P Port Of London Authority v Payne & Ors [1992] UKEAT 511_91_0705

EMPOLYMENT APPEAL TRIBUNAL
BAILII case number: [1992] UKEAT 511_91_0705Case No Appeal No. EAT/511/91, EAT/11/92, EAT/102/92 & EAT/161/92Venue 4 ST. JAMES'S SQUARE, LONDON, SW1 4JU
Between
P Port Of London AuthorityPayne & Ors
Date 6 April 1989
[1]BAILII case number: [1992] UKEAT 511_91_0705 Appeal No. EAT/511/91, EAT/11/92, EAT/102/92 & EAT/161/92 EMPOLYMENT APPEAL TRIBUNAL 4 ST. JAMES'S SQUARE, LONDON, SW1 4JU At the Tribunal On 24-28 February 1992 2-6 & 18 March 1992 and 7 May 1992 Judgment delivered on 9 July 1992 Before THE HONOURABLE MR JUSTICE WOOD MC (P) 1st, 2nd & 3rd Appeals - Miss J W Collerson Ms P Smith 4th Appeal - Mr J D Daly Miss J W Collerson PORT OF LONDON AUTHORITY APPELANT P PAYNE & OTHERS RESPONDENTS Transcript of Proceedings JUDGMENT Revised APPEARANCES For the Appellant Mr Alan Pardoe QC Mr Andrew Clarke (of Counsel) Messrs Masons 30 Aylesbury Street LONDON EC1A OER For the Respondents Mr John Hendy QC Mr John Bowers (of Counsel) Mr Damion Brown (of Counsel) Messrs Pattinson & Brewer Solicitors 30 Great James Street LONDON WC1N 3HA MR JUSTICE WOOD ... PRESIDENT) The Port of London Authority (PLA) was incorporated in 1908; it is regulated by the Port of London Act 1968. The constitution of the PLA is contained in the Port of London Authority (Constitution) Revision Order 1975. The Constitution is such that the Secretary of State may appoint members of the Authority and his appointees may out-vote all the others. The duties of the PLA are to provide, maintain, operate and improve such port and harbour services and facilities in, or in the vicinity of, the Thames, as it considers necessary and desirable, and to take such action as it considers incidental to the provision of such facilities and services. It also has powers to seek improvement and conservancy of the Thames River itself. The Port of Tilbury (Tilbury) is the PLA's trading name for its stevedoring operations. Tilbury is a 1000 acre site on the north bank of the river. Tilbury is within the Dock Labour Scheme. At all material times Mr McNab was the Chief Executive and Mr Farrow, the Director of Personnel responsible to the Chief Executive at Tilbury. In order to understand the explosion in industrial relations which took place in 1989 it is essential to examine the history of working practices in the docks. The Dock Labour Scheme was introduced in 1947. At that time most of the workforce in the dock was casual. The men were only paid when working on a ship. They were chosen by the employer as required. The financial advantages to the employer and his customers are obvious in that labour was only paid for in respect of time actually worked on a ship. However, the members of the workforce naturally disliked the system as it was inherently unfair to those who worked and it led to financial insecurity and feelings of degradation. At times a large number of men would be required, at other times only a few. Although practices have changed with the introduction of mechanisation, it should be realised that over all the years the handling of cargo has required specialised skills. Just to state these facts emphasises the conflict of economic interests between employees and employer. This conflict as the Industrial Tribunal found "subsisted and underlay the approach of both sides to industrial relations". At all material times until 1989 the Transport and General Workers' Union (T & G) was the Trade Union recognised by the PLA. The Dock Labour Scheme was designed to give some sort of security to the largely casual labour force. It sought to eliminate some of the features of casual labour. The basic notion was the establishment of a register of men and the forbidding, without special permission, of the employment of men not on that register. The registered men were ensured certain minimum payments, whether actually working or not, and it was a criminal offence to employ non-registered dock workers on registered dock work. The Scheme was administered by the National Dock Labour Board with local Dock Labour Boards in each port. The National Board was jointly controlled by the two sides of industry and financed by a levy made on employers as a percentage of the wages bill. There was a National Joint Council and a Local Joint Council in each port; these bodies settled the ordinary industrial issues which arose. By 1965, as the Tribunal found, problems and unrest were evident in the Port industry. A Committee of enquiry under Lord Devlin issued a report and the Tribunal comment - "Although the Report was written 25 years ago the tribunal was struck as much by the similarities of the problems arising in 1989 as by the differences." Following the Devlin Report total de-casualisation was gradually achieved. The position in 1989 was described by the Tribunal thus - All employees who were registered dock workers were paid a basic wage according to his grade and with some skills-related differentials. In addition each man was able to earn bonus, the rate of which depended upon the type of cargo he handled, different categories attracting different rates of bonus. The men were allocated to work in turn and rotation according to the type of work so as to ensure the fair distribution of bonus. ... Allocations were very complex. The expression "going to work" meant being allocated to a particular job. If a man was not allocated, he was left "on the call". Generally, if a man did not "go to work" he was paid the basic pay. If he did "go to work", he was paid his basic pay plus whatever bonus he, or his gang or pay group earned, calculated according to rate and tonnage moved. A man's turn to "go to work" depended on the size of the total workforce and the traffic in and out of the port; the amount of bonus he earned during his time depended on the type of cargo and (sometimes) the way it was stowed." Once de-casualisation was eliminated, registered dock workers were allocated to a permanent employer. If that employer went out of business his workforce was put on to the "temporary unattached" register under the Scheme administered by the Dock Labour Board. Whilst on that register the men were paid from the payroll levy on the other existing employers. In 1972 under the Jones Aldington Agreement the temporary unattached register was no longer used. The agreement provided that if an employer went out of business the Local Dock Labour Board would itself allocate the men to other employers on the River. Those employers were required to take on men whether needed or not. This imposed an additional financial burden on those employers at a time when changes in the port industry meant that the need was for fewer men rather than more. As a result of the added financial burden successive employers were forced out of business. The effect was described by the Tribunal as "a kind of domino effect". In order to meet this problem the PLA decided that it should take those men who were on other employers' registers on to their own payroll as an Employer of Last Resort. The cost of this was added to the Port Rate and subsidised from Government funds. In June 1989, just before abolition of the Dock Labour Scheme, the PLA decided to divest itself from its role as Employer of Last Resort in order to protect itself from dumping. Redundancy could not take place. It is easy to understand that for a number of years prior to 1989 industrial relations at Tilbury were grim. The PLA wanted change and was in financial difficulties. The T & G and its members wanted the status quo and argued from an historical perspective. The PLA were campaigning for the abolition of the Dock Labour Scheme and for local negotiations on pay and conditions. The view of the T & G was precisely the opposite and it campaigned to that effect. Both sides were on a collision course. On 6th April 1989 the Secretary of State for Employment announced the introduction of a Bill for the abolition of the National Dock Labour Scheme. The Dock Bill was given its first reading on 7th April. Industrial action had already taken place in March, but at a mass meeting on 7th April there was a decision to take industrial action. During the remainder of April various meetings took place within the T & G itself and also between national officers of the T & G and the PLA. The General Executive Council of the T & G initially recommended against a strike ballot, but at a mass meeting on 21st April the registered dock workers were told that the executive committee had recommended a strike ballot. On 20th April the T & G announced that they were to hold a national ballot for a strike. On 25th April Mr McNab confirmed to Mr Todd, the General Secretary of the T & G, that there would be no return to casual employment. On 8th May the PLA and other employers issued writs seeking injunctions against the T & G preventing them from calling for industrial action. On 10th May the ballot started. On 18th May the hearing in front of Mr Justice Millett was begun and by a decision of 27th May he refused an injunction. The Court of Appeal by a decision of 7th June allowed the employers' appeal and granted an injunction. The House of Lords allowed an appeal by the T & G on 21st June and discharged the injunction. The first ballot had expired on 14th June and a second ballot for industrial action was started on 28th. On 3rd July the Dock Work Act received the Royal Assent. The employers' case had been that the T & G were seeking to 'manufacture' an industrial dispute and that the true reason for the proposed strike was political. The official strike started on 10th July. Between 20th and 24th July letters of dismissal were sent and fresh contracts were given to some of the men. On 27th July 1989 men started to return to work and on 1st August a delegate conference of the T & G called off the official strike. This was in fact officially called off on 3rd August. By the issuing of individual contracts to those prepared to return to work the PLA in effect de-recognised the T & G, but formal letters of de-recognition were not sent until 15th December 1989. The PLA needed to make a radical reduction in the labour force. The criteria for selection were medical categorisations, skills level, sick record, age and attitude to work. The average age of the workforce was 50 and there was no particular policy at that time based on age. There was a shortage of skills. Attitude to work meant assessing whether the individual had ". .. showed that they were keen to continue to work and help us build a future in the new competitive environment. In the light of the changes that would be necessary to produce a prosperous port at Tilbury it was vital for us to have a workforce willing and able to adapt to those changes." The Personnel Department carried out its assessment of attitude without consultation beyond a survey form. The T & G instructed members not to return the survey forms. Some obeyed, some did not. In June 1989 the total workforce at Tilbury was 1,731 of whom 1,122 were registered dock workers and all were members of the T & G. The remaining 609 belonged in the main to other Trade Unions such as the EEPTU, the AEU, NALGO and the ATT. The total number of redundancies including voluntary and non-registered workers was 680. Within the registered dock workers there were 29 shop stewards; 9 accepted voluntary redundancy, 4 remained and 17 were made redundant. Amongst the non-registered dock workers there were 32 shop stewards; 7 were made redundant, 3 took voluntary redundancy and 22 were retained. It is the 17 registered shop stewards made redundant who are the Applicants in these proceedings. They have been supported throughout by their Trade Union. The whole of the PLA operation at Tilbury has been restructured and the position at February 1992, today, is that the total workforce is 880 of whom 346 are members of the T & G and of the remaining 534 some 114 are members of other Trade Unions. The PLA operates a "check off" system in respect of 460 Trade Union members out of a total workforce of 880. The "check off" system is one whereby the employer deducts Trade Union dues from the weekly or monthly pay packet and accounts to the Trade Union for that sum. There are in excess of 50 'cash payers'. There is thus a substantial non-union element in today's workforce. The new position at Tilbury is that the PLA no longer employs dock labour. The men are employed by wholly owned subsidiaries. The terms and conditions of service for Tilbury Cargo Handling Ltd, Tilbury Grain Handling Ltd and Port of Tilbury Handling have all been disclosed. There are radical changes made in almost every area. Pay and conditions are no longer the subject of collective bargaining. Bonus is calculated on throughput. There is no need for day-to-day negotiation and there are no shop stewards. No trade union is recognised, the only right which the workforce has is to be represented by a trade union for discipline and grievance procedures. Each company has its own discipline and grievance procedure. Thus the only activity of an "independent trade union" is the function of representation at discipline and grievance hearings. The evidence of Mr Burton indicates that customers are returning to Tilbury and that although there were some serious initial difficulties to be overcome in industrial relations those seem to have been ironed out. He also stated that there was some body of opinion amongst the workforce that the return of the Applicants was not desirable. It is clear to the majority that since 1989 there is a wholly different and new attitude to work and to providing a service for shipping. In the light of that history it is not surprising that the litigation that has ensued has been unremitting, neither side giving an inch, neither side giving quarter. The Proceedings The hearing of these cases occupied the Industrial Tribunal for 197 days. These have stretched from 23rd October 1989 intermittently until 21st February 1992. This appeal started on 24th February 1992. The Tribunal has given four written decisions. After seven days' hearing one Tribunal member, a Mr Mills died and the parties agreed to proceed before a Tribunal of two. Those written decisions cover some 447 pages and before analysing the various issues we would like to pay grateful tribute to the immensely careful and helpful presentation of this whole matter by the Tribunal and in particular the learned Chairman, Mrs T J Mason. She faced a gigantic task. During the hearing before us there arose the question whether or not the four decisions should be read together. We decided that they should. The Tribunal make it clear that the evidence heard during the "Liability" issue should be regarded as relevant to the second and third hearings; indeed it seems to us upon a reading of the four decisions that the Tribunal themselves regarded the whole matter as one and that the individual hearings were arranged as a matter of convenience. Each of the decisions is the subject of an appeal and it was common ground that we should hear appeal No.1 first, followed by Nos. 2 and 3 heard together. Later (because of shortage of time) No.4 was heard and due to the retirement of one of the members of this Tribunal that appeal was heard before a differently constituted panel. No one considering this case can avoid massive reading and we have sought only to refer to sufficient material to allow an understanding of our reasons. We have found it a difficult case and caution ourselves against the danger of drowning in a morass of detail thereby losing sight of the overall view of the situation as it has developed. Of the 13 days of the hearing before us the first eight involved the appeal on "Liability". The Applicants In addition to those 17 shop stewards already mentioned there were two other applicants about whose precise position the parties are unable to agree and who were in a somewhat special position and whose cases differed from the other 17. They were Mr Desmond and Mr Nicholson. The last party to these proceedings was the T & G itself which claimed protective awards under the provisions of S.99 et seq. of the Employment Protection Act 1975. By consent all these proceedings were heard together. The 17 Applicants were representative of different departments at Tilbury. The stevedoring operation was dealt with in three areas, the Conventional Department; the Containers Department; and the Grain Terminal. The trade name "The Port of Tilbury" was adopted in August 1988. The PLA owned all the physical assets and registered dock workers were assigned to particular departments. Occasionally there were transfers between departments. The Applicants came from various departments:- Conventional Department Ships clerks Mr Stevens, Mr Matthew Tighe, Mr Michael Tighe and Mr Lerpiniere Dockers Messrs George, Lake, Coughlin, Hussey, Shilling, L Morgan, Fenn, Lismore, J Mahoney and Cole. Container Department Mr Payne The Grain Terminal - Corn porters Mr T Mahoney and Mr T Morgan The Conventional Department handled conventional cargoes. It also covered various specialist berths adapted to handling particular cargo. It encompassed the scrap metal berth, the cement terminal, the roll-on - roll-off (Ro-Ro) berth, the handling of fruit vessels, the handling of paper at berths 44 and 46 and a wholly owned subsidiary of the PLA at 42 berth, handling timber. The Department was managed by its director, Mr David Buckley, its operations manager, Mr Wembourne, and later Mr Lonagan and the superintendents amongst whom was Mr Millard. He was the only witness called from this Department. The Container Department was highly mechanised handling containers with specially designed equipment. It covered the multi-user container terminal (MUCT) and Tilbury Container Services (TCS). MUCT was directly managed by the PLA. TCS was a separate company with its own management except at the level of ship supervisors which with its registered dock workers were supplied by the PLA. Mr Nicholls was the director of MUCT, Mr Mcbride was director of TCS. The Grain Terminal was a specially built terminal designed for both the loading and discharge of ships carrying grain in bulk. The actual cargo handling was mostly automatic. The registered dock workers were a small workforce and this terminal had its own history and its own particular practices. The labour allocations were always carried out by the corn porters delegates, that is the shop stewards. The foreman had no direct responsibility for registered dock workers and there was no requirement for the shop stewards to tell management the names of those men on duty. Above the foreman were the operations manager (Mr Cooper) and the director (Mr Harris). There was no question but that the dismissals were on the grounds of redundancy. Thus so far as the individual applicants were concerned the following issues arose -(a) Were the dismissals automatically unfair under the provisions of Ss.58(1)(b) and 59(a) of the Employment Protection (Consolidation) Act 1978 in that the selection for redundancy had been unfair and had been made for the reason that each Applicant had taken part or proposed to take part in the activities of an independent Trade Union at an appropriate time (there was no issue as to the phrase "an appropriate time").(b) if not, was the dismissal of each unfair under S.57(3)?(c) was the appropriate order in any case that of reinstatement or re-engagement - or neither?