Glanford Borough Council v Kneeshaw [1994] UKEAT 332_93_1210

EAT
Glanford Borough Council v Kneeshaw
[1994] UKEAT 332_93_1210 · 1994-10-12
MR JUSTICE PILL: Mr Cottam, on behalf of the Glanford Borough Council seeks to amend the Council's notice of appeal to allege perversity. He seeks to allege that on the evidence presented the findings of fact of the Tribunal on the question of unfair dismissal were perverse. That is not a case which, in our view, emerges from the existing notice of appeal or even from the skeleton argument which Mr Cottam has helpfully prepared, where it is stated at paragraph 41:
"We do however accept that in determining an appeal the Appeal Tribunal will accept as fact the finding of the tribunal."
Mrs Gill, on behalf of the Respondent to this appeal, Mrs Kneeshaw, opposes the application made at this very late stage in the course of the hearing. She submits, rightly in our view, that the case has not been prepared on Mrs Kneeshaw's behalf on the basis that this challenge would be made. It would be inevitable that if the amendment were granted there would need to be an adjournment. The Chairman's notes would be required and those advising Mrs Kneeshaw would need to be able to consider the case sought to be put in order to be able to meet it.Mr Cottam has made plain that he pursues his application for leave to amend only if the case could proceed today taking the view, and of course it is a perfectly understandable one, that the delay and possible costs involved in an adjournment, would not be in the interests of the Borough Council. We are not prepared to grant leave to amend on the basis that the case should proceed today and accordingly we refuse the application for leave. We will, of course, consider the points which Mr Cottam has made on the question of unfair dismissal and the point that is emphasized is that the Tribunal misapplied the decision in Polkey vAE Dayton Services and Duffy v Yeoman in reaching the conclusion they did.

Judgment

We consider an appeal and a cross-appeal in relation to decisions of the Industrial Tribunal held at Hull in 1993. Following hearings on 11, 12 and 22 January 1993 the unanimous decision of the Tribunal was that the Applicant, Mrs E. Kneeshaw had been unfairly dismissed by the Respondent, the Glanford Borough Council. The Tribunal also held that the application relating to equal pay using a fellow employee, Mr Appleyard, as the comparator, was well-founded and an equality clause should be inserted into Mrs Kneeshaw's contract to reflect that, and that should be back-dated. The relevant date was stated at the so-called remedies hearing as being 1 April 1988.Two other claims, that there had been an unlawful deduction of wages and that the Applicant had been discriminated against by reason of sex were dismissed by the Tribunal.Following the remedies hearing on 9 March the Tribunal found that it was not practicable for the Borough Council to reinstate or re-engage the Applicant. The Tribunal noted that the Applicant was not entitled to a basic award, having been paid a redundancy payment. The Tribunal further held that the Applicant was not entitled to any compensatory award on the basis that she had suffered no loss for the reasons which were then given.The Council appealed against the finding of unfair dismissal and the equal pay finding. Mrs Kneeshaw appeals against the subsequent finding that she had suffered no loss by reason of her unfair dismissal. Mrs Kneeshaw worked for the Council on the Barton Clay Pits Project, working from the Information Centre at the Old Boathouse at Barton-on-Humber. She worked there, according to the findings of the Tribunal, from November 1987, initially undertaking clerical duties but broadening her duties and, indeed, she was designated as the Countryside Promotions Officer in recognition of the work she actually did.Mr Appleyard, to whom reference has already been made, was employed for several summers on temporary contracts.The funding of the Project came under threat and from February 1992 it was feared that the Project would have to close with the loss of all jobs. The Tribunal found that there clearly was a potential redundancy situation under the Employment Protection (Consolidation) Act 1978 and that finding is not challenged by the Council.The Countryside Commission were a major source of the funding, though a number of Councils did contribute to the funding of the Centre. Subsequent events are set out in the Tribunal's decision and the documents submitted to the Tribunal on behalf of the Applicant and of the Council. There is no doubt that in May 1992 Mrs Kneeshaw was offered continued work but for a reduced number of hours. She declined to accept the fresh terms offered to her and her employment was terminated on the ground of redundancy. Mr Appleyard remained in the employment of the Council on the Project for some time afterwards.In relation to the claim for unfair dismissal, the Tribunal held that the employers acted unreasonably in treating the reason for redundancy, which they accepted was the reason for dismissal, as a sufficient reason for dismissal (paragraph 10). At paragraph 11 they stated:
"We have to say that having applied the law as it stands in Polkey vAE Dayton Services the tribunal then has to go on to consider the likelihood of compensation being successful, and while leaving the matter of remedy open it does seem to us that as Mr Appleyard was in fact taken on again, although his contract had in fact expired and his was of a temporary nature, that had proper consultation taken place it may well have been that Mrs Kneeshaw would have continued in full employment. It may be that Mr Appleyard would not have continued to be in full employment."
