ROYAL BANK OF SCOTLAND v MR M BEVAN [2007] UKEAT 0440_07_2611

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2007] UKEAT 0440_07_2611Case No Appeal No. UKEAT/0440/07Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
ROYAL BANK OF SCOTLANDAPPELLANTMR M BEVANRESPONDENT
Before
His Honour Judge RichardsonDate 26 November 2007
[1]APPEARANCES For the Appellant MR ERIC GILLIGAN (Solicitor) Brodies Solicitors 15 Atholl Crescent Edinburgh EH3 8HA For the Respondent MR BARRY HARWOOD (of Counsel) Instructed by: Messrs Express Solicitors Resolution House 319 Palatine House Northenden Manchester M22 4HH SUMMARY Time limits – reasonable practicability. The Claimant had been waiting for the result of his internal appeal before commencing proceedings for unfair dismissal. He learned the result just 5 hours before the expiry of the 3 month period. The Tribunal did not err in law in holding that it was not reasonably practicable for him to commence proceedings within the 3 month time limit. Reg 15(1) and (2) of the Employment Act 2002 (Dispute Resolution) Regulations 2004 considered. Royal Bank of Scotland v Theobald (EAT/0446/06) considered and distinguished. HIS HONOUR JUDGE RICHARDSON This appeal raises a short and interesting point which lies at the intersection between established case law on the question when it is "reasonably practicable" to begin proceedings and a new statutory provision, in reg 15 of the Employment Act 2002 (Dispute Resolution) Regulations 2004 , which allows for an extension of time to begin proceedings where an employee reasonably believes that statutory dismissal procedures are being followed.[2]The appeal is brought by the Royal Bank of Scotland ("RBS") against a judgment of the Employment Tribunal sitting in Bristol by Chairman alone (Mr Sara). By his judgment the Chairman held time to be extended under section 111(2) of the ERA 1996 to enable Mr Bevan to pursue his claim for unfair dismissal. The statutory background[3]A strict time limit is applicable to claims brought for unfair dismissal under Part X of the Employment Rights Act 1996 . Section 111(2) of the Employment Rights Act 1996 provides – "111 (2) Subject to subsection (3), an [employment tribunal] shall not consider a complaint under this section unless it is presented to the tribunal-(a) before the end of the period of three months beginning with the effective date of termination, or(b) within such further period as the tribunal considers reasonable in a case where it is satisfied that it was not reasonably practicable for the complaint to be presented before the end of that period of three months."[4]The Employment Act 2002 introduced statutory dispute resolution procedures. It is not necessary for the purpose of this judgment to set out its provisions extensively, or to refer to most of the regulations made under it which are contained in the Employment Act 2002 (Dispute Resolution) Regulations 2004 ("the DRR"). It is sufficient to describe certain features of the legislation.[5]The 2002 Act sets out dismissal and disciplinary procedures which an employer is expected to follow if he contemplates dismissing an employee. The procedures are set out in in Schedule 2, Part 1. The applicable procedure is generally the standard dismissal and disciplinary procedure. The employer must set out in writing what it is which leads him to contemplate dismissal; he must send that statement to the employee and invite the employee to a meeting; before the meeting he must tell the employee the basis for the grounds set out in the statement in time for the employee to consider his response to it; and after the meeting he must inform the employee of his decision and notify him of his right to appeal against it. If the employee appeals the employer must invite him to attend a meeting and after the appeal meeting the employer must inform the employee of his final decision. There are general requirements about avoiding unreasonable delay and about the timing, location and conduct of meetings and appeals.[6]Section 31 of the 2002 Act makes provision for awards to be adjusted if statutory procedures have not been complied with. Section 31(2), (3) and (4) read as follows:
"31 Non-completion of statutory procedure: adjustment of awards (2) If, in the case of proceedings to which this section applies, it appears to the employment tribunal that; (a) the claim to which the proceedings relate concerns a matter to which one of the statutory procedures applies, (b) the statutory procedure was not completed before the proceedings were begun, and (c) the non-completion of the statutory procedure was wholly or mainly attributable to failure by the employee- (i) to comply with a requirement of the procedure, or (ii) to exercise a right of appeal under it, it must, subject to subsection (4), reduce any award which it makes to the employee by 10 per cent, and may, if it considers it just and equitable in all the circumstances to do so, reduce it by a further amount, but not so as to make a total reduction of more than 50 per cetn. (3) If, in the case of proceedings to which this section applies, it appears to the employment tribunal that- (a) the claim to whci the proceedings relate concerns a matter to which one of the statutory procedures applies, (b) the statutory procedure was not completed before the proceedings were begun, and (c) the non-completion of the statutory procedure was wholly or mainly attributable to failure by the emloyer to comply with a requirement of the procedure, it must, subject to subsection (4), increase any award which it makes to the employee by 10 per cent and may, if it considers it just and equitable in all the circumstances to do so, increase it by a further amount, but not so as to make a total increase of more than 50 per cent. (4) The duty under subsection (2) or (3) to make a reduction or increase of 10 per cent does not apply if there are exceptional circumstances which would make a reduction or increase of that percentage unjust or inequitable, in which case the tribunal may make no reduction or increase or a reduction or increase of such lesser percentage as it considers just and equitable in all the circumstances."
