MR J LOCK v CARDIFF RAILWAY COMPANY LTD [1998] UKEAT 1022_97_2303

EMPLOYMENT APPEAL TRIBUNAL

BAILII case number: [1998] UKEAT 1022_97_2303

Case No Appeal No. EAT/1022/97

Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

Between

MR J LOCKAPPELLANT

CARDIFF RAILWAY COMPANY LTDRESPONDENT

Before

Mr Justice Morison

Date 23 March 1998

[1]APPEARANCES For the Appellant MR A McLOUGHLIN (of Counsel) Messrs Pattinson & Brewer Solicitors Transport House Victoria Street Bristol BS1 6AY For the first Respondent MR D BROWN (of Counsel) Messrs Eversheds Solicitors Fitzalan House Fitzalan Road Cardiff CF2 1XZ MR JUSTICE MORISON (PRESIDENT) : This is an appeal brought on behalf of Mr Lock against a decision of an Industrial Tribunal which was promulgated on 23rd July 1997. The unanimous decision of the Industrial Tribunal was that he had been fairly dismissed by his former employers, the Cardiff Railway Company Ltd, the respondent to this appeal.

[2]The reasons for the Industrial Tribunal's decision are contained in a written document and we would like to say at the outset, that it appears to us that the Industrial Tribunal have approached the task before them with care and we would wish to pay tribute to the clarity with which they have expressed their reasons.

[3]The essence of the employer's case at the Industrial Tribunal was that Mr Lock had committed an act of misconduct which justified his dismissal. The misconduct relied upon occurred on 17th December 1996 when during a train journey Mr Lock, who was employed as a conductor, asked and required a passenger to leave the train because he did not have a valid ticket for use on that train, nor did he have the wherewithal to pay the £1.25 excess fare that was required of him. The passenger concerned was a young man aged 16, but whom Mr Lock believed to be older. During the course of the interchange between him and the passenger it is Mr Lock's case that the passenger was rude and abusive. As a result of being put off the train the youth required assistance from his family to get home, which assistance was given to him. The incident occurred in late afternoon early evening, and it appears that he eventually arrived home some three hours later than he anticipated. Mr Lock was seen by his employers and he attended a disciplinary hearing which was conducted by Mr Hirani, who is train crew manager and Mr Lock's then superior.

[4]The Industrial Tribunal having heard the evidence produced to them, and having directed themselves as to the law, set out the parties' contentions in the form of an interchange between what was said on behalf of Mr Lock, followed by what was said in refutation on behalf of the former employers. At paragraph 26 of the decision the tribunal said this:

"26. It was argued that Mr Lock had admitted his mistake and dismissal was too harsh."

At paragraph 27 the tribunal said:

"27. This is rejected. This was not a question of mistake. It was a matter of judgment. Mr Lock, in jumping to the conclusion that the boy intended to defraud before enquiring as to where he he had boarded the train and as to whether he had heard the announcements, showed a lack of judgment in dealing with the public too severe to be written off as a mistake."

Paragraph 28 reads:

"28. Mr Hirani made his decision on the basis of the evidence before him. That evidence was that Mr Lock jumped to his conclusions on the basis of announcements made at Central before the boy had boarded the train, and at an earlier station than Queen Street."

I pause there just to indicate that this was a train service at which certain tickets were not to be used. Paragraph 28 continued:

"Mr Hirani properly took into account the company's policy as to courtesy towards customers and as to their safety. It is difficult to imagine a situation more offensive to a passenger than to put him off the train, without money other than what might be thrown after him, and in a strange area and without access to a phone, when he has proffered a ticket perhaps in genuine good faith, and has sought to top up the sum with such money as he has been able to find or borrow. We find that Mr Hirani was justified in concluding that Mr Lock's attitude and conduct was unacceptable."

[5]Accordingly, the Industrial Tribunal on the evidence found that:

"(i) The reason for dismissal was conduct (ii) the alleged conduct leading to dismissal was that Mr Lock ignored reasonable instructions as to the procedures to be followed on part payment of fare, [ that is a reference to his failure to complete the necessary form contemporaneously with the incident ] and instructions to be helpful and courteous and concerned for the safety of passengers. (iii) at time of dismissal the respondents genuinely believed that Mr Lock committed the alleged conduct and in view of their investigation and Mr Lock's admission and recognition that he had not applied proper procedures they had reasonable grounds for that belief. (iv) the respondents applied reasonable procedures in that the applicant was made aware of the charges prior to hearing and had a full opportunity to put his case at the investigatory hearing, by means of his report and, with representation, at the disciplinary and appeal hearings. (v) in view of Mr Lock's admission such investigation as was carried out was reasonable. (vi) in view of the clarity of the written instructions as to excess fare situation, the emphasis in the instructions on courtesy and safety, and the importance to the respondent of good public relations, dismissal came within the band of responses a reasonable employer would have made to the situation."