The Tribunal held that there had been insufficient consultation on the question of redundancy with employees, including Mrs Kneeshaw. Their findings are set out at paragraph 9. We do not propose to set out the paragraph in full. At subparagraph b. the Tribunal stated that:
"What happened in this case was that the employers failed to properly identify the facts as likely to give rise to a redundancy situation in law because they wished to avoid redundancies, and numerous discussions were carried out with joint funding bodies but none with the employees with a view that there might be redundancies. So it was at a meeting between the management and Mrs Kneeshaw with Mr Kneeshaw present - he happens to be an ACAS official - which was to persuade her to take a cut in hours, that the question of redundancy was first raised by Mr Kneeshaw who was well aware of the law."
The Tribunal went on to state that the members of management at that meeting were somewhat taken aback because they had not considered the situation properly within the legal context. Following that meeting, Mrs Kneeshaw's contract, with that of others, was extended until the end of May 1992. When she was dismissed for redundancy, the Tribunal noted that again, as they put, there was no consultation and no warning.Before considering the submissions which have been made to us, we indicate our recognition of the difficult position in which the Council found themselves. This was a project funded by outside bodies and with a small staff employed by them. We have no doubt that they acted in good faith and in an effort to keep the project, which was no doubt a worthwhile one, going, and that they did make efforts to continue the employment of those involved. They had to recognize that the difficulties with funding meant that changes were required.However, we have to remind ourselves of the position of this Tribunal. The Industrial Tribunal is the body which finds facts and is of course dependant upon the information placed before it in reaching its decision on the facts. If they make an error on law, then it is open to this Tribunal to correct that error. We hope that we do act at all times with commonsense but when appeals are made to our commonsense by Mr Cottam, we do have to remind ourselves of our function and not treat ourselves as if we could take any amount of evidence and act as if we were the Tribunal hearing the evidence and making the relevant findings of fact.The Council are represented before us, as they were before the Tribunal, by Mr G G Cottam of the Yorks and Humberside Employers' Association and Mrs Kneeshaw is represented by Ms Tess Gill of Counsel.Mr Cottam supplied to this Tribunal a detailed skeleton argument, though it was unfortunate that that was not supplied to his opponent. Ms Gill had an opportunity this morning, when she became aware of the document, to consider it before the hearing proceeded. We mention that 9-page document because statements and assertions of fact are made as if, we say with respect, the matter was being pursued before an industrial tribunal with evidence to be called and it was necessary to draw Mr Cottam's attention to that. He readily accepted the point and is, of course, well aware of the fact that it is the Industrial Tribunal which is the fact-finding body.He did, nevertheless, appear to persist in submissions which were in effect challenges to the findings of fact which the Industrial Tribunal made. The case was not put in that way in the notice of appeal or, indeed, formally in the skeleton argument, where there is an acceptance, at one point, of the role of the Industrial Tribunal as the fact-finding body and recognition at paragraph 41 that:
"the Appeal Tribunal will accept as fact the finding of the [industrial] tribunal."