(d) if reinstatement or re-engagement was ordered and was not effected, was it impracticable so to do?(e) what compensation should be awarded including any special award?(f) should any deduction be made from that compensation for contribution?(g) Should any deduction be made on the grounds that it was just and equitable so to do?(h) had there been an unlawful deduction of wages under the provisions of the Wages Act 1988? The T & G made a claim that there was a transfer of undertaking from PLA to its subsidiary companies in July 1989. This claim was made under Regulation 11 of the Transfer of Undertakings (Protection of Employment) Regulations 1981 and the European Community Directive 77/187. The T & G also alleged a failure to consult about proposals to dismiss for redundancy in July 1989. It claimed a protective award under S.101 of the 1975 Act. It failed on the first matter and succeeded on the second. There is no appeal. The First Hearing - Liability. ("L") - this is for ease of reference. This took place over some 168 days between October 1989 and May 1991. The Decision is dated 20th August 1991. The unanimous decision of the Tribunal was that - "(1) The respondents unfairly dismissed all the individual applicants in that it selected them for dismissal for redundancy for a reason falling within S.58(1)(b) of the Employment Protection (Consolidation) Act 1978 (a trade union reason). (2) The respondents unfairly dismissed all the individual applicants for redundancy (S.57(3)). (3) The respondents failed to consult representatives of the Transport and General Union about its proposals to dismiss some 600 members of the union in July 1989. The Tribunal will make a protective award under S.101 of the Employment Protection Act 1975 in respect of any of those members dismissed for a 90 day period from the dates of dismissals. (4) There was no transfer of an undertaking from the respondents to its employment only subsidiary companies in July 1989. (5) The complaint by the individual applicants that the respondents made unlawful deductions from their wages fails. (6) The hearing is adjourned. A date to be fixed to determine remedies." The Second Hearing - Remedies. ("R") This occupied some 21 days between September and November 1991. The reasons occupy some 126 pages. The unanimous decision of the Tribunal was that re-engagement orders should be made in respect of the following applicants, Mr Desmond, Mr George, Mr Lake, Mr Lismore, Mr J Mahoney, Mr T Mahoney, Mr Les Morgan, Mr T Morgan, Mr Nicholson, Mr Payne, Mr M Tighe and Mr Michael Tighe. The terms of such re-engagement were set out in an Annex to the Decision. Those terms do not include provision for the return of the redundancy payments of £35,000. Mr Les Morgan was ordered to make a deduction of any past earnings payable under the Order, any sums earned between the date of dismissal and the date of re-engagement. The Tribunal ordered that PLA pay to each of the remaining applicants a basic award, a compensatory award and a special award to be calculated in accordance with their decision and with Ss.73 to 75A of the 1978 Act. The remaining matters were adjourned. The Third Hearing - Practicability of re-engagement. ("P") This took place on four days - 11th, 12, 13th and 17th February 1992. The unanimous decision of the Tribunal was that the PLA had failed to show that it was not practicable for it to comply with the Tribunal's orders for re-engagement made on 20th December 1991. It therefore found that the 12 applicants, the subject of the re-engagement orders were entitled to a basic award, a compensatory award and a special award to be calculated in accordance with Sections 73, 74, 75 and 75A(2) of the 1978 Act. The issue of the special award and of costs was adjourned to the fourth hearing. The Fourth Hearing - Compensation ("C") The unanimous decision of the Tribunal after this fourth hearing of some three days was that those applicants in respect of whom no order for re-engagement had been made should receive a special award of a week's pay multiplied by 104 but not exceeding £25,040. The special award payable to those applicants in respect of whom a re-engagement had been made was to be a week's pay multiplied by 156. The method of calculation of a week's pay was laid down in the decision. Further, the PLA was ordered to pay 40% of the costs incurred by the Applicants in the hearing on liability (the first hearing); those costs should be on County Courts Scale II and to be taxed if not agreed. There is an appeal from the order for costs, which we have not yet heard. Despite this we have been asked to deliver our judgment on the first four appeals. The Wages Act Claim In the light of the Decision in DELANEY v. STAPLES [1991] ICR 31 CA the Industrial Tribunal dismissed the applicant's claim under this Act. The House of Lords has upheld this decision. That part of the appeal is dismissed. Documentation and veracity of witnesses The Industrial Tribunal were extremely critical of the way in which the PLA had behaved in the case. Orders for discovery had not been complied with, discovery had been given at a very late stage even after most of the evidence had been completed and the Tribunal were satisfied that they had not seen all the relevant documentation. As is clear from a substantial passage in the third judgment (P3/5 to P5/10) the Tribunal deplored the attitude of the PLA and considered that it had shown scant respect for the Tribunal and its second decision ordering re-engagement. Of the witnesses generally the Tribunal said this - "This has been a difficult case in which to arrive at the facts. Feelings have run high and there has been and is much at stake on both sides. The stakes are high both in financial terms and in terms of the reputation of the protagonists. The temptation to tell the Tribunal less than the whole truth has been very great; few have resisted it. With the exception of Messrs Terry Martin and Hunt, we think that no one has told the Tribunal the whole truth. It gives us no pleasure to state that some witnesses have been deliberately untruthful in particular areas. Some witnesses have been forgetful and others have allowed their present perception of the rights and wrongs of particular events to cloud the objectivity necessary for complete accuracy. In that situation we have had to be most careful." They also comment, "We consider that Mr T Morgan was accurate as to the running of the Grain Terminal and Mr Matthew Tighe was reliable as to the clerks. We accept Mr Desmond's evidence as to events at Phoenix Wharf." The two main witnesses for the PLA were Mr McNab and Mr Farrow. The Tribunal express their views about those two witnesses and about the PLA's case in L11/10 of the Liability Decision as follows - "In considering the oral evidence, we have on the whole preferred the evidence of Messrs Lake and Watson to that of Messrs McNab and Farrow where they have conflicted. We consider that neither Mr McNab nor Mr Farrow were truthful. Mr McNab's extravagant allegations were much reduced under cross-examination and there was conflict between the picture of Tilbury which he presented to the Tribunal and that presented by Messrs Farrow and Millard as well as by Mr Watson and many of the Applicants. The similarly extravagant allegations made in the Notice of Appearance were not sustained by the evidence. Much of the PLA's case seemed to have been put together as a package of justification after the event of the dismissals. The PLA's original case put forward in the Notice of Appearance as to Mr Farrow's personal knowledge of the Applicants was not sustained and indeed turned out to be very different. Furthermore, in this regard, it was only under cross-examination and at a late stage that Mr Farrow told the Tribunal about the Directors' lunches where he said he gathered so much information. These are amongst many such indicators that the PLA's evidence is not to be relied on, save where it is supported by other evidence which we do regard as reliable. We bear this in mind in deciding that we cannot accept the PLA' case that past events and activities of the shop stewards were the real reason for the decision to dismiss them. Furthermore, the evidence of Messrs McNab and Farrow in this regard cannot stand with Mr Farrow's evidence that, had the trade union negotiated locally, the shop steward Applicants might not have been dismissed. There are various other indicators which we deal with in their context, including the PLA strategy as to the future. Both Mr McNab and Mr Farrow were evasive in giving evidence under cross-examination." "Militant" port It is essential to an understanding of this case that the background to the history of events should be clearly appreciated. In its final comments at L282/7 the Tribunal say this - "... What we have to say is addressed to the PLA and to the T & G who are both parties to this litigation. That is, to the Port Authority itself, and to the T & G in the widest sense of its membership. Our remarks are not confined to the salaried employees of either body. It is evident from the history which we have set out that in 1988 it must have been clear to the employers and to the union that there would be changes in the Port industry. From that time, both sides pursued a course of confrontation culminating in the meeting between NAPE and the T & G on 18th April 1989 and the entrenchment over the national bargaining which we have described. ... it seems to the Tribunal to be wholly unsatisfactory that a great industry such as the Port industry allowed its industrial relations to fall to such a low ebb that at Tilbury there was no constructive discussion as to the way ahead at such a crucial time. In our judgment, both the PLA and the T & G in its widest sense of the whole membership are to be strongly criticised for their failure in that regard at Tilbury. We point out that the real sufferers as a result of the dispute have been the individual members of the workforce (who are also members of the T & G) who have lost their jobs. We recommend for the future that both sides abandon confrontation and try for some cooperation in the interests of the industry itself and all of those who work in it." The nature of the operation of a port is basic. An owner of a ship or its charterer is interested in turning round his ship as quickly as possible. It is also in the interests of the cargo owner that unloading and loading of cargoes should be as quick, efficient and as safe as possible. Thus, it can never be in the interests of those using the port for there to be stoppages. To pay demurrage adds significantly to costs. The Industrial Tribunal found that insurers were loading premiums for Tilbury by surcharges of 33 1 / 2 to 45 per cent. Underwriters will pitch premiums in the light of experience of claims and it is in their interests to keep rates down provided they are realistic. It cannot be in their interests to increase the rates without good reason. Brokers would take their business elsewhere. As the Tribunal found there may be reasons other than industrial relations difficulties which would cause delays such as defective equipment or shortages of equipment, but those would no doubt be common to other ports. It seems likely that industrial action of one kind or another is the cause for an increase in premium. The extent to which anyone is to be blamed is a different matter. The Enclosed Docks Productivity Agreement The Enclosed Docks Productivity Agreement (EDPA) was a collective agreement made between T & G and the London Enclosed Docks Employers Association. It was effective from 1st January 1975 and updated on 31st March 1988. We have seen a copy which was in force at the material time. The preamble sets out the aims of the Agreement to promote the efficiency of the port, to facilitate the introduction and operation of improved working methods of cargo handling, and to improve progressively the wage structure and conditions of employment of the employees. The Agreement also states that the parties concerned understand that the success of the agreement depends on mutual cooperation and understanding of the problems confronting employees and management and that they can only be resolved by joint negotiation. Clause 5 of the EDPA dealing with 'wage structures' states - "It is a condition of the Agreement that no unauthorised additional payments for any reason whatsoever will be made" It is quite clear that agreements were made between shop stewards and management in connection with various matters. There were many examples. Indeed, on reading the various decisions it seems to us abundantly clear that this agreement was honoured in the breach. Although it was of no legal force, as is common with such agreements, it seems to us that had this Agreement been observed by both sides then much of what occurred could have been avoided. It was not. Ad hoc agreements were made from time to time between management and shop stewards on behalf of the workforce. The result was repeated commercial chaos. Sound industrial relations demands a responsible and reasoned input from both sides. Procedures are in place to minimise the risk of stoppages. There may be wholly unreasonable and disruptive use of trade union rights or power, just as there may be wholly unreasonable and obstructive attitudes from management. Thus it seems to us that although in considering "the activities of an independent trade union" under S.58(1)(b), a dividing line must be drawn between those acts which fall either side of that line, such a division is not necessary nor indeed, in some circumstances, realistic or fair when considering the overall responsibility for a given situation. In assessing the balance of responsibility for these appalling industrial relations and the issue of justice - that which is fair, just and reasonable between the parties - it seems to us unreal and lacking in commonsense to regard the situation as one coloured 'black and white'. It is the clearest possible case of 'shades of grey'. The National Port Shop Stewards Committee There was a committee which in the judgment of the majority (Miss Smith dissenting) pointed to the obvious militancy of the shop stewards and the workforce at Tilbury. It was the National Port Shop Stewards Committee (NPSSC). This was an unofficial combine of T & G shop stewards. Any shop steward from any part of the country might attend. It was suggested that it was a body concerned with pensions and other similar constructive activities but the Tribunal rejected this. In commenting upon it the Tribunal say this - "We have no doubt that it was a body which, in times of difficulty for the T & G, considered ways in which industrial action might be taken and orchestrated that industrial action. Although the committee was unofficial, it was known about and tolerated by the T & G as a "combine" which enabled the T & G to do unofficially that which it could not do officially without it endangering union funds in any legal action which might be taken against the union. In effect, it appears to have been a body of shop stewards acting together in what they perceived as the interests of members whatever legislative constraints might be placed on the T & G itself. However, it is important to note that because the NPSSC was operating outside the democratic structure of the trade union, the ordinary members had no control over its activities at all. The shop stewards who attended the NPSSC may or may not have reported back their doings to the members, but if they did not, there was no compulsion on them to do so. Nor was there any compulsion to consult the members before the shop stewards made their contribution to the committee's deliberations. For some time the men in the Container Departments mandated their shop stewards not to attend the NPSSC. It seems to the Tribunal that in a democratic union in a democratic society there are serious dangers in the toleration and use of unofficial combines." At R43/8 in a different context the Industrial Tribunal says this - "... the fact that some Applicants nevertheless found it suitable to be involved in the NPSSC with its acknowledged purpose of unofficial industrial action, to achieve whatever the T & G could not achieve officially, is relevant in considering whether there can be a successful employment relationship between them and the PLA subsidiary companies in the future ..." The majority agrees with the inferences to be drawn from those passages and our reading of the decisions as a whole that the sole purpose of that committee was for it to be used as a tool in the militant domination of working practices at Tilbury. We can see no other reason for its existence. Miss Smith draws a different conclusion and would express it thus. This type of committee is in no way unusual in British industry. The existence of combine committees is widespread certainly in engineering. They were discussed in the Donovan Report and mentioned in earlier TUC reports on workplace representation. They often occupy an anomalous position within the industrial relations system and many are not formally recognised either within trade union rules or by management. Nevertheless they fill a recognisable need and are often tolerated and even encouraged by both trade unions and management. From the trade union point of view such committees provide a forum for the exchange of information between shop stewards dealing with problems in their own workplace. This may avoid unnecessary clashes. Secondly, shop stewards are enabled to develop a common approach to particular problems for example, redundancy, fringe benefits and pensions. Thirdly, they provide a means of mobilising support for particular groups involved in a dispute. Fourthly, trade unionists have felt under attack by the changes in the law in the 1980s whereby union funds may be placed in jeopardy and are entitled to make such arrangements as are legal to avoid such jeopardy from the pursuit of trade union activities. Her experience tells her that from the point of view of management a combine committee offers advantages of co-ordinated approach to common problems affecting all workplaces without too much regard to the implication for the practices of other employers. A paid official, who also negotiates with other employers, is likely to fell inhibited by possible repercussions. The Appeals The sole criticism of the "Liability Decision" is that the conclusion reached by the Tribunal was not only not based upon its findings of fact but was contrary to its expressed findings. There was no appeal against the finding of unfair dismissal. The only appeal was against the finding that the selection for redundancy was on the grounds contained in S.58(1)(b) of the 1978 Act. By reason of S.72(c) such a finding merited a special award under S.75A. The appeals against the Second and Third Decisions were heard together. The PLA appealed against the order for re-engagement and against the finding that they had not established that it was not practicable to re-engage 12 of the Applicants. The effect of those findings of the Tribunal was to increase substantially the awards which would be made under S.75A. Thus it is clear that the result depending upon each appeal is financial. These are substantial sums but it is abundantly clear on a reading of the whole of the documentation, that behind every move in this litigation