MR O BROWN v CONCEPT AUTOMOTIVE SERVICES LTD [2001] UKEAT 0934_00_1511

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2001] UKEAT 0934_00_1511Case No Appeal No. EAT/0934/00Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MR O BROWNAPPELLANTCONCEPT AUTOMOTIVE SERVICES LTDRESPONDENT
Before
His Honour Judge WilkieDate 15 November 2001
[1]APPEARANCES For the Appellant MR C HAY (Representative) Northern Complianant Aid Fund Midlands Unit 70 Villa Road Handsworth, Birmingham BH19 1BH For the Respondent MR C BAYLIS (of Counsel) Instructed by: Messrs Reeves & Co Solicitors 27b The Mansions 252 Old Brompton Road London SW5 9HW JUDGE WILKIE QC: This is an appeal by Mr Brown against one of the two decisions of the Employment Tribunal held at Birmingham on 20 th March last year. The Tribunal decided firstly that his contract of employment with Concept Automotive Services Ltd was terminated unlawfully and the Respondent was ordered to pay Mr Brown £185.00 damages for breach of contract. That is not a decision which is the subject of appeal by either Mr Brown or Concept Automotive Services Ltd. The Tribunal went on to decide that the Respondent did not discriminate against the applicant on the grounds of his race. It is against that decision that Mr Brown appeals.[2]The decision of the Tribunal is set out in a very user friendly form which covers 20 pages and 64 paragraphs. It was a case in which the Applicant represented himself and the Respondent was represented by an employment consultant. The decision sets out clearly and logically the various stages in the Tribunal's deliberations.[3]First of all they describe the source of the evidence, then they set out the issues, and in paragraph 7, they say that "The basis of the claim of racial discrimination was that the Applicant alleged that he was the victim of direct discrimination because, amongst other things, a white person would not have been dismissed in similar circumstances to those in which he was dismissed".[4]They then set out, under the headings "Heading of Facts", a careful resume of the events, the evidence, the points of dispute and their conclusions on the evidence, together with their reasoning. They bring that lengthy passage of their decision together in paragraph 41 where they make a series of findings of fact. In those findings of fact, to the extent that they are on issues where there was dispute between Mr. Brown's evidence and that of his witnesses and that of the respondent, the Tribunal prefer the evidence of Mr Brown and his witnesses and reject the evidence of the Respondent which was, in the main, orally given by Mr Budden.[5]They then, under the next heading, deal with the contract claim and, as we have indicated, found it in favour of Mr Brown and made him an award which is not the subject of appeal.[6]In paragraph 58, they begin to deal with 'The Race Claim'. In paragraph 58, they summarise the allegation of direct discrimination including the assertion that Mr Brown was "discriminated against because he was treated less favourably because of his race than another person" which included the assertion that he was "dismissed when a white person would not have been dismissed".[7]In paragraph 59, they correctly state that if either of the assertions contained in paragraph 58 were correct, that would amount to discrimination as defined in Section 1(1)(a) of the Race Relations Act 1976 and furthermore, would be unlawful contrary to Section 4(2) of the Act because he was dismissed and also subjected to a detriment.[8]In paragraph 60, they re-state again that what was alleged was direct discrimination, that is to say "he was treated less favourably and/or dismissed when a white person would not have been treated in such manner". They then go on to say, which is accurate and not challenged, "There is no direct evidence however, that the reasons why the Respondents acted in the way in which they did was in any way connected with the Applicant's race. The applicant is Afro-Caribbean". They then go on in paragraph 61 to say that "If the applicant had been able to give evidence as to someone else of a different ethnic group who had been subjected to a different form of disciplinary process (or who had not been dismissed for similar offences) then a presumption may have arisen that the Applicant had been treated in the way in which he was because of his race. In this case however, the Applicant produces no such evidence".[9]Mr Courtney Hay, who has appeared for the applicant today, and for the clarity and quality of whose submissions we are extremely grateful, does not criticise any part of the Tribunal's decision up to and including paragraph 61. However, he says that the Tribunal went completely off-track in paragraph 62 and as a consequence of that, the conclusions to which they came to in paragraph 63 are unsustainable as a matter of law in the sense that they manifestly do not follow upon a lawful process of reasoning.[10]Paragraph 62 contains two sentences. The first is as follows:
"As a matter of law the Applicant cannot say that because he is being treated in a way in which no reasonable employer would treat an employee and, as he is from a minority racial group, an inference arises that, that poor treatment is because of his race"
The second sentence reads:
"In the absence of either direct evidence that the treatment was because of his race or a comparator who has been treated differently, the Tribunal cannot find that the Applicant was discriminated against because of his race"
That second sentence, if taken in isolation, is manifestly in error in that it appears to present only two bases upon which the Applicant can establish direct discrimination, namely direct evidence of discrimination or evidence of an actual comparator who has been treated differently in similar circumstances to the Applicant. It ignores entirely what is implicit in the terms of the section of the Act that with direct discrimination, a hypothetical comparator may be appropriately brought into play in order to support an allegation of direct discrimination.[11]Mr Baylis for the Respondent, who has striven manfully to persuade us that this Tribunal did not err in law takes issue with the criticism which Mr Hay makes of the first sentence in paragraph 62. It is certainly correct to say that the first sentence in paragraph 62 bears close similarities to a sentence which is set out in paragraph 14 of the judgment of the Court of Appeal in the case of Anya v University of Oxford [2001] IRLR 377 as to which sentence, Lord Justice Sedley commented as Neill LJ pointed out in King "Such hostility may justify an inference of racial bias if there is nothing else to explain it. Whether there is an explanation as the Industrial Tribunal posit here will depend not on a theoretical possibility that the employer behaves equally badly to employees of all races, but on evidence that he does". Mr Baylis points out correctly that the first sentence of paragraph 62 may be taken as an implicit reference to the House of Lords decision in Zafar v Glasgow City Council [1998] IRLR 36 and in particular paragraph 12 where Lord Browne-Wilkinson delivering the leading speech in that case, says: "I cannot improve on the reasoning of Lord Morrison [in another case which was being cited]. We express the position as follows: the requirement required to establish less favourable treatment which is laid down by Section 1(1) of the 1976 Act is not one of less favourable treatment than that which would have been accorded by a reasonable employer in the same circumstances, but of less favourable treatment than that which had been, or would have been accorded by the same employer in the same circumstances. It cannot be inferred, let alone presumed only from the fact that an employer has acted unreasonably towards one employee that he would have acted reasonably had he been dealing with another in the same circumstances".[12]It seems to us that whether or not the Tribunal in this case stated the law correctly in the first sentence in paragraph 62, it is a matter of nice distinction between respectively the House of Lords in Zafar and the Court of Appeal in Anya v University of Oxford . However, we do not think that the decision that we make rests upon the decision on correctness or otherwise of that particular sentence. The real nub of Mr Hay's criticism is in the second sentence in paragraph 62, which he says is manifestly erroneous in law. Mr Baylis does not seek to argue that that sentence is, in its bare form, anything other than an erroneous statement of the law but he says that it is not to be read in isolation but is to be read in conjunction with the following paragraph which reads "On the contrary, having listened to the evidence of the Respondent, the Tribunal was quite satisfied that there was no element of racial discrimination. The decision to dismiss the applicant arose out of Mr Budden's frustration. He believed the Applicant was taking holiday to which he was not entitled. All of the evidence that the Tribunal heard lead it to conclude that Mr Budden would have treated anybody else in exactly the same way". The concluding paragraph of the decision drew the conclusion that the Tribunal did not accept that the allegation of racial discrimination was made out.[13]It is highly significant that there is no mention in this Tribunal's lengthy decision of the case of King v Great Britain China Centre [1991] IRLR 513 . In this Tribunal, we are used to receiving many cases in which a conclusion of the Tribunal, one way or the other, in a claim for discrimination, whether it be sex or racial discrimination, is appealed, and in such cases, finding a lengthy recitation from the case of King v Great Britain China Centre and in particular paragraph 38 of that decision in which the Court of Appeal extract certain numbered principles and guidance, including the following 2) It is important to bear in mind that it is unusual to find direct evidence of racial discrimination. Few employers will be prepared to admit such discrimination even to themselves. In some cases, the discrimination will not be ill-intention but merely based on an assumption "he or she would not have fitted in" 3) The outcome of the case will usually depend on what inferences it is proper to draw from the primary facts found by the Tribunal. These inferences can include, in appropriate cases, any inferences that it is just and equitable to draw in accordance with s65(2)(b) of the 1976 Act from an evasive or equivocal reply to a questionnaire. 