Mr Cottam did then seek to amend his notice of appeal to include an allegation that the Industrial Tribunal had been perverse in their findings of fact. He, however, sought to pursue that application only on the basis that the hearing would not be adjourned and his first priority was that the hearing should continue today. We have given a ruling upon that. It would not have been fair either to Mrs Kneeshaw or to the Industrial Tribunal to proceed in that way when we do not have the Chairman's notes and Ms Gill would naturally wish to see how the case for perversity was put and to have an opportunity to consider it and reply to it and such procedure could not have been followed in the course of today. It was inevitable that an adjournment was necessary if he persisted in his application and Mr Cottam did not pursue it on that basis.Having said that, most of Mr Cottam's arguments, as set out in the skeleton, are upon points of law and are covered by the two specific grounds of appeal, which in his amended notice of appeal he has set out. The grounds of appeal on the question of unfair dismissal are as follows:
"i. the tribunal reached an unreasonable decision based upon the facts and circumstances.
ii. that the tribunal gave undue weight in its deliberations to the Council Directive 75/129, which does not apply in this particular case.iii. that the tribunal has misdirected itself in its application of Polkey in that it has submitted its own view in place of the unchallenged criteria upon which posts were filled by the employer."Mr Cottam has submitted that the final conclusion of the Tribunal was an unreasonable one on the facts and circumstances as found. He submits that the decision on that question is wrong on the face of it. He has made detailed submissions upon grounds 2 and 3. He submits that the eventual conclusion was unreasonable by reason of the Tribunal's finding that the contracts of all the employees were of a fixed nature.The submission on Polkey was put in this way. Paragraph 24 of the skeleton argument:
"The tribunal state they have applied the principles of Polkey, but which principles? They have detailed a series of events but they have not dealt with the circumstances known to the employer and why these have been rejected. They have concentrated purely on the question of consultation and warnings."
It is right to say that the reason given by the Tribunal, as will have appeared, is of a failure to have adequate consultation. In answering the submissions of Mr Cottam, Ms Gill relies upon the statement of Lord Bridge in Polkey vAE Dayton Services [1988] ICR 142 at page 162H to 163A:
"in the case of redundancy, the employer will normally not act reasonably unless he warns and consults any employees affected or their representative, adopts a fair basis on which to select for redundancy and takes such steps as may be reasonable to avoid or minimise redundancy by redeployment within his own organisation."
Ms Gill says that the Tribunal have plainly found, as a fact, that there was no sufficient consultation and relies upon Lord Bridge's statement that the employer will normally not act reasonably unless he warns and consults any employees affected or their representative.Mr Cottam relies upon the judgment of Lord Mackay:
"In considering whether the employer acted reasonably or unreasonably in treating the reason for dismissal as a sufficient reason for dismissing the employee, there is no scope for the tribunal to consider whether, if the employer had acted differently he might have dismissed the employee. It is what the employer did that is to be judged, not what he might have done.
In judging whether what the employer did was reasonable, it is right to consider what a reasonable employer would have had in mind at the time he decided to dismiss as the consequence of not consulting or not warning as provided for in the Code of Practice. If the employer could reasonably have concluded, in the light of the circumstances known to him at the time of dismissal, that consultation or warning would be utterly useless, he might well act reasonably even if he did not observe the provisions of the Code. Whether in any particular case it did so is a matter for the Industrial Tribunal to consider in the light of the circumstances known to the employer at the time he dismissed the employee."Mr Cottam submits that in the circumstances of this case the difficulties of funding, which were not of the employer's making, consultational warning would have been utterly useless. Mr Cottam further relies upon the decision of the Court of Appeal in Duffy v Yeomans & Partners Ltd and the principle there established that the employer to take advantage of the principle enunciated by Lord Mackay does not need to have taken a deliberate decision not to consult.We have considered those submissions. We cannot be in doubt that the Tribunal did find as a fact that the employer's consideration was unreasonable for want of consultation. Further, they found and this was a finding they were entitled to make, that had proper consultation taken place it may well have been that Mrs Kneeshaw would have continued in full employment. That being their finding it is not, in our judgment, open to the employers to make a successful challenge on the basis of Polkey . It must also be added that in document IT3, which the Council submitted to the Industrial Tribunal on 5 August 1992, they stated:
"The applicant was dismissed on the grounds of redundancy. Full and detailed consultation took place with the applicant throughout the whole period commencing as early as February 1992. She has also been represented in the consultation process, when she was accompanied by her husband as a meeting held on the 16th March 1992."
