, that in the case of Morganite Crucible the offer - although I think the report does not expressly state this, but by inference clearly the offer - was of a job for an indefinite period; the fact that it was likely to be a comparatively short-term job was not part of the terms offered but part of the employee's conclusion. She thought that it would last only 12 to 18 months, and clearly the appeal to the National Industrial Relations Court proceeded on the basis that that was a reasonable conclusion for her to reach and that, therefore, this should be treated as employment which might only last for that period. It was, however, on its face for an indefinite term, whereas the offer in the present case was for a fixed term. Is that a material distinction?

The crucial passage in the judgment of Sir John Donaldson on this point is perhaps the one just before the part which is cited in the Reasons of the Industrial Tribunal. He says in Morganite Crucible v Street

[1972] 2 All ER 411

, at page 413:

"The second submission made by counsel for the employers is that the tribunal has erred in principle in deciding that a job which, accepting the employee's own evidence, would have lasted for 12 to 18 months was not sufficiently permanent for it to be unreasonable for an employee to refuse to accept it. There are no reported decisions to guide us on this matter. We think that this raises an interesting and important question of principle. No employment (with the possible exception of judicial employment) can be said to be almost permanent, and the question must to some extent be one of degree. On the other hand, the distinction between "temporary" employment and "regular" employment is well known. There is one industrial tribunal decision, Ireland v Fairfield-Rowan Ltd , where the applicant was given notice on grounds of redundancy and was then offered a continuation of his employment for two months, but that offer was rejected. That seems to us to be a clear example of an offer of temporary re-employment. In the present case the offer, being on any view for 12 to 18 months, was an offer of regular re-employment."

and that is where the quotation overlaps with the part cited by the Tribunal.

There are certainly phrases in that passage that suggests that there is some rule of thumb by which one can distinguish between "temporary" and "regular" employment. Sir John Donaldson says:

"On the other hand, the distinction between "temporary" employment and "regular" employment is well known."

It seems to us that when one actually looks at the way he deals with the question as a whole, it must be concluded that he is not applying some rule of thumb such as the distinction between a fixed term and a definite term, nor is he applying a rule that goes by what one might call "labels", in which one simply looks at the form of the offer of employment to see whether it includes the word "temporary" or the word "regular". He is rather suggesting a test which depends on degree and fact, and that seems to us to follow from his words "the question must to some extent be one of degree" .

It is also shown by the fact that in dealing with Ireland v Fairfield-Rowan Ltd he is clearly having regard to the fact that the continuation was for two months as being an indication that it was temporary, and the emphasis seems to be on the very short period. Perhaps most crucially, the sentence that shows that the approach there was not by way of rule of thumb or by "label" but by an overall view of the facts, is the sentence "In the present case the offer, being on any view for 12 to 18 months, was an offer of regular re-employment." So it is the fact that it was for 12 to 18 months that seems to be relied upon as showing that it was an offer of "regular" re-employment, and we therefore consider that the Industrial Tribunal was fully entitled to find as a fact that the present case "was on all fours with the facts of the case of Morganite Crucible Co Ltd" and, certainly, that it comes within the principle of that case.

The second basis on which Mr Winteler criticises the Tribunal's treatment of Morganite is that he says they attached unjustified importance and weight to that decision and gave insufficient weight to the view that the decision was an "overstatement" - that being the view that is expressed in Harvey on Industrial Relations - and to the subsequent decisions in two cases to which I shall refer later. The passage in Harvey itself relies on the same two cases, so we do not need to refer to the editorial view in Harvey separately; we can go directly to the two cases in question.

The first is Thomas Wragg & Sons Ltd v Wood

[1976] ICR 313

, a case in the Scottish Division of the Employment Appeal Tribunal, a case of dismissal for redundancy taking effect on 6 December 1974.

"The employee obtained other work but on December 5, one day before the expiry of his notice period, the employers made a written offer of suitable alternative employment........ which the employee refused. ............... an Industrial Tribunal held that having regard to his age, his fears of future redundancies in the construction industry, the fact that he had accepted other employment and that the employers' offer was not made until the day before the end of the notice period, the employee had acted reasonably in refusing the employers' offer."

The Employment Appeal Tribunal dismissed the appeal, holding:

"... that although the employee's fears of future redundancy and the lateness of the employers' offer of alternative employment did not alone justify the employee's refusal of the employers' offer, the tribunal rightly considered that those factors, when considered with the employee's acceptance of another job before the expiry of the notice period, meant that he had not acted unreasonably ...."

It seems to us that if one, as Mr Winteler invites us to do, treats what is there described as "the fear of future redundancy" as being substantially the same point as the shortness of employment or potential employment in Morganite and in this case, then that case of Wragg in no way suggests that the Industrial Tribunal here were incorrect in following Morganite . There were clearly very important matters of distinction in Wragg : both age, which is not relied upon here, and perhaps most importantly of all the conjunction of the two facts first, that the offer was made on the very last day before the expiry of the notice and, secondly, that the employee had by then already reasonably obtained other employment. It does not seem to us by any means to follow that in a case such as the present Wragg casts any doubt on the general validity of the principle enunciated in Morganite .