[6]Mr Lock was dissatisfied by this decision and, as we have indicated, presented a Notice of Appeal which came on for hearing before the Employment Appeal Tribunal at a preliminary hearing, and it was ordered that the matter should proceed to this full hearing on the grounds, solely, that the conclusion that dismissal was within the range or band of responses a reasonable employer might have made to the situation was a misdirection or perverse.

[7]Before turning to Counsel's submissions, it is as well to point out that there were certain difficulties that the Industrial Tribunal had to face in dealing with this case. The first one related to the way in which the employers had conducted their disciplinary proceedings. This is not referred to anywhere, as we understand it, in the tribunal's written decision. The position is this. At the disciplinary hearing which was conducted by the train crew manager, he arrived at the conclusion that Mr Lock should be dismissed by reason of a previous warning which he said had been given to Mr Lock. The notes of the first disciplinary hearing read as follows:

"My view is the final warning must mean what it says and due to the serious nature of the incident where a customer was left without any recourse to any help, was conduct totally unacceptable to the Company. Improper conduct and attitude to those in authority and to our customers cannot be accepted and it is therefore my decision today that you be dismissed from the service. I regret having to make this decision, but I feel it is right and proper given the circumstances."

[8]It seems to us that there can be no doubt but that the basis of the decision taken by the train crew manager was that the conduct of Mr Lock justified dismissal not solely because of the incident itself, but because of the incident itself when taken in conjunction with the fact that he had been given a final warning. Thus, his conduct or misconduct represented not only a poor performance in relation to the handling of a customer, but also demonstrated in his view, an inappropriate attitude to those in authority, in the sense that, having been given a final warning, within a short time thereafter, he was breaking the company's written instructions again.

[9]The matter went to an internal appeal. It was submitted to the appellate panel that it was unfair to take into account any previous alleged misconduct of Mr Lock, because of the timing of any such previous disciplinary action. It would appear that at the appeal hearing the person who took the appeal decided that he should look at the matter on the basis only of the incident which had occurred, where the boy had been asked to leave the train. As I understand the record of the appeal hearing, it looks as though the person who decided that the appeal should be dismissed, considered that he should look at the charge on its own merits and not by reference to any past behaviour.

[10]Very properly when the matter came before the Industrial Tribunal, Counsel on behalf on behalf of Mr Lock sought to cross-examine the train crew manager as to whether he had taken into account any previous alleged misconduct. As a result of interchanges that took place, we understand the Industrial Tribunal were faced with a contention on behalf of the employers that they relied on the incident when the boy was put off the train and on nothing else as justifying the decision to dismiss. It is for that reason, we assume, that the Industrial Tribunal make no references to the earlier incident in their decision.

[11]The second comment we would make at this stage, is that there was no explicit reference made to the Code of Practice which applies in cases of dismissal. The responsibility for making Codes of Practice in this area falls upon ACAS. In 1997 ACAS promulgated a Code of Practice which was designed to give practical guidance to employers and employees' organisations on how to draw up disciplinary rules and procedures and how to operate them effectively. Paragraph 8 of the Code of Practice provides as follows:

"Employees should be made aware of the likely consequences of breaking rules and in particular they should be given a clear indication of the type of conduct which may warrant summary dismissal."

Then in paragraph 10 there are certain requirements for disciplinary procedures.

(h) it says as follows:

"Ensure that, except for gross misconduct, no employees are dismissed for a first breach of discipline."

[12]It seems to us that although the Code of Practice was not referred to expressly by Counsel on Mr Lock's behalf, nor on behalf of the employers, Industrial Tribunals should always have the Code of Practice to hand as a guide for themselves as to what is good sound industrial relations' policy and Practice. In other words, this Code sets out the standards, as we see it, of sound industrial Practice based on a considerable body of experience. The lay members themselves also have such experience, but the Code forms, as it seems to us, the basis on which employers' conduct should be judged. It would have been of assistance, we think in this case, for the Industrial Tribunal to have taken the Code into account on the difficult question at issue before them as to whether a one-off act of misconduct, which this was to be treated as, could justify a dismissal. Nowhere in the decision itself is there any reference to paragraph 8 of the Code, nor is there any reference to 10(h). There is no statement in the decision that the tribunal are satisfied that Mr Lock's conduct on the particular occasion could be described as gross misconduct. It will be borne in mind that the employers themselves regarded what he did as showing a lack of judgment and a lack of judgment in the exercise of his discretion as a conductor as to how to deal with a passenger.

