MR S FARRELL v FORD MOTOR COMPANY LTD [2000] UKEAT 1103_99_2806

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2000] EAT 1103_99_2806Case No Appeal No. EAT/1103/99Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MR S FARRELLAPPELLANTFORD MOTOR COMPANY LTDRESPONDENT
Before
His Honour Judge J Altman Mr A E R Manners Mr P M SmithDate 28 June 2000
[1]APPEARANCES For the Appellant MR GWYNN PRICE-ROWLANDS (of Counsel) Instructed by: Messrs Goodmans Solicitors 6/8 Broadway Norris Green Liverpool L11 1JS For the Respondent MR NICHOLAS RANDALL (of Counsel) Instructed by: Michael Edwards Solicitor Ford Motor Company Ltd Eaple Way, Brentwood Essex CM13 3BW JUDGE ALTMAN: This is an appeal from the decision of the Employment Tribunal sitting at Liverpool on 2 July 1999 when the complaint of unfair dismissal was rejected. By the notice of appeal, the Appellant complains essentially of 2 matters. In ground 6(b) it is said that the Tribunal were wrong in insisting that the matter be dealt with as a final written warning followed by a dismissal case, rather than a gross misconduct case, since the Respondent obviously dealt with the matter as a gross misconduct case. In relation to that, other grounds of appeal are set out, relating to the way in which the Employment Tribunal approached their analysis of a final written warning given for an earlier matter of misconduct. The second matter is that there were the features of that earlier written warning, namely, the absence of a time limit, that nearly two years had expired which meant the Employment Tribunal should have given consideration to that in determining that it was inappropriate to rely on that earlier warning.[2]It is helpful to set out the progress of this case. The Appellant began work for the Respondents in 1977. Up until 1996 his record was unblemished and he was, so far as we know, a well-regarded employee. On an occasion on 26 November 1996 it was alleged that he left work some 15 minutes early, without telling the supervisor or waiting for the oncoming shift to take over from him. The Appellant's case at that time was that there had been simply a misunderstanding on one occasion, that it was not for as long as 15 minutes and that it came at the end of the long period, to which I have referred, of good employment.[3]It is interesting to read the way in which the Respondents' described their approach on that occasion in the notice of appearance before the Employment Tribunal:
"After an investigation and the conclusion of the internal discipline procedure, and appeals process, during which the (Appellant) was fully represented, the decision was made to dismiss the (Appellant) for gross misconduct. However, the decision to dismiss was commuted to a 5 day suspension without pay and a final written warning, on the basis of him having a clean disciplinary record. This discipline, from November 1996, was on the (Appellant's) record when the recent incident, which led to his dismissal, took place."
We have seen the warning letter on that occasion which sets out those features, except no time limit was given for the warning. We have been informed that the Respondents handbook, issued to the Appellant in the 1970's, did provide for a 3 year warning period; but it has also been pointed out to us that the ACAS code, and frequently the general practice in industry, is to look more to a time scale of 12 months. But be that as it may, we note the process by which on that occasion there was a decision to dismiss for gross misconduct, which thereafter was commuted, only because of a clean disciplinary record.[4]The incident, which led to dismissal, took place on 22 October 1998. The Appellant and the Respondent gave differing accounts as to what had occurred. The Respondents' case, as we understand it to be from their notice of appearance, was that the Appellant left work some 1¼ hours early, without telling a Supervisor, indeed ignoring a supervisor calling after him and a colleague as they walked out, leading to the need to check whether permission had been given and for a tannoy to be put out for them; and that the men, then including the Appellant, returned at the shift end in order to clock out. The Appellant's case was that he was working a voluntary shift. He had worked through his break periods; he believed there was a general practice of what may be called 'job and go' and that when the Supervisor called after him, he thought it was done jokingly, and that he was not leaving the site, but going to repair a tyre on his car.[5]The process of interviews and appeals was not subject to criticism but the way in which the Respondents put their case is of some importance. In the contemporaneous documents, we have the dismissal letter which was furnished after the appeal, which shows that the initial disciplinary interview hearing was described as ending in the following way:
"The conclusion from that hearing was that you were found to be absent plant without permission. Your department manager therefore dismissed you for gross misconduct."
Then the appeal hearing was described as follows:
"Having taken all the facts of the incident into consideration and your previous disciplinary record the decision to dismiss you from the company for gross misconduct was upheld."
