MISS SARAH LIVESEY v PARKER MERCHANTING LTD [2004] UKEAT 0755_03_1301

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2004] UKEAT 0755_03_1301Case No Appeal No. UKEAT/0755/03Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MISS SARAH LIVESEYAPPELLANTPARKER MERCHANTING LTDRESPONDENT
Before
His Honour Judge Ansell Ms V Branney Professor P D WickensDate 13 January 2004
[1]APPEARANCES For the Appellant MR S GORTON (of Counsel) Instructed by: Messrs Weightman Vizards India Buildings Water Street Liverpool L2 OGA For the Respondents MR R POWELL Solicitor Messrs DLA Solicitors Victoria Square House Victoria Square Birmingham B2 4DL HIS HONOUR JUDGE ANSELL This is an appeal from a Decision of an Employment Tribunal sitting at Ashford, Kent, on 23 and 24 June 2003, which in a Decision promulgated on 17 July 2003, dismissed the application making complaints of unfair constructive dismissal and direct sex discrimination. Leave for this hearing was given by His Honour Judge McMullen QC, in Chambers, on 27 September 2003.[2]The Appellant had commenced employment with the Respondent Company in March 2000 as sales representative, based at a depot in Aylesford near Maidstone, their business being the sale of protective clothing and equipment to the building trade. The Depot Manager was Mr Julian Newton and the Appellant was the only female sales representative, the other two sales representatives being Mr Don Dewar, who was a friend of Mr Newton, and Mr Joe Welsh. By May 2000 Mr Newton was making sexist comments to the Appellant, which became cruder and more offensive as time went by, culminating in having told her in July/August 2001 that she had only obtained an order because "she had big tits". She spoke to a fellow employee in Telesales named Shaun about this, but he told her to ignore it. Thereafter comments such as this were made by Mr Newton to Miss Livesey on a regular basis, sometimes to other employees about her, for example suggesting that he would send her to a customer from whom he hoped to obtain a big account because she "would stick her tits out". During July 2001, Miss Livesey understood that there had been complaints about Mr Newton making sexist remarks to other female members of staff.[3]It was Miss Livesey's case that she had made a formal complaint about Mr Newton's sexist comments to Mr Clarke, the Industry Sector Manager, but that allegation was rejected by the Tribunal.[4]Matters came to a head at the Respondent's Christmas party at a hotel in Chatham on 23 December 2000. Miss Livesey was expecting to receive a lift home from Mr Dewar. Mr Newton had made a few suggestive remarks about Miss Livesey during the evening, and one point during the evening had tried to put his finger up her skirt. At the end of the event Mr Newton accepted a lift home from Mr Dewar and got into the back of Mr Dewar's car where Miss Livesey was already sitting. The Tribunal found that in the car he had grabbed hold of her face, tried to kiss her, put his hands up her skirt and began to feel her breasts. He was trying to touch her and she continually tried to push him off, this went on throughout the journey in spite of her telling him to leave her alone; Mr Dewar took no action to intervene.[5]Through Mr Dewar, the incident had got back to more senior management, Mr Hughes the Field Manager for the South East and the Sales Director Mr Thorndick Both of them encouraged the Appellant to place the complaint on a more formal basis, and in due course a complaint was made. Miss Livesey went off work sick on 29 January 2001, having told her doctor that she had suffered sexual harassment at work. About the same time she consulted a solicitor and sent a statement to Mr Holmes, the Human Resources Manager, dated 31 January 2001. The statement concluded as follows:
"I have been subjected to verbal sexual harassment for the past six months. My work colleagues have all been aware of this. I have handled his sexual comments over this time. I never thought anything like this would happen to me. I hope you now understand why I cannot come to work. This has been devastating for me. I am not ready to talk to anyone at work just yet. It's just too much. I will call when I feel able to do so."