The other case was that of Paton Calvert & Co Ltd v Westerside

[1979] IRLR 108

, where again the employee had taken a job with a new employer after the notice of redundancy dismissal but before the offer of further employment by the employer, so that the sequence of events was the same as that in Wragg although the offer was not such a last - minute one. Again the question of age was taken by the Industrial Tribunal as being a relevant matter, which is not advanced here, and the Employment Appeal Tribunal held that they were entitled to conclude that the employee had not unreasonably refused that offer of further employment, although it was in other respects suitable, being effectively on substantially the same terms as his previous contract.

Again, one has the situation that the offer was made after the person, whose age entered into the considerations, had reasonable accepted other employment. At paragraph 15 of the Employment Appeal Tribunal's judgment they summarise it in this way:

"............. we consider that it is possible for a man's age and for the apparent viability of the company ...."

- which again is a point of distinction from this case because clearly there could be no question as to the viability of a local authority -

"........ to be capable of creating exceptional cases within the general rule defined in Morganite Crucible Limited v Street ."

So far from casting any doubt on the decision in Morganite , the Employment Appeal Tribunal in that case dealt with the matter explicitly upon the words used in Morganite itself as a general rule to which there could be exceptions and found that that case was exceptional. None of the matters on which they relied showing that it was exceptional applies in this case and we do not consider, therefore, that that ground of criticising the Tribunal's treatment of Morganite can be sustained.

The third way in which Mr Winteler attacks the Tribunal's reliance upon Morganite , was that the Morganite case was not a case concerning unfair dismissal but concerning entitlement to redundancy payment. That is true, and it is a feature of this case that the grounds upon which the employers relied for the reasonableness of their actions would equally have justified them in resisting the payment of a redundancy payment. However, it is apparent that they expressly took the view that although they were entitled, in their view, to resist making a redundancy payment on that ground they would, nonetheless, make the payment. They were fully entitled to do that and still rely on the same point in relation to unfair dismissal.

That distinction, however, seems to us to be of no assistance to Mr Winteler unless he can point to some reason why the test should be different in the two cases. It is apparent to us that in the case of Elliott v Richard Stump Ltd , relied upon by the Industrial Tribunal, the very same test is being applied to unfair dismissal as was applied by the Morganite case on the issue of redundancy payments. That is apparent from the sentence in Elliott v Richard Stump which reads:

"... if that employment was offered to him on reasonable terms, then in our view, his refusal and consequent dismissal on the grounds of redundancy could not be said to be unfair."

If, indeed, that sentence is an accurate statement of the law, then there can be no possible criticism of the decision reached by the Tribunal in this case and the way in which they reached it. We are inclined to the view that it is right, but in case that short and summary way of dealing with the matter is wrong we proceed to consider the matter more widely in the way in which Mr Winteler put it.

When pressed as to whether there was any distinction and what it was between the two situations, Mr Winteler said that in unfair dismissal cases the question of reasonableness must be looked at as a whole, and the reasonableness or otherwise of the refusal of the offer of re-engagement not dealt with in isolation. It seems to us, yet again, that if that is the true test then the Appellant must fail. In a passage in Harvey on Industrial Relations, to which Mr Winteler referred us for another reason, namely the issue of onus, Volume 1 section III paragraph 863 reads as follows:

"[It would seem that] it is immaterial that the employee had reasonable grounds for refusing if he in fact relied on other, unreasonable grounds"

We consider that a correct statement. It is quite clear and unchallenged that in this case the appellant's reason for refusing the offer for alternative employment was not the procedural deficiencies and errors to which the Industrial Tribunal referred, and which Mr Winteler invites us to say they should have thrown into the balance; it was solely and simply the fact that the offer was for a 12 months temporary post. Therefore, on that ground, again if one proceeds beyond a simple reliance on Elliott v Richard Stump , it seems to us that the attack on the Tribunal's decision fails.

Even if one goes further and accepts that in the case of unfair dismissal a different approach is required, and that the Tribunal would not be justified in ignoring the procedural deficiencies and errors made by the Council, the question remains whether they really did misdirect themselves in that respect. In our view, they did not. They clearly had in mind the procedural deficiencies and errors made by the Council and they reminded themselves at the close of the passage they cited from Morganite that there may be exceptional cases which will qualify the general rule.

Mr Sales for the Respondents contended, in our view rightly, that the circumstances that would displace that general rule would indeed need to be exceptional, an example being as in the case of Wragg , a last-minute offer to an employee who had reasonably accepted other employment. The Tribunal said nothing more decisive about the deficiencies and errors made by the Council than that had it not been for the impact of Morganite :

"..... the Tribunal would have been inclined to the view that on the basis of decision in Polkey vAE Dayton Services Ltd the procedural deficiencies and errors made by the Council in the handling of the applicant's redundancy were such to have satisfied a claim that the applicant's redundancy was unfair." (my emphasis)

In our view they were fully entitled to form the view, and must be taken to have formed the view, that the significance of the Appellant's unjustified refusal of the post offered outweighed that of those deficiencies and errors. For that reason also, which as I have made clear is in the alternative to our primary reasons, we would dismiss this appeal.

Mr Winteler finally took a point on onus. We need say only that there is nothing in the Tribunal's reasons to provide any scope for suggesting that they misdirected themselves in that respect, and we therefore dismiss this appeal.