[7]An employee is not obliged to wait for the completion of the procedure before commencing proceedings. However, the DRR extends the normal time limit for a further 3 months in circumstances which are set out in reg 15(1) and (2):
"15 Extension of time limits (1) Where a complaint is presented to an employment tribunal under a jurisdiction listed in Schedule 3 or 4 and- (a) either of the dismissal and disciplinary procedures is the applicable statutory procedure and the circumstances specified in paragraph (2) apply; or (b) either of the grievance procedures is the applicable statutory procedure and the circumstances specified in paragraph (3) apply; the normal time limit for presenting the complaint is extended for a period of three months beginning with the day after the day on which it would otherwise have expired. (2) The circumstances referred to in paragraph (1)(a) are that the employee presents a complaint to the tribunal after the expiry of the normal time limit for presenting the compliant but had reasonable grounds for believing, when that time limit expired, that a dismissal or disciplinary procedure, whether statutory or otherwise (including an appropriate procedure for the purposes of regulation 5(2)), was being followed in respect of matters that consisted of or included the substance of the tribunal complaint."
[8]The question which arises in this case is: what happens if a procedure was being followed almost to the end of the 3 month period, but is then brought to an end shortly beforehand? It would, of course, have been possible for the employee to have commenced proceedings at any time. Is it open to the Tribunal to say that it was not reasonably practicable to do so? The facts[9]Mr Bevan was employed by RBS as a customer adviser. He was made subject to investigation and disciplinary procedures for alleged gross misconduct. On 10 January 2007 a disciplinary meeting was held. On 12 January he was dismissed. So the normal 3 month time limit would have expired at midnight on 11 April.[10]Mr Bevan appealed against his dismissal. The appeal meeting took place on 8 March 2007. For reasons which RBS did not explain the letter dismissing his appeal bears a date a month later, and was not posted until 10 April, so that he received it on 11 April at 7pm when he came home from work.[11]It is common ground that until that moment Mr Bevan reasonably believed that a dismissal procedure was still being followed. Only at 7pm did he cease to believe that fact – just 5 hours before the expiry of the 3 month time limit. But, of course, since he had ceased to hold that belief at the expiry of the time limit, time was not extended for a further period of 3 months by virtue of reg 15(1) and (2) of the DRR.[12]Mr Bevan, at the appeal meeting, had expressed concern about his ability to lodge papers for the Tribunal within the time limits. It was therefore plain that he was awaiting the outcome of the appeal before presenting his claim. The Tribunal Chairman described it as a "remarkable co-incidence" that the letter arrived so shortly before the last moment at which it would have extended time for a further 3 months. It is indeed difficult to understand why RBS took so long to decide the appeal and post the letter. But that is not the point of this appeal. The same question could arise in a case where there was very good reason for the decision being made and notified just before the expiry of the 3 month period.[13]To complete the story, Mr Bevan e-mailed his solicitors on 12 April, alerting them to the position. The claim, which was professionally drafted, is stamped as received by the Tribunal on 18 April. The Tribunal Chairman appears to have thought that 11 April was a Friday, whereas it was in fact a Wednesday, but this makes no difference to the number of working days between receipt of the email by the solicitors and the lodging of the claim form. The Tribunal's reasons[14]The Tribunal Chairman was much exercised by a case in the Employment Appeal Tribunal: Royal Bank of Scotland v Theobald (EAT/0446/06, 10 January 2007) to which I shall return later. After discussing it he said – "9. This is a strong judgment but I still feel I must look at this case on the particular facts of this case, which are different in my view in a significant way. The significant difference is simply the much shorter period of time. In Theobald the claimant had 1½ to 2 days to activate what he should always have been considering as a possibility. In the present case receiving notification on Friday evening when time expires at midnight that day makes life much more difficult for the claimant. He received the letter after the hours when his solicitors would have closed the business for the weekend. It was after the Tribunal office would have closed and it gave him a miniscule time to get together a proper application. Although the requirements are robust it seems to me that they are not that robust and I have come to the conclusion that is was not reasonably practicable for him to present his claim in time, given that he was entitled to wait until he had heard the outcome of the appeal before presenting his claim. Indeed the whole structure