Pye & Ors v British Coal Corporation [1996] UKEAT 126_95_1902

EAT

Pye & Ors v British Coal Corporation

[1996] UKEAT 126_95_1902 · 1996-02-19

MR JUSTICE MUMMERY (PRESIDENT) This is an appeal by five former employees ("the Applicants") of the British Coal Corporation ("British Coal") at Parkside Colliery which has "ceased as an operating unit". The Applicants' employment (3 were electricians, 1 a mechanic and 1 a general underground worker) terminated on Monday 7th June 1993 on the grounds of redundancy.

The issue before the Industrial Tribunal was whether British Coal acted fairly and reasonably in its attempt to find alternative employment for the Applicants.

The issue on this appeal is whether the Industrial Tribunal, held at Liverpool on 26th and 27th May 1994, made an error of law in the decision rejecting the claims of unfair dismissal. The Extended Reasons for the decision were sent to the parties on 22nd December 1994. The Applicants served a Notice of Appeal at the beginning of February 1995 and also made an unsuccessful application for a review to the Industrial Tribunal.

At a Preliminary Hearing before this Tribunal on 19th May 1995 Directions were given for the case to proceed to a full hearing and for the production of the Chairman's Notes of Evidence. We have read and considered the evidence recorded in those notes.

The appeal has been ably argued by counsel for each party - by Mr Swift for the Applicants and by Mr Irvin for British Coal. We are grateful to them for their assistance on a difficult point.

The Facts

The Tribunal found the following facts:-

(1) Parkside Colliery, Newton-le-Willows, Merseyside, ceased to operate with effect from 28th May 1993. That, the Tribunal found, was a "time of unprecedented change and upheaval involving large scale closures ... throughout the coal industry as a whole."

(2) From 28th May onwards group counselling sessions or meetings took place. At the meetings the Applicants indicated their wish for a transfer. Mr Trevor Morris (formerly Assistant Manager - Personnel) contacted the group Headquarters to see what vacancies there were. He was told that the "only possible transfers were to Point of Ayr Colliery in North Wales", a colliery in the same group as Parkside.

(3) Arrangements were made for a meeting to be held on Monday 1st June at 7.30 a.m. to discuss the possibilities with local colliery management at Point of Ayr Colliery. The Applicants did not go to the meeting. They did see Mr Morris the following week on 8th June and confirmed that they did not consider that Point of Ayr was a suitable transfer. They referred to Selby and Asfordby collieries as alternatives. Mr Morris passed that information to group headquarters. He was not in a position to do anything else. He then issued letters confirming redundancy.

(4) The position taken by the parties is conveniently set out in the correspondence. The Applicants' position is stated in the letter dated 4th June sent to the Employee Relations Director of British Coal at Eastwood Hall by Mr Scargill, President of the National Union of Mineworkers. He wrote -

"Dear Mr Hunt

Parkside Colliery - Transfers

I have been informed by our area Unions that men at Parkside Colliery who have requested transfers have been offered only Point of Ayr Colliery in North Wales. It has previously been accepted by British Coal that the offer of Point of Ayr to these men living in Lancashire does not constitute a reasonable offer of alternative employment. I also find it difficult to understand this offer given that British Coal have made it clear that the workforce at Point of Ayr is to be cut to 150. It would appear that British Coal are trying to force these men out of the industry.

In the past, transfers have been available in the case of pit closures on a one-to-one basis, even if this means moving outside the relevant British Coal group. I understand that there are waiting lists of men currently employed in the Selby group and at Asfordby Colliery who wish to volunteer redundancy. In this event, it would seem reasonable that the men currently requesting a transfer are given the opportunity to transfer to such collieries as they wish.

I would be grateful if this matter could be treated with urgency as these men are being asked for a decision by the end of the day."

In relation to the future of the Point of Ayr Colliery, we have been shown an extract from British Coal's Newspaper, Coal News, for October 1992 which was put before the Tribunal. That contained details of which mines were to close and which to stay open. In the Midland and Wales Group it was stated that Parkside would close by the end of December (1992) and Point of Ayr by the end of March (1993).

Under the heading of mines which were "to stay open" were Asfordby in the Nottingham group and North Selby in the Selby group.

The position of British Coal was set out in the letter replying to Mr Scargill's letter. That letter was written by Mr Burningham, Head of Human Resources. It read as follows:-

"Dear Mr Scargill

Parkside and Trentham Collieries - Transfers

I am replying on Mr Hunt's behalf to your letters of today's date about Parkside and Trentham collieries.