[6]It is pointed out that a final appeal from that was also upheld and what was upheld was "the decision to dismiss you from the company for gross misconduct." When the Respondents came to describe their position in their notice of appearance, they described what Mr Moloney, who took the initial decision to dismiss, did, as follows:
"Having considered all the information available to him Mr Moloney believed that the (Appellant) had been missing from the plant without permission, and dismissed the (Appellant) for gross misconduct. The fact that he had a previous discipline for a similar offence was also considered. The (Appellant's) representative lodged an appeal against the dismissal and, in line with the Respondents' procedures, the (Appellant) continued to be suspended on full pay pending the outcome of the appeal process."
That was then described again as a decision upheld at the first disciplinary appeal, and again at the final appeal the confirmation of dismissal for gross misconduct was confirmed, also after consideration of the earlier disciplinary matter. Then in specific numbered paragraph 4, the Respondents said this: 4. "The Applicant states…. "dismissal was recommended taking the previous offence (nearly two years ago) into account." This is not correct. The (Appellant) was dismissed for gross misconduct, based on the circumstances of the incident on October 22 1998 alone. However it is the case that had the (Appellant) not been dismissed for the same offence two years previously, which was subsequently commuted…he would, in all likelihood, have had his dismissal commuted in this instance." And at the end of the notice of appearance they said this:
"In all the circumstances the Respondent contends that it dismissed the (Appellant) for a fair reason (conduct), that it amounted to gross misconduct, and that the Respondent treated the reason as a sufficient reason for dismissing the (Appellant). In further, or in the alternative, the Respondent argues that the (Appellant) would, in all likelihood, also have been dismissed on the basis of the Respondents' progressive disciplinary policy given that he had received a final written warning two years previously."
[7]Mr Randall on behalf of the Respondents conceded, in his words, that these documents, so far as the difference between an ordinary dismissal and a dismissal for gross conduct were concerned, were "at sixes and sevens." However, it seems to us clear on the face of those documents that the Respondents intended to come to the Tribunal to deal with: i. First of all the reason for dismissal as being gross misconduct and ii. Secondly, to contend that they were reasonable in treating that as the reason for dismissal, raising in the event the matter of an alternative procedure which had it been followed, they say would have led to the same result.[8]When the matter then came before the Employment Tribunal there was some evidence which we have looked at and we are indebted to Mr Randall for not taking nice procedural points, as to whether we should or not. We have had of course no notes of evidence but we have had sight of a witness statement of Mr Moloney who was the only witness for the Respondents. Reference to the earlier disciplinary warning was mentioned in that statement in the context of the fact that the Appellant should have had knowledge of the seriousness of leaving the plant without permission and he then in paragraph 11 described what he did. He said: 11. "I concluded that Mr Farrell had indeed been absent plant without permission which is treated as an act of gross misconduct…the normal sanction for gross misconduct is dismissal, and taking into account his existing disciplinary record I decided that dismissal was the appropriate sanction in this case."[9]Again the emphasis is on gross misconduct it seems to us, on the face of the position of the Respondents. When the matter was considered in the decision of the Employment Tribunal, the Tribunal in paragraph 6 set out their basic primary findings of fact. They set out the job for which the Appellant was employed, the existence of the earlier warning, a brief summary of the conflicting accounts of the incident which led to dismissal and they then made their findings as to the disciplinary meeting in paragraph 6(f) as follows: 6(f) "A disciplinary meeting took place on 2 November before Mr Moloney who, in the light of Mr Farrell's previous disciplinary record, decided to dismiss him." Whilst we caution ourselves against reading a decision of an Employment Tribunal through a magnifying glass, we do note that that description, on the one hand, emphasises the previous disciplinary record, but on the other hand, it makes no mention of Mr Moloney's assessment that the incident that led to the dismissal itself was gross misconduct. The Employment Tribunal then go on to find that the conduct was the reason for dismissal. They then go on to refer to the argument for the Appellant that the Respondents were unreasonable in relying on the previous final warning.[10]On behalf of the Appellant, Mr Price-Rowlands has submitted that the employer and the Employment Tribunal should have looked at the earlier warning not only in form but also in substance. This is in relation to the features of its being too severe for the incident itself, being rather old without a time limit having been put upon it, and with its standing, he would say, in 'stark contrast' when set against the rest of the Appellants' work record. The finding of the Employment Tribunal was this:11. "There was no question but the company were entitled to regard Mr Farrell's actions in 1996 as amounting to misconduct of some kind. There clearly was no bad faith on the part of the Company and in that situation we did not feel it was appropriate for us to interfere with the level of discipline imposed at that time. A different employer might indeed have decided to issue a different type of warning but we were not in a position to set aside the final warning on Mr Farrell's record.12. "In accordance with Mr Farrell's contract such a warning remained on his record for three years and the company were therefore reasonably entitled to regard it as in existence in October 1998."