MR S O'NEIL v WOOLDRIDGE ECOTECH LIMITED [2007] UKEAT 0282_07_2509

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2007] UKEAT 0282_07_2509Case No Appeal No. UKEAT/0282/07Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MR S O'NEILAPPELLANTWOOLDRIDGE ECOTECH LIMITEDRESPONDENT
Before
Lady Smith Mr D EvansDate 25 September 2007
[1]APPEARANCES For the Appellant MR NICHOLAS FRIMOND (Solicitor) Nicholas Frimond Solicitors 6 Riverview Walnut Tree Close Guildford Surrey GU1 4UX For the Respondent MR G WOOLDRIDGE (Representative) Wooldridge Ecotech Ltd Unit 17 Hall Grove Farm Bagshot Surrey GU19 5HP SUMMARY Unfair dismissal - Automatically unfair dismissal. Employment Tribunal erred in finding modified procedure applied and that it had been complied with because dismissal not at time employer first became aware of employee's conduct or immediately thereafter and, in any event, step 1 of modified procedure not carried out. Also erred in finding that dismissal fair in circumstances where there was no proper investigation. Remitted to a fresh Employment Tribunal. THE HONOURABLE LADY SMITH Introduction This is an appeal by a Claimant from a decision of the Employment Tribunal sitting at London (South), Chairman Ms C E Taylor, reasons for which were registered on 21 December 2006. They found that the Claimant was not unfairly dismissed and also that there was no automatically unfair dismissal, the latter under reference to section 98A of the Employment Rights Act 1996 .[2]For the sake of clarity, we propose to refer to parties as Claimant and Respondent.[3]We note in passing, although nothing turns on it, that representation before the Tribunal was different, the Claimant being represented by Mr O Isaacs of Counsel and the Respondents being represented by their personnel manager, Ms Thomas. Background facts[4]So far as the background facts are concerned, the factual background can be shortly stated. The Respondent's business is that of haulage and demolition contractors and the Claimant was employed by them as a driver. His work involved transporting materials from construction sites to the Respondent's tip.[5]On 3 April 2006, the Claimant believed that one of his colleagues, who had been driving behind him as they were returning to the tip from a construction site, had been driving dangerously. He was angry and raised his voice and used vulgar language towards the colleague when they got to their destination.[6]The Respondent's Mr Attwell, who was the Claimant's line manager, investigated the incident and concluded that the Claimant had indeed verbally abused his colleague. While Mr Attwell initially took the view that the Claimant should be issued with a verbal warning, the warning was withdrawn after the Claimant challenged it as unfair and unjustified and his colleague agreed that he need not receive such a warning. The Claimant thereafter limited his contact with Mr Attwell and avoided communicating with him.[7]Mr Attwell had a practice of making enquiries if a driver had transported fewer loads than others on any particular day. The Claimant fell into that category on 26 April 2006. Mr Attwell accordingly telephoned him to find out why that had happened. The Claimant apparently gave him a satisfactory explanation but Mr Attwell took the opportunity to ask him why his attitude to him had changed. He also understood that the Claimant had been stopping other drivers maximising the amount of work they were doing in any one day and asked him why he had felt it necessary to do so. An argument ensued between them and the telephone call was ended by the Claimant.[8]Mr Attwell's position was that the Claimant had sworn at him during the telephone call and the Tribunal accepted his evidence (he gave evidence before them) that the Claimant had done so. That was however, we note, in circumstances where the Tribunal also found that neither party had a clear recollection of the telephone call. There is no finding that the Claimant conceded that he had sworn at Mr Attwell nor is there any finding as to what exactly it was that the Claimant was alleged to have said.[9]Mr Attwell was the person who usually made all the necessary decisions for the Respondents regarding hiring and firing. He took the view that the Claimant had committed an act of gross insubordination and that it amounted to gross misconduct. He discussed the matter on the day of the telephone call with Mr Graham and Ian Wooldridge. Having done so, he decided that it was appropriate to dismiss the Claimant. It was not, though, until the following day that he did so. He called the Claimant into his office and dismissed him. The Claimant had received no prior notice. No disciplinary meeting was held. He was advised of his right of appeal in a letter confirming his dismissal. The Claimant appealed unsuccessfully. The Tribunal's reasons[10]The Tribunal explains why it concluded the dismissal was not unfair at paragraph 27 where they state:
"The Tribunal was satisfied that Mr Attwell had reasonable grounds on which to conclude that the Claimant was guilty of insubordination. The Tribunal accepted the evidence of the Respondent that it was entitled to treat the Claimant's actions as an act of gross misconduct and dismiss him summarily. The Claimant was granted a right of appeal which he exercised. We found that in the circumstances of this case that the Respondent's decision not to hold a disciplinary hearing before his dismissal was reasonable given that the relationship between the Claimant and Mr Attwell was destroyed. The Tribunal was satisfied that the Respondent had regard to all relevant factors and could reasonably conclude that the Claimant's actions of insubordination constituted an act of gross misconduct. Accordingly, the Tribunal finds that the Respondent's decision to dismiss the Claimant was fair."