As I pointed out in my earlier letter today, the scope for transfers from closures to continuing collieries is becoming increasingly restricted, with few vacancies available in most places. As regards the Midlands and Wales Group, the only vacancies available are at Point of Ayr Colliery. This colliery is, as you indicate, facing a reduction in manpower levels but there are a number of men at Point of Ayr who wish to accept redundancy, which enables transfer opportunities to be offered to Parkside and Trentham men, although I understand that in fact very few have expressed any firm interest in transfer.

As regards Selby and Asfordby, you will appreciate that the Groups within which they are situated also have colliery closures from which men wish to transfer to continuing collieries. In the Selby Group, transfer to the Selby mines are taking place from Sharlston, and in the Nottinghamshire Group, transfers have taken place from the four closed collieries to Asfordby. In all cases, NUM members have been involved and I am sure you would agree that it would be quite inappropriate for the Corporation to offer Parkside men transfer to the limited numbers of jobs available at Selby and Asfordby at the expense of men from closures in those Groups."

The Tribunal also set out a later shorter letter from Mr Burningham to Mr Scargill on 8th July 1993 replying to another letter of Mr Scargill dated 11th June and that says -

"I indicated in my letter dated 4th June 1993 it would be quite inappropriate to seek to offer transfers to Asfordby to men from other groups at the expense of men, including NUM members, from closures in the Nottinghamshire group. I understand that the number of men at Asfordby wishing to accept redundancy is, in any event, limited and can be no more than can be accommodated by men wishing to transfer from closing collieries in Nottinghamshire, including Rufford, which has recently been agreed locally."

Against the background of that correspondence the Tribunal found as a fact that -

"...It was unlikely that steps would be taken to accommodate the wishes of anyone seeking to go to the area in question."

The Proceedings

It was in these circumstances that Mr Pye, a general underground worker, and his fellow workers, presented Originating Applications to the Industrial Tribunal on 2nd September 1993 claiming unfair dismissal. The claims were in common form and the essence of the complaint in each case was as follows:-

"British Coal announced that the colliery would cease to be an operating unit as from Friday 28th May 1993. All men were to be counselled on redundancy.

I requested a transfer to another colliery. British Coal said that I could transfer to Point of Ayr Colliery, situated in North Wales, on a job at a lower grade to the one I was then employed. I made it clear that due to this and the travelling involved, that this was not a suitable offer of alternative employment.

However I was prepared to move house to a colliery elsewhere in the country that was not under threat. I was aware that there were vacancies at such collieries and that in the past transfers of this nature had been common practice. British Coal refused to even consider this and said that Point of Ayr was the only option.

I was unable to accept this offer and I was then made redundant.

As a result, I believe that my dismissal was unfair under S.57(3) of the Employment Protection (Consolidation) Act 1978."

The grounds of resistance stated by the British Coal Corporation were on similar lines in each case. We take Mr Pye's case as a typical example. The essence of British Coal's case was that, when it was confirmed to Mr Pye that his job at Parkside Colliery was redundant on the closure of the colliery and Mr Pye indicated his wish to transfer, to another colliery, he was offered Point of Ayr and told that, if he was interested in such a transfer he should attend an appointment arranged at that Colliery for 7th June to discuss the details of the proposed transfer with local colliery management. The IT3 went on to allege that -

"(4)...It was made clear to the applicant on 3rd June that a transfer to Point of Ayr Colliery was the only transfer that the respondent was able to offer the applicant and that the alternative was for the applicant to accept redundancy on the enhanced financial terms explained to him. The position was confirmed by letter to the applicant dated 4th June 1993.

(5) The applicant did not attend the meeting arranged at Point of Ayr for 7th June 1993.

(6) On 8th June 1993 the applicant was interviewed at Parkside Colliery by the Colliery Assistant Manager (Personnel). The applicant rejected the offer of a transfer to Point of Ayr and requested suitable alternative employment/a transfer to another colliery. The Colliery Assistant Manager (Personnel) again explained that the only transfer the respondent was able to offer the applicant was to Point of Ayr. The applicant preferred to be dismissed by reason of redundancy rather than accept the offer of a transfer to Point of Ayr Colliery."

In those circumstances British Coal argued that Mr Pye was dismissed by reason of redundancy and that the dismissal was fair and that British Coal had acted reasonably and in accordance with the substantial merits of the case in treating that reason as a sufficient reason for dismissing him.

