Haines v Zee [1993] UKEAT 174_93_0710

EAT
Haines v Zee
[1993] UKEAT 174_93_0710 · 1993-10-07
MR JUSTICE KNOX: There were two Applicants in this case before the Industrial Tribunal, Mr and Mrs Haines, but there is only an appeal by one, Mr Haines, from the decision of the Industrial Tribunal which sat at Shrewsbury on the 9th and 10th December 1992 and decided unanimously that Mr and Mrs Haines were not unfairly dismissed, that there was no unreasonable refusal to give reasons for their dismissals but that their claim under the Wages Act succeeded and that they were entitled to the sum of £4,051 in respect of wages unlawfully deducted in 1990 and 1991.The appeal of Mr Haines is on two of those matters, namely, whether he was unfairly dismissed and secondly, whether there was an unreasonable refusal to give reasons for his dismissal.Mr and Mrs Haines entered into an agreement on the 30th September 1988 to work for the Respondent in the Industrial Tribunal and before us, a Mr Barry Zee, as caretakers of Mr Zee's premises called Leighton Hall in what is now Powys, but used to be Montgomery. Their duties, the Industrial Tribunal found, involved keeping the premises clean and tidy and seeing to the repair and maintenance of the building, at the employer's expense, and the maintenance of the garden and some 15 acres of grounds. The quid pro quo was remuneration which started at £100 a week but was later increased to £667 per month and the provision of accommodation free of rent, rates and taxes, which they were required to occupy in a part of Leighton Hall which was known as the Tower House. Their employment went from the 1st October 1988 and was terminated by a letter dated 30th December 1991. That is important on two scores, one on the unfair dismissal aspect of the matter and secondly, on the question of unreasonable refusal to give reasons for dismissal. The Industrial Tribunal set out the dismissal letter in full. For our purposes it will suffice to read parts of two paragraphs in it. It was of course written on behalf of Mr Zee and addressed to Mr Haines. The first paragraph which needs reading is the first paragraph in the letter which reads as follows:"For some time now we have asked you to compile a completed list of work undertaken by you to justify your employment with us. Your reply to this request indicates you have not achieved any of the expected caretaker/gardener job commitments necessary to justify your continued employment".and then there was included, with that letter, a work schedule which was to cover what needed to be done. The other passage that needs quotation is as follows:
"Given the time span you have been employed at Leighton Hall it will be reasonable to expect you to achieve the main part of our agreement which forms part of your contract of employment. However, on recent visits by my General Manager, Sue Greenough (sic) was very surprised to find that in return for your full employment no satisfactory maintenance standards have been met by you either to the property or the gardens, truthfully speaking the whole of the property is in an untidy state generally."
Then the letter effectively concludes with a dismissal by saying:
"There is therefore no alternative but to inform you that we must terminate your employment and must ask you to find alternative accommodation within one month of this notice dated above."
and that, it is common ground, was treated as a dismissal on one month's notice.The Industrial Tribunal at its hearing heard witnesses on both sides. On Mr Haines' side Mr and Mrs Haines gave evidence. On Mr Zee's side Mr Zee and the lady whose name I mentioned earlier, Miss Susan Greenough, also gave evidence. But that is all the help, effectively, that the Industrial Tribunal had. It tackled its task by setting out the dismissal letter and then setting out in some detail what the witnesses on either side said and they analysed their evidence over several pages. The conclusion that they reached having set out the evidence that had been given to them was contained in two paragraphs, 4 and 5. Paragraph 4 deals with the unfair dismissal claim and 5 deals with the claim that there was an unreasonable refusal to give reasons for the dismissal. It is necessary to read those in full. They read as follows:4. Doing the best with the evidence which we have heard we find first, that Mr Haines and Mrs Haines were not unfairly dismissed because:(a) He made a threat to sell his employer's property - ie the dining room table and chairs;(b) He failed to render proper reports to his employer as requested by Miss Greenough;(c) He was given a warning in September or October that if he used the house for outside functions with Miss Greenough's permission, he must tell her in advance and obtain permission;(d) He reported his employer to the local authority, without telling him that he was going to do so, which, in our view, (though an entirely legal action) was a disloyal act, striking at the trust which must exist between employee and employer;"Then paragraph (e) I need not read because it deals with Mrs Haines in respect of whom there is no appeal before us. Paragraph 5 reads as follows:
"5. So far as Mr Haines' claim that he was unreasonably refused reasons for his dismissal, we find that he was given the reasons for his dismissal on 31 December 1991 in his dismissal letter."