lies the bitterness which has existed between the parties throughout the proceedings. It still persists. Neither side can claim innocence. The First Appeal (Liability) The relevant conclusions reached by the Industrial Tribunal are contained in the following paragraphs - (L280) "1 This is a case which turns essentially on the facts which we have found which we have set out in Parts 4 to 12 of this decision. We summarise our findings in the light of the applicable law. The individual Applicants' complaints that they were selected for dismissal for redundancy for a trade union reason which was therefore automatically unfair 2 The Tribunal finds that the reason the PLA selected all the individual Applicants for redundancy in July 1989 was the PLA's view that all the individual Applicants would in the future at Tilbury support the T & G's insistence on the campaign for, national negotiations of terms and conditions of service for all ex-registered dock workers and aim thereby to achieve terms no less favourable than those enjoyed by registered dock workers under the Dock Labour Scheme. That campaign was the official policy of the T & G. It was headed by the General Secretary. The reason outlined was a reason that the Applicants proposed to take part in the activities of an independent trade union within section 58(1)(b) of the Employment Protection (Consolidation) Act 1978. On the facts, the Applicants' past activities (whether or not they constituted the activities of the T & G) were not the reason that the PLA selected them for dismissal for redundancy. On the facts, all the Applicants were employed by the PLA in positions as dockers, clerks or corn porters (as the case may be) and, on the facts found, there were other employees in the PLA' undertaking at Tilbury in similar positions who were not dismissed. It follows that the PLA's selection of all the individual Applicants for dismissal for redundancy was unfair. The Applicants' alternative case that selection for redundancy was unfair 3 The Applicants complain that quite apart from the selection for dismissal for redundancy for a trade union reason, the dismissal was unfair having regard to the criteria set out in section 57(3) of the Employment Protection (Consolidation) Act 1978. On the facts found, the Tribunal agrees that the dismissal was unfair in all the circumstances in that the PLA acted unreasonably in treating the redundancy as a sufficient reason for dismissing the individual applicants. In making that finding, we have regard to the PLA' failure to consider the Applicants as individuals, its entirely subjective criteria relating to "attitude" and that if, as alleged, selection was for past misconduct, the misconduct relied on was in most instances, on the facts, no such thing and was not so regarded by the employer at the time." The Tribunal were considering both S.57(3) and also sections 59 and 58(1)(b). They present very different issues. The structure of this decision It is important to bear in mind the skeletal structure of the decision as indicated on the 'contents page'. Pages L1-14 contain the history of the hearings and the Tribunal's comment on the evidence to some of which we have already referred. Thereafter their findings of fact are contained in L14-187. The submissions of the parties are explained from L187-245, and from pages L245-280 the law and its application are set out. The conclusions are on L280 - we have set them out above. The existence of a redundancy was not in issue. The sole issues were whether the selection of the Applicants for redundancy had been unfair under S.57(3) or had been unfair under Ss.59 and 58(1)(b), or under both. S. 59 reads - "Where the reason or principal reason for the dismissal of an employee was that he was redundant, but it is shown that the circumstances constituting the redundancy applied equally to one or more other employees in the same undertaking who held positions similar to that held by him and who have not been dismissed by the employer, and either - (a) that the reason (or, if more than one, the principal reason) for which he was selected for dismissal was one of those specified in section 58(1); ..." S.58(1) - "... the dismissal of an employee by an employer shall be regarded for the purposes of this Part as having been unfair if the reason for it (or, if more than one, the principal reason) was that the employee - (a) ... (b) had taken part, or proposed to take part, in the activities of an independent trade union at an appropriate time, or (c) ..." It is common ground between the parties that the burden of proof - the civil burden of proof - is upon the Applicants. Their case, put shortly, was that they had been selected for redundancy because and only because, the purpose of so doing was to get rid of the shop stewards regardless of how they had conducted themselves. That, so stated, would have been insufficient as the requirement of S.58(1)(b) is for them to show that they "had taken part or proposed to take part in the activities of an independent trade union". The case put forward by the PLA was that the reason for the dismissal of the Applicants as a group was because the decision-makers thought that members of the group had been disruptive in the past in a way that constituted an abuse of their power and would be disruptive in the future in the same way as they had in the past, using every means available without restriction and that they would do that in the future in order to support T & G policy of obtaining a T & G national agreement as near as possible on the lines of the Dock Labour Scheme. The "Reason" The word "reason" is familiar to those dealing with claims for unfair dismissal under S.57. Having referred to the provisions of the 1978 Act the Tribunal at L.245 say this - "The reason is the reason in the employer's mind at the time that he made the decision to select." A little later at L.253 they pose themselves the following questions - "1. What were the acts, conduct or behaviour for which the PLA selected the applicants for dismissal; and 2. Did such matters taken together as a matter of commonsense constitute participation in the activities of an independent trade union?" Guidance on the understanding of the word "reason" is to be found in two decisions of the Court of Appeal. The first is ABERNATHY v. MOTT, HAY AND ANDERSON [1974] ICR 323. The relevant passage is in the judgment of Cairns LJ at p.330B where he says - "A reason for the dismissal of an employee is a set of facts known to the employer, or it may be of beliefs held by him, which cause him to dismiss the employee. If at the time of his dismissal the employer gives a reason for it, that is no doubt evidence, at any rate as against him, as to the real reason, but it does not necessarily constitute the real reason. He may knowingly give a reason different from the real reason out of kindness or because he might have difficulty in proving the facts that actually led him to dismiss; or he may describe his reasons wrongly through some mistake of language or of law. In particular in these days, when the word "redundancy" has a specific statutory meaning, it is very easy for an employer to think that the facts which led him to dismiss constitute a redundancy situation whereas in law they do not; and in my opinion the industrial tribunal was entitled to take the view that that was what happened here: the employers honestly thought that the facts constituted redundancy, but in law they did not." Guidance is also to be found in another decision of the Court of Appeal in HINDLE v. PERCIVAL BOATS [1969] 1 WLR 174 . This was a case dealing with an appeal under the Redundancy Payments Act 1965. The claimant, a highly skilled woodworking craftsman, had been employed for over 20 years by a firm and its successors in wooden boat building and repairs. In 1960 the new employer took over the business and for five years carried out repairs only. Boat building was resumed in 1965 by which time fibre glass was being extensively used as an alternative to wood. The claimant continued to work until January 1967 when he was given written notice of dismissal and was told orally that he was "too good and too slow"; he was not replaced. He found other employment almost at once but made a claim for a redundancy payment on the ground that his dismissal was attributable wholly or mainly to a reduction in the employer's requirements for woodworkers. The evidence of the employers before an Industrial Tribunal was that because the claimant was so thorough and so slow his continued employment was uneconomical and that he was not replaced because they could not find a suitable replacement. The Industrial Tribunal by a majority, found that at the date of dismissal there was no overstaffing and accepted as genuine the opinion of the employers that the claimant was too slow and was dismissed for that reason. His claim therefore failed. The Queen's Bench Divisional Court accepted that finding of fact and dismissed his appeal. On appeal to the Court of Appeal the claimant failed. The majority decision was that of Sachs and Widgery L.JJ. Sachs LJ sets out the issues at p.181D - "The present claim for a redundancy payment was made under section 1(2)(b) of the Act. Such a payment could only become due to the employee if it was found by the tribunal (having due regard to the onus of proof), first, that the requirements of the employer's business for employees to carry out work of a particular kind had diminished or was expected to diminish, and, secondly, that his dismissal was attributable wholly or mainly to such a diminution. It is convenient to refer to these findings as being the first and second conditions precedent to entitlement." He deals with the first of the conditions and then turns to the second at F - "As regards the second condition there was much discussion in this court as to whether a tribunal ought to apply an objective or subjective test in deciding whether or not the dismissal is attributable to some established diminution in the requirements of the business. For my part I found, as did Widgery LJ, that the posing of such a question tended to confusion, at any rate when linked, as Mr Kidwell desired, with attempted distinctions between the motives of the employer and the reasons for the dismissal. To my mind the position in law on this point clearly emerges when one considers the case of an employer who in truth dismisses his most efficient workman solely because of some genuine but mistaken belief and who but for that belief would have retained that man in his employment - and indeed would have kept him above all others of his employees. Instances could include a belief that he had been guilty of grave misconduct in the course of his duties, or that he had been guilty of some deplorable act outside his duties (for instance, an indecent assault on his employer's daughter). It would be impossible to hold that because the belief was mistaken the dismissal was attributable to some established diminution in the above-mentioned requirements - and I reject the submissions of Mr Kidwell to the contrary. Similarly when the requirements of the business remain constant over the relevant comparable periods (in a seasonal business the relevant comparison may well be as here between periods each of a complete year) and a man is dismissed because it is believed, whether rightly or wrongly matters not, that his work does not "pay for his keep," then if in truth he is simply dismissed on that account the dismissal cannot be attributed to a non-existent diminution in the above requirements." His view is also expressed again at p.182F - "... But in any event once the tribunal is satisfied that the ground put forward by the employer is genuine and is the one to which the dismissal is mainly attributable the onus is discharged - and it ceased to be in point that the ground was unwise or based on a mistaken view of facts, though such matters may well be relevant for consideration by the tribunal when assessing the truth of the employer's evidence." Lord Justice Widgery also gives us helpful guidance at p.187B - "The appellant's first submission in this court is that when deciding whether his dismissal was "attributable" to a diminution in the requirements of the business within section 1(2) the test to be applied was an objective one and that the tribunal erred by applying a subjective test and considering only the state of Mr Percival's mind. I agree that the tribunal must look at the facts objectively to discover the true causes to which the dismissal is attributable but I do not find the distinction between objective and subjective tests to be either helpful or conclusive. The dismissal is attributable to the facts which caused it to occur. The tribunal must consider the evidence to see what those facts were and must bear in mind that the claimant succeeds on this issue unless the employer demonstrates that a diminution in the requirements of the business was not the main cause. The employer's evidence may be highly material because he knows what prompted him to dismiss the claimant and if his evidence is believed it may go a long way to establishing the true causes of his action. It must also be remembered that the employer is often entitled to dismiss his employee on due notice without assigning any reason at all. He may think that the employee is a bad influence in the works, or suspect him of pilfering, or wish to replace him by a younger man. If dismissal then follows, the employer does not assume the obligation of proving that his suspicions were well founded or of persuading the tribunal that any reasonable employer would have acted as he did. All he must do is prove that redundancy was not the main cause and he does this by proving that the requirements of the business for workers of the relevant kind had not diminished. It is not the policy of this Act to reward long service and good conduct, as such, but only to compensate an employee who is dismissed for redundancy as defined in section 1. The tribunal must, however, be alert to realise that dismissal is often attributable to a number of causes and that an employer who has personal objections to a particular employee might still have retained him were it not for a diminution in the requirements of the business for employees of that kind. The tribunal must not only be on the look out for the dishonest employer who puts forward a false reason for the dismissal, but also for the employer who misdirects himself (to use the language of the Divisional Court) into thinking that he was influenced by the personal deficiencies of the employee when in truth the main factor was that the requirements of the business had declined." The learned Lord Justice also adds later at p.188D - "I do not feel able to draw a distinction between "motive" and "reason" in sufficiently vivid terms to be of value to tribunals who have to consider these questions hereafter, ..." The Principles It seems to us from those decisions that the following principles can be extracted: the first, that the reason is the set of facts which may be beliefs known to or beliefs held by the decision-makers which caused the decision to be made; secondly, that the belief must be a genuine belief and in testing the genuineness of that belief it may be relevant to consider whether the facts upon which it was based were known to the decision-maker to be false at the time or that the inference drawn from those facts was wholly unreasonable but the belief itself does not have to be reasonable, it has to be genuine; thirdly, that it is possible to have a mistaken belief provided it is a belief genuinely held. Having decided what was the belief and the facts behind it the Tribunal must then consider whether the facts founding that belief judged objectively fell within S.58(1)(b). The facts How then did this Tribunal find the facts? There are a number of passages in that part of the Decision which includes their findings of fact, which seem to be relevant to the issue of the reason for the selection. Some passages are somewhat extensive, but it is necessary to set them out in order to understand the submissions in this appeal. " The decision to dismiss the shop stewards 51 During the week beginning 22 May Mr McNab and Mr Farrow met. Independently of each other they had considered the way ahead. Mr Farrow thought, bearing in mind the respective stances of the T & G and the Port employers, that local talks or negotiations with the T & G as to terms and conditions of employment would not take place. For that reason he thought the PLA would be in a position to impose terms and conditions of employment on a "take it or leave it" basis at abolition in a way foreshadowed in the Farrow Paper, particularly as the workforce was almost certain to be on strike at or after abolition. We think that this was in fact the management team's preferred course because of its obvious advantages. In particular, it would enable the management to achieve maximum change to existing conditions without the difficulty presented by protracted negotiations with the T & G or the expense of a buy out. Management was aware of both those aspects, that awareness is reflected in Mr Farrow's evidence on Days 25 and 39 and in some of the documents. However that may be, in a situation where the management would be, in Mr Farrow's phrase, "imposing arrangements", the presence of the shop stewards presented a problem. Mr Farrow bore in mind some of the past and ongoing industrial difficulties at Tilbury for which he blamed the shop stewards . He thought that the shop stewards would not accept the changes the management wanted, particularly because the T & G itself was pursuing a national agreement to cover the terms and conditions of service of ex-registered dock workers . Bearing in mind the shop stewards' past history and behaviour, Mr Farrow thought that in the future they would support the T & G. He considered that they would do so by any means within their power . When he met Mr McNab, Mr Farrow aired these thoughts . Mr McNab agreed with him . Neither made any secret of this to the Tribunal and they spelled it out several times in different ways, both in examination in chief and in cross-examination. The following are examples of passages taken from the Chairman's note. On Day 5 Mr McNab said:
"We thought the group [the shop stewards] would make every attempt to frustrate what we wanted to do . Could not see anything else in the letter from Morris and Todd and in the documents/meeting and letters from Morris and Todd other than that the shop stewards would stand behind them. They would insist that this was the only thing discussed before abolition ie restitution of terms and conditions of service of the Dock Labour Scheme. And what could happen at abolition would ensure that any benefits we put in would be frustrated . They would make efforts in future, however long it took, to get that Agreement back and I still think that would be the case. 'That Agreement' means the Dock labour Scheme replaced by a national industrial agreement. Their reason: would preserve their position built up under the Dock Labour Scheme and we would have a continuation of the abuse of power, continual confrontation and exploitation . I saw in Morris's second letter asking for guarantees relating to trade union officials as the entrance for the Group (the shop stewards) into the situation."