[6]Miss Livesey was seen on 2 February and interviewed by management for three and a half hours. She explained that she did not feel she could ever work at the Maidstone depot again and that with Mr Newton still employed, she could not work anywhere within the company. The Tribunal found that Mr Homes had adopted a very sympathetic approach to her and he assured her that he would keep her informed at every step.[7]In due course it was decided that Mr Newton was going to be suspended but on 6 February he tendered his resignation, and since this had achieved the primary objective of removing Mr Newton from the business, the resignation was accepted. Mr Newton finished work immediately, although he was paid for his thirteen week notice period. On 9 February Mr Holmes attempted to contact Miss Livesey and when that failed he sent her a detailed letter informing her that Mr Newton was no longer an employee of the company and hoping that she would now be able to return to work and that she would gradually make a complete recovery from her recent ordeal. However, endeavours by Mr Holmes to contact her thereafter failed. In due course he received a report from Miss Livesey's doctor indicating that she was unable to return to work with the company but that she was looking for a new job. Her sick pay expired at the end of March but it was extended by a further month to the end of April. During May there were further attempts from Mr Holmes to contact Miss Livesey and there was some correspondence between the solicitors that she had instructed and the Respondents, with particular reference to the company car which she had returned at the end of May. Those solicitors, in a letter dated 20 June, indicated her intention to issue proceedings of sex discrimination and constructive dismissal but it was not until 17 July that the solicitors indicated that their client had felt unable to return to work and regarded her employment as terminated by reason of the company's conduct.[8]The Tribunal held that since the Respondent Company was not aware of Mr Newton's behaviour until after the events on 23 December his earlier actions could not be attributed to the company, and since the company had dealt with the complaints promptly and properly, once they had found out about them. The company was not in itself in breach of the Appellant's contract of employment. Further if they were wrong about that, then they held that the Appellant's delay in resigning from her employment until July amounted to an affirmation of the contract and a waiver of the breach.[9]As regards the claim under the Sex Discrimination Act the Tribunal unanimously held that the words and actions of Mr Newton amounting to sexual harassment in the workplace were done in the course of his employment and although this is not entirely clear from the Tribunal's Decision, these actions also included the events at the Christmas party. However, the lay members found that the incident in the car on the way home from the party was not done in the course of employment, the Chairman disagreeing with this view. In any event, the Tribunal unanimously found that the defence available to an employer under section 41(3) of the Sex Discrimination Act were made out, in other words, the Respondent had taken such steps as are reasonably practicable to prevent the employee from doing the acts in question. Before us the Appellant seeks to challenge all these conclusions and we propose to deal with the submissions under the heads of claim. The law[10]In section 41 of the Sex Discrimination Act 1975 :
"(1) Anything done by a person in the course of his employment shall be treated for the purpose of this Act as done by his employer as well as by him, whether or not it was done with the employer's knowledge or approval. (2) Anything done by a person as agent for another person with the authority (whether express or implied, and whether precedent or subsequent) of that other person shall be treated for the purposes of this Act as done by that other person as well as by him. (3) In proceedings brought under this Act against any person in respect of an act alleged to have been done by an employee of his it shall be a defence for that person to prove that he took such steps as were reasonably practicable to prevent the employee from doing that act, or from doing in the course of his employment acts of that description."
Constructive Dismissal[11]Vicarious Liability Mr Gorton submits that the Tribunal, in concentrating on the issue of the employer's knowledge of Mr Newton's acts manifestly erred in law by not asking itself the correct and relevant question which was whether Mr Newton had been guilty of conduct for which the Respondents were responsible in law, in other words, were the acts that he committed by him done in the course of his employment, and that whilst the Tribunal dealt with this issue under the Sex Discrimination Act claim, they failed to do so in relation to constructive dismissal. Further, he submits that the concept of "in the course of employment" should now be determined in accordance with the guidance given by the House of Lords in Lister -v - Hesley Hall Ltd [2001] 2 WLR 1311 . In that case the claimants were resident in a boarding house attached to a school owned and managed by the defendants and the warden of the boarding house employed by them, without their knowledge, systematically sexually abused the claimants. The Court of Appeal had held that the warden's acts could not be regarded as an unauthorised mode of carrying out his authorised duties, but on appeal the House of Lords held that having regard to the circumstances of the warden's employment, including the close contact with the pupils and inherent risks that it involved, there was sufficient connection between the work that he had been employed to do and the acts of abuse that he had committed for those acts to be regarded as having been committed within the scope of his employment, for which the defendants should be held vicariously liable. At paragraph 24 Lord Steyn felt the correct approach was to:
"concentrate on the relative closeness of the connection between the nature of the employment and the particular tort"
. Later at paragraph 25 he said this:
"the reality was that the county council were responsible for the care of the vulnerable children and employed the deputy headmaster to carry out the duty on its behalf. And the sexual abuse took place while the employee was engaged in duties at the very time and place demanded by his employment. The connection between the employment and the torts was very close."