[11]The Claimant submitted that the dismissal was automatically unfair and the Tribunal dealt with that submission at paragraph 28 where they said:
"The Claimant submitted that the Respondent had not complied with the statutory disciplinary procedure. The Tribunal was satisfied that the letter informing the Claimant of his right to appeal satisfied the requirements of a "step 1" letter. Having regard to the modified procedure we found that the Respondent complied with the statutory disciplinary procedure. The Tribunal concluded that this part of the Claimant's complaint is not well-founded."
Relevant legislation[12]Under section 98 of the Employment Rights Act 1996 , the Tribunal required to determine firstly whether the dismissal was potentially fair i.e. was the dismissal by reason of the Claimant's conduct in circumstances where the Respondents had a genuine belief that he had committed the act of misconduct complained of which was arrived at after having carried out a reasonable investigation into the matter? Various authorities over the years have discussed this including British Home Stores v Burchell [1978] IRLR 379, Sainsbury's Supermarkets Limited v Hitt [2003] IRLR 23 and also the case of Weddell v Tipper [1980] IRLR 96 specifically referred to in the skeleton argument put forward by the appellants today, and in particular the passage at page 101 where the EAT stated:
"Employers do not have regard to equity or the substantial merits of the case if they jump to conclusions which it would have been reasonable to postpone in all the circumstances until they had, in the words of the Employment Tribunal in this case, gathered further evidence or, in the words of Mr Justice Arnold in the Burchell case, carried out as much investigation into the matter as was reasonable in all the circumstances of the case. That means that they must act reasonably in all the circumstances and must make reasonable enquiries appropriate to the circumstances. If they form their belief hastily and act hastily upon it without making the appropriate enquiries or given the employee a fair opportunity to explain himself, their belief is not based on reasonable grounds and they are certainly not acting reasonably."
[13]It was then for the Tribunal to turn its mind to the provisions of section 98(4) and ask whether on the evidence the employer had acted reasonably. In short, whether the dismissal was in all the circumstances fair bearing in mind how the objective reasonable employer would have acted and bearing in mind that there will have been a band of reasonable responses open to him as discussed in Iceland Frozen Foods Limited v Jones [1982] IRLR 439. Unfairness in procedure will lead to a decision that the dismissal was unfair in many cases unless it is shown that the employee would, on the balance of probabilities, have been dismissed in any event : section 98A(2) of the 1996 Act. We are, of course, there referring to unfairnesses in procedure other than statutory procedures because if the statutory disciplinary procedure and dismissal procedure is not followed then there is automatic unfairness and we turn to that now.[14]Failure to follow any part of the applicable statutory dismissal procedures as provided for in schedule 2 of the Employment Act 2002 under reference to paragraph 3 of the Employment Act 2002 (Dispute Resolution) Regulations 2004 will render a dismissal automatically unfair : section 98A(1) of the Employment Rights Act 1996 .[15]In particular, there are two types of procedure that may be followed in respect of dismissals. One is called the standard procedure which will apply to all cases unless the other, the modified procedure can be shown to apply. Before the modified procedure can be shown to apply it is necessary to satisfy each and every one of the four sub-paragraphs of paragraph 2 to regulation 3 of the 2004 Regulations. These are:
"(a) the employer dismissed the employee by reason of his conduct without notice; and (b) the dismissal occurred at the time the employer became aware of the conduct or immediately thereafter; and (c) the employer was entitled in the circumstances to dismiss the employee by reason of his conduct without notice or any payment in lieu of notice; and (d) it was reasonable for the employer in the circumstances to dismiss the employee before enquiring into the circumstances in which the conduct took place."
Step 1 of the modified procedure is also relevant. It is set out in Schedule 2 to the 2002 Act and provides:
"4. The employer must – (a) set out in writing – (i) the employee's alleged misconduct which has led to the dismissal, (ii) what the basis was for thinking at the time of the dismissal that the employee was guilty of the alleged misconduct, and (iii) the employee's right to appeal against dismissal, and (b) send the statement or a copy of it to the employee."