On Day 29 Mr Farrow said:
"It was not a question of looking at the disciplinary procedure in isolation. We were looking at significant changes to working arrangements and we were moving to imposing working arrangements because the trade union was pursuing a national agreement. Under those circumstances I did not believe there was any possibility that the shop stewards would accept imposition of those arrangements. They would not make the best of what they regarded as a bad job and would actively oppose by any means ."
On Day 46 Mr Farrow also said of his conversation with Mr McNab on 23 or 24 May:
"At this time my view was that we were inevitably moving to the position of imposing any new arrangements we wanted because there was no prospect of negotiation on anything else than national terms and therefore there seemed only one clear path in those circumstances. In addition, the Directors had begun to develop new terms and conditions of service which they wanted and it was clear they were significantly different from before ... It seemed to me in the position of the T & G pursuing a national agreement and recreation of the Dock Labour Scheme, my view: any new arrangement imposed would be totally unacceptable to the shop stewards and given the T & G's stance on re-creation it seemed to me the shop stewards would actively work against us as their purpose and in those circumstances in my view we could not continue to employ them and still achieve success as a port or with any new arrangements which had been imposed."
There are other passages in the evidence to the same effect. We have quoted these passages in the context of our findings as to the decision to dismiss because we find that they demonstrate accurately the thinking of Messrs McNab and Farrow at this time . For the reasons set out, Messrs McNab and Farrow decided that the shop stewards should be selected for dismissal in the impending redundancy exercise , subject to approval by the PLA Board at its meeting on 1 June. 52 The phrase used between Mr Farrow and Mr McNab was "the shop stewards". That was not glossed at the time as "the group of shop stewards who were giving us trouble" as it was to the Tribunal. On Day 39 Mr Farrow made it clear that it was the shop stewards' collective attitude which he criticised. We find that there never was at any stage an assessment of each of the shop steward Applicants as individuals and we reject Mr Farrow's very unsatisfactory evidence to that effect. In this respect, the subsequent allegations as to Mr Farrow's personal knowledge of the stewards made in the Notice of Appearance are wrong and the PLA record cards are misleading. We will return to those in due course. In making this finding we have paid particular regard to the widely different characters of the shop steward Applicants as they appeared giving evidence over many days; to the undoubted constructive contribution made by many of them to the Port industry; and to their part in the various events which we have described. The criteria outlined in the Notice of Appearance and by Messrs McNab and Farrow in evidence (particularly as to confrontation and aggression) do nothing to explain the selection, for example, of Mr Matthew Tighe who, in the Tribunal's view, could not possibly fit this description. On all the evidence about the decision to select the shop stewards for dismissal, we find that there was no intention by Messrs McNab and Farrow to differentiate between shop stewards who were or were not regarded by the PLA as unreasonable. 53 We find that in their discussion what Messrs McNab and Farrow envisaged was a purge of all the shop stewards at Tilbury to ensure that in the future there would be no organised resistance to the new regime . We find on the evidence that at this stage Messrs McNab and Farrow had accepted that derecognition of the T & G for collective bargaining was inevitable. No other conclusion was possible at that stage. We mention it for completeness and point out that Mr McNab's paper on derecognition presented to Tilbury Management Board on 26 October 1989 (V2 D4 p90) came long after he and Mr Farrow had so concluded. In this context we also note that the sixth draft of the new terms and conditions prepared on 11 June 1989 shows no role for the trade unions in collective bargaining. 54 We have stressed the management's post-Scheme plans because they were of crucial importance to the reason for selecting the shop steward Applicants for dismissal . We find that the shop stewards' past activities were not in themselves the reason for selecting the shop stewards. There was no element of punishing the shop stewards for past misconduct or past activities. The management perception of past conduct was the signal or indication to management of how the shop stewards would be likely to conduct themselves in the future . This is why Mr Farrow (and the pleadings) mentioned the shop stewards' "attitude" as being in effect faulty and their adherence, as individuals, to the Scheme as the problem. Whatever the shortcomings of the record cards as evidence of the Applicants' conduct and behaviour, they are certainly revealing as to management's thinking about the future. Variations of the phrases "A Scheme man", "would not accept the new environment, unacceptable" sound like a refrain through the shop stewards' cards. That the PLA thinking was prospective rather than retrospective is also indicated by Mr McNab's evidence (on Day 8). It is made absolutely clear by Mr Farrow's evidence (on Day 42) that had the T & G been prepared to enter into local negotiations at 1 June the decision to dismiss "might not have been final". Contrary to Mr Pardoe's submission, we find that Mr Farrow's evidence was not merely an acknowledgement of what would have been the only practicable position had the T & G negotiated locally. In our view, it was an off-guard and candid acknowledgement that the shop stewards' position as lay officials of the T & G and their support for its policy of pressing for national negotiations of terms and conditions of service was seen by Messrs McNab and Farrow as the major obstacle to future employment where the T & G was holding to its policy. And that evidence is entirely consistent with Mr Farrow's evidence in chief in the Day 29 "nutshell" of the reason for selection that the shop stewards would actively oppose the new arrangements and would not accept them because the trade union was pursuing a national agreement. The National Ports Shop Stewards Committee (and the shop stewards' membership of it) were not matters specifically taken into account in the decision to dismiss. 55 As we have mentioned, the view formed by Messrs McNab and Farrow of how the shop stewards would behave in the future; that is, their support for the T & G's policy and their resistance to the new imposed working arrangements was based on the management's perception of the shop stewards' behaviour in the past . We accept that Messrs McNab and Farrow had in mind the most unhappy industrial relations which had bedeviled Tilbury in the late 1980s and some if not all of the problems, both present and ongoing, with which Mr Farrow especially had had to deal or of which he was aware through the operations managers . In examining the history of events and the more general allegations dealt with in Part 12 of this decision, we have looked closely at those problems to see to what extent management's perception of the shop stewards was justified ." (Because this citation is so lengthy, we have underlined the passages upon which Mr Pardoe especially relies as showing findings of what was in the minds of Mr McNab and Mr Farrow). Towards the end of the part of the Decision dealing with facts the Tribunal refer to " The PLA's general allegations of fact" and make the following findings or comment (L182). "35 In the Notice of Appearance, Further and Better Particulars and in the summary of their case, the PLA made general assertions of fact which it says are established by the evidence. They fall into three groups:- (1)allegations relating to the past behaviour of the shop steward Applicants; (2)allegations relating to future behaviour of the shop steward Applicants; and (3)allegations relating to the PLA's actions and beliefs at the time that it decided to dismiss the shop stewards. Allegations relating to the past behaviour of the shop steward Applicants 36 In summarising its case, the PLA alleged that the Applicants' activities had been disastrous to Tilbury; that the Applicants had always failed to perform their duties and ensure observance of industrial agreements; that the Applicants had always engaged in activities which had not been the activities of the T & G; and that the Applicants had always abused their power (see paragraphs 14 and 15 of Part 14 of this decision). These specific allegations cover the facts which the Tribunal has set out. We find on the facts that the PLA is wrong in each of these specific assertion of fact. Similarly, Mr McNab was wrong in his assertion (repeating the Step-by-Step paper) that the shop stewards manipulated the men by playing on their insecurity. It is not necessary for this decision to decide whether the actions of the Applicant shop stewards relied on by the PLA as constituting breaches of relevant collective agreement, initiation or continuance of industrial action and/or misconduct were or were not participation in the activities of the T & G and we do not do so, but we note the lack of contemporary protest ." (Our emphasis) ... Allegations relating to future behaviour on the part of the shop stewards 40 The PLA asserts that in future the Applicant shop stewards' activities would continue to be disastrous; that they would not adapt to change; that they would seek to reinstate the provisions of the Dock Labour Scheme; and that continuation of their employment would mean perpetuation of all that had stifled progress. Having seen and heard the Applicants and, bearing in mind that Mr Farrow did not know many of the shop steward Applicants as individuals and certainly did not assess any of them on an individual basis in considering how they would respond to the abolition of the Dock Labour Scheme and the resultant changes, we do not accept all these allegations. However, on the evidence, we find that the PLA was right that all the Applicants would have supported the T & G policy of seeking to achieve national Terms and Conditions of Service as close as possible to those enjoyed by registered dock workers under the National Dock Labour Scheme. That was T & G policy and the Tribunal has no doubt that they would have pursued it in the future to whatever extent possible under the new working arrangements. In so far as the PLA is saying that the shop stewards would misconduct themselves in the future on the basis of their behaviour in the past, the PLA' allegation is not based on fact." (our emphasis) 41 ... 42 Future working practices . The PLA asserted as a fact that it thought that none of the shop steward Applicants would be able to adapt to the new working practices. This is something they cannot have thought at the time they decided to dismiss without individual assessment. Furthermore, being an assessment made on a group basis, it is rooted in an assumption of collective support for the Applicants' trade union. It is certainly right that all the Applicants will continue to support the trade union. But for many of them realism and the need to work may well supply the impetus necessary for adaptability at work just as it has for the ex-registered dock workers (and T & G members) still employed by the PLA in its subsidiary companies." The final passage to which we need refer in extenso is where the Industrial Tribunal apply the facts to the law and in fact make their basic finding of the reason for the selection. This is at p.258, para. 24, where the Decision reads:- "In the light of the foregoing, we consider the present case. On the facts which we have found ( see paragraphs 51 to 55 of Part 10 of this decision ), the reason which Messrs McNab and Farrow had in their minds at the time for dismissing the shop steward Applicants was (in summary) their view that all the shop steward Applicants would in the future support the T & G in its policy and campaign for national negotiations of terms and conditions of service for all ex-registered dock workers with the ultimate object of achieving terms no less favourable than those under the Dock Labour Scheme; and that, therefore, the shop steward Applicants' attitude would be wrong and they would not support the new environment but would actively work against it. As described, the policy was the official policy of the T & G and the campaign was headed by the General Secretary. That reason seems to us as a matter of fact to fall squarely within the words of section 58(1)(b) of the Employment Protection (Consolidation) Act 1978 as a reason that the Applicants "proposed to take part in the activities of an independent trade union" and to be therefore automatically unfair." (Our emphasis) The Questions The questions requiring answer were first, what was the belief held by the PLA decision-makers upon which the decision to select for redundancy was made, and secondly, did the facts upon which that belief was based constitute the activities of an independent Trade Union? This is the law as we understand it and thus far we believe, that at this appeal this was common ground. As we have understood the submissions for the PLA on this appeal they run as follows:- 1.The conclusion at L280 (above) merely repeats the reasoning and decision at L258/24. It adds nothing. 2.The reasoning of the Industrial Tribunal was therefore contained in that paragraph 24 and the findings of fact upon which reliance is expressly made are those at L126-130 (para. 51-55). 3.Those findings were made expressly despite the earlier criticisms of Mr McNab and Mr Farrow not only as witnesses but as to their conduct during the hearing. 4.Those findings and the language of those paragraphs are consistent only with a conclusion that the reason for the dismissal of the Applicants as a group was because the decision makers thought that members of the group had been very disruptive in the past in a way that constituted an abuse of their power and would disrupt in the future in the way that they had in the past using every means available without restriction, and that they would do that in the future in order to support T & G policy of obtaining through national negotiations an agreement as near as possible to those of the Dock Labour Scheme. 5.Those conclusions of fact link the past and the future and it makes no sense to say that the reason was only prospective. It was the future as foreseen from a repetition of the activities of the past. 6.It was therefore essential that the past activities of the Applicants as seen by the decision makers should have been analysed to decide whether they were trade union activities. This the Industrial Tribunal refused to do L182/36). 7.Findings of fact made contrary to the evidence of Mr McNab and Mr Farrow were not relevant to the belief nor were they so assessed by the Industrial Tribunal. Those findings were only relevant to the second question which was not one being considered by the Industrial Tribunal as it explains. 8.The questions to be answered under S.59 and S.58(1)(b) are not the same as those under S.57(3). There is no element of "reasonableness" save possibly in a careful analysis of the whole evidence in seeking to decide whether the alleged belief was genuine. It might be said that no one in the position of the decision-maker and in the circumstances of the case could reasonably have held that belief and that it was wholly unacceptable to be asked so to find. That was not the reasoning of this Industrial Tribunal in the wording of L126-130/51-55. 9.Thus it is argued that the Industrial Tribunal erred in law in that it made clear findings on L126-130 and then reached a decision at L258/24 without relating and analysing the findings of fact to the 'belief' which was being put forward by the PLA and which the Tribunal found. 