Intec Business Colleges Ltd v Morgan [1995] UKEAT 100_95_2007

EAT
Intec Business Colleges Ltd v Morgan
[1995] UKEAT 100_95_2007 · 1995-07-20

JUDGE N BUTTER QC:

This appeal concerns the question of jurisdiction. Ms Morgan's employment began on 10 February 1992. She was summarily dismissed on 8 February 1994 and therefore, on the face of it had not the requisite two years' employment to entitle her to bring a claim for unfair dismissal.She was entitled to a statutory notice period of a week. The effect of Section 55(5) of the 1978 Act is that, if the Tribunal were entitled to find that the seven days' notice was required by Section 49, then the effective date of termination of employment would have been postponed to 15 February 1994 and the employee would be deemed to have the relevant qualifying period of employment.It is important however, to have regard to the provisions of Section 49(5) which provides:
"49(5) It is hereby declared that this section does not affect any right of either party to treat the contract as terminable without notice by reason of such conduct by the other party as would have enabled him so to treat it before the passing of this Act."
Therefore, if (and I stress the word `if') the conduct of the employee was of such a nature that the employer was entitled to treat the contract as terminable without notice then statutory notice is not required. In that event, the position would clearly be entirely different. I turn to consider the background to the case.Ms Morgan presented a claim alleging she had been unfairly dismissed, which came before the Industrial Tribunal in Birmingham. It was heard on 1 and 2 September and 2 and 3 November 1994. The Tribunal held that it did have jurisdiction; that the Applicant was unfairly dismissed. It is not necessary, for the purposes of this appeal, to deal with other aspects of the claim.The Tribunal set out its reasons, which were detailed and involved an unusually lengthy review of the evidence which they had heard. It is necessary for us to highlight some of the relevant findings and to refer to a number of specific paragraphs. Quite shortly, as appears from paragraph 4, the Applicant joined the employers on 10 February 1992 as an Administrative Assistant and was shortly promoted to the position of Administrator. It became plain, at some stage, that there was what may be called "a conflict of personality" between her and a Ms Janet Hinds, who had been employed with the employers prior to the Applicant joining them.In December 1993 there was an incident when it was said that the Applicant had asked, in relation to a new man, a friend of Ms Hinds, "Is he a sambo?" . This allegation was denied by the Applicant. There was a further incident in December, when it is said that the Applicant said in relation to Ms Hinds "When she's wearing that coat, all you can see is the whites of her eyes and her teeth".Because of complaints, made the employers investigated the matter. The main enquiry was carried out by Mr John Herman, the Chairman and Managing Director. As a result of his investigation he dismissed the Applicant summarily.I can move on to paragraph 31 of the decision. Two-thirds of the way through that, the Tribunal say:
"31 .... Since this is a case of misconduct it is not for us to say at the end of the day whether we find all or any of the complaints proved. .... ."
They go on to refer to the test laid down in the leading case of Burchell. In paragraph 34, in relation to the incident involving the alleged use of the word "sambo", the Tribunal says:
"34 .... We find it is not for us to say whether the Applicant or Janet Hinds are telling the truth about that incident. .... ."
Lower down, they refer to the absence of corroboration. They say:
" .... We have to consider whether he [that is Mr Herman] was reasonably entitled to reach the conclusion he did about that incident."
Further down, in paragraph 36, they indicate they did not form a very favourable view of Ms Hinds.In paragraph 39, as to the use of the expression "white eyes" which was denied by the Applicant, the Tribunal accepted the evidence against the Applicant on this and concluded that the incident had occurred. They also indicated that they accepted evidence from a Mr McDonald and a Ms Joanne Walters.The first sentence of paragraph 42:
"42 As to the other matter, his [that is Mr Herman's] reaction was because in his view there was evidence to substantiate the second then the applicant must be lying about the first. .... ."
In paragraph 44 onwards, the Tribunal deal fully with the procedure which had been adopted by Mr Herman and for reasons which it is unnecessary for the purpose of today's judgment to recite, they found that the procedure was seriously flawed. They said "there was no supporting evidence of one serious complaint" . They drew attention to the fact that "the applicant was not shown the statements and she was not made aware of other racial [presumably alleged racial] comments. There was no proper disciplinary hearing" and the Tribunal concluded that "These fundamental defects made the decision to dismiss unfair".They go on in paragraph 45 to amplify that. Those are matters dealing essentially with the procedural points. In paragraph 46 they commenced to deal with the question of jurisdiction, but it is in relation to paragraph 48 and paragraph 49 in particular, that attention must be paid. In paragraph 48 what they say is:
"48 What is being urged upon is that in the circumstances of this case the applicant was dismissed for gross misconduct and that her conduct was such as would entitle the respondent to treat the contract as terminated on 8 February and so prevent the applicant from adding the statutory notice period. We have considered that point and we conclude we do not accept that submission. We say this for the following reasons. The authorities show that what amounts to gross misconduct is a matter for the tribunal to determine. See Wilson v Racher 1974 ICR 428. It is not sufficient for the employer merely to label an act as gross misconduct which the tribunal has to accept Lanton Leisure Ltd v White and Gibson 1987, IRLR 119. We find the facts reveal a number of matters which point away from that. .... ."
Then, they go on to deal with those. A little later, in paragraph 49 they say:
"49. .... Although we accept there was evidence from which he might reasonably have concluded one act of misconduct, we have grave misgivings as to whether it could reasonably be said to amount to gross misconduct as opposed to mere misconduct and moreover whether it was conduct of such a nature as would entitle her [the applicant] to be deprived of the right to her statutory period of notice. For these reasons we conclude the right to a satisfactory notice period under Section 49 has not been excluded. The applicant is entitled to add this to her period of employment. She accordingly qualifies to make the complaint of unfair dismissal. Since we have jurisdiction we confirm the applicant was unfairly dismissed."
They then go on to deal with the question of contributory fault.It is plain that the Tribunal asked themselves whether there was gross misconduct and they decided that there was not. The only real finding they have made against the employee was in relation to the coat incident. They disclaimed the need to decide upon the other main incident that was relied upon. It should be said in passing that there were other incidents of alleged racial remarks which we are told were dealt with in evidence before the Tribunal, which are not referred to expressly in the course of the Tribunal's decision.We have some sympathy with the Tribunal in dealing with what was a long, and no doubt, difficult case. Despite the gallant efforts of Mr Gorton, on behalf of the employee, to persuade us otherwise however, we have reached the conclusion that the Tribunal's approach was flawed. They concentrated on the question of misconduct and whether the employers had acted reasonably. They referred to, but did not (with respect, it seems to us) take on board sufficiently the effect of the case of Lanton Leisure Ltd v White and Gibson [1987], IRLR 119 to which reference was made in their decision. It is of value to look in particular at paragraph 7 of the report where the Employment Appeal Tribunal said:
"7 We agree with the Industrial Tribunal, and the submission by counsel for the respondents, that it is first necessary to find out by means of an enquiry on the merits whether there was in fact such conduct which would enable an employer to terminate without notice. If it were not so, it would mean that an employer could simply define a dismissal as `gross misconduct' to avoid the provisions of s.55(5)."
In our judgment, the Tribunal do not appear to have applied their mind to the necessary question, "Was there a repudiatory breach of contract?". We regret we do consider it necessary to remit to the same Tribunal for them to consider the question which is vital to the issue of jurisdiction; whether it is necessary for them to hear further evidence or merely to hear submissions is a matter we feel which can properly be left to them.For the reasons which we have indicated, it is our unanimous view that the appeal must be allowed.