The appeal[16]There were two parts to the arguments advanced on appeal. The first was that the Tribunal had erred in law in finding that the modified procedure applied and had been complied with. It was said that it neither applied since paragraphs (b) and (d) of paragraph 3(2) of regulation 3 were not satisfied and was not, in any event, complied with since the letter of 27 April did not set out in writing what the basis was for the employer thinking that the Claimant was guilty of misconduct. There would need, it was said, to have been more specification.[17]The second part to the argument was that the Tribunal had also erred in law in finding that the dismissal was not unfair. It had correctly noted that it was inherent in a fair dismissal for misconduct that there required to have been a fair investigation but they had made no finding in fact to that effect. Further, on the findings that they did make it was not open to them to conclude that there had been a fair investigation.[18]Specific reference was made, as discussed, at paragraph 40 of the skeleton argument to the respects in which the Respondents, had failed in a way which amounted to a wholesale disregard of industrial procedures. Firstly, that there was no investigation; insofar as there was one it was undertaken by Mr Attwell who was a witness to the alleged misconduct, acted as investigator, made the decision to dismiss and was involved in the appeal. Secondly, that prior to dismissal the Claimant was not given any opportunity to state his case. Thirdly, that the Respondent took into account allegations of which the Claimant was wholly unaware. Fourthly, that the decision to dismiss was taken by a panel consisting of Mr Ian and Graham Wooldridge together with Mr Attwell. Mr Ian and Graham Wooldridge had not been privy to any disciplinary hearing and Mr Attwell acted as witness, accuser and judge; in all the premises the disciplinary decision was not impartial but flawed and unfair. Fifthly, that the appeal was decided by Mr Graham Wooldridge in consultation with Mr Roger Attwell and Mr Ian Wooldridge. We understand the matters advanced under the third, fourth and fifth aspects of paragraph 40 of the skeleton argument to have been advanced by reference to what was contained in witness statements that were before the Tribunal.[19]Insofar as disposal was concerned, it was submitted that there should be a remit to the freshly constituted Tribunal. Mr Frimond relied on the extent of the errors being such as to indicate that that was appropriate. He also commented that the Claimant had no confidence in this Tribunal getting it right next time, to use a colloquialism, given the extent of their error.[20]Turning to the arguments advanced on behalf of the Respondents, Mr Wooldridge opened by reference to regulation 3(2)(b) noting, we understand, that it required before the modified procedure could be used that the dismissal occur either at the time the employer became aware of the conduct or immediately thereafter. He advised us that the dismissal was, in fact, on the same day. We explained to him that for the purposes of this appeal we were bound by the findings of fact of the Tribunal and the finding was that dismissal took place on a date that was after the telephone call events.[21]Mr Wooldridge also drew our attention to a document promulgated by ACAS entitled Disciplinary Grievance Procedures. It is the document that bears the date reference 09/04 and he drew our attention in particular to paragraph 36 of that document and to the sentence in paragraph 6 where, having referred to the possibility of dismissing without a meeting, it says that:
"To allow for these cases there is a statutory modified procedure under which the employer is required to write the employee after the dismissal setting out the reasons for the dismissal and to hold an appeal meeting if the employee wants one."