10.The reason found by the Industrial Tribunal at L126-130 was that being put forward by the PLA. Subsequent findings of fact on various incidents may have indicated that the view taken by Mr McNab and Mr Farrow on a specific occasion is held by the Tribunal to be wrong but this is not a finding that the belief could not have been held. 11.Moreover the test under S.58(1)(b) required an answer to the second question and that was never addressed. 12.Thus the only conclusion which could properly be drawn was that the belief put forward by the PLA constituted the reason for the selection of the Applicants and that related to the past and to an expectation of the future. It was a reason in the round. The PLA belief was that these past activities or at least some important facets were not in the future going to be repeated as "Trade Union activities". It was those activities which were not "Trade Union activities" which the PLA anticipated would be repeated. Mr Hendy for the Applicants takes two major points by way of answer. He submits first that the point now taken by Mr Pardoe is a new point and not one which was taken before the Industrial Tribunal; that the case which was argued was whether the incidents alleged to have occurred did not in fact occur in the way that the PLA was suggesting and that the issue of belief was never raised. We are unable to accept that for two reasons. The first is that the case of Abernathy was cited to the Industrial Tribunal and the only point of citing that case could have been in order to examine the words of Lord Justice Cairns. Secondly, however, it is abundantly clear on the notes which we have seen on the opening of Mr Pardoe before the Industrial Tribunal and of his closing submissions that this matter was placed before the Tribunal. It is also fair to comment that the Tribunal in the passages to which we have already referred clearly had the correct approach in mind. It may be that in the light of the way Mr Hendy presents his second point, the issue of credibility overwhelmed all else and that the necessity of linking the finding of the belief held with the reason for selection became blurred. The second main ground in Mr Hendy's submissions is that Mr McNab and Mr Farrow were found to be so untruthful that one simply could not believe a single word that they said. Nor did the Industrial Tribunal. He submits that the reasoning of the Industrial Tribunal was as follows: first that what the PLA said was fact upon which the decision was based, was not fact. Secondly, that the alleged belief that it was fact was not reasonably based. Thirdly, that the PLA did not actually believe that it was fact at all, and finally, that it did not genuinely hold that belief. Schedules have been prepared for us showing that something like 90 incidents were examined by the Tribunal. It is clear that in some incidents the factual basis for the belief is not accepted by the Tribunal as being genuinely in the mind of the decision-maker, in this case Mr Farrow. Examples of this are L46/10 - "Containers"; L64/51 - "Petersfield". At L131 et seq where Mr McNab is said to have presented an inaccurate statement of facts to the Board; L158-9, paras 3 and 4 - "9 am - squeeze"; L165/15 - "Housekeeping 44 and 46 berths"; L176/28.2 - "Corn porters"; and L181/33 - "Containers". There are many other incidents in which the Tribunal in itself inquiring into the situation decides that it accepts the version put forward by the Applicants but the results of those findings do not affect the basic issues of "belief" and "reason". Despite all this the Tribunal made its express findings as to belief at L126-130. There were however a number of incidents in which the Tribunal found that the Applicants, or some of them, were open to criticism - See R30/3. Mr Pardoe relies upon a number of other incidents namely, L48/15 - Cement Weighbridge; L57/35 - Scrap metal Terminal; L61/47 - Scrap metal by barge; L62/49 - Bonus Sub-committee; L67/3 - Bedding and Chalking; L68/4 - Merger, Clerks and Dockers; L70/72 - Pay 88; L76/15 - Stoppage of nurses; L76/81 - Sunzest; L81-83 - Hunter plywood; and L96/3 - 99/5 - Pay 89. We are unable therefore to say that there was no basis upon which the Tribunal could have reached its findings of fact at L126-130. We are therefore unanimously of the opinion that the reasoning of the Tribunal does contain an error and an error of law as submitted by Mr Pardoe, in that the Tribunal decided not to make the necessary analysis of those facts in order to decide which of them fell within the phrase 'Trade Union activities' and which the Industrial Tribunal found that the PLA belief as to the future was founded. It failed to analyse and draw the distinction which it made itself, between 'Trade Union activities and the activities of a Trade Unionist'. However that is not the end of the matter. We bear in mind that the Industrial Tribunal is the only Court charged with findings of fact and that if due to an error of law which we have found we hold the view that the Decision as a whole was or might be wrong, then it is our duty to remit the case for rehearing. It is only if on a proper approach in law and upon the findings of fact of the Tribunal on the evidence that we are of the opinion that the result in the Industrial Tribunal was plainly and unarguably right that we can substitute our own reasoning and decision. We bear in mind O'KELLY v. TRUST HOUSE FORTE PLC [1983] ICR 728. CA; MORGAN v. ELECTROLUX LTD [1991] IRLR 89. CA; and in particular in DOBIE v. BURNS INTERNATIONAL SECURITY SERVICES (UK) LTD [1984] ICR 812 . CA in a passage from the judgment of the learned Master of the Rolls at p.818G where he says - "Once you detect that there has been a misdirection, and particularly that there has been an express misdirection of law, the next question to be asked is not whether the conclusion of the tribunal is plainly wrong, but whether it is plainly an unarguably right notwithstanding that misdirection. It is only if it is plainly and unarguably right notwithstanding the misdirection that the decision can stand. If the conclusion was wrong or might have been wrong, then it is for an appellate tribunal to remit the case to the only tribunal which is charged with making findings of fact." We therefore turn to examine the findings of fact and the decision as a whole to see whether in our judgment the conclusion that the Applicants were dismissed for a reason falling with S.58(1)(b) was plainly and unarguably the right one. Looking again at the wording of S.58(1)(b) it was for the Applicants to prove that the reason for their selection fell within that wording, but the reason could be either a prospective view of the situation or a reason based upon the past and because of past behaviour. There may be several reasons and the principal reason is to be sought. In the present case the reason was held to be prospective, but based upon past activities. As we have already indicated the picture at Tilbury has changed radically. The one side would argue for much the better and the other for much the worse. Ultimately in the years to come the proof of the pudding will be in the eating. Miss Smith holds the view that all the past activities of the Applicants were trade union activities and therefore finds the following analysis unnecessary. Future Trade Union Activities At L252/16 to L257/22 the Tribunal helpfully analyses a number of cases relevant to an understanding of the phrase "proposed to take part in the activities of an independent Trade Union", but it is in paragraph L257/23 that the seeds of the error in L258/24 are sown - "If the act for which an employer dismisses is prospective, that is future support at work of a trade union's official policy or campaign, or of a trade union's full-time officer's pursuit of trade union policy or campaign which is also within the object of the union, it seems to us to be beyond argument that such support will amount to taking part in the activities of a trade union. Any dismissal for the reason that an employee would in the future give support for such a policy or campaign is undoubtedly within the words of S.58(1)(b), "... or proposed to take part in the activities of an independent trade union ..." and selection for redundancy for such a reason will be automatically unfair." This view ignores past behaviour which, if it is known, must be taken into account. The Industrial Tribunal had already indicated that there are cases which have caused problems for those required to decide upon which side of the line the activities fall. In looking to the future one is necessarily speculating. There is no certainty. The Applicants will no longer be shop stewards. There are none. Any recruiting for trade union membership carried out by them will be carried out as individuals. In the light of the past history it seems to us unreal to expect reasonable behaviour on all sides in the future. What if the Applicants seek not just to convert the attitude of the PLA but to form small unofficial and possibly secret groups to seek the power to make demands (something akin to the unofficial Shop stewards Committee) - that would be unofficial. We do not suggest that they would, but what if they did? If no progress was to be made in the campaign by individuals for restoration of national negotiations, what will be the next step for these Applicants? Is it likely that they would find themselves up against the authority of management? How would each and every one of these activities be assessed? The belief of the PLA was as found by the Tribunal. Did the facts upon which that belief was based constitute the activities of a Trade Union? Our reason for addressing these problems is to indicate a considerable degree of uncertainty as to how the Applicants would have behaved had they not been dismissed (or indeed if they were re-engaged). The PLA could only make assumptions about the future. In finding that the reason lay in the future belief, the duty of the Tribunal was to make findings of fact as to the precise nature of those assumptions. It was a difficult one. There will have been past facts upon which belief is found to have been based and which support the future assumption that the Applicants proposed to take part in the activities of an independent Trade Union. Thus, without the clearest findings of what those facts are upon which the decision-makers base their reasons the majority find it impossible to analyse the basis of fact and belief upon which the Industrial Tribunal reached its conclusion as to the future. The only facts found to have been in the minds of the PLA decision-makers are those to which we have referred at L126-130 above. They refer to the past, and, we repeat, are facts found. That is the answer to the first question. Thus if those facts upon which the belief was based fell within the phrase "activities of an independent trade union" there is a sound and logical basis for a finding that the reason for selection was that the Applicants "had taken part ... in the activities of an independent trade union ...". Was the belief being put forward genuine? Was it mistaken? What was the real reason? We therefore turn to seek to analyse as best we may the past activities of these Applicants in the light of the findings made and taking into account the whole of these decisions. We look to see whether taken as a whole the only decision which could be reached on the facts, if the approach had been made in the way we have suggested, was that what the PLA believed would be future activities of the Applicants would have constituted Trade Union activities because in the main, they were so in the past. We note, as did the Tribunal, that the activities of a trade union are not necessarily the activities of a trade unionist. However, it is not always that the mere description of the word "disruptive" necessarily prevents the activity from being a trade union activity. Although the Tribunal did not feel it necessary to analyse the past acts and facts that pre-dated the decision to select for redundancy they did give some indication of their approach at L258, para 26 - (Our emphasis) Because of our findings of fact, it is not necessary to analyse the past acts and facts in the present case that pre-dated the decision by Messrs McNab and Farrow to impose terms and conditions of service on the workforce which was to remain and to dismiss the shop stewards. However, for completeness, we outline the additional indicators which we think would assist in deciding whether any particular act was participation in the activities of the trade union within the broad envelope described. They are only indicators to assist common sense and the presence or absence of any one of them will not necessarily be decisive. Nor is this collection of indicators exhaustive. Affirmative answers to the following questions would indicate to us as a matter of common sense that a particular act was participation in the activities of the trade union in the particular workplace being considered: (1) Did any of the full-time officers of the union participate in or authorise the act. (2)Did the act complained of take place at a meeting of the workforce properly convened under the trade union's procedure for such meetings or at an official committee of the trade union. (3)Was the act part of keeping trade union members informed of matters in which they had an interest or which were part of the regulation of relations between the members and the employer. (4)Was the act undertaken at the request or instigation of members of the trade union in the sense that the employee was expressing or representing the views of those members or their views as well as his own. We accept that the fact that a person was a shop steward is not decisive of whether an action was participation in the activities of a trade union but it is certainly an indicator. We also think that the test of whether the employee was really conducting his own campaign or, if a shop steward, operating according to his own ideas rather than after consultation with the men or as their representative is a useful contra-indicator. In that regard we consider that the T & G's advice to its shop stewards in the Handbook which is quoted at paragraph 11 of Part 6 of this Decision to be salutary." The Tribunal also add that they did not think that the terms of the shop steward Credential helped to resolve the issue of whether an act by a shop steward was participation in the activities of the T & G. The advice given to shop stewards by the T & G in its Handbook is set out at L33/11 - "The shop stewards' Handbook contains several paragraphs of advice. We note particularly at pages 4 to 5:
"As a Shop Steward you represent the members in the workplace. You are responsible for ensuring that wages and conditions of employment are a credit to the Union. If any of your members has an individual grievance or a problem, you have the responsibility to see that you do your best to help. In dealing with many of your problems the Union will expect you to be able to manage on your own. If you cannot, you know that you have the help and resources of the T & G W U behind you. In your role as a Shop Steward you have to guard against two dangers. One is relying so much on yourself that, in effect, you run your own union and proceed without any regard for the importance of working as a team. Sooner or later, even the strongest group of members needs help from members outside of the group. It is, therefore, a matter of self-interest not to undermine the unity which is expressed in the Trade Union movement. The other extreme to guard against is becoming a mere messenger. So far as possible only major issues or matters of principle should be referred to the District Officer. Although, of course, the District Officer will always be prepared to give advice when needed."