Both Lord Steyn in his speech and Lord Clyde cautioned against looking for assistance from cases in the context of sexual and racial discrimination where the Court was engaged in an exercise of statutory construction and as Lord Clyde stated at paragraph 40:
"The language and the purpose of the provision may call for an approach and a solution which may not exactly accord with the application of the rule of vicarious liability."
[12]Mr Powell, for the Respondents, seeks to justify the Tribunal's approach on constructive dismissal in a novel and interesting way. He argues that in this particular case, all the matters relied upon for a breach of contract were also the matters relied upon for the claim under the Sex Discrimination Act and therefore he argues that where the employer has a defence under section 41(3), on the basis that they have taken reasonable steps, such defence should also be open to them on the issue of constructive dismissal. He contends that this approach can be arrived at in a variety of ways: firstly he suggests that since the terms of the Sex Discrimination Act 1975 and its amendments are incorporated into every employment contract, the defence under section 41 should therefore also be implied. Secondly, he argues that the concept of reasonableness as regards the employer's conduct has been held to be relevant for the purposes of assessing whether or not there has been a fundamental breach of contract - see Duffin & Clark Ltd -v- Daly [1985] IRLR 363 . Thirdly, he contends that the well known formulation of the duty of trust and confidence set out in Malik -v- BCCI [1998] AC 20 , as set out by Lord Steyn, formulates the approach as one where the employer must not act "without reasonable and proper cause".[13]We cannot agree with these submissions. The approach of the House of Lords in Lister -v - Hesley Hall Ltd makes it clear that in considering the issue of vicarious liability under common law principles the Court should not be drawn into comparison with the approach taken to similar statutory concepts e.g. under the Sex Discrimination Act . Secondly, it seems to us that concepts such as reasonableness or reasonable or proper cause for the breach should apply to the acts complained of, i.e. the acts of sexual harassment rather than to the employer's knowledge or approach. The whole concept of vicarious liability under common law depends on acts being attributed to the employers, provided they are committed in the course of employment irrespective of the employer's knowledge of the particular acts complained of.[14]We are therefore quite satisfied that the Tribunal were in error in their approach on this issue and that the employers were liable for Mr Newton's actions, certainly up to the time of the events occurring within the Christmas party.[15]However, where does that leave the assault in the car? As we have previously indicated, for the purposes of the Sex Discrimination Act the majority lay members sought to draw a distinction between this act and the events occurring actually at the party, though without giving any reasons as to why they drew that distinction, save that in paragraph 38 they set out that each case must depend on its own facts. Mr Gordon argues that on this important issue, the Tribunal should have given reasons for their Decision - see English -v- Emery Reimbold & Strick [2003] IRLR 710 . He further argues that whether under the Sex Discrimination Act or in common law, the majority of the Tribunal were in error in seeking to draw a distinction between the events which occurred at the party and those in the car on the way home. At common law, we can see no grounds for making any distinction, applying the modern approach to vicarious liability, as laid down in the Lister case. Mr Newton, the Depot Manager where Miss Livesey worked, and presumably the most senior employee at that location, clearly embarked on a course of sexual harassment, which as the Tribunal found, had become cruder and more offensive as time went by and which culminated in the events during and after the Christmas party. Bearing in mind that continuous course of conduct, it would seem to us totally unrealistic to seek to draw any distinction between the events which occurred in the party and those immediately afterwards in the car. These were serious acts for which the employer was vicariously liable and therefore amounted to a fundamental breach on the part of the employer which would have entitled the employee to resign. Affirmation[16]Whilst, as we have found, the Tribunal did not deal properly with the issue of breach, they did go on to consider the issue of affirmation on the basis that the employers were in breach of contract. Mr Gorton criticises the Tribunal's approach on this issue by suggesting that they have focused incorrectly simply on the delay in resigning until July as amounting to a waiver of the breach, as opposed to asking themselves the correct question which was whether by her conduct the Appellant had impliedly affirmed the contract; he refers to W E Cox Toner -v Crook [1981] IRLR 443 , where at paragraph 13 Mr

Justice Browne-Wilkinson set out the position as follows:

"It is accepted by both sides (as we think rightly) that the general principles of the law of contract apply to this case, subject to such modifications as are appropriate to take account of the factors which distinguish contracts of employment from other contracts. Although we were not referred to cases outside the field of employment law, our own researches have led us to the view that the general principles applicable to a repudiation of contract are as follows. If one party ('the guilty party') commits a repudiatory breach of the contract, the other party ('the innocent party') can choose one or two courses: he can affirm the contract and insist on its further performance or he can accept the repudiation, in which case the contract is at an end. The innocent party must at some stage elect between these two possible course: if he once affirms the contract, his right to accept the repudiation is at an end. But he is not bound to elect within a reasonable or any other time. Mere delay by itself (unaccompanied by any express or implied affirmation of the contract) does not constitute affirmation of the contract; but if it is prolonged it may be evidence of an implied affirmation: Allen v Robles [1969] 1 WLR 1193. Affirmation of the contract can be implied. Thus, if the innocent party calls on the guilty party for further performance of the contract, he will normally be taken to have affirmed the contract since his conduct is only consistent with the continued existence of the contractual obligation. Moreover, if the innocent party himself does acts which are only consistent with the continued existence of the contract, such acts will normally show affirmation of the contract. However, if the innocent party further reserving his rights to accept the repudiation or is only continuing to do so to allow the guilty party to remedy the breach, such further performance does not prejudice his right subsequently to accept the repudiation. Farnworth Finance Facilities Ltd v Attryde (1970) 1 WLR 1053."
