GEORGE ELLISON LTD v MR I E BROWN [2003] UKEAT 0338_03_2210

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2003] UKEAT 0338_03_2210Case No Appeal No. EAT/0338/03Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
GEORGE ELLISON LTDAPPELLANTMR I E BROWNRESPONDENT
Before
Lord Johnston Mr P DawsonDate 22 October 2003
[1]APPEARANCES For the Appellants MR T LINDEN (of Counsel) Instructed by: EEF Broadway House Tothill Street London SW1H 9NQ For the Respondent MR A BURNS (of Counsel) Instructed by: Messrs Sydney Mitchell Solicitors Apsley House 35 Waterloo Street Birmingham B2 5TJ THE HONOURABLE LORD JOHNSTON This is an appeal at the instance of the employer against a decision of the Employment Tribunal sitting in Birmingham to the effect that the Respondent employee had been unfairly dismissed. The issue of remedy was adjourned.[2]The background to the matter is that under arrangements between the company and employees, holidays were regulated by a process involving effectively an agreement and the dispute that arose in this case was over the failure in fact of the Respondent to obtain the agreement of his employer before he went on holiday at a particular time in the year.[3]The background to that is that he and the managing director both sought at different times in the preceding year to fix holidays which would seem to coincide, rather unfortunately. The net result was that from the end of March 2002, the employee knew that if he took his holidays at the time he had booked, at the end of July, he did not have the agreement and the approval of his employer. Matters were apparently discussed to see whether a compromise could be reached, but that was not achieved and there is no doubt, and it was not disputed, that when the employee took the holiday in question, he was doing so against the express disapproval and non-agreement of his employer.[4]Upon his return from holiday he was disciplined and at the subsequent disciplinary hearing he was dismissed. He appealed unsuccessfully against the dismissal. The dismissal letter referred to the findings of the disciplinary hearing and confirmed that he was being dismissed:
"on grounds of gross misconduct relating to your actions in connection with the holiday you took between 29 July and 2 August inclusive"
The contractual arrangements whereby holidays could be booked were governed by part of the contract of employment which is quoted under the guise of "holiday guidelines" by the Tribunal at paragraph 8 of their Decision. It is:
"All holidays must be booked in advance and are subject to approval by the departmental management. Holiday charts will be available and all dates should be booked as early as possible. Anyone not having booked an agreed his/her holiday by 29 March will be allocated the two weeks commencing 22 July 2002." (Our emphasis)"
[5]Against that background the conclusions of the Tribunal were in the following terms:
"23 The reason given by the respondent for the dismissal is that the applicant had taken an unauthorised holiday. It therefore relates to the "conduct" of the applicant. It is a potentially fair reason for dismissal under Section 98( 2) of The Employment Rights Act 1996. 24 We will deal firstly with the question of whether the applicant did indeed take unauthorised leave. We have referred to page 27 of the bundle which contains the holiday guidelines. Accordingly to these guidelines, anyone not having booked or agreed his/her holiday by 29 March will be allocated the two weeks commencing 22 July 2002. those are some of the dates the applicant took for his annual leave. He was contractually entitled to do so as his leave had not been agreed. 25 Whether or not the respondents appreciated or realised that these guidelines applied to the applicant is irrelevant. We have no doubt that they have been properly incorporated into the applicant's contract of employment. There is also no doubt that, according to the evidence, Mr Baker had refused the request for annual leave. In those circumstances, Mr Brown was contractually entitled to take his holiday in the last week of July. 26 We reject the argument that custom and practice dictated that different rules applied to the applicant. Page 27 is a document marked "
'Holiday Guidelines 2002." They are the rules relevant and applicable for the then current year. The rules were therefore contemporary and could hardly be said to have been superseded by custom and practice over time. 27 We also reject the argument that, following Singh -v- British Steel Corporation [ 1974] IRLR, the holiday rules did not apply to the applicant because the applicant was not a member of one of the unions. There is nothing whatsoever in the ""Guidelines" to suggest that they do not apply to non-union employees. The applicant had not any time indicated that he did not wish to consider himself bound by them because he was not a union member. 28 For Mr Andrew Baker, who was so closely and personally involved in this matter to make the decision to dismiss, was unfair. No reasonable employer would, in these circumstances, have appointed Mr Andrew Baker to be the person making the decision as to whether or not to dismiss. It is clear that the entire situation arose as a result of a clash of holidays between the applicant and Mr Baker. In his witness statement, Mr Andrew Baker said that some 2 to 3 weeks before he was due to go on holiday, Mr Brown approached him once again to request the week off. He asked the applicant to let him think about the issue and promised to get back to him. He did this because his initial reaction was one of anger and he did not wish to allow his emotions to cloud his judgment. Thus Mr Baker clearly recognised, or ought to have recognised, that his judgment could be clouded on this issue because he was so personally involved in these matters. 