Clancey Ltd v Akram [1997] UKEAT 1097_96_2010

EAT
Clancey Ltd v Akram
[1997] UKEAT 1097_96_2010 · 1997-10-20

LORD JOHNSTON : This is an appeal at the instance of the appellant/employer against a finding of the Industrial Tribunal that the respondent/employee had been unfairly dismissed from their employment and was entitled to a remedy, that matter being agreed between the parties as a matter of calculation.

The background to the matter is that the employers are inter alia in the business of a foundry and cast metal working and make quality products including camshafts for the upper end inter alia of the motor business, not least BMW and Mercedes. It was explained to us that the need for quality in this type of product was absolutely essential and that the customers, putting it simply, were very hard task maskers.Without going into the process in any great detail, though it was very helpfully explained to us, it appears that the camshaft required to have a centre drilling through them which is cast or moulded at the time that the component is produced by inserting into the mould some material which will, at the end of the day, produce the necessary cavity. It is also, however, necessary for the material that has created that cavity to be removed from the finished product, and this, according to the history, had been leading to trouble and complaints from the customers who were receiving the component with either traces of the substance in the component or sometimes completely blocked cavities in the centre of the component.In order to address this problem, the employer introduced into the system a machine or piece of equipment which was described either as a hedgehog or as a pincushion, whereby it was necessary for the workers dealing or handling this equipment to place the cast camshafts on to a pin or spike on that machine which would have the automatic and full proof effect of dislodging all the material which was now alien to the component from it. It was emphasised to us how important it was to the product and its quality which in turn was essential to the company maintaining its business, that this procedure should be followed.By way of a quite separate background the respondent had gone on leave back to his native Pakistan in October 1994 and had overstayed his time there to some considerable extent, the reasons for which are not material to us; suffice it to say, that upon his return he was disciplined by the company and indeed an incident occurred in which it was alleged that he had threatened the wife of the official of the company who was involved later in the matters with which we are concerned. The matter was concluded as far as the employee was concerned with a warning which was, as far as we were concerned, contained in a letter that was written to him by the Personnel Director, Mr Osborne, on 18th October 1994, stating inter alia that he was to be disciplined but not dismissed because of this particular offence. At the same time within that letter, there is contained the phrase "Since that time I have been advised that you are not carrying out your job in accordance with quality standards applicable". It was demonstrated to us that that sentence allegedly related to the failure on the part of the respondent properly to carry out what I will describe as the hedgehog procedures with regard to the handling of the camshaft material with which he was involved when he returned to work. Both parts of the letter were governed by a general warning in the third paragraph. That matter is not without importance in considering the issues that were raised with us.It appears that trouble was continuing as far as the quality of the product was concerned after this date on the same basis, and in February 1995 it was necessary for contact to be made at a personal level by executives of the company with the customer which again appeared to heighten the need for quality control to be maintained. According to the findings of the tribunal in paragraph 18, not long after the company's managing director had returned from Germany having tried to deal with this problem, the respondent was discovered to have produced one obvious and another less faulty item of workmanship out of 400, obviously having not used the hedgehog system because if he had done so, since it is allegedly fool proof. The respondent was, after investigation, dismissed by reason of that offence. That leads us to consider against that background the matter which is now before us.The critical findings of the Industrial Tribunal are to be found in paragraphs 20 and 21 of their decision:
"20 We understand within the motor supply industry there has to have been a change of culture over the last 10 years to survive. They are competing with low wage cost economies. They can only get and keep the contract by high efficiency and high quality. We can understand all those problems. But the sacking of a man to discourage others for effectively the first quality breach after 18 years service would not, it is suggested be acceptable in German law. It is not acceptable in this law either unless there are exceptional circumstances. Was this a direct abuse by the applicant of a manager's instruction? We have no doubt that the applicant was as were other workers, told of the requirement to use what we will describe as the hedgehog, a simple device which would have discovered the fault. We do not believe that the importance of the use of it was emphasised to such an experienced worker as Mr Akram, in the way that it was put in evidence to us. The reason for that is that Mr Akram knows his job better than anyone and would be seen to have known his job better than anyone. Undoubtedly he did take short cuts which was wrong. We do not think it was a deliberate attempt to avoid a direct command, so we do not put it down as conduct, we put it down as capability. The company on the other hand concluded that there had been a direct disobedience. We do not think that was a reasonable conclusion to come to having heard all the evidence. We think he should have been given the benefit of the doubt. We think any other worker would have been given the benefit of the doubt in those circumstances. The reason of course he was not given the benefit of the doubt was his previous brush with Mr Osborne the previous October. We understand exactly Mr Osborne's feelings about the matter which is simply here is man who had threatened his wife. That was the 'feel' we had throughout the hearing.
21 We conclude that this was the company going outside the reasonable band of punishments for the offence that was found. He should have been (and any reasonable company of this size would have done) warned. His offence given his length of service and one relatively minor criticism of the quality of his work, was not reasonably appropriate. Our belief is that following, to paraphrase Mr Osborne's comment, the incident in the Autumn Mr Akram put his head 'above the parapet' and got it shot off. That was unfair."For the appellant Mr Chesterfield relied upon two main submissions in attacking the Industrial Tribunal decision. First of all he pointed to the fact that an essential or substantial part of the tribunal's decision contained particularly in paragraph 21, was that the respondent should have been in receipt of warning rather than been subjected to dismissal consequent upon this particular offence relating to the camshaft in question; and that failure to act in that way amounted to, so far as the tribunal was concerned, an inappropriate reaction within the band of reasonable responses to the relevant test. He pointed out, forcibly, that in the letter of the previous October, to which we have already made reference, reference was made by way of warning to quality