[17]The Tribunal, in dealing with the matter, set out the position in paragraph 31 thus:
"… it is our finding that the Applicant's delay in resigning from her employment amounted to an affirmation of the contract and a waiver of the breach."
They continued as follows:
"32 The Applicant's last working day was 29 January 2001. She instructed solicitors in February and had given detailed instructions to them by the end of March 2001. She continued in the Respondent's employment and accepted discretionary sick pay until 30 April 2001. The medical records show that the Applicant ceased to have anti-depressant medication by 4 June. The Applicant retained her company car and essential company records until May 2001. 33 The last act in the breach of contract must have been Mr Newton's failure to apologise to the Applicant on 12 January 2001, when she returned to work after her holiday, or possibly his resignation on 6 February 2001. 34 We find that the Applicant's failure to resign from the Respondent's employment until July does amount to a waiver of the breach. Although she became ill with depression, this did not prevent her from seeing a solicitor who was pro-active on her behalf between March and 17 July. We cannot therefore find that her absence from work with depression prevented her in some way from accepting the Respondent's repudiation by resigning from her employment in response to the breach."
[18]Mr Gorton seeks to criticise the Tribunal's Decision in that they failed to take into account a number of important pieces of evidence. First of all he refers to the expert psychiatric report from Dr Andrew that was before the Tribunal which states that according to the history which the Appellant had given, she would appear to have developed an adjustment reaction with depressive features just prior to her leaving work, which developed into a major depressive episode approximately three months after December 2000, which lasted for a period of between three to six months. Dr Andrew was also of the opinion that she had developed post traumatic symptoms of avoidance, thinking about the incident which manifested itself in avoiding work and contact with colleagues which also reminded her of the incident, although there was no evidence that she had developed a full-blown post traumatic stress disorder. However at the conclusion of the report, Dr Andrew said this:
"I am concerned however in this case that Miss Livesey sought initially to withhold information from me during interview which might potentially have been vital in my formulating an objective assessment and opinions in the case. One can only guess at the reasoning but one must consider the possibility that she sought to mislead and one has to at least consider the reliability of her account."