The Decision of the Industrial Tribunal

In the Extended Reasons the Industrial Tribunal referred to the relevant statutory provisions in S.57 of the 1978 Act and to the guidance in applying those provisions set out in the decision of Iceland Frozen Foods Ltd v. Jones

[1982] IRLR 439

. They referred to the evidence given by the Applicants and by Mr Trevor Morris, the former Assistant Manager, Personnel and Mr George Carr, Deputy Group Employee Relations Manager for British Coal. They prefaced their findings of fact by saying that all the documentary and oral evidence had been considered and that -

"... If a specific matter of detail has not been mentioned it should not be assumed that it has not received consideration."

The Tribunal stated their findings of fact. The points which should be highlighted in those findings are:-

(1) At the time the Applicants were made redundant

"...unprecedented change and upheaval, involving large scale closures, was current throughout the coal industry as a whole and these claims must be viewed against that background."

(2) After the Applicants indicated a wish to seek a transfer Mr Morris contacted Group Headquarters to see what vacancies there were. The Tribunal accepted he was told that -

"...the only possible transfers were to Point of Ayr Colliery in North Wales."

(3) After the failure of the Applicants to go to the meeting arranged at Point of Ayr and the interview which Mr Morris had with the Applicants on 8th June 1993, at which they confirmed they did not consider Point of Ayr as a suitable transfer and referred to Selby and Asfordby as alternatives, Mr Morris passed that information on to Group Headquarters. The Tribunal found that -

"...he was not in a position to do anything other than that."

(4) As to the position in areas other than that covering Parkside Colliery, the Tribunal referred to an exchange of correspondence between Mr Scargill and British Coal's Head of Human Resources. Having set out those letters the Tribunal stated -

"...Against that background it was unlikely that steps would be taken to accommodate the wishes of anyone seeking to go to the area in question."

The Tribunal's Reasons

On those findings of fact the Tribunal set out the following reasons for rejecting the claims of unfair dismissal (paragraphs 9 and 10).

(1) The circumstances surrounding the redundancies were of

"...unprecedented difficulty and trauma. They were not confined to one site or locality but nationwide in their impact, their general effect being on such a scale as to attract the widest possible publicity and debate.

(2) The Tribunal had to consider whether the actions of British Coal fell "within the

range of reasonable responses open to a reasonable employer ... taking into account all the circumstances of the case."

(3) The prevailing circumstances in this case were wholly exceptional and, faced with a crisis situation, British Coal had to do the best that it could.

(4) The Applicants had already received their appropriate redundancy payments.

(5) The ultimate question was one of reasonableness in the context of S.57(3). In the key sentence of the Extended Reasons the Tribunal said this -

"...In the quite exceptional circumstances prevailing at the time we are driven to conclude that the respondent's actions cannot be seen as unreasonable in the context of the legal principles we have referred to above. ... it follows that these applications are dismissed."

The Submissions of British Coal

Mr Irvin, for British Coal, strongly supported the decision of the Industrial Tribunal and submitted that the appeal should be dismissed for the following reasons:-

(1) The Industrial Tribunal referred fully and correctly to the statutory provisions in S.57 of the 1978 Act and to the proper test to be applied to the facts of the case.

(2) The Industrial Tribunal carefully considered the factual background to the dismissal of the Applicants on the grounds of redundancy and accepted British Coal's evidence about the counselling of the Applicants and the efforts made to relocate them.

(3) The Tribunal applied its own judgment, as an industrial jury, to the question whether or not the decision to dismiss the Applicants fell within the range of reasonable responses open to a reasonable employer. They considered the factual background of the case and rightly pointed out the unprecedented difficulty facing British Coal at that time.

(4) No error of law had been identified in the decision. The Tribunal had fully considered the facts, applied the correct legal test and reached a reasoned decision which a reasonable Tribunal could have reached in those circumstances.

(5) The Appeal Tribunal was only entitled to disturb the Industrial Tribunal's decision if there was an identifiable error of law (which there was not) or if the ultimate conclusion of the Tribunal was perverse in the sense that no reasonable Tribunal, properly directing itself on the law and the facts, could have reached. That was not the case.

(6) The Appeal Tribunal were not entitled to interfere with the decision of the Tribunal and to substitute their own decision simply because they would, in the relevant circumstances, have reached a different decision.

(7) As to the specific criticism made by Mr Swift on behalf of the Applicants about British Coal's efforts to find alternative employment, Mr Irvin submitted that British Coal had in fact consulted with the Applicants on this point and had offered those seeking employment a transfer to Point of Ayr Colliery which they refused. The Applicants sought a transfer to two other collieries, Selby and Asfordby. British Coal had made enquiries, but a transfer to those collieries was not available. In those circumstances and against the background of unprecedented change, upheaval, crisis and exceptional difficulty, the Industrial Tribunal were entitled to find that British Coal had acted fairly and reasonably in dismissing the Applicants.

