OUTOKUMPU STAINLESS LTD v MR J LAW [2007] UKEAT 0199_07_0410

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2007] UKEAT 0199_07_0410Case No Appeal No. UKEAT/0199/07Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
OUTOKUMPU STAINLESS LTDAPPELLANTMR J LAWRESPONDENT
Before
Mr Justice BeatsonDate 4 October 2007
[1]APPEARANCES For the Appellant MR JAMES LADDIE (of Counsel) Instructed by: EEF Legal Services Broadway House Tothill Street London SW1H 9NQ For the Respondent MR JOHN RATLEDGE (of Counsel) Instructed by: Messrs Atteys Solicitors Richmonds House White Rose Way Doncaster DN4 5JH SUMMARY Time limits – Just and equitable extension Fixed term employment Regs s1 2002 No 2034. Need to consider each individual claim when considering extending time because they may well have different time limits and different periods of delay BCC v Keeble and Butterworth v Evans 20/2/07 EAT considered. THE HONOURABLE MR JUSTICE BEATSON This case raises an appeal resulting from a pre-hearing review held by Mr R Williams, sitting alone, at the Employment Tribunal in Sheffield on 11 January 2007. The hearing was to determine two issues. The first was whether the claim was within the statutory time limits, and if not, whether the Tribunal had jurisdiction to hear it. The second was whether the claim should be struck out by reason of the Claimant's failure to comply with an order of the Tribunal or by reason of his scandalous or unreasonable conduct of the case. In the event only the time point was considered at the review.[2]The Tribunal held that the Claimant's claim under section 23 of the Employment Rights Act 1996 , in respect of unlawful deduction of wages, was in time and that it had jurisdiction to deal with it. It held that the claim under the Fixed Term Employees Prevention of Less Favourable Treatment Regulations 2002, SI No 2034, was out of time but the Tribunal deemed it just and equitable to allow the claim to proceed.[3]The appeal by the employer only concerns the claim under the Fixed Term Employees Regulations. By virtue of Regulation 3, a fixed term employee has the right not to be treated by his or her employer less favourably than comparable permanent employees as regards the terms of his contract, or by being subjected to other detriment on the ground that he or she is a fixed term employee.[4]The facts of this case are not in dispute and I can summarise them from the skeleton argument prepared by Mr Laddie, who appeared on behalf of the employer. The Claimant claims to have been employed by the employer from 26 August 2003 until 31 December 2005. The employer contends that the Claimant commenced his employment on 1 September 2003.[5]The Claimant claims that the employer made a series of unlawful deductions from his wages from the commencement of his employment. He also complained that he suffered a detriment under the Fixed Term Employees Regulations and identifies a number of such alleged detriments at paragraph 9.1 of the ET1. No dates were pleaded for these incidents although all must have occurred prior to 31 December 2005 when he left the employment. He lodged a grievance on 30 March 2006. There was an issue taken by the employer as to whether the grievance was lodged then or at a later date and was out of time, but the employer said it was willing to deal with the grievance. The grievance letter concerned both the unlawful deduction issue and the less favourable treatment issue. The Tribunal stated that the employer had both in mind when it said it was willing to deal with the grievances in the letter.[6]Both parties were represented at the pre-hearing review. The Claimant did not call evidence. The claim under the Fixed Term Regulations, as put in paragraph 9.1 of the ET1, is as follows:
"The detriments that the claimant has suffered are: (1) the claimant has been paid at a much lower rate; (2) the claimant has not received lump sum bonus; (3) the claimant has not received pension contributions; (4) the claimant has not received life insurance; (5) the claimant has not had the ability to work flexi-hours; (6) the claimant has not been give the opportunity to secure a permanent position with the company; (7) the claimant has been denied applications to become a permanent employee on numerous occasions; (8) the claimant has not been given a statement of terms and conditions of employment that complies with Section 1 of the Employment Rights Act 1996; (9) the claimant has raised a grievance with his employers but they failed to deal with it properly. The claimant's appeal against the rejection of my grievance is still to be determined."