He considered it important that he was given access to the previous GP and hospital notes in order to clarify the diagnosis. The GP's report dated 4 April 2001 which had been obtained by the Respondents confirmed that she was signed off work until the beginning of April and that he would anticipate that she would require antidepressants for four to six months, although she did not take any prescribed antidepressants after the beginning of June, preferring to buy an over-the-counter product, St Johns Wort.[19]The Appellant criticises the Tribunal's finding that she had instructed solicitors and given them detailed instructions by the end of March and that those solicitors were pro-active on her behalf between March and July 2001. Mr Gorton suggests that as a finding of fact it is an error, we do not agree. Within the papers there was a document dated 29 March 2001 which was a very detailed attendance note in the form of a statement from the Appellant, and whilst in that statement it is right to say that she concluded by saying that she felt that she had to resign the job, her resignation did not follow for at least a further three months. The documents also indicate that the employers wrote to Miss Livesey on 18 May expressing their ongoing concerns regarding her continued absence from work and her failure to communicate with them or respond to letters and phone calls. The letter pointed out that the company car which she still retained had been summoned for recall and also that her last sick note had expired on 10 April, and they had not received any subsequent notification of her continuing ill-health. However, within a matter of days, Miss Livesey had returned the car to the company and had also again consulted her solicitors who entered into correspondence, particularly in relation to the employer's request for business mileage sheets. There was no suggestion in that correspondence from the solicitors that Miss Livesey was unable mentally to deal with these matters by reason of her continuing depression. We can find no error in the Tribunal's approach in this matter. Further Mr Gorton argues that the issue of acceptance of sick pay relied upon by the Tribunal together with the actions in relation to the company car and property that we have just referred to, should have been analysed by the Employment Tribunal in the context that the Appellant was suffering a major depressive episode. We are quite satisfied that the Tribunal had in mind the various pieces of medical evidence that were put in place in front of them and clearly sought to place particular reliance on the contemporaneous report from the GP, together with analysing the Appellant's actions of that time in relation particularly to being able to return the company car and the further instruction of solicitors in the middle of May, and again we can find no error in their approach. Accordingly, we can find no fault in the Tribunal's approach or conclusions in relation to the issue of affirmation. Sex Discrimination Act[20]As we have indicated above in the context of constructive dismissal, we are quite satisfied that the Tribunal were in error in seeking to draw a distinction between the events which occurred at the Christmas party and in the car immediately afterwards. Applying the principles in the Lister case, and certainly the same if not a wider interpretation should be applied to section 41 of the Sex Discrimination Act - see Jones -v- Tower Boot Company Ltd [1997] ICR 254 and in particular the concluding paragraphs of the judgment of Lord Justice Waite, page 265. In Chief Constable of the Lincolnshire Police -v- Stubbs [1999] IRLR 81 a female police officer had been subject to sexual harassment on two occasions, one after her turn of duty when she went to a pub and met other police officers, and the second occasion when she attended an organised leaving party. The EAT agreed with the Employment Tribunal in finding that both incidents occurred within the definition of the course of employment. At paragraph 44 Mr Justice Morison said this:
"It would have been different, as it seems to us, had the discriminatory acts occurred during a chance meeting between Mr Walker and the applicant at a supermarket, for example, but when there is a social gathering of work colleagues such as there was in this case, it is entirely appropriate for the tribunal to consider whether or not the circumstances show that what was occurring was an extension of their employment. It seems to us that each case will depend upon its own facts. The borderline may be difficult to find. It is a question of the good exercise of the judgment by an industrial jury: whether a person is or is not on duty, and whether or not the conduct occurred on the employer's premises are but two of the factors which need to be considered."
[21]Whilst we are loath to interfere with the good exercise of judgment by an industrial jury, as we have already indicated, we can find no justification for the distinction they sought to draw between events at the party and in the car immediately afterwards, bearing in mind the course of conduct that Mr Newton was clearly pursuing.[22]That leaves the last issue in the case, namely the Tribunal's finding in respect of the statutory defence under section 41(3). The Tribunal dealt with the matter in paragraph 40 and 41 of the Decision as follows:
"40 We have looked at this aspect of the case very carefully and we are unanimously satisfied that this defence has been made out. We have accepted the evidence of Mr Holmes which was tested and stood up to cross-examination. We are satisfied that the Respondent's equal opportunities and harassment policy was given a high profile and adhered to and that its application satisfied the requirements of the defence available to an employer under section 41(3). We accepted Mr Homes' evidence that Mr Newton had received training in equal opportunities and that he was made aware of the importance attached by the company to adherence to its equal opportunity and harassment policy. 41 The Respondent did therefore take such steps as were reasonably practicable to prevent Mr Newton from committing acts of sex discrimination against the Applicant. Unfortunately, these steps did not have the desired effect but we do find that the Respondent, having established the defence is not liable to the Applicant for the acts of Mr Newton."
Mr Gorton submits that the Employment Tribunal, in coming to their conclusions, failed to deal with the second of what he submits is a two-stage test that the employers have to satisfy in order to avail themselves of the defence and has referred us to the authority of Canniffe -v- East Riding of Yorkshire Council [2000] IRLR 555 , where at paragraph 14 Mr

Justice Burton said thus:

"We are satisfied that the proper approach is: (1) to identify whether the respondent took any steps at all to prevent the employee, for where it is vicariously liable, from doing the act or acts complained of in the course of the employment; (2) having identified what steps, if any, they took to consider whether there were any further acts, that they could have taken, which were reasonably practicable. Further in paragraph 22 in relation to the second question he added: "and in that context and that context alone, it would be relevant to ask whether any such further steps would have been of any consequence or have had any realistic chance of success. But even if they had not had any realistic chance of success, if in fact it was reasonably practicable for them to be done, they should have been done. That is the purpose of this legislation, and that is the difficult eye of the needle through which a respondent employer who seeks to avoid a vicarious liability must travel in order to avoid that liability."