of Regulation 15 is intended to encourage parties not to start proceedings until internal proceedings have been completed. It seems to me that the injustice caused by last minute notification that his appeal is dismissed can properly be dealt with by the not reasonably practicable provisions of the section." The Chairman then went on to deal with the question whether the Claim had been brought "within such further period as the tribunal considers reasonable" for the purposes of section 111(2)(b). He said – "The other argument made by the respondent is that, having heard about it on the 11 th , the claimant did not bring the claim within a reasonable period thereafter by bringing it on 18 April through his solicitors. Given that he was using solicitors, the evidence is that he e-mailed his solicitors on Saturday 12 April. They would have received that e-mail on Monday 15 th . It seems to me that to get the claim in by 18 th was within a reasonable time thereafter. There is no suggestion of any prejudice there in any further delay to the respondents." Submissions[15]The argument deployed by Mr Gilligan on behalf of RBS runs as follows. There is a clear line of authority to the effect that the existence of an ongoing appeal procedure does not of itself indicate that it is not reasonably practicable to present a Tribunal claim in time. Reference was made to Palmer and Saunders v Southend on Sea Borough Council [1984] IRLR 119 at paragraphs 30 and 31, London Underground v Noel [2000] ICR 109 at 117 and most recently Theobald v Royal Bank of Scotland at para 43. That line of authority was binding on the Tribunal Chairman and ought to have been applied. Indeed it is submitted that Theobald is on all fours with this case.[16]Further, and in any event, it is submitted that the Chairman erred in taking into account reg 15 of the DRR at all, for the following reasons. Firstly, reg 15 had no application; Mr Bevan did not believe, at the expiry of the 3 month time limit, that any procedure was still being followed. Secondly, there was (it was submitted) no reason to suppose that Mr Bevan had this provision in mind at all. At the Tribunal he argued unsuccessfully that the effective date of termination was the date of the letter confirming his dismissal, 19 January. If so, reg 15 of the DRR had no effect on his thinking at all.[17]Further and in any event it is submitted that the Chairman wrongly took into account what he perceived to be the injustice caused by last minute notification that the appeal had been dismissed. The test of reasonable practicablity will apply whether or not the result seems just or equitable.[18]Finally, it was argued on behalf of RBS that the Chairman erred in law in holding that the period between 12 April and 18 April was a reasonable further period for the purposes of section 111. It was submitted that he made errors about the dates and wrongly took into account that there was no prejudice to RBS.[19]On behalf of Mr Bevan, Mr Harwood submitted that the Tribunal Chairman's reasons were correct and in any event disclosed no error of law. He submitted that section 111(2) was to be applied liberally in favour of the employee: see Marks and Spencer plc v Ryan [2005] IRLR 562 . Each case was to be determined on its own facts, and earlier authorities were not to be taken as laying down rules of law. Royal Bank of Scotland v Theobald was distinguishable on its facts, and laid down no relevant principle of law. As the question of "such further time as the tribunal considers reasonable", there was no error of law in the Tribunal's conclusion.[20]In the course of submissions, as Mr Gilligan and Mr Harwood discussed the statutory context and purpose of reg 15, consideration was given to the provisions of section 31(2)-(4) to which I have referred above. Mr Gilligan submitted that these provisions had no bearing on the position of an employee considering whether to commence proceedings before a statutory procedure was concluded. If the statutory procedure was not completed, and its non completion was attributable to him, that could not be a reason for delay. If the statutory procedure was not completed, and its non completion was attributable to the employer, then the employee's remedy was to pursue the claim and seek an enhancement. In any event in this case, he pointed out, Mr Bevan had nothing left to do under the statutory procedure. Mr Harwood submitted that section 31(2)-(4) provided part of the statutory context within which reg 15 should be considered. Reasonable practicability[21]It is convenient to start with the Tribunal Chairman's observation that the purpose of reg 15 was to encourage parties not to start proceedings until internal procedures have been completed.[22]In general I agree with this observation. Indeed I can see no other discernible statutory purpose behind reg 15. If the claim is one to which the statutory dismissal procedure applies, reg 15 extends time so long as the employee has reasonable grounds for believing, when the normal time limit expires, that a dismissal procedure is being followed, even if it is not the statutory dismissal procedure. There would be no point in extending time in this way unless it was envisaged that it was both reasonable and desirable that an employee should delay the issuing of proceedings so long as he reasonably believed that a dismissal procedure was being followed.