The Handbook goes on to deal with the relationship between the shop steward and the member. It says:- "As a Shop Steward your main responsibility is towards those members who elected you. This involves more than just helping them with their individual grievances. It requires you to tackle the matters that are important to their well-being. ... During the course of negotiations affecting your own industry you have a particular responsibility to convey to members reliable information about the developments in those negotiations. At the same time, you should keep in close touch with your District Officials and report to them all matters of importance on organisation, requirements of members, grievances settled, and practices of the management that may affect working agreements. At the Port of Tilbury the clerks' shop stewards prepared "Rules of Conduct" for shop stewards. Those are at V4 D3 p3. We have read them with interest. They regulate a conduct of the clerk shop stewards amongst themselves." We have examined those 90 incidents which were drawn to the attention of the Industrial Tribunal. We have taken some guidance from the thinking of the Industrial Tribunal; we take into account the clearly stated views of Mr McNab and Mr Farrow that the reason for dismissing the Applicants was that they were shop stewards (eg. Mr McNab L156/30; Mr Farrow L147/18). The two industrial members sitting with me have brought their extensive experience into our deliberations. As we have already said, Miss Smith is of the view that each and every one of the incidents fall within the phrase "the activities of an independent trade union". Miss Collerson and I would not go so far, but whilst emphasising that at this juncture we are examining that sole issue and not attributing blame for the breakdown of industrial relations, we are clearly of the view, without descending to detail, that there were a very substantial number of the criticisms made by the PLA of events in which the shop stewards role constituted "the activities of an independent trade union", and which were found to be the basis of belief. We have therefore formed the unanimous view that upon the facts found by the Industrial Tribunal and particularly at L126-130 and being sure upon the whole of the case that the issue which was not decided by the Industrial Tribunal should be decided in the favour of the Applicants, we reached the clear conclusion that the reason for the selection of the Applicants for dismissal was a reason under S.58(1)(b) and that it was by reason of the past activities, not solely for the anticipated future activities of those Applicants. That was the real reason. This view obviates difficult speculation. The decision of this Industrial Tribunal was in our judgment plainly and unarguably right. Mr Desmond and Mr Nicholson, two of the Applicants, were treated slightly differently from the others. The Industrial Tribunal deals with their cases at L148/20 - L152. The only reasonable inference to be drawn is that the basis for the belief and therefore the reason for dismissal was no different from that of the other Applicants and that their activities were those of an independent trade union. We therefore reach the same conclusions in their cases. The appeal on liability therefore fails. It would seem to follow that as the reasoning for the decision is now different, the subsequent issue of remedy should be reheard. This may or may not be so. We heard no submissions upon this, but whether or not this is so and lest we be held ourselves to be wrong on our approach to the liability appeal, we turn to appeals No.2 and No.3. The Second and Third Appeals - Remedies ("R") and Practicability ("P") - We heard the "Remedies" (Stage 1) and the "Practicability" (Stage 2) appeals together. In the first of these the Industrial Tribunal ordered re-engagement of some 12 of the Applicants in the terms set out in the Schedule and in the latter it held that the PLA had failed to prove that compliance with those re-engagement orders was not practicable in the following words (P.19, para 38) - " The Tribunal is not clairvoyant. We are not managers of the Port nor are we in a position to second-guess them. We can only decide on the evidence which we have before us in accordance with the statutory provisions. We cannot say it was practicable for the PLA to re-engage the Applicants but on the other hand on the evidence we are not satisfied on the balance of probabilities that it was not practicable for the PLA to comply with the re-engagement Orders. That being so, we find that the PLA has failed to satisfy the burden of proof imposed by section 75A(2) and the Applicants are entitled to Special Awards calculated in accordance with that section." The PLA criticism of these decisions can be stated shortly as follows - The Tribunal was wrong to find (R11/1) that S.69 gave a general discretion whether or not to make orders under it. The relevant factors are limited to those set out in S.69(5) and (6) - (a), (b) and (c).[2]The Tribunal was wrong in failing to "determine" the issue of "practicability" before deciding to make the re-engagement orders.[3]At "Stage 1" the question of proof is "neutral", but at "Stage 2" the burden of proof is upon the employer to show impracticability: it was therefore wrong of the Industrial Tribunal to delay a decision on the issue of practicability until "Stage 2". It was unfair on the employer. If at "Stage 1" the Industrial Tribunal had given its reasons for determining that re-engagement was practicable, the PLA could have challenged those reasons by evidence or argument at "Stage 2".[4]In its third decision (Practicability) the Tribunal erred in law in substituting its own view for a reasonable and sound commercial view held by management at PLA. In the case of Mr Lake there was no work available.[5]The Tribunal gave no clear decision that it rejected the evidence of the witnesses of the PLA on these issues and indeed that there were contrary indications, thus, the ultimate conclusion was made contrary to its own findings of fact.[6]In any event in its approach to the issue of practicability the Tribunal erred in law in failing to find that lack of vacancies was itself conclusive of impracticability. The proper interpretation of S.69 In so far as the researches of the Bar and this Court are concerned, the argument now presented by the PLA in 1 and 2 above are wholly new and if it is correct there are a number of decisions in this Tribunal including our recent decision in RAO v. CIVIL AVIATION AUTHORITY (EAT/530/91 - 21.1.92) which will require reconsideration. As Mr Bowers comments, if it is so new, it must after all these years be suspect. It is therefore important that we scrutinise this new submission on the interpretation of S.69 against the framework and intent of the 1978 Act. The PLA submit that when considering remedies the procedure envisaged by the 1978 Act is as follows:- S.68(1) reads as follows:- "Where on a complaint under section 67 an industrial tribunal finds that the grounds of the complaint are well-founded, it shall explain to the complainant what orders for reinstatement or re-engagement may be made under section 69 and in what circumstances they may be made, and shall ask him whether he wishes the tribunal to make such an order, and if he does express such a wish the tribunal may make an order under section 69." Stress is laid upon the fact that the reference is to S.69 as a whole and not to any part of it. Secondly, it is pointed out that unless the considerations relevant to the decision whether or not to make an order under S.69 are limited by those set out in S.69(5)(a),(b) and (c) and (6)(a),(b) and (c), it is impossible for an Industrial Tribunal to give a clear explanation to a complainant as required by S.68(1). If there is a general discretion under S.69 then this renders the duty cast upon the Industrial Tribunal virtually impossible. The circumstances could be paraphrased thus - "(a) If you, the complainant, state a wish for an order of any particular nature, and(b) the Tribunal determine that it would be practicable for the employer to reinstate or re-engage you, and(c) if we find that you have caused or contributed to your dismissal we nevertheless determine that it would be just to order your reinstatement or re-engagement, then in those circumstances an order under S.69 for reinstatement or re-engagement can be made ". The PLA submission then turns to the basic matter namely, the wording of S.69(1), (5) and (6). "69. Order for re-instatement or re-engagement (1) An order under this section may be an order for reinstatement (in accordance with subsections (2) and (3)) or an order for re-engagement (in accordance with subsection (4)), as the industrial tribunal may decide, and in the latter case may be on such terms as the tribunal may decide. (2) ... (3) ... (4) ... (5) In exercising its discretion under this section the tribunal shall first consider whether to make an order for reinstatement and in so doing shall take into account the following considerations, that is to say - (a) whether the complainant wishes to be reinstated; (b) whether it is practicable for the employer to comply with an order for reinstatement; (c) where the complainant caused or contributed to some extent to the dismissal, whether it would be just to order his reinstatement. (6) If the tribunal decides not to make an order for reinstatement it shall then consider whether to make an order for re-engagement and if so on what terms; and in so doing the tribunal shall take into account the following considerations, that is to say - (a) any wish expressed by the complainant as to the nature of the order to be made; (b) whether it is practicable for the employer or, as the case may be, a successor or associated employer to comply with an order for re-engagement; (c) where the complainant caused or contributed to some extent to the dismissal, whether it would be just or order his re-engagement and if so on what terms; and except in a case where the tribunal takes into account contributory fault under paragraph (c) it shall, if it orders re-engagement, do so on terms which are, so far as is reasonably practicable, as favourable as an order for reinstatement." It is submitted that when deciding whether to make a S.69 order the Tribunal is limited to these considerations set out in (a), (b) and (c) of each subsection. The reasoning continues thus: first, as already submitted, unless the consideration is so restricted it is impossible to give a clear and concise explanation under S.68. Secondly, the merits of the case can only be introduced under S.69(5)(c) or (6)(c). Thus, an applicant who is blameless has a right to a S.69 order if it is practicable. This is consistent with this being the primary remedy. Thirdly, it is submitted that in many cases a replacement would have been engaged and in those cases S.70(1) is applicable. Section 70(1) provides, " Where in any case an employer has engaged a permanent replacement for a dismissed employee, the tribunal shall not take that fact into account in determining, for the purposes of (5)(b) or (6)(b) of S.69, whether it is practicable to comply with an order for reinstatement or re-engagement unless the employer shows ..." It is said that this wording points to a duty upon an Industrial Tribunal to determine the issue of practicability under S.69 and it cannot be a different duty depending whether or not there has been a permanent replacement. Fourthly, it is argued that the obligation to consider practicability - "shall take into account" - is really meaningless unless you decide whether practicability is or is not a valid factor in the considerations. Lastly, it is said that an employer is entitled to have the issue decided and it is unfair to place him in a worse position at "Stage 2" (burden of proof) and to do so at the whim of an industrial tribunal. If at "Stage 1" there are further matters upon which the Tribunal requires help then the proper approach is to adjourn. At "Stage 1" an employer is entitled to know the thinking of the Industrial Tribunal, otherwise he may be surprised or "ambushed" at "Stage 2". Mr Bowers for the Applicant, submits that the general discretion is to be found in the wording of S.69(1) and from the opening phrase in S.69(5)(a), " in exercising its discretion under this section ..." and he relies upon RAO and other cases. So far as the duty to determine practicability at Stage 1, he relies upon TIMEX (infra). The case relied upon by this Industrial Tribunal for the proposition that there was a general discretion under S.69(6) in deciding whether to order re-engagement is CITY AND HACKNEY HEALTH AUTHORITY v. CRISP [1990] ICR 95 , a decision of this Court presided over by Knox J. At p.99 the learned Judge was considering the powers of a Tribunal to decide terms for re-engagement. The passage relied upon is at p.99D where he says - "I return to the initial submission that there is a general discretion conferred by S.69(1) in relation to terms for the orders for re-engagement. In our view, there is a discretion but it is a discretion which has to be read subject to the following provisions of the section. Specifically it has to be read subject to what is contained in subsections (4) and (6). ..." It seems to us that that is a clear reference to the discretion in the final words of S.69(1) and that is a discretion as to the terms of the order for re-engagement but not the issue whether or not to make such an order. It does not support the general proposition. It does, however, seem to us that the width of the discretion is emphasised by Lord Bridge of Harwich in POLKEY v. DAYTON LTD [1988] ICR 142 at p.164 where he says - "The second consideration is perhaps of particular importance in redundancy cases. An industrial tribunal may conclude, as in the instant case, that the appropriate procedural steps would not have avoided the employee's dismissal as redundant. But if, as your Lordships now hold, that conclusion does not defeat his claim of unfair dismissal, the industrial tribunal, apart from any question of compensation, will also have to consider whether to make any order under section 69 of the Act of 1978. It is noteworthy that an industrial tribunal may, if it thinks fit, make an order for re-engagement under that section and in so doing exercise a very wide discretion as to the terms of the order. In a case where an industrial tribunal held that dismissal on the ground of redundancy would have been inevitable at the time when it took place even if the appropriate procedural steps had been taken, I do not, as at present advised, think this would necessarily preclude a discretionary order for re-engagement on suitable terms, if the altered circumstances considered by the tribunal at the date of the hearing were thought to justify it." The next decisions to which we were referred were BATEMAN v. BRITISH LEYLAND (UK) LTD [1974] ICR 403 and COLEMAN v. MAGNET JOINERY LTD [1974] ICR 25 and in the Court of Appeal [1975] ICR 46. We need only refer to the decision in the Court of Appeal which approved some passages from the decision of the NIRC in both cases. It is right to remember that reinstatement or re-engagement was being considered under S.106(4) of the Industrial Relations Act 1971, the wording of which was different from the terms of S.69. The wording under that Act is that the industrial tribunal "... considers that it would be practicable and in accordance with equity for the complainant to be re-engaged or reinstated" . The real issue was whether 'practicable' really meant 'possible'. The Court of Appeal was clear that that was not so and Lord Justice Stephenson specifically approved of two passages to which we were referred: at p.52A "On the evidence before the tribunal, for the reasons given by Lord Salmon, the answer was bound to be "No," if the tribunal was entitled, if not bound, to consider not merely the bare possibility of re-engagement by the employers but the consequences of such re-engagement. The language used by the tribunal, which Lord Salmon has read, suggests that it may have had some doubt whether or how far it could consider the consequences of re-engagement pursuant to a recommendation. The Industrial Court held that it could and should consider the consequences of the recommendation being carried out. As Mr Irvine put it, "practicable" means not merely "possible" but "capable of being carried into effect with success." If the re-engagement of these two men would inevitably lead to serious industrial strife, it would not be practicable or, I should have thought, in accordance with equity that they should be re-engaged. The court said [1974] ICR 25, 31:
"When considering whether a recommendation is 'practicable' the tribunal ought to consider the consequences of re-engagement in the industrial relations scene in which it will take place. If it is obvious, as in the present case, that re-engagement would only promote further serious industrial strife, it will not be 'practicable' to make the recommendation."
And for that reason they concluded that the industrial tribunal were right not to recommend re-engagement. Their view of subsection (4) was reaffirmed by the Industrial Court in Bateman v. British Leyland UK Ltd [1974] ICR 403. There the court said, at p.406:
"... 'practicable,' in the context in which it is used in section 106(4)(b), is not to be equated with 'possible,' which would oblige a tribunal to make a recommendation for re-engagement provided the job was still open. It is the duty of the tribunal to consider the industrial relations realities of the situation and, if the evidence points overwhelmingly to the conclusion that the consequence of any attempt to re-engage the employee will result in serious industrial strife, it will be neither practicable nor in accordance with equity to make such a recommendation. Although we have reconsidered this matter in the light of the arguments presented to us on this appeal, we are satisfied that the correct approach to this question is that set out by the court in Coleman v. Magnet Joinery Ltd [1974] ICR 25" - that is, this case. "