[7]The claim is brought pursuant to Regulation 7(1) of the Regulations, which enables an employee to complain to an Employment Tribunal that his employer has infringed a right conferred on him by Regulation 3 the provisions concerning time limits under the Regulations contained in Regulations 7(2) to (5). These provide:
"(2) Subject to paragraph 3, an Employment Tribunal shall not consider a complaint under this regulation unless it is presented before the end of the period of three months beginning, (a), in the case of an alleged infringement of a right conferred by Regulation 3(1)… with the date of the less favourable treatment or detriment to which the complaint relates, or where an act or failure to act is part of a series of similar acts or failures comprising the less favourable treatment or detriment the last of them… (3) A tribunal may consider any such complaint, which is out of time, if in all the circumstances of the case it considers that it is just and equitable to do so. (4) For the purposes of calculating the date of the less favourable treatment or detriment under paragraph 2(a), (a) where a term in a contract is less favourable, that treatment shall be treated subject to paragraph B as taking place on each day of the period during which the term is less favourable; (b) a deliberate failure to act, contrary to Regulation 3…shall be treated as done when it was decided on. (5) In the absence of evidence establishing the contrary, a person shall be taken for the purpose of paragraph 4(b) to decide not to act; (a) when he does an act inconsistent with doing the failed act or (b) if he has done no such inconsistent act when the period expires within which he might reasonably have been expected to have done the failed act if it was to be done."
[8]The Tribunal held that in paragraph 11 of its reasons that the proceedings under the regulations were out of time. This decision has not been challenged by the Claimant. Mr Laddie, on behalf of the employer, submitted that both the judgment and the reasons – see paragraph II of the judgment and paragraph 1.2 of the reasons – erred in treating the items in the ET1 as a single claim. Although Mr Ratledge, on behalf of the Claimant, did not formally abandon the submission in his written skeleton argument, paragraph 5 – that in reality the Fixed Term Employees Regulations complaint was a single complaint – he did not pursue it at the hearing. His decision cannot be faulted, the items are manifestly not components of a single claim.[9]The Tribunal appear to have treated all the complaints under the Fixed Term Regulations as three months out of time, on the basis that they should have been lodged by 30 March 2006, three months after the termination of the Claimant's employment: see paragraph 9 of the reasons. Mr Laddie submitted that the failure to differentiate the different claims led the Tribunal into error when considering the exercise of its discretion under rule 7(3). This is because each complaint might well have a different time limit.[10]When considering whether to extend time, the Tribunal must consider the extent to which a complaint is out of time, if it is to exercise its discretion in accordance with the principles in British Coal Corporation v Keeble [1997] IRLR 337. In the case of the claims based on the terms of the contract, those claims would have arisen at the inception of the contract, and the last act or failure to act may have been the date on which the employment ended. Mr Laddie submitted this was, however, not so in the case of the complaint about fixed and discreet incidents. The complaints about failures to give opportunities to secure a permanent position, the rejection of applications for such positions on numerous occasions and the refusal to permit the Claimant to work flexi-hours were complaints about fixed and discrete incidents.[11]Mr Ratledge skilfully sought to show that, with the exception of the opportunities to obtain permanent jobs, the Tribunal did not fall into error in the exercise of its discretion because it had treated the items in the ET1 as a single claim and the end of the three-month period as 30 March 2006. He argued that this was reasonable in the light of the statement of Mr Harrison, who represented the employer at the hearing, that the claim under the Fixed Term Regulations should have been lodged at the latest by 30 March. The employer denies that at the hearing it conceded that time ended on 30 March 2006.[12]It does not appear to me, from the way the matter is set out in paragraph 9, that there was such a concession. In any event, there would be difficulties with such a concession because the question of whether time has expired is a question going to the jurisdiction of the Tribunal and it is not open to a party by consent or waiver to provide the Tribunal with jurisdiction which it does not have: see Westwood Limited v Reed [1973] ICR 303.[13]Mr Ratledge also submitted that, as far as the complaints about the terms of the contract were concerned, 30 March 2006 is manifestly the correct date. Accordingly, the Chairman, considering rule 7(3) in the light of a three month delay, was right in respect of those claims, which were the majority of the claims. He also submitted that with respect to the complaint about not dealing with the grievance, since the grievance was lodged on 30 March, that claim was not out of time. But this is to gloss over the position of the other claims. It is, in substance, a submission that the matters complained of, in relation to the contract and the other matters, were part of a continuing series of unlawful acts.