[13]The argument in this case has been short and succinct. On behalf of the Mr Lock, Mr McLoughlin has urged us to the view that no reasonable tribunal could have concluded that dismissal for a mere error of judgment fell within the range of reasonable responses. He says conductors are put into a difficult position. They are being asked to ask passengers for money, often in circumstances, as here, in which the passenger does not consider that such a request is justified. They are, as with other officials in uniform, likely to be subject from time to time to abuse and possibly worse in the course of carrying out their duties. He argued, therefore, that just because Mr Lock turned somebody off a train in circumstances where, with the benefit of hindsight he thought he should not have done, did not justify a dismissal. He pointed out that the Industrial Tribunal merely described Mr Lock's attitude and conduct as unacceptable without going on to find that his conduct could be categorised as so gross as to justify dismissal for a one-off act.

[14]On behalf of the employers, Mr Brown in a conspicuously able submission for which we are grateful, drew our attention to our duty to give a full margin of appreciation to Industrial Tribunals. We are an appellate body whose currency is points of law. It is not our function to second guess decisions of Industrial Tribunals or to reverse them merely because we disagree with their conclusions. The question as to what fell within the range of reasonable responses was pre-eminently a question of fact for the decision-maker, the Industrial Tribunal, sitting as an industrial jury. Secondly, he said to us, that the decision itself does not demonstrate any overt error of law. Thirdly, he submitted to us that we should be careful not to rejudge the seriousness of Mr Lock's alleged misbehaviour. The employers were, he submitted, entitled to take the view that he was guilty of oppressive and overbearing conduct towards customers, and that it was quite sufficient in the circumstances for the employers to have categorised various forms of misconduct as misconduct which might give rise to dismissal or to some other sanction, and that it was not a case where the employers needed to spell out in detail which offence would be treated as gross misconduct and which would not. Accordingly, although the Code provided a useful tool for employers and employees, it did not need to be slavishly followed. He submitted to us, in the circumstances, that the tribunal have applied their minds in accordance with their duty to the questions which they must face.

[15]I should say at the outset that this a case where I have turned to my lay members for guidance. It seems to me that they are in a particularly good position to advise me as to whether they found the tribunal's decision one which, having regard to the fact that they are the fact-finding tribunal, which could be regarded as acceptable in the sense of whether it was rational.

[16]It is their view, having regard to the standard laid down by the Code of Practice, to which I have referred, that the decision of the Industrial Tribunal departs from the standards of sound industrial experience as put into Practice. It is their view, with which I entirely agree, that no reasonable tribunal properly directing itself could have concluded that a one-off act of the sort referred to could justify a dismissal.

[17]Furthermore, it seems to us that the Industrial Tribunal have misdirected themselves in law by not having regard to the provisions of the Code of Practice. The position is this. Under s.207 of the Trade Union and Labour Relations (Consolidation) Act 1992 it is provided as follows:

"(1) A failure on the part of any person to observe any provision of a Code of Practice issued under this Chapter shall not of itself render him liable to any proceedings. (2) In any proceedings before an industrial tribunal or the Central Arbitration Committee any Code of Practice issued under this Chapter by ACAS shall be admissible in evidence, and any provision of the Code which appears to the tribunal or Committee to be relevant to any question arising in the proceedings shall be taken into account in determining that question."

The Industrial Tribunal should have taken into account and examined the question of whether the Code of Practice had been complied with in this case.

[18]The Disciplinary Code the employers says, at paragraph 15:

"The agreed disciplinary procedure will be applied in any of the following circumstances: [ there is then set out a whole series of different potential disciplinary offences, ranging from: ] You are unfit for work through consuming alcohol or drugs before, or while, on duty. Your are absent from work without permission. You persistently commit of minor offences. You misuse travel facilities."

Paragraph 16 sets out the disciplinary procedures and it simply says:

"If charged with any disciplinary offence you will be given a hearing at which you can state your case. You may be suspended from work during investigations prior to the hearing. After the hearing, if the charge is proved, the Board may: ..."

Then it sets out the various ranges of disciplinary sanctions: dismissal; suspension from work for a defined period; reduction in grade; transfer to another post; and suspension or limit of the free travel facilities.

[19]It will be observed at once that nowhere have the employers spelt out the likely consequences to an employee of breaking rules, other than in a general sense. In particular, they have failed to give a clear indication of which type of conduct may warrant summary dismissal. It is not specified in the disciplinary Code which offences could be described as gross for which a first breach would justify the disciplinary sanction of dismissal.

[20]In those circumstances, the very difficult question before the Industrial Tribunal, is made much easier when one has regard, as one should do, to the terms of the Code of Practice. It is possible to say in this case that there has been a failure by the employers to introduce a disciplinary Code which falls within the requirements of paragraph 8 and 10(1)(h). Having regard to those factors, in addition, it seems to us that the Industrial Tribunal's decision cannot stand, as they have failed to have regard to the provisions the Code.