Upon the evidence before them in this case, which we have only shortly rehearsed in this judgment, the tribunal were amply justified in concluding that they should not recommend re-engagement, and the appeal fails." Strictly speaking, it is the re-engagement which would be practicable and in accordance with equity, not the recommendation which leads to it. With that slight alteration in the wording, I would agree entirely with what the Industrial Court said about the meaning of "practicable" and indeed "in accordance with equity" both in the present case and in Bateman's case and with their application of what they said to the evidence in the present case." Although those two cases were decided under different wording it seems to us that they indicate that there are considerations which may or may not strictly fall under the word "practicable" but which are relevant in deciding whether or not to make a S.69 order. We were also referred to the case of SAFEWAY FOOD STORES LTD v. COOKSON an unreported decision of this Court (EAT/129/80) presided over by May J. At pp.6 and 7 of the transcript the learned Judge is clearly taking the view that there was a wide discretion in the decision whether or not to make orders under S.69. Lastly, we were referred to the case of TIMEX CORPORATION v. THOMSON [1981] IRLR 522. In this case an industrial tribunal had ordered re-engagement without deciding whether it was practicable. This was the last of three issues before the industrial tribunal. In a short ex tempore judgment the learned President, Browne-Wilkinson J said this at paragraphs 7, 8 and 9. "7. In ordering re-engagement, the Industrial Tribunal recited the evidence before them that consideration had been given to finding Mr Thomson alternative employment but it had been decided that none would be available because of the general redundancy situation both in Dundee and in England. No consideration was given to whether a particular post might exist for Mr Thomson but the evidence was that none was likely to be available. On this evidence the Industrial Tribunal order re-engagement. 8. It is submitted that in reaching that decision the Industrial Tribunal failed to give effect to the requirements of S.69(6)(b) of the Act which requires that the Tribunal 'shall take into account ... whether it is practicable for the employer to comply with an order for re-engagement'. It was said that the only evidence before the Tribunal indicated that re-engagement was not practicable and the Industrial Tribunal had overlooked the difficulty apparent in re-employing a senior manager in the circumstances of this case. Again, we reject this argument. S.69(6) only requires the Industrial Tribunal to 'have regard' to the matters of practicability. In our judgment there is no need for an Industrial Tribunal to reach a final conclusion that re-engagement is practicable before making any such order. If, having made an order for re-engagement, it proves not to be practicable to perform it there are no adverse consequences for the employer. If the employee asks for compensation by reason of the failure of the employers to re-engage, no order for additional compensation can be made under S.61(2)(b) if the employer satisfies the Tribunal that it was not practicable to comply with the order. Therefore at that stage the Industrial Tribunal will have to decide, looking at the matter in the knowledge of the actual facts which have occurred, whether or not it was practicable to carry out the order. At the stage when the order to re-engage is being made, it is not in our judgment necessary for the Industrial Tribunal, looking at future possible events, to make a definite finding that the order for re-engagement was practicable. They must have regard to the question of practicability and if they are satisfied that it is unlikely to be effective, they will no doubt not make an order. The only strict requirement is that they should have regard to practicability. 9. In this case, as it seems to us, the Industrial Tribunal were not satisfied that it was impracticable to re-engage Mr Thomson. They therefore made the order in the hope that a new position could be found for Mr Thomson. They had regard to the practicability of re-engagement and in our judgment it has not been demonstrated that they have erred in principle. Accordingly the decision must stand." Although the learned Judge in that case refers to the wording of S.69(6)(b) it is apparent from the remainder of the judgment that he interpreted the words 'shall take account of' as 'shall have regard to matters of practicability'. Although we do not agree with that part of Mr Pardoe's first submission which argues that there is no general discretion, there may well be occasions on which an Industrial Tribunal will find that re-engagement is practicable, yet it would decide not to make the order. We do not know how rare this would be, but an Industrial Tribunal on the guidance given in the cases must be satisfied that the new situation which it is ordering will in fact work. To quote from above "... if they are satisfied that it is unlikely to be effective, they will no doubt not make an order." It must be a realistic appraisal and it must bear in mind that the employer would already have been penalised. An employer must be allowed to manage his own business. To restrict the factors capable of being taken into account is likely to create problems for the future rather than to simplify the Industrial Tribunal procedure. Arguments could arise as to whether or not a set of facts fell within the phrase 'practicable'. Appeals could abound. One should also not forget the importance of trust and confidence in the employer/employee relationship and indeed, questions of capability. The importance of considering the issues in the round and the viewpoints of both employer and employee is stressed in some passages from decided cases. (per Sir Hugh Griffiths in COLEMAN (supra) at p.30H) " If, because of a restrictive construction of 'practicable' which precludes the Tribunal from considering the consequences of a re-engagement, they are led in to making recommendations which have no hope of being acted upon, or which, if they were, would only lead to industrial strife, the result would be that their recommendation will fall into disrepute and carry no weight . When considering whether a recommendation is 'practicable' the tribunal ought to consider the consequences of re-engagement in the industrial relations scene in which it will take place." See also BATEMAN (supra) at p.407. Sections 68 and 69 are applicable to all cases where dismissal has been judged unfair and it seems difficult to see why when considering the issue of practicability, different principles should apply depending upon the reason for dismissal. The reason itself may be one of the relevant circumstances but not a dominant one imposing a course of decision-making upon the Industrial Tribunal. It does not impose a policy. We were also referred to a recent decision in this Court COALDRAWN TUBES LTD v MIDDLETON EAT/615/90, 15.12.1991 ) where a division presided over by Tucker J dealt with problems under S.69. In referring to the duty of an Industrial Tribunal this Court said at p.2D "It is clear from the section 69(5) of the Act that the Tribunal has a discretion to exercise, and that in considering whether to make an order for reinstatement they had to take into account whether it was practicable for the appellants to comply with such an order. The Tribunal believed that it was practicable, and they accordingly made the order for reinstatement." At p.7E the Court said - "It is very difficult to see how reinstatement could become a practicable option, because it would result either in a redundancy process or in significant over-manning. It would be contrary to the spirit of the legislation to compel redundancies, and it would be contrary to commonsense and to justice to enforce over-manning." We are, however, impressed by Mr Pardoe's second and third submissions. The tests of practicability are different at Stage 1 and Stage 2. The factual basis will be different. The fact that the second stage enquiry is different from the first is also indicated by the wording of S.71(2)(b) and S.75A(2) which read - "... and the employer satisfies the tribunal that it was not practicable to comply with the order." Those words suggest that the scope of the enquiry is directed towards those matters that have arisen or those considerations that can apply after a S.69 order has been made. Looked at from a practical point of view, the lay members take the view - and I agree with them - that it is preferable in the ordinary run of cases that the simple clear procedures should prevail. The parties will know what is going to happen at stage 1 and stage 2. Thus, an industrial tribunal should decide 'practicability' upon the evidence before it at stage 1, and if more enquiry or evidence is needed, then the fairest course is to adjourn stage 1 and hear further evidence. The industrial members feel difficulty in understanding why the determination of practicability should be delayed to stage 2 and point out that at stage 2 the issue is the impracticability of complying with the stage 1 order. That Stage 1 order was presumably made as being practicable, otherwise the guidance given by Lords Browne-Wilkinson and Griffiths as to realism and foreseeability is being ignored. If, therefore, an industrial tribunal is presumed to have decided that the order would be practicable, why should not the employer know the reasons. "We find that despite lack of vacancies this order is practicable because you can ...". In fairness this should take place. If an employer feels that he has been "ambushed" at stage 2 it can only lead to exacerbation of industrial relations and a feeling of distrust in the Tribunal system. If he knows the reasoning, he can if necessary, meet it at stage 2 with further evidence. It also seems to us impossible to take a factor "into account" unless it has been determined to exist or not. With great respect, the change of wording in TIMEX which is repeated some four times during the latter part of the judgment gives a different meaning to the words of the Act which in its simplest form in subsection 69(6) reads - "If the tribunal decides not to make an order for reinstatement it shall then consider whether to make an order for re-engagement ... and in so doing the tribunal shall take into account ... whether it is practicable for the employer to comply with an order for re-engagement." Those words are, in our submission, different from the understanding of 'have regard to matters of practicability'. The Tribunal must decide whether it is practicable. There is a duty to examine and determine a factor and then bring it into the balancing exercise. It must also be said that the Court in TIMEX is unlikely to have had the benefit of the extensive and helpful submissions made over some days to this Court. It therefore seems to us for the reasons we have given that although there is a wide discretion given to the Tribunal whether or not to make an order under S.69, nevertheless it is required to decide the issue of practicability at Stage 1. If an Industrial Tribunal decide that it is impracticable to make a S.69 order it is unlikely that an order will be made. The converse may not however be true as we have indicated. It may be thought to be practicable but there may be other reasons why a decision to make an order is not taken. In R22/16 to R26/23, this Tribunal uses the phrase "at that stage" referring to Stage 2 and it seems to us that on a reading of the decision the issue of practicability on the facts is being reserved for that stage. This was an error in law. We therefore reject the first of Mr Pardoe's submissions but accept the second and third. The Third Appeal - Practicability ("P") Although the Tribunal did not accept much of the evidence from Mr McNab and Mr Farrow on the liability issues, it found the witnesses for the PLA to be reliable and helpful on the remedies issue and seemingly acceptable on the practicability issue. At R5/4 it said - "In making our additional findings of fact in this part of the case, the Tribunal has found the evidence of the PLA' witnesses reliable and helpful. Some of the witnesses gave views on matters which are ultimately for the Tribunal to decide. However, broadly speaking, we found their evidence reliable in casting light on the present situation at Tilbury and helpful (but not decisive) in indicating their views as to the probable impact of reinstatement/re-engagement of the applicants." They qualified their views about Mr Burton's evidence in connection with finding work for incapacitated workers. In paragraphs P3/5 to P5/11 the Tribunal pour strictures upon the PLA and its staff and witnesses as a whole. However, they then say that they are disregarding their behaviour "however deplorable" and thereafter find facts. At P6/15 in dealing with the period in November and December 1991 the Tribunal finds - "The management had set its face against further severances partly on the grounds of the cost of the severance package and the unsettling effect on the workforce of making further redundancies. It was also because, as Mr Hills said, he was happy with the workforce at its current level. ..." At paragraph 16 - "In October 1991 Tilbury Cargo Handling Ltd was asked to train ten trainees for possible transfer from the Conventional Department to the Container Division. Mr Hills considered at that stage that if that transfer took place he would not replace those ten employees. However, they were not transferred because of the decline of work in the Container Department which we described in our Remedies Decision. However, as we have said, on Mr Hills' evidence we find that the size of the workforce now for the work that it has to do is at an acceptable level." At paragraph 20 - "There is no evidence that Mr Hills' failure to consider offering severance to existing members of the workforce with a view to substituting the Applicants was on the grounds of cost." In directing themselves on the law the Tribunal say - "26 The words of section 75A(2) seem to us to provide for a perfectly comprehensible and common sense approach by a tribunal and to give to it the task of weighing the efforts made by the employer and his explanations as to why he finds himself unable to comply with the tribunal's Order. The employer's burden of proof in the circumstances fits well with the exercise of industrial common sense by the tribunal both where there are and where there are not existing vacancies. The wide concept of what is practicable allows us to take all the circumstances into account." 27 ... "28 We respectfully agree with the Employment Appeal Tribunal that an employer is not required to create work for the applicant to do. That must be right because (among other things) the Tribunal would in effect be requiring the employer to create a redundancy situation. ..." "29 We accept the PLA's submission that the question of practicability is a question of objective fact in the circumstances in each particular case. For the same reason we accept the PLA's submissions that the employer is not as a matter of law under duty to organise a severance exercise, analyse skills, consider doing in-house work done by outside contractors, to recapture contracted-out work or to dismiss existing employees. In proving that it was not practicable to comply with an Order, an employer may or may not adduce evidence that he considered some of those matters. But at the end of the day, the question is not "did he have and fulfil a duty to do those things?, but "has he satisfied the tribunal that it was not practicable to comply with the Orders?" The answer to the second question is entirely dependent on the particular circumstances of the employer's particular commercial concern and is a question of fact in every case." "30 So, we accept the PLA's submissions that the question of whether it is practicable for the employer to comply with a re-engagement Order is one of objective fact and that what was in the employer's mind is irrelevant. We reject the Applicants' submission that the employer as a matter of law has to show that he had given serious consideration to all available options and rejected them on proper grounds. That would put a burden on the employer which is not provided by the legislation. As we have said, the question of practicability will depend on the facts in any particular case. It would be wrong to gloss the statutory wording in the ways suggested." "31 We accept the PLA' submission that the Tribunal should not substitute its commercial judgment as to such things as the optimum size of a workforce for that of the employer. However, this does not mean that a Tribunal must necessarily accept an employer's bare assertions as to non-practicability of compliance with its Orders. The burden of proof is to be discharged by the evidence in the ordinary way and the employer must satisfy the Tribunal on the balance of probabilities." In setting out their reasoning the Tribunal say this at paragraphs 36 and 37 - "36 At the time Mr Farrow asked Mr Hills to consider whether he could re-engage the Applicants, Mr Hills was satisfied with the existing size of the workforce. The only enquiry Mr Hills made was to consider whether he could justify taking on a group of 12 men in addition to the 271 cargo operatives which he had already. Mr Hills knew through the staff consultative council, a body which was properly constituted as a forum for communication between employer and employee, that some members of the workforce might want to apply for severance if it were offered. He did not know who they were or whether they were persons who were usually allocated to particular duties (as described). On Mr Hills' own evidence he did not consider whether a way of complying with any of the re-engagement orders would be to enquire who (if any) of the existing workforce really wished to volunteer for severance with a view to seeing whether any one of the Applicants might be sufficiently well-qualified to fill the resultant vacancy or vacancies. In the absence of evidence, the Tribunal does not accept Mr Pardoe's submission that such an enquiry of the workforce or at least of Mr "B" would have been too onerous or that to offer severance to other employees too expensive. There was no evidence that severance would be too expensive in a case where an Applicant was re-engaged in substitution and the severance payment made to him in 1989 repaid to the PLA (as it would have to be). Nor do we accept that enquiries as to whether anyone wished to volunteer for severance would have been too upsetting for the existing workforce." "37 As we have said, it seem to us probable on the evidence that some of the existing employees do wish to leave on severance. The PLA (through Mr Hills and Mrs Martin) were on notice of that fact and that being so, the PLA's failure to consider whether the Tribunal's Orders (or some of them) could be complied with by substituting any of the Applicants for those men casts serious doubt on the assertion that it was not practicable to comply with any of the Tribunal's Orders. That doubt is not dispelled by Mr Hills' assertion that in effect he was happy with the workforce as it was and did not want to disturb that situation to re-engage the Applicants however unfairly dismissed. Further, in a situation where there was a likelihood that there might be one or more vacancies, Mr Hills' consideration of the Applicants not as individuals but only as a group of 12 which he could in no way accommodate also casts doubt on whether it was really impracticable to comply with any of the Tribunal's Orders. Our doubts about this are not dispelled by Mr Hills' evidence that he would not have replaced the ten men trained to go to POTCH because he also said that he was nevertheless satisfied with the size of the workforce at 271. We reject the PLA's "catch-all" submission in this regard." Mr Pardoe makes a number of criticisms of that reasoning. He submits that the evidence of Mr Burton and of Mr Hills, who was called on the third hearing, shows quite clearly that for good and logical reasons there had been a change in the profile of the workforce, in its make up and in the balance between the various departments and in age. Mr Hills had said that he would not recruit further and that if any voluntary redundancies occurred he would not replace. His veracity is nowhere doubted; if it was ever doubted the reason is nowhere explained and reading the decisions as a whole and a transcript of his evidence it seems to us that there is no good reason put forward for rejecting Mr Hills' evidence. Secondly, there are specific findings to which we have already referred in paragraph 15 that the grounds upon which further severances were not to be acceptable was the cost of the package and the unsettling effect on the workforce. There was no evidence of anyone coming forward to seek severance and the point was made that the Redundancy Payment figure now would be lower than £35,000 as it was originally. The sole basis upon which the whole of this decision hangs is the failure by Mr Hills to seek voluntary severance from the present workforce and the burden of proof. The cost of such a procedure was only raised in final speeches after the close of the evidence as is quite evident from the transcripts that have been placed before us. It is suggested that the Tribunal had in mind that the £35,000 would have to be repaid and that is referred to in paragraph 36. If that had been anticipated then it could have been made part of the term of the re-engagement order. It was clearly not envisaged at that time and is merely dealt with as an afterthought during submissions. It is just the sort of point which should have been raised at Stage 1. However, it seems to us that to look at the situation and hang the whole case on the burden of proof and the failure to seek voluntary severance is really quite unreal in the light of the other evidence. What for instance would have happened if only three men had come forward seeking voluntary severance? What would have happened if ultimately on the date of re-engagement the applicant or applicants had been unable to produce £35,000 each? If there had been a decision later not to allow voluntary severance because the particular post involved was not one which the employers were prepared to allow to go, that would have created further disruption or unhappiness. Moreover, if the severance had not taken place because of some hitch then that would have been further anguish for those involved. In such a situation the families of the workforce should be considered and the unsettling effect upon them. Although the Industrial Tribunal in a bracketed comment at p39 expresses the view that in the event of re-engagement the £35,000 redundancy payment was repayable, it refers to no legal authority for this. Mr Bowers has argued this point before us; we are not satisfied that it is repayable under any statutory provision. Ultimately Mr Bowers felt bound to argue that the sum was recoverable under the equitable principle of "unjust enrichment". This would entail the necessity of proceedings in the County Court after the date of re-engagement and could do nothing but exacerbate the position between applicants and the PLA. There would also be the added costs of litigation. The Tribunal did not conduct an enquiry into the details of the costs and costing and the detailed effect upon any order for re-engagement of that element. It seems almost to have been an afterthought dealt with as a problem during submissions and which could stand in the way