We note in passing the entire terms of that paragraph which go rather further than the sentence referred to. We are indeed satisfied that as guidance it is accurate and does not misrepresent the terms of the statute. We are, of course, bound to refer back to the terms of the statute and indeed the terms of the regulations and that is where, if there is any doubt, an employer must go also.[22]Mr Wooldridge submitted that any remit should be to the same Employment Tribunal because they have arrived at a decision in this case and it simply needs clarification. He said they have heard the facts of the case and their decision was backed up by Langstaff J. We understand the latter reference to be to the initial decision on the sift in this case. Mr Justice Langstaff made an order under rule 3.7 of the EAT Rules (As Amended) 1993 to the effect that no reasonable grounds were advanced in the notice of appeal first served in this case. However, a further procedure took place thereafter and it is plain that ultimately this Tribunal was satisfied that reasonable grounds were to be advanced at the full hearing and those are the grounds which we have considered today.[23]Mr Wooldridge submitted further that Mr Attwell felt intimidated and so felt it was unwise to invite the Claimant to a meeting, that that directed them towards a modified procedure and pointed the Tribunal towards the modified procedure being appropriate. He referred also to the fact that there was evidence that Mr Attwell and the Claimant's relationship had broken down. He said it was the nature of the swearing that the Tribunal had found unacceptable.[24]He took issue with certain matters advanced in paragraph 40 of the skeleton. In particular, he submitted that Mr Attwell was not in fact involved in the appeal, that no account had been taken of other evidence of which the Claimant had not been given notice. He added that he had had a long conversation with the Claimant on the telephone after he had been dismissed, a call in respect of which he took notes. He said that the Claimant had said he was surprised that he was dismissed but that he had said he was surprised he was surprised because he had not spoken to his line manager since the earlier incident.[25]Mr Wooldridge said that he believed there had been a full investigation to the point that the Claimant was asked what he was looking for. We understood that to be a reference to what we heard at the appeal hearing. Mr Wooldridge indicated that part of the investigation was the telephone conversation. He again indicated that there was an element of intimidation, stress to the manager, stress to the office and other work colleagues and it was not considered to be acceptable.[26]Mr Wooldridge again told us that insofar as the fifth matter at paragraph 40 of the skeleton was concerned, the appeal was not decided in consultation with Mr Attwell - he had been interviewed and that was as far as it went. We have to say that was not consistent with what was read to us by Mr Frimond from the witness statement from Mr Wooldridge that had been before the Tribunal which did indeed indicate that Mr Attwell had participated in the decision making at the time of appeal.[27]Mr Wooldridge indicated that they did understand the need to interview employees but it was difficult in this case given the relationship problems and that, he said, was what the modified procedure was for. Discussion and decision[28]Turning to our discussion and decision in this case, we are readily persuaded that this Tribunal erred in law in its conclusion that the modified procedure applied. Having found, in fact, that the Claimant was dismissed not only not until after Mr Attwell had discussed the matter with Mr Graham Wooldridge and his brother, but not until the day after the conduct complained of, it was not open to them to be satisfied, as for the modified procedure to apply they required to be, that there had been a dismissal "at the time the employer became aware of the conduct or immediately after it". That, of course, is a quotation from the provisions of regulation 3.[29]Further, we agree that the letter of 27 April did not satisfy the requirements of step 1 of the modified procedure. It did not tell him what it was that Mr Attwell had alleged that he had said that was characterised as verbal abuse. To adopt the language of the President, Mr Justice Elias in the case of Alexander v Bridgen Enterprises Limited [2006] IRLR 422 as is quoted by the Claimant in the skeleton argument:
"The employee must be given sufficient detail of the case against him to enable him properly to put his side of the story."
The letter did not do that. The reader is left wondering what the employee is alleged to have said and what it was about it that was thought to have justified it being described as verbal abuse.[30]The Tribunal were not, accordingly, on their findings, entitled to conclude that the modified dismissal procedure applied nor indeed were they entitled to conclude that if it did apply that it had been complied with.[31]In the circumstances, it was incumbent on the Tribunal to ask if the standard procedure applied, (insofar as we can see on the information before us, it did) and then to ask whether it was complied with. On the findings of fact made by this Tribunal they could not have found that the standard procedure was complied with since there was a dismissal without the employer having first set out in writing the employee's alleged conduct and sending it to him with an invitation to attend a meeting to discuss the matter. Such a meeting would have required to take place with the issue of whether or not to dismiss not being decided on until such a meeting had run its course. We do not understand Mr Wooldridge to suggest that the standard procedure was complied with. Indeed, he seemed to be at pains to stress that his company in this case were entitled to use only the modified procedure. The result would then have been that the dismissal was automatically unfair under and in terms of section 98(a)(1) of the 1996 Act and it was then for the Tribunal to go on and consider a remedy.[32]As regards the second point raised on appeal, we are also persuaded that the Tribunal have erred in law. Having recognised the principle that there requires to have been a reasonable investigation by an employer in such a case as this before any dismissal has the potential to be regarded as fair, they made no finding as to whether there was such an investigation. The findings that they do make seem to be to the effect that there was no investigation at all but that that was to be excused because the relationship between the Claimant and Mr Attwell had broken down. That approach will not, we are afraid, withstand scrutiny. It amounts to an acceptance by the Tribunal that there was no investigation at all, therefore no fair investigation and they are thus not able to justify their stated conclusion that it was a fair dismissal.[33]We are, accordingly, satisfied that the Tribunal have indeed fallen into error in the respects for which their decision is attacked by the Claimant in this appeal.[34]As regards disposal, we are not persuaded that it would be appropriate to remit the case to the same Employment Tribunal. The extent to which they have fallen into error is such as to make it inappropriate to do so. Bearing in mind the principles in Sinclair Roche and Temperely v Heard [2004] IRLR 763, we will remit the case to a freshly constituted Tribunal for a re-hearing.