PENDRAGON PREMIER LTD T/A STRATSTONE OF MAYFAIR v MR D J BURKHARDT [2001] UKEAT 313_01_1809

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2001] UKEAT 313_01_1809Case No Appeal No. EAT/313/01Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
PENDRAGON PREMIER LTD T/A STRATSTONE OF MAYFAIRAPPELLANTMR D J BURKHARDTRESPONDENT
Before
Mr Recorder LangstaffDate 18 September 2001
[1]APPEARANCES For the Appellant MR I WRIGHT (of Counsel) Instructed By: Retail Motor Industry Federation Legal Dept 201 Great Portland Street London W1N 6AB MR RECORDER LANGSTAFF QC: This is a preliminary hearing in an appeal against a decision of the Employment Tribunal sitting at Cardiff. In Extended Reasons promulgated on 17 January 2001 the Employment Tribunal found that the employee had been unfairly dismissed.[2]The brief facts the Tribunal found were these. The employee was a financial controller. He was told when he was interviewed prior to joining the Appellant company in 1998 that he was eligible to participate in a stakeholder bonus scheme.[3]On 28 March 2000 unsubstantiated allegations were made against him of poor performance, personality issues were raised and he was told that he was a square peg in a round hole. Very shortly after that he was asked to attend a meeting on 28 April 2000 without having been told in advance what the meeting was to discuss. As the Tribunal set out at paragraph 13:
"The applicant attended this meeting on 2 May 2000 and that meeting lasted all of 10 minutes. He was not told in advance what the meeting was about. He was not told that he was going to be facing any allegations and at the end of it he found himself effectively on garden leave. At that point the respondents indicated that an investigation had taken place by Dawn Healey and that investigation had centred on two issues. The first issue was that the applicant had allegedly paid himself out under the stakeholder scheme when he should not have done so and secondly that it was alleged that he had falsified his claim for petty cash expenses."
[4]On 8 May 2000 there was an interview about those allegations at which, it appears, the employee tendered a letter of resignation which was subsequently withdrawn. That meeting resulted in an adjournment until 16 May 2000 for further enquiries to be made.[5]Following that second meeting a letter was sent to the employee dated 17 May 2000 which set out the reasons for his dismissal. They were that he had received a stakeholder bonus payment of £1,204 for the period May 1999 to August 1999, although not entitled to this payment under the scheme rules and letter of appointment to his revised position and that he had also paid himself petty cash of £450 without an authorised signatory and without receipts.[6]The Employment Tribunal resolved a number of conflicts of fact which arose on the evidence. Those conflicts they resolved, as they were entitled to do, largely in favour of the employee. At paragraph 24 the Employment Tribunal having directed itself that the question it should ask in the circumstances was that posed by British Home Stores Limited v Burchell [1980] ICR 303 , with the assistance of the cases of Weddel v Tepper [1980] IRLR 96 and Spink v Express Foods Group Limited [1990] IRLR 320 - essentially the three-fold tests derived from British Home Stores Limited v Burchell .[7]Before us Mr Wright, in an attractive submission, has submitted that the Employment Tribunal were wrong to have adopted and applied the British Home Stores Limited v Burchell test. He has suggested that based upon a comment in Harvey on Industrial Relations at Division D1 paragraph 1466, an Employment Tribunal should be alert to the possibility that there may be an exceptional case in which the need of an employer to be entirely satisfied as to the complete and unimpeachable integrity of an employee in a critical position is so important that any doubt about that integrity would be sufficient to justify the dismissal of that employee. This argument, which is the only argument advanced for seeking leave to raise the issue at an inter partes hearing, has in its application to this case three significant difficulties which we consider both individually and cumulatively to be fatal to its prospects of success.[8]The first is that it is accepted by Mr Wright that the Employment Tribunal here were addressing the requirements of section 98(4) of the Employment Rights Act 1996 . Although those requirements are not set out in full in their decision, it is such common ground to these Tribunals that we would not necessarily expect it to be and it is certainly implicit in the decision. That requires the Tribunal in determining whether a dismissal is fair or unfair, having regard to the reason shown by the employer, to determine whether the dismissal is fair in accordance with equity and the substantial merits of the case. It has to take into account all the circumstances. Undoubtedly one of the circumstances, which the Employment Tribunal would have been well aware of, was the relatively senior position that this employee held. That statutory test normally leads to an examination of the factors identified by British Home Stores Limited v Burchell , the appropriateness of which has recently been affirmed by the Court of Appeal, if it had ever been in doubt, in the case of Post Office v Foley .