[21]Mr Brown urged us to the view that as this was an agreed Code, and as no specific point was taken on the Code of Practice issued by ACAS before the Industrial Tribunal, therefore, we should not place any weight on this point.

[22]It seems to us essential that employees should be given due warning of which types of misconduct will, on a first breach, lead to dismissal. They are entitled to know before they are dismissed what they may be in for if they break that particular rule. It seems to us to be no answer to say that this was an agreed Code and that Mr Lock's agent, his union, made the agreement, because, as it seems to us, the union cannot be taken on Mr Lock's behalf to have agreed that any one-off breach of any one of the rules set out in 15.1 would thereby justify a dismissal for gross misconduct. It is clear from paragraph 16 that any breach of any of those rules might have led to action short of dismissal. It seems to us that the fact that the unions may have agreed to a Code, does not deprive Mr Lock of the benefit of good industrial relations practices.

[23]Accordingly, this is a very rare case in which we are prepared to intervene on an unfair dismissal finding by an Industrial Tribunal. But it seems to us, having looked at the matter, that on any view this decision of the Industrial Tribunal was so unreasonable that it cannot stand. Justice has not been done to Mr Lock, although I would wish to emphasise that the tribunal were faced with particular difficulties in this case to which I have referred.

[24]What should we do in the light of our decision? It seems to us that in the first place that we should substitute for the finding of fair dismissal, a finding of unfair dismissal, because that, in the judgment of the whole of the Court (that is my lay colleagues and myself) is the only conclusion that one could have arrived at, if, as appears to be the case, Mr Lock was being disciplined for a one-off act of misjudgement, in the exercise of a discretion given to him by his employers, in difficult circumstances and in the heat of the moment.

[25]But there is still the question of remedy. This matter will have to go to a remedies hearing, and in our judgment, it should go back to the same tribunal for that purpose. The first question that they will wish to consider is Mr Lock's wish that he should be re-engaged as a conductor. In addition, they will have to consider the question of his culpability, if any, by reference solely to his conduct during the particular incident, taking account of the fact that Mr Lock was exercising his discretion, in, as we have indicated, the heat of the moment; and of Mr Lock's apparent unwillingness to accept the youth as a passenger, because of the language which had been used by the youth to him. It is a matter entirely for the Industrial Tribunal to decide what reduction, if any, should be made in Mr Lock's compensation; and for them to decide whether the order of re-engagement would be inappropriate in the light of their assessment of his alleged contributory fault.

[26]Mr Brown invited us to say that the question of what is known as a Polkey reduction should also be a live issue. It seems to us that it should not be. This is not a case of a dismissal being rendered unfair through procedural error. The reason why the dismissal was unfair was, in our judgment, because no reasonable employer without first having told the employee that this would happen, could reasonably have concluded that dismissal was fair penalty for a one-off act. It seems to us, therefore, that there is no scope for a Polkey reduction.

[27]Accordingly, the appeal will be allowed. A finding of unfair dismissal will be substituted. We remit the matter back. Whilst we can understand Mr Lock's apprehension that the Industrial Tribunal is not to be trusted to hear this matter, as they have already decided the case against him, we should say that we think that position is not well-founded. We have every confidence in the Industrial Tribunal. They will be able, we believe, to look at the question of remedy in a fair and completely unbiased way. And having regard to such guidance as we have given as to Mr Lock's culpability they will assess the question of contributory fault, if any; and consider the question of re-engagement. Technically, as we understand it, they would be obliged to consider the question of reinstatement if Mr Lock invited them to do so, but we would think that Mr Brown was almost certainly right when he indicated that there would be grave difficulties in relation to reinstatement at this time, bearing in mind that there was no claim for reinstatement in the IT1. This is first time that re-instatement has been suggested. That of course does not apply of course to re-engagement which could take place at any time if the tribunal thought it was an appropriate order to make. Accordingly, to that extent, the appeal is allowed. [Application for leave to appeal to the Court of Appeal by the respondents.]

[28]MR JUSTICE MORISON (PRESIDENT) : We refuse that application. Mr Brown has suggested that there are really two matters which were fit for hearing before the Court of Appeal. One, is our role, having regard to the decision in the case of East Berkshire Health Authority v Mattadeen

[1992] ICR 723

to which no explicit reference was made in our judgment, but which we had looked at, and in particular the passage at page 733.

[29]The second matter was in relation to the Code of Practice.

[30]The reason why we refuse this application is because we fully understand the limited circumstances in which we have the right to interfere with a tribunal's decision, but all three of us having looked at the tribunal's decision, and taking into account, as we think we should, the Code of Practice as setting the standards, we are all of the view that this was a decision which invited the comment "oh my goodness", and, in those circumstances, we do not think that there is any principle involved. In relation to the Code of Practice, we think that the position is relatively straightforward and therefore we refuse leave.