[14]The difficulty with viewing the matter in this way is that it was not the way the Tribunal considered it. The Tribunal did not address itself to the well-known test in Hendriks v Commissioner for Metropolitan Police [2003] ICR 530 , paragraph 48, to determine whether acts are part of a series of similar acts and linked so as to form a continuing act. Nor did it hear evidence as to whether the individual acts were part of a series of similar acts. The Claimant declined to give evidence. There was accordingly no material before the Tribunal from which it could reach such a conclusion: see Arthur v London East Railway [2007] ICR 193 at paragraph 35 on the need for evidence to determine what link there is between the acts within the three month period and those outside it, and therefore between the individual acts whether within or outside the period.[15]In the absence of a proper finding of a continuous course of conduct, it is necessary to consider the individual acts of alleged less favourable treatment: see Butterworth v Evans (EAT/0538/06/LA), a decision of this Tribunal on 20 February 2007. This was not done and the failure to do so affected the way the exercise of discretion, rule 7(3), was approached.[16]I have concluded that, in the light of the treatment of the proceedings under the Fixed Term Regulations as a single claim and the failure to consider the individual acts of less favourable treatment, the Tribunal fell outside its power to extend time under rule 7(3). Notwithstanding the width of its discretion, in the exercise of this jurisdiction ( Hutchinson v Westward Television [1997] IRLR 69) it is necessary for a Tribunal considering the exercise of its discretion to ascertain when the time limit expires in order for it to approach the exercise of discretion properly and lawfully. If it does not it cannot consider the length of the delay, and it cannot properly consider whether it is just and equitable to allow the claim to proceed. For these reasons the first ground of the appeal succeeds.[17]Although it is not necessary to do so, I shall deal with the second ground of appeal briefly. The fact that the Tribunal heard no evidence from the Claimant as to the reason for his delay is troubling. The Tribunal rejected the Claimant's solicitor's default as a basis for exercising its discretion: see paragraph 12 of the reasons. In Virdi v Commissioner of Police of the Metropolis [2007] IRLR 24 Mr Justice Elias stated that it is highly material that the failures are those of a solicitor rather than the client, and that the errors of a solicitor should not be visited on the client's head. In the light of Virdi's case what the Tribunal did in this case may have been a misdirection. Be that as it may, however, in the absence of evidence from the Claimant, the only matter which could have weighed with the Tribunal in favour of extending time was the fact that the Claimant would otherwise lose a potentially valuable claim.[18]Bearing in mind the width of the discretion to extend time, and the circumstances in which it is proper for this Tribunal to set aside the decision of a Tribunal extending time, the decision to do so without the Claimant's evidence in all the circumstances of this case raises a question. Where a Claimant does not put evidence before a Tribunal in support of his application, explaining his delay and saying why an extension should be granted, how can the Tribunal be convinced that it is just and equitable to extend time? In Bexley Community Centre v Robertson [2003] IRLR 434 at paragraph 25 Lord Justice Auld stated the Tribunal had to be convinced of this. His Lordship stated that the exercise of the discretion to extend time is the exception rather than the rule, because a Tribunal cannot hear a complainant unless the applicant convinces it that it is just and equitable to extend time.[19]Whether or not this is, at Mr Laddie submitted, a question of the burden of proof, the Tribunal must have material before it from which it is proper for it to conclude that it is just and equitable to extend time. Having rejected the solicitors' failures as a reason and without evidence from the Claimant, all the Tribunal had was the inference that the claim was a potentially valuable one, which would be lost. That of course is a factor which is present in all cases where time has expired and cannot in itself be a reason for extending time.[20]The decision of the Tribunal to extend time must be set aside. The employer submits that this Tribunal could substitute its own judgment for that of the Tribunal and decline to exercise the discretion to extend time. The Tribunal's findings as to the prejudice to the employer were that a fair determination of the matter was still possible and that the prejudice to the employer was not such as to mean that time should not be extended. In view of this finding it cannot be said that the position of the employer means that the only proper exercise of discretion is against an extension of time.[21]Accordingly, the matter is remitted to the same Employment Tribunal to consider afresh whether it is just and equitable to extend time or not.

Cited in 3 later judgments