[11]We ourselves have not fully understood the submission that the Employment Tribunal was under some duty to assess for itself the appropriateness of the earlier warning. We have been helpfully referred to the case of Stein v Associated Dairies Ltd [1982] IRLR 447 which suggests that it is not the function of the Employment Tribunal to sit in judgment upon the issuing of a final warning and it is quite right, as Mr Randall has pointed out, that the point of a warning on a disciplinary record is that an employee is on notice. That is not, of course, the only purpose of a warning. It also marks the fact that an employee has demonstrated a disposition to behave in a way; that he is later accused of having done so on an earlier occasion and that is a factor for an employer to take into account, when assessing whether he can remain in employment, when there is a subsequent breach. But the Employment Tribunal then go on in paragraph 13 to say that they accept that the incident on 22 October 1998 could reasonably be regarded by the Respondents: 13. "As amounting to misconduct of some kind, and clearly not "trivial" misconduct." And they find that the Respondents were entitled to take the view that the Appellant was fully aware that he should not have absented himself in the way he did.[12]The Employment Tribunal come to the conclusion therefore, that as a matter of fact this was not a 'job and go' incident in which the Appellant was acting within his contract, but that he had done something wrong. However, they then go on to say this:14. "The company might have had some difficulty in establishing that Mr Farrell's actions amounted to gross misconduct, which is the way in which they described them. However, it is clear that Mr Moloney was relying on Mr Farrell's previous disciplinary record when he took the decision to dismiss." And they go on to say:15. "Mr Farrell was subject to a valid final written warning on 22 October 1998, on which date he behaved in a way that the Company was reasonably entitled to regard what happened " as further misconduct . " And then they summarise their conclusion with the words:16. "In such a situation it is impossible for us to say that no reasonable employer could dismiss."[13]It seems to us that the starting point for the case before the Employment Tribunal was an allegation by the Respondents of gross misconduct. In paragraph 14 of their decision the Employment Tribunal seem to have purported to make a finding that this was simply a matter of terminology. Whilst they used the word "described" as the origin of the term, they go on to say that Mr Moloney was relying on the previous disciplinary record. We understand that is what the Appellant arrived at the Tribunal to argue about. However, the Employment Tribunal made a finding in effect that the Respondents would have fallen down had they maintained the grounds of dismissal as being truly for gross misconduct, and not a matter of ordinary misconduct, following a warning. Yet they go on to refer back then to the disciplinary record. Accordingly, there seemed to have been in the mind of the Employment Tribunal two possible scenarios: i. A dismissal for gross misconduct and ii. A dismissal for misconduct following a current, final written warning.[14]Mr Randall says that simply because the Respondents used a terminology 'gross misconduct,' it may not have been 'gross misconduct' but would have been lesser conduct, which if approached in a different way could have led to dismissal, and that to allow this appeal would be the triumph of form over substance. However, it seems to us on the face of the decision, which is all we really have to go on, that the Employment Tribunal appear to have substituted their view as to what the employer did in this context for that put forward by the Respondents. But we are not sure about it. We ask ourselves was the Employment Tribunal saying that 'gross' was simply a word used and the reality was that the employer was dismissing for misconduct, following a final warning? That conclusion certainly was not available in the face of the employer's stance.[15]At the most it seems to us, on the reading of the information before us, that the earlier written warning formed a particular part of the Respondents' reasoning. They said that they were entitled to dismiss for gross misconduct and would then look to see if there was any extenuating reason to prevent such dismissal; and the existence of the previous warning prevented that process taking place. It seems to us, however, that there are fundamental differences that have to be recognised between dismissal for gross misconduct and dismissal in accordance with a 'progressive procedure.' Gross misconduct is a different quality of act of misconduct. It is so serious that it warrants summary dismissal; in other words the act itself is a fundamental breach of the contract of employment, such as to entitle the employer to treat the contract as at an end without requiring termination by notice.