of a decision on the issue before it. The natural consequence of this reasoning of the Industrial Tribunal is that if an employer does not invite applications for severance he must thereby be held to have failed to satisfy the Tribunal that it was not practicable to comply with an order for re-engagement. No one came forward, there was no evidence that anyone would wish to have severance and indeed, the decision might almost be criticised as being speculation. This whole question could, and in our judgement, should have been aired and examined at Stage 1. In many aspects of jurisdictions given under the 1978 Act it is made clear that an Industrial Tribunal is not to substitute its own view for that of management providing that the particular management in the particular circumstances is reasoning, deciding and acting within a reasonable bracket. To do so is an error of law. The issue of "practicability" is no exception. The duty upon an employer is to be able to explain in a reasonable and logical way why there are no vacancies in his workforce or a particular part of his workforce. An employer in making his explanation is entitled to say what in his commercial judgment is in the best interests of his business when viewed against its existence, survival and success in a competitive commercial market. That success is to be seen not only against the interests of its owners whether or not shareholders, but against the interests of the maintenance of employment and the wellbeing and contentment of its workforce. This commercial decision or judgment will of course need to be tested and no doubt an Industrial Tribunal will keep such investigation within bounds. It seems to us that it would impose an enormous and unnecessary burden if a wide investigation including discovery were to be allowed into the internal workings, costings and calculations of any and every business. It might also raise a number of very difficult problems on confidentiality. The whole approach must be balanced between the interests of both sides of the equation. Provided that the decision or judgment of the employer is within the reasonable brackets to which we have referred it should be respected. We feel bound to hold that this decision by the Tribunal was a substitution of the employers' decision and judgment by its own. Precisely what the Tribunal is doing is second guessing the situation. The second way Mr Pardoe criticises this third decision is that the Tribunal were bound by the case of FREEMANS v. FLYNN [1984] ICR 874 and COALDRAWN TUBES LTD v. MIDDLETON (EAT/615/90)(17.12.91) and that the distinction sought to be made by the Tribunal was an invalid distinction. It was therefore a part of Mr Pardoe's submission and an important part, that the mere lack of vacancies in the workforce at Tilbury of itself obviated any order being made under S.69 because it would establish that compliance was impracticable. If this was intended to indicate that an employer merely has to attend and state his view that there are no vacancies, then this "bare assertion" is in our view of itself wholly insufficient. It would open the door to specious defences. We have understood the phrase 'bare assertion' to mean a statement without fact or reason to support it. We agree with Mr Bowers on that matter. The issue of "vacancies" is clearly most relevant to practicability. Mr Pardoe relied for his proposition on two cases in particular. COLEMAN v. MAGNET JOINERY [1974] ICR 25 at 30G and BATEMAN v. BRITISH LEYLAND [1974] ICR 405 at 407A . It seems to us however that those cases tend to establish that the mere existence of vacancies does not preclude a finding that the order will be impracticable. They do not establish that the absence of vacancies necessarily precludes a finding that the order will be practicable. There is also different wording in S.106(4) of the 1971 Act that failure to comply with a recommendation attracted a financial penalty. The guidance on the issue of "vacancies" was given by a division of this Court in FREEMANS PLC v. FLYNN [1984] ICR 874 where in his judgment the President, Mr Justice Waite said this at p.879H, " What the Tribunal said was that the effect of a re-engagement order was to make it the duty of the employers to search for and find a place in their ranks for the employee, irrespective of vacancies that came up. It is not, they said, just a question of the employers considering vacancies which arise from time to time within the organisation but, as they put it, on fulfilling a duty to fit the employee in somewhere. Merely considering official vacancies which arose in the ordinary course of events, they said, was simply not good enough. We think this states the duty of an employer against whom a re-engagement order is made far too highly. If that duty is carried to such extremes there will be no logical answer to the argument that it becomes the employer's duty to dismiss other employees in order to create the necessary space for he or she who is to be re-engaged." This Industrial Tribunal sought to distinguish this case but it seems to us that the principle is perfectly clear and that, once the commercial judgment is accepted, then it is far too high a duty upon an employer to expect him to make room for those ordered to be re-engaged. Likewise, we hold the view that it is imposing far too high a duty upon an employer to make such an order which in effect will require him to disrupt his workforce. We use that word advisedly because if he is ordered to seek to find vacancies by voluntary severance then he will be bound to place notices in the workplace which would have been contrary to his policy; it would have necessitated a fresh consideration of relevant and fair criteria; it would have required a number of interviews and a number of assessments as to whether or not the particular job was to be maintained or not; it would have involved uncertainty amongst others lest it was thought that perhaps compulsory redundancies might be required in order to accommodate the 12 Applicants; it would have created speculation as to how the Applicants might behave on their restoration, and not only the employees themselves but their families would have been placed in a state of uncertainty. We have read the evidence of Mr Burton and of Mr Hills. It seems to us that unless they were disbelieved, and there is no indication that they were, then their judgment is overwhelmingly logical and well within the reasonable bracket to which we have referred. We allowed Mr Hendy to make a further submission after Mr Bowers had addressed us on the second and third appeals. He made the point that there was no evidence of the reasons for any decision of the Board of the PLA itself. That may be so but it was clear that the Board would have acted on the advice of senior management and Mr Burton and Mr Hills were clearly those who were responsible for reaching the decision and informing those above them of the basis upon which the argument of practicability would be based. It is also clear, as Mr Hendy pointed out, that the PLA through Mr McNab and Mr Farrow had made it clear that the Applicants were not going to be reinstated. However, provided there were logical and reasonable grounds to support that decision then, despite that prejudice, it seems to us that that was a position which the PLA were entitled to maintain. We therefore also find - As to the Remedies Decision - Second appeal (a)that the Industrial Tribunal erred in law in that it misunderstood the nature of its task under S.69 in failing to determine whether at that stage it was practicable for the PLA to comply with orders of re-engagement and to take that into account in exercising its discretion, and to give its reasons for deciding that it was practicable (b)as a result of that initial error it failed to take into account a number of factors relevant to practicability at that stage It follows therefore that that decision must be set aside and the matter remitted for a rehearing. As to the Practicability Decision - Third appeal Lest we be found ourselves to be in error in our decision on second appeal, we find that the Industrial Tribunal erred in law in that - (a) it substituted its own commercial judgment for that of the employer. (b) it failed adequately to take into account the question of finance in its criticism of PLA's failure to seek voluntary severances. This decision must also be set aside and the matter remitted for a rehearing. Not every aspect of the Second and Third Decisions has been the subject of appeal, but lest there should be any misunderstanding it is our decision that every issue should be re-examined. Nothing is to be deemed to have been prejudged. Provided that the fresh Tribunal has read the "Liability Decision" of the first Tribunal, together with our judgment and the transcripts of evidence, it seems to us that the whole matter is capable of being dealt with in some 12 to 15 days' hearing and with a case of this complexity and depth of feeling, we do not regard such an order by us to be excessive in order to seek to achieve a result between these parties. The Fourth Appeal (Compensation) The Applicants are entitled to compensation for having been unfairly dismissed. Section 72 reads - "[Where a tribunal makes an award of compensation for unfair dismissal under section 68(2) or 71(2)(a) the award shall consist of - (a) a basic award (calculated in accordance with section 73), and (b) a compensatory award (calculated in accordance with section 74), and (c) where the dismissal is to be regarded as unfair by virtue of section 58 or 59(a), a special award (calculated in accordance with section 75A); but paragraph (c) shall not apply unless the complainant requested the tribunal to make an order under section 69, and shall not in any event apply in a case within section 73(2).]" The award is a single award made up of component parts. For the purposes of calculating the basic award (S.73) and the special award (S.75A) the multiplicand is "a week's pay" and the multiplier is as specified in those sections. The relevant parts of S.75A are "(1) Subject to the following provisions of this section, the amount of the special award shall be - (a) one week's pay multiplied by 104, or (b) [£12,550], whichever is the greater, but shall not exceed [£25,040]. (2) If the award of compensation is made under section 71(2)(a) then, unless the employer satisfies the tribunal that it was not practicable to comply with the preceding order under section 69, the amount of the special award shall be increased to - (a) one week's pay multiplied by 156, or (b) [£18,795], whichever is the greater, but subject to the following provisions of this section. (3) - (7) ..." For those Applicants in respect of whom no S.69 order was made, the compensation award is routed via S.68 to S.72 to S.75A(1). For the remainder, who obtained S.69 orders, which were not complied with and in which the PLA failed to establish that it was impracticable to comply, the claim is routed via S.68, S.69, S.71(2)(a), S.72 to S.75A(2). Although special awards fall under the general heading of compensation, they are additional to the compensatory awards and are clearly intended to deter employers from dismissing on the grounds of appropriate trade union membership or activities. The importance attached to this aspect of industrial relation is emphasised by exclusion of the necessary qualifying period under S.64(1) and (3). Whilst there is a fixed limit to the amount under S.75A(1), there is none under S.75A(2). These subsections also envisage that the figure under (a) may exceed that under (b). The purpose of these provisions is to deter. Section 152 reads "Schedule 14 shall have effect for the purposes of this Act for calculating the normal working hours and the amount of a week's pay of any employee". Schedule 14 is headed "Calculation of normal working hours and a week's pay" . Part II is headed "A week's pay" . Paragraphs 3 to 6 do not need to be cited in detail. Suffice it to say that in order to carry out the calculation it is necessary to establish "a calculation date" and also that the employment has continued "for 12 weeks or more". Paragraph 7(1) starts - "For the purposes of this Part, the calculation date is:- ..." Thereafter in sub-paragraphs (a) to (l) that date is established for calculations under various sections of the Act. There is no reference to section 75A. Paragraph 8 establishes limits to the amount of a week's pay for an additional award (S.71(2)(b)); a basic award (within the meaning of S.72), and a redundancy payment. Where an applicant has not been employed for a period of 12 weeks, which could apply to those cases where no qualifying period is required for jurisdiction, paragraph 9 is applicable for the establishment of "a week's pay". That paragraph reads - "In any case in which an employee has not been employed for a sufficient period to enable a calculation to be made under any of the foregoing provisions of this Part, the amount of a week's pay shall be an amount which fairly represents a week's pay; and in determining that amount the tribunal shall apply as nearly as may be such of the foregoing provisions of this Part as it considers appropriate, and may have regard to such of the following considerations as it thinks fit, that is to say - (a) - (d) ..." It will be observed that no "calculation date" is required. Finally, Paragraph 12 of the Schedule reads - "The Secretary of State may by regulations provide that in prescribed cases the amount of a week's pay shall be calculated in such manner as the regulations may prescribe." By S.5(3) of the Employment Act 1982 the 1978 Act was amended to insert S.75A. Schedule 14, paragraph 7 was amended by paragraph 30 of Schedule 3 of the 1982 Act in order to make provision for a minor amendment to S.55 of the 1978 Act by paragraph 1 of that Schedule 3. However, paragraph 7 was not amended to make express reference to a calculation date for S.75A. For some years Industrial Tribunals have been including special awards in their compensation award under S.72 without experiencing any problems. However a new point is now taken. If correct, it may make a considerable difference to the amount of the award in this case. The argument is simplicity itself. Section 72 requires a special award to be "calculated in accordance with S.75A". That section refers to "a week's pay" as the multiplicand. Section 152 requires a week's pay to be calculated in accordance with Schedule 14, which in its relevant paragraphs (3 - 6) requires the identification of the "calculation date". Paragraph 7 of the Schedule defines that date for all the sections in the 1978 Act where the calculation of a week's pay is relevant - except for S.75A. Therefore no calculation can take place under S.75A(1)(a) or (2)(a) which must make a nil return and the only figure which can be brought into account is that in S.75A(1)(b) or (2)(b). This Industrial Tribunal gave its Reasons on this matter in the following passages - "12 Whatever the explanation for there being no provision in Schedule 14 for the purposes of section 71(2)(a) or section 75A awards, we have to apply section 71(2)(a(, 72 and 75A. Certainly we are not entitled to ignore the very clear words of section 75A(1) and (2) that the amount of the Special Award shall be one week's pay multiplied by 104 or £12,550 or 156 or £18,795 "whichever is the greater" in each case but with a limit for subsection (1) cases. 13 It is a fallacy to suggest that if there is no provision for a calculation date, a Tribunal cannot calculate a "week's pay". We reject Mr Pardoe's submission that the failure to provide for a calculation date in paragraph 7 of Schedule 14 together with the Minister's failure to make regulations under paragraph 12 of Schedule 14 means that we can ignore "whatever is the greater" in section 75A and must award £12,550 or £18,795. It would not be right for such a reason to ignore the clear legislative provisions and fail to carry out our duty as directed by section 71(2)(a). It seems to us that in default of a statutory method of calculating a week's pay, the matter is at large and we have to do the best we can in the circumstances applying our knowledge of industry and common sense to give effect to the statutory provisions for remedy in the case of trade union dismissals. ... 14 It seems to us that the ordinary meaning of a "week's pay" is the amount to which an employee is entitled to receive under his contract of employment: that is, the gross amount before deduction of tax and national insurance contributions. Where, as here, that amount varied because the employee was entitled to bonus under his contract, then in arriving at an amount for the purposes of calculating the Special Award it will be right to take an average over a fairly long period: we think that period should be 12 weeks before the effective date of termination, not counting strike, sick and holiday weeks. Payment for overtime worked should not be included because a man is entitled not to work just as an employer is entitled not to provide work in overtime. Payments made by the employer to a pension fund on the Applicants' behalf should not be counted as part of the week's pay. ..." Mr Pardoe criticises this reasoning in two ways. First, he argues that S.152 is being ignored and secondly, he submits that the whole jurisdiction is based upon statute and the statute must be strictly construed. The draughtsman of the 1982 Act knew of the terms in paragraph 12 of Schedule 14 of the 1978 Act and had it been intended that a calculation was to be made under S.75A, regulations could have been made amending paragraph 7. It was not, he submits, a case of oversight, it was a deliberate omission. In passing we note that such amendments to paragraph 7 as have been made, were made by statute and it is clearly arguable that the wording of paragraph 12 is not sufficient to allow for such an amendment. However, for the present argument we will assume that there is power to amend paragraph 7 by regulation. The purpose of S.75A is clear. It is to make provision for an award in special circumstances which award is to be of a substantial stated sum, which itself can be varied by order of the Secretary of State (S.75A(7)) or an even larger sum where the multiplicand coupled with the statutory multiplier so indicates. If Mr Pardoe's submission is correct, that purpose is rendered sterile. If Parliament had so intended there was no need to include (a) in each subsection and the whole wording of the section could have been greatly simplified. We cannot think that this was a deliberate omission. If it is necessary for S.75A to be mentioned specifically in paragraph 7 of Schedule 14 then its omission was an oversight. Does the omission necessarily preclude the finding of a week's pay as the multiplicand in S.75A? We would first point out that paragraph 7 deals with situations where the calculating date could be open to doubt. In the present case there can be no such doubt as the Applicants were summarily dismissed on a particular date. That was the effective date of termination. It is clearly arguable that in that situation there is no need to look for a calculation date under the provisions of paragraph 7 (h) or (i), indeed the wording of those sub-paragraphs may not cover the present situation. When considering a S.72 award it is necessary for an Industrial Tribunal to decide the figure of a "week's pay". For this it applies Schedule 14. Let us suppose that this calculation has been carried out and that the figure reached is £X. If that sum exceeds the statutory limit (Schedule 14, paragraph 8) then the latter applies for the purposes of a basic award calculation. Thereafter in order to assess that basic award the multiplier and other provisions of S.73 are used. The resulting figure may be reduced or obliterated by the provisions of S.73(9). That has in fact happened in the present case. Secondly, the Industrial Tribunal will proceed to assess the compensatory element of award. Finally, the Tribunal will turn to S.75A. The multiplicand - £X - has already been decided. Is it to be ignored? We cannot think so. Is an Industrial Tribunal to be precluded from carrying out the function envisaged by the section? Although the whole of S.75A has been brought into operation, are parts of it to remain unworkable? Turning to S.152, we would paraphrase the sense of the section thus - " If you need to calculate a week's pay for any purpose in this Act, Schedule 14 provides the method" . Sections 72 to 76 are to be read together. In calculating the award under S.72 the Industrial Tribunal by the time S.75A is being considered have already decided that a week's pay is £X. There is no need to refer again to Schedule 14. We cannot think that there was any intention to vary the multiplicand for the purposes within sections 72 to 76. We therefore reject Mr Pardoe's submissions and this appeal is dismissed.