[9]Accordingly, we think that it was not inappropriate for the Employment Tribunal to have regard to section 98(4), taking into account the guidance which Burchell suggested. We cannot say that they were wrong to do so. It is for a Tribunal to consider whether it is assisted by the guidance of cases such as Burchell . A Tribunal normally will be. We can only interfere if it was clearly an error to do so. In the light of the authority we cannot think and say that it was, nor do we think it arguable.[10]The second difficulty is that the aspect of the Burchell test, to which the extract in Harvey relates and on which Mr Wright's arguments focus, is the nature of the understanding by the employer as to what the circumstances are. Burchell calls for there to be a belief by the employer that there has been misconduct by the employee. He argues that it should be sufficient in some cases that there is not a belief in the dishonesty of an employee but merely a reasonable doubt about it. If that submission is well-founded then it would not affect the applicability of the other two limbs of the British Home Stores Limited v Burchell approach. That is, that the belief must have been reasonable (or, no doubt, in Mr Wright's argument the doubt must be reasonable) and secondly, it must be based upon a proper investigation. Neither of those limbs is effected by his submission as we understand it. He asked us two questions. The point of law, he said, in a case of dismissal for misconduct, following investigation where an employer has no more than a real doubt that the employee has committed acts of misconduct was whether there are exceptional cases where an Employment Tribunal could conclude that the dismissal was fair. He then enquired, if so, was this one of those cases. Even on his own formulation the requisite investigation is necessarily a proper or reasonable investigation. He accepted in argument very frankly that the investigation here was flawed. He challenges the Employment Tribunal's description of it as little short of disgraceful but although his submission is that that is exaggerated (and there is material which may support his submission in that respect), he nonetheless is constrained to agree that the investigatory process was nonetheless flawed. It would follow that that limb of the test, whether one adopts his own formulation or that derived from British Home Stores , could not be satisfied.[11]We need not in this judgment deal with the detail of the reasons why the Tribunal held that the process is flawed. It is sufficient to record that agreement and, indeed, to record our view that we do not think that the Employment Tribunal was disentitled to come to the conclusion at least that the process of enquiry investigation was, indeed, flawed.[12]The third difficulty which there is with the submission made to us is that it seeks to argue on appeal a very different case from that argued below. Before the Tribunal we are told, again very frankly, by Mr Wright, that Counsel then appearing asked the Tribunal to approach the issue of fairness by adopting and applying the British Home Stores Limited v Burchell test. It appears the Applicant's representative did the same. Accordingly, to argue now that this was an approach which the Employment Tribunal should not have taken is to elevate into an error of law a matter which, when it was put before the Tribunal, was an agreed approach. It represents a very different submission. Quite apart from the practical consequences that there may be if a Tribunal in this situation had always to consider whether or not an agreed approach put before it, which was apparently consistent with the law as they knew it and which decided many other misconduct cases was, in fact, the proper approach and to record that in its decision, we think that there is here the problem of seeking to raise on appeal an argument which was not raised below. It is only in exceptional cases that that can be done. The point is frankly addressed in the skeleton argument. It is urged upon us that because the approach arises directly from considering British Home Stores Limited v Burchell , it should be permitted to be argued on appeal.[13]We do not see that a full Tribunal would give leave for this point to be argued. We have heard the argument de bene esse and we consider that it has no such merit as enables us to say that there is here a point of law which should properly go before a full Tribunal.[14]It follows that for the reasons which we have given we think that there is no merit in this appeal, despite the attractive way it has been presented by Mr Wright, and we shall dismiss it.