29 Given that there was something of a history between the applicant and Mr Andrew Baker in relation to the booking of this particular holiday, it was entirely inappropriate for Mr Andrew Baker to have appointed himself or been appointed the dismissing officer. There is no reason why Mr Hare could not have taken his place. Mr Hare was higher than the applicant in the company management hierarchy. There were several other managers who could have carried out the initial investigations. Instead, we are left with a somewhat bizarre situation of Mr Hare carrying out an investigation, chairing the disciplinary hearing but leaving the final decision on whether or not to dismiss to Mr Baker! 30 Moreover, we find that the reasons given by the respondent for the dismissal to be disingenuous. In the letter of dismissal, all that the applicant is told as to the reason for dismissal is that it "relates to your actions in connection with the holiday you took between 29 July and 2 August inclusive". In the witness statement however Mr Andrew Baker sets out other reasons some or all of which contribute to the decision to dismiss. At paragraph 20 of his witness statement he says that the applicant had shown "a total disregard for the respondents policy and ignored his instructions." The applicant had also "publicised the dispute both within the respondent and to contacts within the industry to the extent that his continued employment would question both his and [my own] credibility". In other words, it was not just about taking an unauthorised holiday (the reason given in the dismissal letter) but because it would undermine Mr Andrew Baker's authority and credibility within the Company. None of these reasons are set out in the letter of dismissal. At the end of the day we are left in some uncertainty as to the real reasons behind the dismissal. 31 When it comes to the appeal, more reasons are added. Mr Brown disobeyed the reasonable instructions of his manager, he had ample time to address the issues but he didn't, he went off on holiday without informing anyone else, he had been given a clear warning of the situation and the way his absence would be treated, Mr Brown did not inform anyone of his intentions, he did not take steps to mitigate the absence by leaving a number where he could be contacted and that he failed to leave his company mobile telephone on. 32 One of the factors taken into consideration both at the dismissal stage and at the appeal (neither of which appear in the dismissal letter or in the notes of the disciplinary hearing) was the issue of the applicant giving "publicity" to this incident. The allegation is neither properly investigated nor put to the applicant at the disciplinary hearing. Even if there had been such publicity, it made it all the more unsuitable for Mr Andrew Baker to decide upon dismissal. 33 We take the view that this was not an unauthorised holiday under the strict terms of the applicant's contract. Even if we are wrong on that, it was an unauthorised holiday, the penalty for which according to the handbook is a loss of pay under the respondent's own rules. In any event, we do not consider that any reasonable employer would have dismissed in these circumstances. The decision to dismiss fell squarely outside the band of reasonable responses. 34 In all of the circumstances, we find the dismissal unfair. The issue of remedy is adjourned."[6]Mr Linden, Counsel on behalf of the Appellants, attached the Decision of the Tribunal on three broad fronts. First of all he submitted that insofar as the Tribunal in the passage we have quoted categorised the holiday provision by the employee as authorised, that was completely wrong in terms of proper construction of the paragraph we have quoted and the actual facts. Whatever construction might otherwise be put on the paragraph we have quoted, he submitted that properly understood, the catch-all in the last sentence of the three relating to allocation of two weeks commencing 22 July 2002 applied to situations where an employee had not sought or obtained approval, and, therefore by the end of March, and therefore was entitled to have that period allocated. He submitted that it did not cover the situation where an employee such as here deliberately took a holiday knowing that it had not been approved or agreed to by his employer. It was therefore, it was submitted, quite wrong for the Tribunal to hold that the holiday taking was authorised; properly understood, it was unauthorised.[7]Secondly, by reference to the observations of the Tribunal in paragraph 33 of the Decision with regard to a sanction that might be employed in relation to unauthorised holiday, he submitted that the Tribunal had wrongly construed a contract of employment in this respect with regard to the idea that the only sanction for taking unauthorised holiday would be a docking of pay, or at least not receiving any pay. We do not take this matter any further because it was conceded in this respect that as far as the construction in this respect of the contract was concerned, that was not a proper approach, and we may say at once with that we agree. There seems to be to us, looking at the provisions in question a lacuna as to whether any sanction is stated where an employee takes unauthorised leave rather than merely leaving the workplace on a particular day without permission. Therefore at that point, Mr Linden submitted, the Tribunal misdirected itself.[8]In any event, he went on to submit that the last part of that paragraph on the basis that the Tribunal had said in any event "We do not consider that any reasonable employer would have dismissed in these circumstances". The Decision of the Tribunal of the Tribunal was wholly lacking in specification as to what circumstances or facts might bear upon that aspect of the matter, no reasons were given as to why the employer should not have treated the conduct as sufficient to warrant dismissal, and accordingly, in this respect as well, the Tribunal's Decision could not stand.[9]He submitted in passing that although the dismissal letter referred to gross misconduct, that did not necessarily have to be established. It was sufficient, he submitted, that the employee had flouted the orders of his senior official or managing director, had gone on holiday for whatever reason against the orders of that person, and that in itself was sufficient to reach the conclusion that any reasonable employer reacting to that situation would have been entitled to dismiss.