The Tribunal did not set out in any detail the series of meetings which it is said occurred. They did find that:
"numerous discussions were carried out with joint funding bodies but none with the employees with a view that there might be redundancies."
There was, therefore, a clear issue of fact before the Tribunal as to whether there had been consultations. That finding having been made against the employers, it is very difficult for them, in our view, now to argue that consultation would have made no difference. Their case, as presented at any rate, in writing to the Tribunal, was that there had been full and detailed consultation.We can find no merit either in the third of Mr Cottam's grounds in relation to the Council Directive 75/129.

(a) :

"certainly it would be the usual practice for consultations to take place and it is interesting to note what Council Directive 75/129, which deals with collective redundancies and therefore is not entirely applicable in this case, says about consultation procedures and purpose. It says that consultations shall be done with a view to reaching an agreement and that these consultations shall at least cover ways and means of avoiding (in this case in the directive) collective redundancies, or reducing the numbers of workers affected and in mitigating the consequences. So that is a helpful highlight as to what consultations are and their purpose and it shows that they take place when a potential redundancy situation is identified or ought to be identified in order to, principally, avoid that situation ever taking effect."
It is not a fatal flaw in this decision that the Council Directive was referred to. It is prefaced by the remark "it is interesting to note" and in our judgment the narrative then set out is not inconsistent with the approach which Lord Bridge has indicated as the proper approach. The Tribunal, of course, did not need to refer to that Directive but we cannot begin to say that their having referred to it in the terms they did makes their decision appealable.As to equal pay, Mr Cottam submits that the Tribunal have paid insufficient regard to the wording of the section 1(4) of the Equal Pay Act. He submits that they have had regard only to the expression broadly similar and not to the subsection as a whole. The Tribunal dealt with that issue as follows:
"5. (b) At the information centre she [Mrs Kneeshaw] . .. worked some weekends, although in her job as promotions officer she did occasional outside events during the weekend, but to cover the weekends a Mr Kim Appleyard was employed on temporary contracts during the summer season and he was employed at grades higher than the applicant and was subsequently graded grade 3 where she remained on grade 1. (c) The applicant has produced and given evidence that the tasks that she undertook were broadly similar to those undertaken by Mr Kim Appleyard and her exhibit A3 sets out those activities in detail. Mr Appleyard has given evidence and clearly resented the suggestion that their tasks were broadly similar. He highlighted the fact that he worked at weekends and that he had ultimate responsibility for cash and stock. On the other hand Mrs Kneeshaw undertook clerical and typing duties, which were her ultimate responsibility, which were things that Mr Appleyard did not do. Of course, although Mrs Kneeshaw did not work regularly at weekends and her contract was permanent as opposed to the seasonal nature of Mr Appleyard's contract, he did in fact have days off during the week to compensate for his working at weekends. Mr Dawson's evidence (Mr Dawson was the project officer and their immediate superior) was quite definite that their duties were largely interchangeable and broadly similar and he was clearly of the opinion that any differences between them were not of any particular importance and the tribunal accept his evidence in that respect.