That of course is a letter from which I have read earlier extracts. In the light of that last paragraph it seems to us plain beyond argument that the Industrial Tribunal found that the reasons for Mr Haines' dismissal were what was stated in that letter of 31st December 1991 and it will be recalled that they were concerned with the standard of maintenance of the house and grounds. They of course are not the same reasons as the reasons which are contained in paragraphs (a), (b), (c) and (d) of paragraph 4 of the Industrial Tribunal's decision and which I need not read again, although paragraph (b) no doubt, the failure to render proper reports, is getting somewhere near the reason that was given in the dismissal letter.The IT3, Notice of Appearance by Respondent, served on behalf of Mr Zee, contained a list of nine failures by Mr and Mrs Haines to perform their duties in a satisfactory manner despite the receipt of several warnings. They were concerned in part with a failure to maintain the cleanliness and appearance of the house and in part with failures to maintain and preserve the appearance of the grounds and such matters as hedges and fences. There is, therefore, some quite considerable connection between those itemised complaints and the rather generalised complaint that was contained in the dismissal letter.It was urged upon us, and we are satisfied that it was correctly urged upon us by Mr Zee, reading a statement that emanated, we imagine, from a legal adviser of his, in support of the decision of the Industrial Tribunal, that there was evidence upon which the Industrial Tribunal could make the several findings that they did make in paragraphs (a), (b), (c) and (d) of paragraph 4 of the decision. That is not the issue on this appeal. It is perfectly true that there was evidence given of all the matters in that paragraph and it is possible that the Industrial Tribunal may well have been correct, if and in so far as they said that those several reasons would have exposed Mr and Mrs Haines to dismissal. But that is not the way the relevant legislation works. The Employment Protection (Consolidation) Act 1978 in Sections 55 to 57 deals with unfair dismissal and what has to be established by the employee or an employee who has been dismissed and who complains that that process was unfair. The legislation operates on the basis that the first requirement is for the employer to establish the reason for the dismissal. In Section 57(1) that is stated in the following terms:
"In determining for the purposes of this Part whether the dismissal of an employee was fair or unfair, it shall be for the employer to show - (a) what was the reason (or, if there was more than one, the principal reason) for the dismissal, and (b) that it was a reason falling within subsection (2) or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which that employee held."
So the first process is for the employer to establish "the reason" for the dismissal. That, as we read the decision of the Industrial Tribunal in total, can only be the reasons given in the dismissal letter. No other conclusion seems to us to be possible, in the light of paragraph 5, which it will be recalled says:
"we find that he [Mr Haines] was given the reasons for his dismissal on 31 December 1991 in his dismissal letter."
and that seems to us quite conclusive on that aspect of the matter.The second stage in the process is that the reason has to fall within subsection (2) and that we take to be satisfied because one of the reasons within subsection (2) is a reason which related to the conduct of the employee and it seems to us that it is pretty clear, although the Industrial Tribunal does not say so in terms, that the complaints in the dismissal letter related to Mr Haines' conduct as an employee.But then one comes to the third and critical stage which is enshrined in subsection (3) of Section 57, which although very familiar, I read again because it is central to this case. It reads as follows:
"Where the employer has fulfilled the requirements of subsection (1), then, subject to sections 58 to 62, the determination of the question whether the dismissal was fair or unfair, having regard to the reason shown by the employer, shall depend on whether in the circumstances (including the size and administrative resources of the employer's undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee; and that question shall be determined in accordance with equity and the substantial merits of the case."
