Sheffield Co-Operative Society Ltd v Emmingham [1993] UKEAT 693_92_1005

EAT
Sheffield Co-Operative Society Ltd v Emmingham
[1993] UKEAT 693_92_1005 · 1993-05-10

JUDGE HAGUE QC:

This is an appeal by employers, Sheffield Co-operative Society Ltd ("the Society") against a decision of an Industrial Tribunal sitting at Sheffield and entered in the register on 18 August 1992, that their employee Mrs Emmingham had been unfairly dismissed.Mrs Emmingham was employed by the Society as a till operator from May 1977 until 26 September 1991 when she was summarily dismissed. The grounds for the dismissal were that she had been guilty of theft by taking a banknote our of the till on the morning of Saturday 21 September 1991 and that she had operated the till in contravention of the Society's written procedures. Mrs Emmingham denied the theft, and contended that her operation of the till, although in contravention of the Society's procedures, followed an established practice known to her store manager. The dismissal followed a disciplinary hearing held by Mr Selby, the Society's Food Trades Officer. It was confirmed after an internal appeal before Miss Maxine Lee, a Senior Manager of the Society, held on 15 October 1991.The facts of the case are set out lucidly and in detail in the Tribunal's written decision. For the purposes of the appeal, we summarise them as follows. On Saturday 21 September 1991 Mrs Emmingham worked as usual for the Society's store at Birley Spa Lane, Sheffield, along with a second till operator, Mrs Barker. According to a detailed statement which she made the same day, the store manager Mr Wragg saw Mrs Emmingham, at a time when Mrs Barker was absent from her till and there were no customers at the tills, open her till with the "amount tendered" button (which should be used only when serving a customer), remove a banknote from the till and apparently secrete it in her clothing. He did not immediately confront her, because some customers came to the tills and he had duties at his office. However, a little later, he did confront Mrs Emmingham, but told her that a customer (and not he himself) had seen the incident. Mrs Emmingham strongly denied the incident, and offered to be body-searched, but Mr Wragg declined that offer. Mrs Emmingham explained that she had had to make some money right after an "over-ring" of her till on a customer's purchase earlier on. Her till was cashed up, but there was only a 4p discrepancy which was of no significance. Mrs Emmingham shortly afterwards also offered to show Mr Wragg the contents of her purse, but he considered that that would be pointless as he did not know what had been in her purse when she started work.Mrs Emmingham before the Tribunal substantially agreed with the history of the matter as set out in Mr Wragg's statement, save that she consistently denied having taken any money from the till. As to the till procedure, the Tribunal in paragraph 4 of their decision said this:
"She did admit then [i.e. when she was confronted by Mr Wragg], and she has admitted in evidence to us that she did not operate the till in accordance with the respondents' written procedures. She admitted to Mr Wragg that what she did on that day, and indeed on previous days, was to ring in to the till an amount less than the amount actually tendered on that occasion by a customer although placing the whole amount into the till. She claimed that she did that so that the till would balance, there having been previous transactions where, for one reason or another, she had rung an amount into the till in excess of the amount of money that was actually put into the till. Obviously that is a way of getting the till to balance, but it has this serious disadvantage for proper accounting procedures, that it is false in that there is a discrepancy between the amount actually put into the till, in connection with a transaction, and the amount recorded as having been put into the till in connection with that transaction. The applicant says that there was nothing dishonest about it, it was simply done so that the till would properly balance and there was no question of any personal gain. The applicant acknowledges that that is not in accordance with the respondents' written procedure. Her case before the tribunal has been that she has used that method with the knowledge of her store manager, Mr Wragg, in order to rectify small mistakes or discrepancies."
It was suggested by Miss Woodward, Counsel for the Society, that the tenor of these observations showed that the Tribunal were themselves considering the question of Mrs Emmingham's guilt or innocence, and so substituting their own decision for that of the Society, rather than considering the reasonableness of the Society's conduct. We cannot accept that suggestion. We agree with Mr Brown, Counsel for Mrs Emmingham, that the Tribunal in that paragraph were doing no more than setting the scene and stating the issues which arose between the parties.Mr Wragg reported the matter to the Society's management, and other persons, including the Security Officer Mr Sewell arrived on the scene about an hour after the incident itself. Mrs Emmingham was searched, with her consent, but nothing was found on her. In support of her explanation of her operation of the till, Mrs Emmingham gave full details of another transaction where she had recorded an amount of £2.20 having been received, but where she had actually put £1.97 more than that into the till, to balance the amount rung into the till earlier for a packet of cigarettes which a customer had first said he wanted but then changed his mind and did not buy. No amount of £1.97 that tied in with that explanation could be found on the till roll. The police were called, with Mrs Emmingham's consent, and she went to the police station where she was questioned. The police considered the question of a prosecution but later abandoned it.Subsequently Mr Sewell took a statement from a customer, Mrs Boyes, who confirmed that Mrs Emmingham had told her that she was not going to ring in £1.97 because of an overcharge of another customer earlier in relation to cigarettes. Mrs Boyes in her statement also said that similar things had happened twice before with Mrs Emmingham, and another customer Mrs Baines made a statement about another occasion a week before when a similar thing had happened.Mr Sewell also interviewed another of the store assistants, Mrs Cupit, who gave evidence to the Tribunal. In paragraph 7 of their decision, the Tribunal made this finding:
"Mrs Cupit told Mr Sewell that she herself had under-rung on occasions in the same way as described by the applicant. Mr Sewell told Mrs Cupit that if she was admitting that kind of procedure then she might face the sack herself, and he tore up the witness statement that he had started to take from her and never put it forward as part of the material of his investigation."