(8) As for Mr Swift's other main point that the Industrial Tribunal had not dealt in detail with the points raised objecting to the proposed transfer to the Point of Ayr, Mr Irvin submitted that there was no error of law by the Industrial Tribunal. The Industrial Tribunal was not bound to analyse the facts in detail or to give in the Extended Reasons a full treatment of all the points that had been argued. The Tribunal had made it clear in paragraph 8 of their decision that they had considered all the evidence, had expressly stated that "If a specific matter of detail has not been mentioned it should not be assumed that it is has not received consideration." They had considered all the legal and factual submissions and had reached a conclusion in which there was no legal flaw.

Conclusion

We have not found this an easy case, but, after considering all the arguments of British Coal and of the Appellants, we have reached the conclusion that the appeal should be allowed and the case remitted to a different Industrial Tribunal for rehearing. Our reasons for this decision are as follows:-

(1) It is common ground that there is a duty on an Industrial Tribunal not only to state the basic factual conclusions but also to provide a statement of the reasons which led them to their conclusions on those facts. As Bingham LJ said in Meek v. City of Birmingham District Council

[1987] IRLR 250

(para. 8 -

"... The parties are entitled to be told why they have won or lost."

(2) It follows from that general principle that when the Industrial Tribunal is dealing, in the Extended Reasons, with the main point of the case, they should state their findings of acts in relation to that point and also the reasons for their decision on it.

(3) In the present case the main question in the case was the issue of redeployment of the Applicants outside the Parkside Group. That is clear from the issues identified in the IT1 and the IT3.

(3) The duty of an employer faced with a redundancy situation is to act reasonably. That duty is set out in paragraph 6 of the decision. Part of that duty is to take reasonable steps to redeploy employees who would otherwise be dismissed by reason of redundancy. The employer is under a duty to consider all other relevant possibilities within his whole enterpris e: Vokes Ltd v. Bear

[1974] ICR 1

at p.3G - 4C .

(4) The Applicants' complaint in the present case was that the only offer of alternative employment made to them was at the Point of Ayr Colliery. There was evidence before the Tribunal that that colliery was not only 70 miles away from Parkside Colliery but was itself under threat of closure or at least of reduction in its workforce. The reason for the offer of alternative employment at Point of Ayr (rather than at another colliery) was that British Coal divided its collieries, for administrative purposes, into groups and Point of Ayr Colliery was in the same group as Parkside Colliery.

(5) The Applicants' case was that British Coal should have taken steps to offer them alternative employment at collieries outside the Parkside Group . The evidence was that there were other cases in 1993 where British Coal had found alternative employment for employees at collieries outside the colliery group in which they worked. There was no policy limiting redeployment to particular colliery groups.

(6) There was evidence that in June 1993 there were opportunities to redeploy employees, such as the Applicants, to other collieries outside the group, such as Selby in Yorkshire and Asfordby in Leicestershire. Those opportunities arose from vacancies or because employees at those collieries were prepared to volunteer for redundancy. The evidence shows that British Coal did not consider the possibility of transferring any of the Applicants to collieries outside Parkside Group. The Tribunal concluded in paragraph 8(9) that it was unlikely that

"... steps would be taken to accommodate the wishes of anyone seeking to go to the areas in question."

(7) The Tribunal seemed to have accepted that in "the exceptional circumstances" British Coal had acted reasonably because there was nothing else that could have been done. They state in paragraph 8(5) of the Extended Reasons that Mr Morris was told by Group Headquarters that the only possible transfers were to Point of Ayr Colliery. After the meeting on 8th June he passed on to Group Headquarters the requests of transfers to Selby and Asfordby. The Tribunal said that Mr Morris "was not in a position to do anything other than that." In our view, the Tribunal failed in its decision to address and assess the evidence on the issue as to what British Coal could reasonably have done by way of redeployment of the Applicants elsewhere.

(8) In those circumstances, our conclusion is that the Tribunal have failed to provide the unsuccessful Applicants with sufficient reasons for rejecting their contentions that British Coal had acted unreasonably in failing to take reasonable steps to find alternative employment for them at collieries outside the Parkside Colliery Group.

In brief, the decision of the Industrial Tribunal fails to explain sufficiently to the Applicants the factual and legal basis on which their contentions about redeployment were rejected. The appeal should be allowed and the case remitted to a different Industrial Tribunal for rehearing.