control, and he also sought to rely upon a paragraph in a witness statement of Mr White, another employee of the company which was presented to us as part of the case. In that statement it is quite clearly stated on page 6 that there had been a conversation, allegedly between the gentleman in question and the respondent which, putting it very simply, resulted in as far as Mr White was concerned the employee being on notice that if he failed properly to carry out the hedgehog procedure he would be liable to instant dismissal.Secondly, Mr Chesterfield approached the matter on the basis that properly understood what the tribunal had done was to substitute its own view for that of the employer which contravened tests so well known in this field of law that they need not be repeated; and that furthermore, had fallen into the trap of moving, if that is the right way of putting it, from what was essentially a issue relating to conduct as the reason for dismissal for that of capability, and thus confused the issues which had been before the employer which is all they should have been considering. Thus the tribunal had again substituted their own views for the position of the employer at the material time. In this respect, he relied upon the decision of the Court of Appeal in London Borough of Hackney v Jaqueline Benn 31st July 1996 [unreported as yet] , BAILII: [1996] EWCA Civ 561 , where the judges quite clearly laid down the proposition as a matter of sound law that if an issue of conduct is being considered upon the facts of the case that is before the Industrial Tribunal, it should not venture into expressions of its own opinion on whether the issue is really one of capability, thus distorting the matter from not an assessment of what the employer did on a reasonable basis, which is the task of the tribunal, but rather as to whether the tribunal had their own personal view that what had happened was reasonable. There was also a secondary issue with regard to contribution, but it was clear that what Mr Chesterfield substantially relied upon in this case was the fact that right throughout the relevant paragraphs we have quoted, the phraseology used by the tribunal such as the words "believed" or "think" made it quite clear that they were substituting their own views in these two contexts, and it further was perverse to have relied upon any lack of warning as featuring in the issue in view of the extent to which evidence disclosed warnings had been given.In reply, Mr Smith was concerned to point to the substance of the Industrial Tribunal's decision and to the fact that what they were really saying was that the warning position was not as represented to us by Mr Chesterfield, but rather to be found in the context of the phrase of sentence (at the top of page 5 of the decision, page 8 of our bundle):
"We do not believe that the importance of the use of it was emphasised to such an experienced worker as Mr Akram, in the way it was put in evidence to us."
That, said Mr Smith, whatever may be the phraseology, clearly demonstrated a finding in fact that as far as the respondent was concerned he was not on notice as to the consequences of failing to follow the procedures that was maintained as far as the employer was concerned were necessary. The fact that the tribunal made no reference, it was submitted, to the letter of the previous October, indicated that they regarded it as no significance in the context of putting the respondent, on such a position of notice and warning. In substance, he maintained that the tribunal had properly directed its mind to whether or not there was within the context of the employer's position a reasonable or not reaction to the position they found themselves in with regard to the employee, and he submitted that the tribunal were more than entitled to conclude that there was not adding by way of their reasoning, the reference to the previous and separate matter to which we have already referred involving the trip to Pakistan and the consequent problems with the gentleman in question Mr Osborne.It seeking to resolve this matter, it is important first of all to emphasise that the role of this tribunal is to endeavour to construe the substance of the decision of an Industrial Tribunal particularly on matters of evidence whatever may be the form in which it is expressed unless the two are wholly inconsistent to the point of rendering the exercise impossible. It is also important to note that while it is beyond peradventure that an Industrial Tribunal must not substitute its own view as to the views of the employer in the context of what was or was not a reasonable response, it must if it is doing its duty make findings in fact as to what the employer was proceeding upon in terms of what was the reason for dismissal at the time, and thereafter express a view under regard to s.98(4) of the 1996 Act, as to whether or not dismissed was within the band of reasonable responses and therefore consistent with the substantial merits and equities of the case. To that extent the tribunal must express is own opinion in any case of this type.Looking at this matter in that context, we are of the view that the tribunal plainly took the view, upon the evidence, that the respondent was not on notice to the extent that Mr Chesterfield maintains before us he was. We are not able to give any status to the content of the witness statement from Mr White put before us, which if it had been part of the findings of the Industrial Tribunal with reference to notice and the conversation, plainly would have been a very important part of a case which might have taken a wholly different course to the one with which we now find ourselves presented from the tribunal. The substance of the decision in our opinion is that the tribunal both considered that Mr Akram was not, as a matter of fact on the evidence, in the position that Mr Chesterfield contends for before us not apparently regarded the letter as a relevant warning nor accepted Mr White's evidence as presented to us. Therefore on that basis the tribunal were entitled to conclude, in our opinion, that although it appeared that the respondent took a short cut that was wrong, as they state, it was not a reasonable response to treat that one instance as sufficient to initiate instant dismissal in the context of that particular position.We consider that the references made towards the end of paragraph 20 to the previous incident involving Mr Osborne, is merely put in by the tribunal to give some colour to why they think the matter may have proceeded the way it did in relation to the reaction of the employer to what was discovered to be the case as regards the conduct of the employee. But we do not consider that they have fallen into the trap of drifting from an issue of conduct to an issue of capability, any more than they have looked at the matter in the context of a mistake or inadvertence as Mr Smith contended for. In these circumstances, whatever view we might have taken of the case presented for us by Mr Chesterfield very ably and very cogently, we are unable to conclude that it altogether conforms to the evidence the tribunal had before it and found as fact to be the case. For these reasons we are unable to accept it.The issue of contribution is only theoretical because of the fact that the compensation levels are at a particular level in this case, but if we had had to decide it, we would have been prepared to accept that the tribunal were in fact making a reduction in the otherwise level of contribution they would have assessed by reason of the employee's long and good service records, and that is something we would have taken the view they were entitled to do.In these circumstances and for these reasons the appeal will be dismissed.