Mrs Cupit subsequently made a statement in which she said that under-ringing took place with the knowledge of Mr Wragg. She gave oral evidence to the Tribunal to the same effect, and said that Mr Wragg did not follow all the Society's till procedures.Mr Sewell did not apparently interview Mrs Barker, the other lady who had been on the tills with Mrs Emmingham on the morning in question. She subsequently made a statement in which she said that, at Mrs Emmingham's suggestion, she had on the same day under-rung with a customer she knew in order to correct an earlier mistake and balance the till, although Mr Wragg had no knowledge of that.The material which Mr Sewell had gathered, including the statements of Mr Wragg and the customers Mrs Boyes and Mrs Baines, was put before Mr Selby. Mr Wragg was not present at the disciplinary hearing conducted by Mr Selby, but after Mrs Emmingham had repeated her allegations that under-ringing had taken place with his knowledge and consent, Mr Selby telephoned him. Mr Wragg denied that he had ever allowed that to be done. Mr Selby knew of the proper till procedures for dealing with mistakes. He believed Mr Wragg and disbelieved Mrs Emmingham on that issue.Mr Selby also accepted, on the balance of probabilities, that Mr Wragg's statement was true and accurate. He therefore believed Mrs Emmingham had stolen the banknote as well as having under-rung over a period of time. He summarily dismissed her, and sent her a letter giving the following reasons:
"On your own admission you have been falsifying the Society's checkout procedures by under-ringing customers' purchases. In addition, the manager of your shop, Mr L Wragg, saw you take a bank note from the till and secrete it on your person. Subsequently on your denial the police were brought in and I understand they are considering prosecuting you for this offence."
Mrs Emmingham appealed under the Society's grievance procedure, and by the time the appeal came before Miss Lee on 15 October 1991, the police had decided not to prosecute. This led to some discussion which gave rise to confusion as to whether or not the Society was pursuing the theft allegation or whether it was relying solely on the breaches of till procedures. Miss Lee, who well appreciated the difference between a police prosecution, involving proof beyond reasonable doubt, on the one hand and sufficient proof to justify dismissal on the other, clearly considered that the theft allegation remained part of the Society's reasons for dismissal. But the Tribunal found that that was not made clear to Mrs Emmingham or her Union representative, Mr Johnson, because words had been said which might reasonably be interpreted as indicating that the Society was no longer relying on the theft allegations. Miss Woodward argued that this was not the case, but in our view there was ample evidence to support that finding of fact by the Tribunal, which cannot therefore be challenged.Mr Johnson complained to Miss Lee that there were no statements from the other store assistants Mrs Cupit and Mrs Barker. Miss Lee, accepting that these might be helpful, adjourned the hearing until 17 October. Mr Sewell took the statements from the two ladies (on the face of them on 17 October itself), and we have referred above to these. However, Miss Lee accepted in her evidence, and the Tribunal found, that she did not have the opportunity to read the statements herself before she made her decision. She thought she had had a telephone call about them with Mr Sewell, in which Mr Sewell told her that there was nothing new in them. If Mr Sewell did tell her that, it was a misrepresentation.On those facts, the Tribunal first held, in clear terms, that Mr Selby had genuinely believed that Mrs Emmingham had stolen a bank note and had under-rung to cover her tracks. The Tribunal also found that this was the reason for the dismissal.The Tribunal then, in paragraph 19 of their decision, directed themselves to consider whether the Society had acted reasonably in treating that reason as sufficient to justify the dismissal. They stressed that it was no part of their function to consider whether Mrs Emmingham had stolen money or not. They said that they had to:
"......... ask ourselves whether, applying the criteria set out in Section 57(3) of the Employment Protection (Consolidation) Act 1978, the employers were justified in dismissing for that reason. A feature of dismissals for misconduct is that generally they will not be fair dismissals unless there has been a reasonable investigation of the facts and the belief in dishonesty is based on reasonable grounds."
