TRW ORS LTD v MR M PARKER [1996] UKEAT 558_96_0612

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [1996] UKEAT 558_96_0612Case No Appeal No. EAT/558/96Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
TRW ORS LTDAPPELLANTMR M PARKERRESPONDENT
Before
His Honour Judge D M LevyDate 6 December 1996
[1]APPEARANCES APPELLANTS MR T LINDEN (Of Counsel) Instructed by:- Mr N Chronias (Solicitor) EEF Broadway House Tothill Street London SW1H 9NQ RESPONDENT Mr T Newton Employment Law Consultant NELC Unit 23 Brougham Enterprise Centre Hartlepool TS24 8EY JUDGE LEVY QC: Mr Michael Parker commenced employment with TRW ORS Ltd., ("the Company") in October 1992 as a Shift Supervisor. He remained in that employment continuously until he was dismissed by reason of redundancy on 4 October 1995. He alleged that he was unfairly dismissed and commenced proceedings in the Industrial Tribunal by submitting an application which was received by the Tribunal on 28 October 1995. A Notice of Appearance was entered by the Company on 3 November 1995. The matter proceeded to a hearing before an Industrial Tribunal at Newcastle on 31 January 1996. The reserved decision of the Industrial Tribunal set out in the Extended Reasons were sent to the parties on 3 April 1996. The unanimous decision of the Industrial Tribunal was that the Applicant was unfairly dismissed. The matters of remedy stated were to be settled by the parties and notified to the Tribunal no later than 30 March 1996. The Company does not challenge the decision of the Industrial Tribunal that the dismissal of the Applicant was unfair, it does, however, challenge a decision which comes in the last paragraph of the Extended Reasons in this form:
"... We decline to apply the Polkey reduction in this case. This dismissal was unfair, we apply all the words of Section 57(3) to the facts we have found."
The reference to the Polkey decision is of course a reference to the decision in Polkey vAE Dayton (Services) Ltd [1988] ICR 142 . The passage which the Tribunal must have had in mind is whether, having regard to certain passages in the judgment in the speech of Lord Bridge in that case, there had to be a reduction in the compensatory award to the Respondents. In the course of his submissions to us today, Mr Linden took us through the material parts of the judgment in Polkey at page 163 B, from the speech of Lord Bridge:
"... If an employer has failed to take the appropriate procedural steps in any particular case, the one question the industrial tribunal is not permitted to ask in applying the test of reasonableness posed by section 57(3) is the hypothetical question whether it would have made any difference to the outcome if the appropriate procedural steps had been taken. On the true construction of section 57(3) this question is simply irrelevant. It is quite a different matter if the tribunal is able to conclude that the employer himself, at the time of dismissal, acted reasonably in taking the view that, in the exceptional circumstances of the particular case, the procedural steps normally appropriate would have been futile, could not have altered the decision to dismiss and therefore could be dispensed with. In such a case the test of reasonableness under section 57(3) may be satisfied."
Lord Bridge went on to approve a dictum of Mr Justice Browne-Wilkinson, as he then was, in Sillifant v Powell Duffryn Timber Ltd. [1983] IRLR 91 , where in a judgment of this Tribunal Mr Justice Browne-Wilkinson said:
"There is no need for an 'all or nothing' decision. If the industrial tribunal thinks there is a doubt whether or not the employee would have been dismissed, this element can be reflected by reducing the normal amount of compensation by a percentage representing the chance that the employee would still have lost his employment."
There is a subsequent decision of this Tribunal in which the Polkey decision was suggested should be addressed in two stages: that is the decision in Wolesley Centers Ltd v Simmons [1994] ICR 503 at page 508F, where

Judge Hague giving the judgment of the Tribunal said:

"... First, the tribunal must ask itself whether if the employer had followed the proper procedures and acted fairly the employee would not have been dismissed. If the answer to that question is reasonably clear one way or the other, there is no difficulty. But in many cases the answer will be uncertain, ... the tribunal must, as the second stage of the process, make a percentage assessment of the likelihood of the employee being retained..."
In the present case, Mr Linden on behalf of the Company submitted that the Industrial Tribunal does not appear to have applied its mind to either stage of the process. He submitted that the closest he came to so doing, is in paragraph 7 of the Decision, which we have already read out. He submitted that the passage is fundamentally flawed in the following respects: The question was whether if the Appellant had followed the proper procedures and acted fairly, the Respondent would not have been dismissed.[2]If the Industrial Tribunal's view was that the result would have been the same, had it been done otherwise, a 100% reduction was appropriate.[3]The reference to the Polkey reduction suggests that the Industrial Tribunal regarded the issue as all or nothing. No consideration appears to have been given to a percentage reduction.[4]The perfunctory manner in which the Industrial Tribunal dealt with this issue, suggested that it did not give it proper consideration. Indeed, he went on to submit that there was not a single finding of fact for the Industrial Tribunal's conclusion, and he pointed at passages earlier in the judgment where the opposite conclusion could well have been justified. Having heard Mr Linden's submissions on this and considered the judgment, we invited Mr Newton to reply to this point. He submitted to us that if we looked at the decision of the Industrial Tribunal, we could find ample justification for the sentence in the judgment and the award of compensation which followed. With respect to Mr Newton, we could find no such support in the judgment at all. We think that Mr Linden's submissions are right. If an Industrial Tribunal wishes there to be a 100% award, or in other words a "no deduction" from the award to the employee, in our judgment, as was said in the Wolesley case, they should give their reason for so doing, so that anyone can understand it. This they have failed to do here and therefore there is an error of law and we must allow the appeal. Mr Linden, in his submissions, has suggested that first we should supply the percentage ourselves, alternatively we remit the decision on compensation for consideration by a different Tribunal. We have not heard full argument on this, but we notice in the Wolesley case that it unanimously sets out the decision of the Industrial Tribunal's compensatory award and remit that matter to the same Tribunal for reconsideration and allow the appeal accordingly. That we would be minded to do, unless Mr Linden or Mr Newton persuade us that a different course is better followed. It may of course be that this appeal having been allowed, there will be no further need for litigation. Despite the courteous further submissions of Mr Linden, we think that justice will be done if this matter can be heard by the same Tribunal, if that can be arranged in the reasonably near future. If convening the same Tribunal is going to cause any substantial delay because of the sad instance of Mr Myers' ill health, it is a matter for the Regional Chairman to decide if it should be heard before a different Tribunal.