[23]I would, however, sound one note of caution. Reg 15 extends normal time limits only for 3 months. Nothing in reg 15 suggests that its purpose was to encourage parties to delay the commencement of proceedings beyond that time. So, in an unfair dismissal claim, the statutory intention is that after 6 months the claim should be commenced even if an employee reasonably believes that a procedure is still being followed.[24]Although I do not think it is necessary to discuss section 31 in any depth in this judgment, I would observe that at first sight this provision appears to suggest that if an employee waits to begin proceedings until the statutory procedures are over, and the result of the appeal announced, he will be safe from a deduction under section 31(2). It may therefore not be surprising if, during the first six months, an employee is advised to wait until the completion of a procedure before commencing proceedings.[25]The position is, however, not necessarily so straightforward. This because the DRR has a provision in reg 12, which deems non-completion of the procedure to be attributable to the first party who fails to comply with a requirement of the procedure, including a general requirement such as taking steps without delay or conducting oneself properly at a meeting. So "non completion" in section 31 is something of a term of art. Be that as it may, section 31 is likely to have a chilling effect on the commencement of proceedings before procedures are over. But as I have said, nothing in the 2002 Act or the DRR suggests any statutory intention that an employee should delay in commencing proceedings beyond the time limit as extended by reg 15.[26]In this case, where Mr Bevan was still less than 3 months from the date of his dismissal, the observation of the Chairman is apposite. Regulation 15 was indeed intended to encourage parties not to start proceedings until internal procedures had been exhausted.[27]Was the Chairman justified in law in concluding that it was not reasonably practicable for Mr Bevan to present his claim within the 3 month time limit? In my judgment he was, and he committed no error of law in reaching that conclusion. My reasons are as follows.[28]It is to be borne in mind that the test is not what is possible, nor even what is practicable, but what is reasonably practicable. The provision should be given a liberal construction in favour of the employee: see Marks and Spencer plc v Williams-Ryan [2005] IRLR 562 at paragraph 20. It is, of course, still not to be read as if it was the equivalent of reasonable, but it means more than what is reasonably capable physically of being done.[29]While it is true that generally speaking the existence of an internal right of appeal is of no relevance to the question whether it is reasonably practicable to make a timely complaint to the employment tribunal, this is not an absolute rule for two reasons.[30]Firstly, it is not truly a principle of law at all. Rather it is a common sense conclusion of fact which will be reached by a Tribunal in the vast majority of cases: see Marks and Spencer plc v Williams-Ryan at paragraph 22, which identifies the context in which it usually arises – namely whether the employee could reasonably be expected to be aware of the fact that there was a time limit for making a complaint to the employment tribunal.[31]Secondly, there may be exceptional cases where the existence of an internal right of appeal is relevant. In Palmer and Saunders v Southend Borough Council the Court of Appeal cited with approval the judgment of Browne-Wilkinson J (as he then was) in Bodha v Hants Area Health Authority [1982] ICR 200 – "There may be cases where the special facts (additional to the bare fact that there is an internal appeal pending) may persuade an Industrial Tribunal, as a question of fact, that it was not reasonably practicable to complain to the Industrial Tribunal within the time limit. But we do not think that the mere fact of a pending internal appeal, by itself, is sufficient to justify a finding of fact that it was not "reasonably practicable" to present a complaint to the industrial tribunal."[32]To my mind the Tribunal Chairman was fully entitled to conclude that this was a case where, exceptionally, it was not reasonably practicable for Mr Bevan to present his claim. Mr Bevan reasonably believed until shortly before the expiry of the deadline that the appeal procedure was ongoing, and was expecting that he would present his claim if and when he learned that the appeal procedure was unsuccessful. Like the Chairman, I have concluded that this is a perfectly reasonable stance for an employee to take – for it is plainly envisaged by the DRR that procedures should be able to take their course before proceedings are commenced. There is, of course, one important caveat to that propostion. It applies only so long as the additional 3 month period does not elapse, for nothing in the new Rules gives any encouragement to delaying the making of a claim after the additional 3 month period elapses.