6. It is therefore clear to the tribunal that under section 14 of the Equal Pay Act, the applicant's work was broadly similar to that of Mr Kneeshaw [that clearly must be Mr Appleyard] ; that such differences that occurred in practice were of no practical importance in relation to terms and conditions of employment, and that in consequence Mrs Kneeshaw should have been graded and paid on the same basis as Mr Appleyard."Section 1(4) of the 1970 Act provides that:
"A woman is to be regarded as employed on like work with men if, but only if, her work and theirs is of the same or a broadly similar nature, and the differences (if any) between the things she does and the things they do are not of practical importance in relation to terms and conditions of employment; and accordingly in comparing her work with theirs regard shall be had to the frequency or otherwise with which any such differences occur in practice as well as to the nature and extent of the differences."
Mr Cottam submits that insufficient attention has been given to the element of frequency and, in particular, he draws attention to the NJC scheme of conditions of service, which show that where an employee is required to work on days other than Monday to Friday the employee is entitled to receive an additional payment to reflect this.We propose to deal with this point briefly. We repeat that the Industrial Tribunal are the fact-finding tribunal. They have made a relevant finding of fact under section 1(4). That does not provide, in the way that Mr Cottam has submitted, for three quite separate questions to be answered by the Tribunal. The reference to frequency - though, of course, to be kept in mind and applied - begins with the expression in the subsection:"and accordingly in comparing her work" .The decision which the Tribunal eventually has to make under the subsection is whether the woman's work is;

"of the same or a broadly similar nature"

as the man's work.The Tribunal referred not only to the expression "broadly similar" but to the following words in relation to the practical importance of any differences. We find that they have applied the correct test and, in our judgment, no successful challenge to the test which they have applied has been made. We have no reason to doubt that they had in mind all the evidence before them and the full wording of the subsection when they reached the decision they did. Mr Cottam submits that the result is an absurd one in that other employees can, on the basis of this finding, claim to be upgraded to grade 3, which was the grade upon which they placed Mr Appleyard. We, of course, make no comment upon whether in fact that is likely to happen but they did invite this situation by putting Mr Appleyard on grade 3. We were told by Mr Cottam that that was done because of his weekend responsibilities. It was a better way, in the employer's view, of providing for additional payments to which he would be entitled for weekend working.If that is done by the short cut, as it might appear, of upgrading rather than doing more complicated mathematics, then the employers to a degree have brought this situation upon themselves. It is noteworthy that in IT3, when dealing with the question of the status of the two posts, the Council said this:
"It is accepted that one of the posts was originally graded the same as the applicants. However since then the duties and responsibilities of this post have increased and the grade amended to reflect this."
That, of course, is inconsistent with the argument now put forward that the upgrading was done only to deal with the question of weekend working.In our judgment on both the contentious issues and on the findings of fact which they made, the Tribunal were entitled to reach the conclusions which they did. The appeal against their finding that there had been an unfair dismissal and their finding in relation to equal pay, must be dismissed.We turn to Mrs Kneeshaw's cross-appeal. That turns, in our view, on a short point. Ms Gill has put it succinctly: she submits that the Tribunal have made a wrong assumption in reaching their conclusion, an assumption which is clearly wrong upon the face of the documents. We have indicated the findings which the Tribunal made on the question of unfair dismissal. I add that we do not, on our findings, consider it necessary to consider the further submission made by Ms Gill, that the dismissal was defective, not only procedurally but as a matter of substance. The Tribunal, in their decision promulgated on 6 April, following the hearing on 9 March, restated their earlier conclusion in these terms:
" [The Tribunal's] criticism of the respondent was principally that they failed to identify a redundancy situation and failed to consult with a view to avoiding a redundancy situation or mitigating is consequences. An offer was made to Mrs Kneeshaw of part-time work which she rejected and clearly at that stage it was more beneficial to take a redundancy payment and, being over 50, to take her pension, which is an index-linked pension, than to continue in part-time employment."
