Kammack 1988 Ltd v Ellison [1994] UKEAT 844_93_1205

EAT
Kammack 1988 Ltd v Ellison
[1994] UKEAT 844_93_1205 · 1994-05-12
MR JUSTICE MORISON : This being an ex temporare judgment I reserve to myself the right to add to, alter, vary or otherwise generally try and improve the language with which I seek to express this our decision.An Industrial Tribunal held at Liverpool after a 2 day hearing unanimously concluded that Mr Ellison's complaint of unfair dismissal made against his former employers, Kammac 1988 Limited, succeeded. In this judgment we shall refer to the parties respectively as the employee and the employers.The decision of the Industrial Tribunal was entered in the register on 8 September 1993 on which date it was also sent to the parties. In paragraph 14 of that decision the Industrial Tribunal indicated that there would be a further hearing on 8 October for the purpose of assessing compensation and accordingly they adjourned the employee's application to that date. On 8 October the matter came back before the same Tribunal. The employers, who had been represented by a representative of a firm called Peninsular Business Services on the two previous days were unrepresented on the resumed hearing, although at a very late stage, I believe, during the course of that day, a different representative of the same firm turned up. Although the Tribunal say he indicated he was in a watching capacity only, we have been told by Mr Diamond and accept, that the true position is that he turned up in effect whilst the Tribunal was giving its decision.At that hearing, having received evidence and submissions as to the employee's losses, the Industrial Tribunal awarded him the total sum of £6,800. The way this sum is calculated is clearly set out in their written decision which was sent to the parties and entered in the Register on 1 November 1993. The employers appeal against both decisions. The basic facts relating to this matter may be shortly stated.In 1988 the employee commenced his employment with the employers as a heavy goods vehicle driver. He was classed as a distance driver. On Thursday 27 August 1992, before the bank holiday weekend, he was told that he would be taking a lorry bound for Southampton. He was not told whether there would be a backload (that is a load for the return journey). He explained that he thought that he would be over the driving hours limit if he was to return in the vehicle and he said that if he did not have a backload he would simply dump or leave the vehicle in Southampton.He repeated what he was saying, whereupon the transport manager told him to take his personal belongings out of his cab and that in the circumstances another driver would do the job. The employee left the site on that day and returned on the bank holiday Monday. The gateman said that he had to speak to the managing director, presumably before he could not allow the employee to come in, and did so, and as a result of what the gatekeeper said to him the employee considered, or was under the impression, that his employment either had been or was being terminated.The employee consulted with his union and on 7 September 1992, wrote to the managing director and asked for written reasons for his dismissal. A letter was sent by the transport manager 2 days later addressed to the union; that letter set out the employers' case and concluded with this paragraph:
"I would also like to point out that with all employees of the company there is a procedure where they can appeal to the Managing Director if they feel that the decision [we would emphasise that word] made by their immediate superior is wrong or unfair."
On receipt of that letter the union immediately accepted the offer of an appeal hearing.Nothing happened and the employee wrote again on 12 October 1992 reiterating the request for an appeal hearing and a request for formal written reasons for the dismissal. There was no response and no dates were put forward for an appeal hearing and on 5 November the employee's IT.1, that is his Originating Application, was presented to the Industrial Tribunal.The complaint in that document was clearly stated to be "unfair dismissal" and "written reasons for dismissal".Some time after that date, in the week commencing 9 November, there was a telephone conversation between the transport manager of the employers and the union representative named in the IT.1. The union representative asked in a letter of 20 November 1992 if dates could be provided for such an appeal hearing and by letter dated 23 November the union was offered dates on 24,25,26,27 November, none of which he, the union representative, could manage. By this time the employee had obtained, according to him, other work and apart from the difficulty of getting time off, he took the view that there had been unreasonable delay by the employers in arranging the hearing, a view with which the union representative agreed.The employers completed an IT3, Notice of Appearance, which the Industrial Tribunal received on 10 December 1992. This document named Peninsular Business Services as their representative. At paragraph 3, in response to the question "Was the applicant dismissed?", the employers had answered "YES". The grounds on which the claim was being resisted were set out in a full page document, the second paragraph of which reads:
"They contend that the Applicant was dismissed on the grounds of Gross Misconduct."
Further on they say that the employee was:
"requested to remove all his personal belongings from the wagon and to leave the site."
Both the IT.1 and IT.3 are consistent with the employment having terminated on that date, namely Thursday 27 August (see paragraph 8 of the IT.1 and paragraph 6 of the IT.3). The IT.3 continued thus:
"The Applicant had the right to Appeal against the decision [and we emphasise the word decision] and did in fact exercise his right in his letter of 7th September 1992 referring to his representative at the United Road Transport Union."