[10]Mr Burns, of Counsel, appearing for the employee Respondent, submitted that properly understood, the contractual position relating to holidays meant that whatever had happened as between the employer and the employee, the catch-all at the end of the paragraph meant that authorised or lawful holiday could be taken by any employee between 22 July and the following two weeks. Thus he submitted that whatever his client thought he was doing, any instruction by the employer not to go on holiday during that period was unlawful and therefore could not result in an unauthorised leave.[11]He secondly went on to submit that the Tribunal had properly directed itself to the question of the band of reasonable responses and was upon the evidence entitled to assume, and indeed conclude, that the conduct, even taking it at its highest, on the basis that there was an unauthorised leave, contrary to his first submission, was sufficient to warrant dismissal. It followed that if of course the initial taking of leave was effectively authorised on his construction of the contract, it could not conceivably be defended that the employee was dismissed. He, as I have already indicated, did not support the position with regard to the handbook on the question of docking of pay, but he went on forcibly to argue that the fundamental and indeed most important part of this case, which although touched upon in some places by the Tribunal in the course of its Decision, did not seem to base its ultimate Decision, namely the fact that Mr Baker, the Managing Director, who was the person with whom his client was in dispute and, indeed, whose orders it is said he flouted, did in fact as Managing Director finally, after the disciplinary hearing conducted by another director, dismiss Mr Brown on his own say-so and nobody else's. This, said Mr Burns, was a breach of natural justice striking to the heart of the whole proceedings and whatever else might be the rights and wrongs of the Tribunal's Decision, it could not stand in this respect.[12]So far as authority was concerned, he referred us to the case of Moyes -v- Hylton Castle Working Mens Social Club [1986] IRLR 482 as an example of the operation of the question of natural justice in the issue of judging one's own cause.[13]We are not certain that we have to resolve the construction issue in relation to the provisions to the taking of holiday, but it would be our view if we have to that the construction contended for by Mr Burns is correct. It seems to us, rightly or wrongly, that by effectively reserving the period of 22 July 2002 and the following two weeks, as appeared available for holiday, it cannot be said that anybody who took as holiday during that period was acting in an unauthorised way and we would not consider the fact that Mr Brown thought he was disobeying orders was only to the point if the matter is looked at objectively as to whether or not he was acting unlawfully or not. To that extent, therefore, we would support the position taken by the Tribunal.[14]We cannot support the position taken by the Tribunal as regards to the sanction in respect of only being available with regard to docking of pay, but we do note that nowhere in the case, as far as we can say, whether contractually or conventionally, was an employee put on guard that if he did take unauthorised holiday, one of the sanctions would be dismissal, and that may be of some relevance.[15]We have some concerns about the lack of specification in the very last part of paragraph 33, but we are satisfied that the Tribunal was applying its mind to the right test, namely the band of reasonable responses. If we had to decide the matter solely on that question, we might find ourselves in some difficulty, for the reasons put forward cogently by Mr Linden, but we look at this matter on a rather broader basis. We recognise that the role of this Tribunal in respect of decisions which might be regarded as flawed, and on that basis we are regarding this Decision as flawed, for the reasons we have just given. Normally it must be simply to remit the matter back for a re-hearing, but, however, under reference to Dobie -v- Burns International Ltd [1984] ICR 812 and many subsequent cases, it has been recognised that this Tribunal has a power if it can be said that there is only one conclusion that can be reasonably supported by a Tribunal properly instructed in the matter, and no other, that it can apply its mind to that question and if necessary substitute its own view.[16]In this case, we are clearly of the view that the decision by Mr Baker to dismiss, having regard to the fact that he was one of the protagonists in this particular dispute, flouts the whole basis of natural justice, inasmuch as he was a judge in his own cause, and looked at objectively, which was the proper test, it cannot be said that he could not have been influenced by the fact that he was involved in the matter in a very serious way. Furthermore, we considered any other Tribunal, looking at those facts, would be bound to the view that that is the only decision that can be reached in the circumstances. We therefore consider that this case should be decided upon the basis that the procedure adopted in the decision by Mr Baker to dismiss is fundamentally flawed and it cannot stand. That being so, the appeal will be dismissed and the case will be returned to the same Tribunal to consider the question of remedy.[17]In so doing, we wish to emphasise that as far as we are concerned, the issues of whether or not there should be a Polkey reduction and whether or not there was contributory fault against the background of a finding of unfair dismissal, are very live issues and we require that the Tribunal of first instance, if a hearing does take place on remedy, to consider those matters. We shall so order.