[16]That is a very different quality of act, it seems to us, than misconduct following a final written warning, which may only lead to dismissal because of the existence of that warning. What was the view of the Employment Tribunal as to the view and approach of the Respondents, in relation to those differences? We pose the question but we regret we are unable to answer it, on the face of that decision. If it was gross misconduct, where did the Respondents stand on the finding of the Tribunal? They stood in difficulty. On their own evidence, a clear record would have saved dismissal, which itself of course, arguably must raise questions as to whether it was gross misconduct. We pose the question as to how an employer can contemplate the continuation of a contract of employment, where there has been gross misconduct and clearly, in the context of a dismissal of gross misconduct, an earlier written warning was critical because without it, there would have been no dismissal.[17]If on the other hand, the Employment Tribunal had been looking at a dismissal for misconduct, following a final written warning, what would the consequences be of that? The Appellant says that in those circumstances the Employment Tribunal would have been bound to look at the way in which, to adopt the words of the statute ' the Respondents treated that misconduct as the reason for dismissal' and that, states Mr Price Rowlands, would have raised questions as to the way in which the employer looked at the earlier warning, considered what particular breach it was given for, would have considered how long ago it had been, and would have considered against that all the good points in the Appellants favour during his employment. What is said on behalf of the Appellant in effect is that: i. First that process was not carried out by the Respondents ii. Secondly, it was not an analysis conducted by the Employment Tribunal when looking at the way in which the employer dealt with the matter.[18]We consider the critical words of paragraph 14 in which the Employment Tribunal say on the one hand that there would have been difficulty in establishing that the actions amounted to gross misconduct but that on the other hand they point out the reliance on the previous disciplinary record. It seems to us that the Employment Tribunal appear to have slid from one stance of the Respondents, namely dismissal for gross misconduct, to another potential stance, namely dismissal after a final written warning. If an Employment Tribunal is confronted with two such dramatically different approaches to dismissal, a dismissal for gross misconduct on the one hand and a dismissal following a final written warning for misconduct on the other, then there is a more extensive process of examining the reasons of the employer in either case which has to be carried out.[19]The final words of paragraph 16, which are a way of describing the duty of the Employment Tribunal, are these: 16. "In such a situation it is impossible for us to say that no reasonable employer could dismiss." We are left as to some doubt what form of dismissal the Employment Tribunal was really finding. Accordingly it seems to us that there were two questions before the Employment Tribunal, which were in the event not answered: i. Question 1: If this was dismissal for gross misconduct, was it reasonable in accordance with the statutory tests? ii. Question 2: If it was not dismissal for gross misconduct, what was the overall approach of the Respondents? And were they reasonable in treating the later misconduct as the reason for dismissal?[20]It is when considering not only the simple fact of an existing warning, but also when taking into account all the other factors as well that can be seen in the actions of an employer, that a fundamental difference between dismissed for gross misconduct and for ordinary misconduct can be seen. It is not just a matter of form but one clearly of substance. It seems to us that there is a danger in treating a procedure as a screen behind which one need not look, when examining the reasonableness of an employers action. Rather one should examine a procedure, as a vehicle upon which the actions of an employer in an individual case can be generally assessed.[21]Accordingly, we have come to the conclusion that the Employment Tribunal erred in failing to identify whether the reason for dismissal was for gross misconduct on the one hand or dismissal following a final warning on the other. Thereafter they failed in applying an assessment of the way in which the Respondents treated the reason as the reason for dismissal in the light of the answer to which ever of those questions they came. It seems to us that this appeal falls to be allowed on that ground. We have considered the most appropriate course. Subject to any submissions which may be made to us, it seems to us that the most appropriate course is for this appeal to be remitted to a differently constituted Employment Tribunal for rehearing.[22]An application to appeal is made and we refuse the application. The appeal is on the ground that there are matters of importance as to the label attached to the form of dismissal. It seems to us that our decision has been based upon an analysis of the way in which the Employment Tribunal gave its decision and deals with matters of substance, not of labels. Whilst we accept the submission that there are interesting points of law presently being considered, about the operation of the unfair dismissal statutory provisions, it does not seem to us that our decision in this case impinges on those points of law.[23]This application is remitted to a differently constituted Tribunal for a re-hearing.