" It ", in that rather long and complicated sentence, is of course, the reason shown by the employer for the dismissal and it follows that the question that an Industrial Tribunal has to tackle is whether the reason shown by the employer was reasonably or unreasonably treated as a sufficient reason for dismissing the employee. It equally follows from that, that if an employer, because of circumstances which may or not all have been known to him, could have had two reasons for dismissing an employee but the actual real reason was only one of those two, the second reason, which was not a real reason for the dismissal, falls entirely out of view at this stage of deciding whether the dismissal was fair or unfair. It may of course come back into view at a later stage in the proceedings if there is a finding of unfair dismissal because it may very well have an effect upon the quantum of compensatory award that the dismissed employee may be entitled to receive. But so far as the fairness or unfairness of the dismissal is concerned all that the Industrial Tribunal is entitled to look at is this question whether the reason shown by the employer was a sufficient reason for dismissal.It follows from that, as we see it, that all that the Industrial Tribunal had to do in this case, having decided that the reasons shown by Mr Zee for dismissing Mr Haines were the reasons stated in the letter of 31st December 1991, was to consider whether those reasons were reasonably treated as sufficient reasons for dismissing Mr Haines. It therefore follows from that that at least two of the reasons which are stated by the Industrial Tribunal as reasons why Mr and Mrs Haines were not unfairly dismissed fall out of view. I refer in particular to paragraph "(a) He made a threat to sell his employer's property", which certainly does not figure in the dismissal letter and paragraph "(d) He reported his employer to the local authority, without telling him he was going to do so". That referred to removal of property from the premises by, or on behalf of, Mr Zee which constituted, or was alleged to constitute, a breach of the legislation regarding historic buildings. Whether that was right or wrong is neither here nor there but the fact of the matter is that there is no possibility of bringing those two paragraphs (a) and (d), of paragraph 4 of the Industrial Tribunal's decision, within what the employer established to the Industrial Tribunal's satisfaction as being the reason for the dismissal. That inevitably means, as we see it, that the Industrial Tribunal has looked at the wrong question in dealing with the unfair dismissal claim.It was submitted to us by Mr Thomas, in an able address on behalf of Mr Haines, that the Industrial Tribunal had effectively been looking at the wrong question and we agree with that analysis because if one is asking one's self, as this Industrial Tribunal seems to have done, were there reasons for Mr and Mrs Haines not being unfairly dismissed one is opening the door to an investigation of every reason that there might be for dismissing Mr and Mrs Haines and one is not doing what the Act requires one to do which is to see whether in the light of the actual reasons that moved the employer, it was fair or unfair, to dismiss for those reasons, or that reason, if there was only one. Accordingly, it seems to us that this decision cannot stand on that basis, and since this is a case where there is material going either way so that it is quite impossible for this Tribunal to say that it was either plainly, and unarguably, fair or unfair, to dismiss, the matter will have to be remitted to a differently constituted tribunal.There is a second branch to the appeal which is the question of unreasonable refusal to give reasons for the dismissal by the employer. That hinges on Section 53(1) of the 1978 Act which reads:
"An employee shall be entitled - (a) if he is given by his employer notice of termination of his contract of employment;"
and I need not read (b) and (c):
"to be provided by his employer, on request, within fourteen days of that request, with a written statement giving particulars of the reasons for his dismissal."
and subsection (4) provides a sanction:
"A complaint may be presented to an industrial tribunal by an employee against his employer on the ground that the employer unreasonably refused to provide a written statement under subsection (1) or that the particulars of reasons given in purported compliance with that subsection are inadequate or untrue, and if the tribunal finds the complaint well-founded - (a) it may make a declaration as to what it finds the employer's reasons were for dismissing the employee; and (b) it shall make an award that the employer pay to the employee a sum equal to the amount of two weeks' pay."
One of the many uncertainties that still survive in this case is what was, actually, Mr Zee's reason for dismissing Mr Haines. Although we have that finding in paragraph 4 of the Industrial Tribunal's decision, if, as we find, the decision cannot stand, it is the whole decision that must, in our judgment, be remitted for the Industrial Tribunal to reconsider in the light of this judgment and on that basis it would be illogical and might lead to an entirely contradictory conclusion for the analysis of "the reason" for Mr Haines being dismissed to stand as found by the original decision.It therefore seems to us inevitable that the whole of the matter must be remitted to the industrial tribunal for reconsideration and that will involve an identification of what really was "the reason" for Mr Haines' dismissal and a consideration of the question under Section 57(3) of whether it was reasonable or unreasonable to treat that reason, when so found, as a sufficient reason for dismissing Mr Haines. That makes it unnecessary for us to investigate the interesting question of whether total silence, in the context of an earlier letter that actually gives the reasons for dismissal when dismissing, is capable of constituting an unreasonable refusal to provide a written statement and we find it unnecessary to embark on an investigation of that interesting question.For those reasons this appeal is allowed, and the matter is, sadly, remitted to a differently constituted industrial tribunal to reconsider all matters other than the decision under the Wages Act . So far as that is concerned there was no cross-appeal by Mr Zee and we see no basis upon which we should interfere with the decision on that score. But, so far as the unfair dismissal and the unreasonable refusal to give reasons for it are concerned, we fear that the parties must go back and start again.