That was clearly a correct summary of the Tribunal's function, and in accordance with British Home Stores -v- Burchell [1980] ICR 303 and other authorities. Miss Woodward's main argument was that the Tribunal did not in fact follow their own correct direction, but substituted their own decision for that of the Society and thereby failed to apply section 57(3) correctly. We consider that argument below.The Tribunal concluded that the dismissal was unfair, for the reasons given in paragraphs 20, 21 and 22 of their decision. In paragraph 20 the Tribunal after holding that Mr Selby was entitled to conclude that Mr Wragg was making an honest allegation of theft, said this:
"That is not the end of the question, because we have had to ask ourselves, although he was entitled to assume Mr Wragg was honest, was he entitled to assume that Mr Wragg was accurate? We do not think he was. He knew that Mr Wragg had not confronted the applicant at the time he said he had seen her take a bank note. By not doing that Mr Wragg had denied the applicant of the best opportunity she would have had to prove her innocence. If he had gone straight over to the till and called a halt to the transaction that was being conducted there, and immediately confronted the applicant, she could have demonstrated that she had not taken any money. His failure in that regard was compounded by his deliberately misleading the applicant as to who it was who had made the complaint to him. He had declined her offer of a search, for understandable reasons although we observe there was a female assistant there who could have helped perhaps, but more importantly he had declined her offer to search her handbag taking the view that it would be useless because she had had the opportunity to put the bank note in it and he did not know how many notes had been in it to start with but if he had looked in her bag, he might have found that there were no bank notes there at all. He had not searched the premises."
Pausing there, the Tribunal was there expressing the view that Mr Wragg ought to have taken further steps and made further investigations.Paragraph 21 reads:
"More importantly, perhaps, Mr Selby was influenced by the evidence presented to him about till irregularities which gave him the picture that the only person who went about under-ringing was the applicant and that she did that behind the back of Mr Wragg. Mr Selby was deprived of the opportunity of considering evidence that could have been obtained from Mrs Barker and evidence that was obtained, but then suppressed, from Mrs Cupit which would have shown, in the case of Mrs Barker, that the applicant's practice of under-ringing had been done on previous occasions for an innocent purpose and, in the case of Mrs Cupit, that under-ringing had on occasions taken place with Mr Wragg's knowledge. So, unwittingly, Mr Selby placed greater reliance on the evidence of till irregularities than might have been justified if the full picture had been properly presented to him. So we conclude that Mr Selby's reliance on the accuracy of Mr Wragg was not based on a reasonable investigation."
The phrase "would have shown" in the second sentence of that paragraph was seized on by Miss Woodward as showing that the Tribunal was accepting the evidence of Mrs Cupit and Mrs Barker in preference to that of Mr Wragg and so substituting its own decision for that of Mr Selby. But we do not think this is so. The context, and particularly the third sentence of the paragraph, indicates that the phrase was used in the sense of "would have been to the effect".Paragraph 22 reads:
"The unfairness that that produced was compounded on appeal because that applicant and Mr Johnson were misled by Mr Sewell as to what was properly under consideration. They were given the impression that the whole basis of the dismissal was the till irregularities and not the alleged theft. That unfairness was further compounded when the appeal, having been adjourned for further evidence to be taken, was reconvened and the appeal dismissed before Miss Lee had had a full and proper opportunity to consider the further evidence that had been obtained. Miss Lee was led to conclude that the applicant had not been allowed by Mr Wragg to follow the practice of under-ringing without considering the important evidence from Mrs Cupit."
In our view, in these paragraphs the Tribunal were mainly considering the investigations made on behalf of the Society, and concluded that in the circumstances they were insufficient. The Tribunal thought that as a result the full picture, particularly as regards the till irregularities, was not before Mr Selby or the disciplinary hearing and not properly before Miss Lee and considered by her at the appeal hearing. They expressed the view that, on either occasion, the result might (not would) have been different. Applying the section 57(3) criteria, the Tribunal therefore concluded that the insufficiency of the investigations rendered the dismissal unfair.In our judgment that finding as to the investigations was a finding of fact, supported by evidence before the Tribunal, and so this Appeal Tribunal cannot interfere with it.Miss Woodward submitted that the Tribunal had in effected substituted their own assessment of the credibility and their own findings of fact for those of the Society. She said that, the Tribunal had been influenced by their rejection (in paragraph 17 of their decision) of Mr Wragg's evidence on one point and their preference for the evidence of Mrs Cupit on that point; she suggested that the Tribunal should not have heard Mrs Cupit's evidence as to under-ringing, and should not have made any findings on her evidence. The Tribunal had thus, she said, been unduly influenced by Mrs Cupit's evidence and had disbelieved Mr Wragg, and so had wrongly concluded that if Mrs Cupit's evidence had been available to Mr Selby or properly before Miss Lee, each of them would have disbelieved Mr Wragg.We reject those submissions. We consider that the Tribunal, having (as Miss Woodward rightly accepted) properly directed themselves, did no more than assess the reasonableness of the Society's conduct. On any fair reading of the Tribunal's decision, we find it impossible to infer that the Tribunal thought that Mr Wragg's evidence should have been rejected. As for Mrs Cupit's evidence, we think it was essential for the Tribunal to hear this and make a finding on it, not for the purpose of exonerating Mrs Emmingham, but for the purpose of determining whether it was of sufficient importance to render it unreasonable of the Society not to have taken it properly into account.For these reasons we dismiss the appeal.