4) Though there will be some cases where, for example, the non-selection of the Applicant for a post or for promotion is clearly not on racial grounds, a finding of discrimination and a finding of a difference in race will often point to the possibility of racial discrimination. In such circumstances, the Tribunal will look to the employer for an explanation. If no explanation is then put forward, or if the Tribunal considers the explanation to be inadequate or unsatisfactory, it will be legitimate for the Tribunal to infer that the discrimination was on racial grounds. This is not a matter of law but as Lord Justice May put it in Nook, almost common sense. In this case the employer put forward in their IT3, an explanation for the decision to dismiss Mr Brown. The Tribunal by it's careful finding of facts and it's exercise of judgment on the relative credibility of Mr Brown and Mr Budden, effectively found those explanations inadequate and/or unsatisfactory. There is nowhere in the decision any recognition by this Tribunal that it is unusual to find direct evidence of racial discrimination or that in some cases the discrimination will be not ill-intentioned and that few employers will be prepared to admit such discrimination even to themselves. There is no recognition of the fact that the Tribunal will look to the employer for an explanation and if either no explanation is forthcoming or the Tribunal considers the explanation to be inadequate or unsatisfactory, then it will be legitimate, though not compulsory, for the Tribunal to infer that the discrimination was on racial grounds. What we have and all that we have is the second sentence of paragraph 62 which is both wrong in law and provides no sensible basis at all for a conclusion that this Tribunal in paragraph 63 has been mindful of the important guidance given in the King case or has carefully gone through the steps called for by the guidance in that case. It seems to us, therefore, that this decision is fundamentally flawed in its process of reasoning even though in all respects up to that point, it is an impeccable exercise in setting out evidence and making findings of fact.[14]It is not for us in this Tribunal to attempt to second guess the Tribunal on the evidence that it heard, nor is this a case where, given the findings of fact by the Tribunal, it is blindingly obvious that there is only one conclusion to which this Tribunal could have come had it approached the matter in the correct way. Plainly these matters are matters ultimately for the judgment of the Tribunal.[15]What we are confident of is that this Tribunal did not approach its reasoning process in the correct way. Had they done so, had they observed the guidelines in King as applied to their own findings of fact, and in particular their findings of the unsatisfactory nature of the explanations put forward by the Respondent, it is by no means clear to us that they would have reached the same conclusion as they did.[16]Accordingly, in this case, we conclude that this Tribunal erred in law and that this appeal must succeed. The question therefore arises what remedy are we to give. Plainly in the light of what we have just said, this is not a case where we can simply substitute our findings for that of the Tribunal. It is a case which must be remitted for further consideration. Mr Hay says that his preference is for the case to be remitted to a fresh tribunal which would have the task of hearing all the evidence afresh. That would, we think of necessity, logically involve their re-opening, or having the power to re-open, the contractual claim which is not the subject of any appeal by either side. Mr Hay, to whose responsible advocacy we pay tribute, has accepted that, given the fact that the Tribunal's decision was unimpeachable up to paragraph 62, he cannot argue that it would be unsatisfactory for this case to be remitted to the same Tribunal for it to consider it's conclusions applying the correct legal processes we have described. We have given this matter much thought and our conclusion is that, given that the contractual claim is not appealed, that this Tribunal has approached the factfinding task in the correct way and that it's error is essentially one of legal approach, the appropriate course is for us to remit this case back to the same Tribunal for them to consider, without any further evidence being adduced, the question of the claim of direct racial discrimination, having regard to the guidelines in King as we have identified them. That will mean that the findings of fact will stand as made as will the determination of the contractual claim in favour of Mr Brown.