On the morning of the first day of the hearing the representative from Peninsular Business Services, Mr Diamond, asked the Industrial Tribunal for leave to amend the IT.3 to allege that the employee had terminated his own employment and that his claim for unfair dismissal could not on that ground succeed. The Industrial Tribunal dealt with that matter at paragraph 6 of their decision when they said this:
"After some discussion Mr Diamond did make a formal application to amend the Notice of Appearance to reflect the respondent's present attitude to which Mr Monks objected on the ground that it altered the whole basis of the case which the applicant had understood he would have to meet. The Tribunal came to the unanimous conclusion however that such a request for a fundamental amendment of the Notice of Appearance should not be granted at this late stage principally because the respondent had been advised throughout by a professional firm and if there was an error in the Notice of Appearance entered by such firm, there had been ample time to make an application to amend before the hearing. Mr Diamond then put forward a submission that whatever was in either the Originating Application or the Notice of Appearance the Tribunal's task is to ascertain the true facts from the evidence they hear and find on that. The Tribunal accepted that general principle but not to the extent of overriding the principle that on the grounds of natural justice each party is entitled to know in advance the case it has to meet. The object of the Originating Application and the Notice of Appearance is so that both parties to a complaint of unfair dismissal may be fully aware of the case they have to meet. If the respondent had made an error in the first place in admitting the dismissal then there must have been ample time between December 1992 when the Notice of Appearance was entered and 24 May 1993 when the application was heard to explain the position and request and amendment but no such action was taken at all. Furthermore the applicant wrote on two occasions to the respondent (A1 and A3) asking for written reasons for his dismissal and no reply was made to the effect that the respondent did not regard him as dismissed."
The Industrial Tribunal having reviewed all the evidence went on to find that there had been a dismissal as at 31 August 1992, namely the bank holiday Monday when the employee spoke to the gateman.The Industrial Tribunal next considered whether the dismissal was fair or unfair and concluded that it was unfair because the employee was never really given the chance to put his own point of view. He never had the benefit of a disciplinary hearing and the employers had failed to comply with their own disciplinary procedures.The employers, through Peninsula Business Services, seek to challenge the decisions of the Industrial Tribunal. In relation to the first decision they rely on the following grounds which have been succinctly and carefully argued by Mr Diamond on their behalf, firstly, the Industrial Tribunal were wrong not to allow them to amend their response to the Originating Application IT.3 on the first day of the hearing. The Industrial Tribunal, it is argued, should have weighed the unnecessary costs of an adjournment if such had been required, against the disadvantage to the employers of not granting their application. Secondly, there was no material on which the Industrial Tribunal could properly have concluded that the employee had been dismissed.In relation to the second decision the grounds are firstly the hearing was improperly resumed on 8 October since there had not been issued a Notice of Hearing under Rule 5(1) of Schedule 1 of the 1985 (Rules of Procedure) Regulations; secondly, the Industrial Tribunal should have treated the employee's failure to take up the offer of an appeal hearing as a failure to take reasonable steps to mitigate his loss and in any event should have alerted themselves to the conflict between the employee saying, as a reason for not attending the appeal hearing that he had recently got employment, and the evidence which he gave to the Industrial Tribunal on the second occasion to the effect that he was out of work during that time; thirdly, having found in the first decision that had the employee seen the managing director on the day after Bank Holiday Monday he would have been dismissed, the Tribunal in accordance with the decision of Polkey vAE Dayton Services Ltd [1988] ICR 142 should have asked "What would have happened if the employee had been dismissed on the Tuesday", in other words the unfairness found by the Tribunal made no difference, or might have made no difference to what would have happened had the employers acted fairly.It is to be noted that there is no appeal against the finding that the dismissal, if such there was, was unfair.Having heard the argument presented to us by Mr Diamond we have come to the conclusion that there is no substantial merit in any of the points which have been raised before us and we shall deal with each in turn. In relation to the first decision we say this. Firstly, an Industrial Tribunal is master of its own procedure which will be applied flexibly so as to ensure that all relevant matters are ventilated before it. This Tribunal, the Employment Appeal Tribunal, will only interfere with a discretionary procedural decision of an Industrial Tribunal if it is satisfied that the Industrial Tribunal has either misdirected itself in law or reached a conclusion which can be legitimately described as perverse.To change a case from one where the dismissal is admitted to one where it is denied is a substantial alteration to the nature of the case. Apart from anything else such a change alters the burden of proof and which party calls evidence first.The Industrial Tribunal had to weigh the pros and cons of such an application and endeavour to do justice to both parties. On the facts of this case we do not consider that there was any reason why the application should have been granted. In the first place as the Tribunal observed, the employers were represented throughout by people who had professional expertise. Secondly, the facts were quite overwhelming in support of a dismissal whether on 27 or 31 August. On the employers' own case the employee was ordered to take himself and his belongings off the site on 27 August (and I refer to page 30 which is the statement attached to their IT.3): he came back on the Monday and was given to understand that the gatekeeper had spoken to the managing director and that he was in effect no longer wanted.He raised the question of the reason for the dismissal and so did the union on his behalf. At no stage was it suggested that he had not been dismissed. The IT.3 was