[23]In paragraph 22 of the judgment, Mr Justice Burton gave further guidance about the application of that test "22. It appears to us, given the context of section 41(3), the requirement under Jones v Tower Boot Co Ltd to apply a purposive construction and the serious nature of the kind of allegations made in this case, that it is important that a Tribunal carrying out its function under section 41(3) should be careful not to skip over any stages. It appears to us that the Tribunal has found that the Respondent took some steps and was satisfied that those steps that the Respondent had taken were reasonable. The Tribunal has not however asked itself the missing question, which is were there any other steps which could reasonably have been taken which the Respondent did not take? It appears to us that there is or could be a very substantial difference between two different scenarios at the workplace. One is where there is no knowledge on the part of employers or managers of risk of any harassment or inappropriate sexual behaviour by an employee, or indeed in particular by one employee towards another particular employee or employees. In those circumstances it may well be sufficient for there to be adequately promulgated a sexual harassment policy, particularly where it can be said that when a one-off incident occurs of a seriousness of the kind that occurred in this case, it must in any event have been known to any employee, never mind a reasonable or honest employee, that the conduct could not possibly be condoned or encouraged by employers. In those circumstances, it may be sufficient for the question simply to be addressed as to whether there was a policy and whether it was promulgated without more. There may, however, be an entirely different situation in which there was knowledge or suspicion in relation to a particular employee of his own predilections or temperament, and certainly of a risk that he might commit inappropriate acts towards a particular employee or particular employees. In this case, there was such a possibility, but the Tribunal did not, in our view, adequately address that possibility or ask itself the right questions."[24]In paragraph 28 of his written submissions, Mr Gorton suggests the further steps that the employers could have taken which the Employment Tribunal failed to consider, but if one analyses those further steps, it appears to us that they all depended on the employers having some knowledge of the Respondents' conduct, actions or risk, whereas in this case there was a specific finding that the senior management did not have that knowledge until after the events of the Christmas party.[25]The issue is further considered in Croft -v- Royal Mail Group PLC [2003] IRLR 592 , where at paragraph 61

Lord Justice Pill dealt with the statutory defence thus:

"The Tribunal did in my judgment make the correct assessment under section 41(3), that is, to consider whether the employers took such steps as were reasonably practicable to prevent employees from doing harassing acts, though the statutory test was not stated with precision. The conclusion that the defence was made out was in my judgment justified in the circumstances. I agree that a consideration of the likely effect, or lack of effect, of any action it is submitted the employers should have taken is not the sole criterion by which that action is to be judged in this context. In considering whether an action is reasonably practicable, within the meaning of the subsection, it is however permissible to take into account the extent of the difference, if any, which the action is likely to make. The concept of reasonable practicability is well known to the law and it does entitle the employer in this context to consider whether the time, effort and expense of the suggested measures are disproportionate to the result likely to be achieved. The Tribunal were entitled to conclude that, at each stage, the respondents did take such steps as were reasonably practicable to prevent the acts complained of."
[26]Mr Powell submits that the Tribunal had examined this issue with great care, and indeed within his written submissions to them he had raised the issue as to whether there were any further reasonably practical steps to be taken by the employers, suggesting that there were none, because the Appellant had not brought the issue to the attention of any senior manager. The Tribunal had also had the opportunity of comparing the EU Directive on Dignity at Work with the Respondents' documentation and that therefore they must have clearly had the two stage test in mind when coming to their conclusions in paragraph 40 and 41. We agree with that submission and even if the Tribunal were in error in not setting out clearly the two stage test, there was clearly no further action that these employers could have taken in the absence of any specific knowledge of Mr Newton's activities.[27]For the reasons that we have stated, therefore, we dismiss this appeal. As the Tribunal stated at paragraph 45 we share their amazement that Mr Newton was not joined as a second respondent to this claim in the light of his very serious sexual misconduct towards the Appellant.