The Tribunal went on to state at paragraph 7 what they considered the real point of consultation to be, namely, whether or not she should be considered along with Mr Appleyard for the post that Mr Appleyard occupied and he was her comparator in the equal pay claim in which she was successful.It has to be noted that the Tribunal's findings of fact on the question of what meetings occurred in the early part of 1992 are briefly stated and if it would have been better if further dates had been given, though this does not weaken the view we have formed on the issues which are in the event before us.What is clear, is that the meeting referred to - and this is common ground - at paragraph 9(b) of the Tribunal's decision upon unfair dismissal took place no later than March 1992 and they did find, as a fact, that it was from February 1992 there was a fear that the project would have to close with a loss of all jobs. It was then the Tribunal held that consultations should have commenced.However, when dealing with the question of compensation, they cannot have had that date in mind. They based their conclusion upon what must have been a consideration at a later date. Paragraph 8:
"It is likely, therefore, that had consultation taken place Mr Appleyard would, as it were, have been kept in post by the employers and had that been situation that consultation had taken place and Mr Appleyard had got the job rather than Mrs Kneeshaw, that would have been a decision which fell within a broad band of reasonable responses which the Tribunal could not upset, had Mrs Kneeshaw then, under that situation, come to claim unfair dismissal."
It is common ground that Mr Appleyard was not offered the job which the Tribunal had in mind until well after February 1992. On several occasions the Tribunal approached the question as if Mr Appleyard were already in post when, upon their earlier findings, the consultation should have commenced. In paragraph 7 they refer to"the post that Mr Appleyard occupied".Later in paragraph 7:
"for the post that Mr Appleyard already occupied which post was to end on 13 September 1992"
Again, in the same paragraph:"As it was Mr Appleyard was already in the post" .The Tribunal then go on to say that the employer's policy was to keep people in post when possible. In paragraph 8, which we have already set out:"Mr Appleyard would ... have been kept in post" .Paragraph 9:
"It seems to us that, bearing in mind the potency of the fact that Mr Appleyard was the post holder"
and the Tribunal went on to state the conclusion that:
"the most likely result of that consultation would have been that Mrs Kneeshaw would still have not been employed at the time that she was indeed dismissed."
We find that approach, persistently stated, entirely at odds with the earlier finding that consultation should have commenced in February. The Tribunal appear to have approached the damages question on the basis that Mr Appleyard was in post in February and that was a clear error of fact on their part.Mr Cottam does rightly draw attention to the fact that also in paragraph 7 the Tribunal noted that the employers had said that Mr Appleyard:
"had some natural history skills which Mrs Kneeshaw did not have and they saw that as important in the post that he occupied."
That may have been one factor in their consideration but the repeated references to Mr Appleyard already being in post demonstrates beyond a doubt that their erroneous belief was a substantial element in their consideration.Mr Cottam also draws attention to the fact that there was no funding available in February. There are no findings by the Tribunal as to when funding became available. If the matter is remitted to the Tribunal, that is one of the points open to the employers to make. Funding reasons and other reasons may also be put forward and, no doubt, reasons will be put forward on behalf of Mrs Kneeshaw, as well, as to what would have been the position had consultations been commenced in February 1992.In our judgment, the cross-appeal succeeds to the extent that the matter must be referred back to the Industrial Tribunal. It will be remitted for further consideration as to whether an award should be made and, if so, what is the appropriate level of that award. We deliberately do not comment upon other points which have been raised, such as the question as to what test should be applied, whether a balance of probability test or, as Ms Gill submits, by reference to Mallett v McMonagle [1970] Appeal Cases , the test of assessing the value of a chance. To that extent the cross-appeal succeeds.In our judgment the case should be remitted to the same Tribunal. This has obvious advantages in terms of the Chairman and Members being familiar with the matter. The mistake which they made, as we found it to be, is not one which in any way reflects on their fairness or capacity and we see no reason why the question of remedy should go to a differently constituted Tribunal.