wholly inconsistent with anything other than a decision to dismiss having been made by the transport manager, whether or not he was empowered to do so. The application for leave to amend was made at the last minute. Those were all matters for the Industrial Tribunal to take into account. No doubt if there had been more merit in the amendment than appeared to be the case the Industrial Tribunal might have weighed the matter differently and gone on to consider that the costs thrown away could be compensated for whereas the disadvantage of not allowing the amendment could not. But where, as here, there appeared to be really no merit in the new case, it was entirely permissible for the Industrial Tribunal to refuse the application for leave to amend in the exercise of their discretion.Second, we have touched on this point already, however it seems to us that it is absurd to suggest that the Tribunal did not have evidence before it on which they could conclude that there was a dismissal. Evidently the combination of what was said on the Thursday and the Monday was sufficient to lead both the employee and the employers to believe that there had in fact been a dismissal.As to the three grounds advanced in relation to the quantum hearing. Firstly, it seems to us that there is nothing in the first and purely technical point that the Tribunal proceedings had not been correctly reconvened. Paragraph 5(1) of the Regulations refers to the first date which is fixed for the hearing of an Originating Application (IT.1). Thereafter the Tribunal has power to adjourn the proceedings to fresh dates pursuant to its powers under Regulation 12. Where that is done there is no need for a new notice under Regulation 5. Here, as the Tribunal themselves make clear, the proceedings were adjourned to 8 October. The employers and their representatives had ample opportunity to ask for the case to be resumed on a different date. The representatives were quite aware of the proceedings at some stage during the course of that day. It seems to us that there is no legal or factual complaint which could be made in relation to the Industrial Tribunal's decision to adjourn to a specified date without a further Rule 5 notice. However, we note that as a result of the way the Tribunal dealt with it as opposed to what has been submitted to us is the normal way in which this particular Tribunal deals with matters, the representative of the Peninsula Business Services unfortunately overlooked that part of the decision and therefore the appointment was not kept.It seems to us that it would have been open to the employers through their representatives after the Tribunal had given its decision on the question of compensation, to have requested that it should review its decision having regard to the fact that no representative of theirs was available to argue the case either as to contributory fault or as to the effect of Polkey on the question of the amount of compensation. That was not done.Secondly there is an unresolved question as to whether an employee who fails to pursue an internal appeal can be said to have failed to mitigate his loss. In Hoover Ltd v Forde [1980] ICR 239, it was held that an employee's failure to use an appellate process is not a matter to be taken into account when the reasonableness of the employers' actions is being considered under section 57(3), nor can it be construed as any kind of acquiesence in the dismissal but that it can be taken into account when determining whether the employee has mitigated his loss. On the other hand a Scottish Division of the Employment Appeal Tribunal has refused to follow this case and has held that it would be wrong to penalise an employee in any way for failing to pursue an appeal through the appeals procedure. That is the case of Williams Muir (Bond 9) Ltd v Lamb [1985] IRLR 95.On the facts of the present case there is, we think, no need for us to attempt to resolve this apparent dichotomy of approach because, factually, any submission that there should be any deduction from the employee's compensation because of his conduct in relation to the appeal would, we think, be bound to fail. The extraordinary failure of the employers to make any kind of prompt response to persistent requests for a right of appeal disentitled them in our view, from making any complaint as to the employee's refusal when the offer was made so late in the day.Thirdly, as we read the decisions of the Industrial Tribunal, although it was likely that the employers would have dismissed the employee on the Tuesday if he had turned up for work, it would probably not have been fair if they had done so. The employee had worked for them for 4 years prior to his dismissal. There is no evidence that he had been subject to any warnings as to his conduct. He was obviously upset about the arrangements being made for his work on the Friday and was taking a strong line. Any reasonable employer would, we think, have wanted time to reflect and give the employee a chance to reflect also. Both were to some extent acting, it seems to us, in a hot-headed manner. The disciplinary procedure gives the employer the right to suspend with pay pending an investigation. We consider that any decent employer would have used that power and tried to sort out what the employee's concerns were about the number of hours he was to drive. It is not without significance that the managing director, without even hearing the employee's side of the story, had apparently already made up his mind that he was going to dismiss the employee. That is not compatible with fairness.Thus, although we accept that the Industrial Tribunal does not appear to have asked itself what would have happened if the dismissal had not taken place as they had found it had, we have powers under the statute to make such order as the Industrial Tribunal could have made or remit the matter back to the Industrial Tribunal for further consideration. We are inclined to deal with the matter ourselves, partly because of the failure by the employers to appear at the resumed hearing and therefore deprive the Industrial Tribunal of the submissions which otherwise would have been made; partly because there was no application for a review based on their absence and finally partly because we are satisfied that there is no merit in the point having regard to the facts.The employee has not, in our view, done enough to merit dismissal and we consider that if he had been dismissed on the Tuesday, such dismissal would have been unfair. Accordingly the compensation to which he was entitled is not to be reduced on the grounds that he would or could have been fairly dismissed during any part of the relevant period.It follows therefore that this appeal should be dismissed.