[33]Once granted this proposition, a Tribunal chairman is entitled to conclude that if the employer suddenly and without warning completes the appeal procedure just before the expiry of the 3 month period it is not reasonably practicable for the employee to commence proceedings in time.[34]I turn then to consider Theobald v Royal Bank of Scotland . Does Theobald contain a proposition of law to the contrary? If it did, although the doctrine of precedent does not strictly apply in the EAT, there would be strong reasons for following it.[35]This case needs to be seen against its own factual background. The claimant was summarily dismissed for gross misconduct. There was an internal appeal. The CAB advised him that he had to complete the internal appeal procedure before making an application to the Employment Tribunal. The appeal proceeded on the basis that this was a misunderstanding of the correct position in law. I comment in passing that, while it is true that no employee has to wait for the completion of the internal appeal procedure before making an application, it may not be entirely surprising if he is given advice to wait, in the light of section 31(2). At all events there were no findings as to the reason why the CAB gave the advice it did.[36]The claimant learned that his internal appeal was unsuccessful at some point between 24 hours and 48 hours before the expiry of the 3 month time limit. He downloaded a Tribunal claim form straightaway. He could, of course, have submitted it electronically there and then. He did not do so. The Tribunal made no findings as to why he did not do so.[37]The Appeal Tribunal (Lady Smith) found that it was not reasonably practicable for the claimant to present his claim up to the point when he learned that his internal appeal was unsuccessful. So her decision turned on the last period of 1 or 2 days. She concluded that no satisfactory explanation had been given as to why the claimant could not have presented the claim during that period. She allowed the employer's appeal on that basis.[38]If one looks at the reason for allowing the appeal, Theobald is plainly distinguishable, as the Tribunal Chairman in this case found. In this case Mr Bevan found out about the result of the appeal in the evening only 5 hours before the expiry of the time limit. He had instructed solicitors and told them the next working day. The Tribunal Chairman was not at all bound by the result to find that, in the circumstances of his case, it was reasonably practicable to present the claim in time. I would add, in any event, that there is no rule of law that it is reasonably practicable to present a claim if the need to do so is known for 24 or 48 hours, or any other length of time. What is reasonably practicable is a matter for the Tribunal.[39]The point which RBS takes relates to Lady Smith's reason for finding that it was not reasonably practicable to present the claim up to that point. Lady Smith found that it was not reasonably practicable by reason of the CAB's advice. She said – "Although listed separately, the fact of the outstanding appeal and the fact of the CAB erroneous advice would appear to amount to one and the same thing, both ceasing to have effect once the Claimant learnt of the outcome of his appeal. I should though, at this point indicate that I accept the Respondents' submission that, on the authorities referred to, the existence of an ongoing appeal procedure does not, of itself, indicate that it is not reasonably practicable to present a timeous tribunal application. The Claimant's case here was not, however, that simple. It was inextricably bound up with the erroneous advice he received that he was not entitled to present a claim during that period."[40]Contrary to the submission for RBS, I do not think Lady Smith was intending to lay down any proposition of law which the Tribunal Chairman in this case was bound to follow. She was intending to do no more than recognise the general proposition (which we have seen is not truly a proposition of law) that generally speaking the existence of an internal right of appeal is not relevant to the question when it is reasonably practicable to commence proceedings. In that case the key feature was the advice of the CAB.[41]I turn then to the argument that Mr Bevan did not, or may not, have realised that his time expired when it did. To my mind, on the facts of this case, that does not affect the question whether it was reasonably practicable for him to begin his proceedings within the time limit. The point is that he did intend to commence proceedings promptly when the result of the appeal was notified to him. If that was a reasonable stance – as the Chairman thought it was, and I agree it was – then the 5 hour period which elapsed prior to the expiry of the time limit was so short that it was not reasonably practicable for him to commence proceedings in time.[42]What of the argument that, since RBS was or may have been responsible for delay, and therefore non completion, in the statutory procedure, Mr Bevan ought to have commenced his proceedings without waiting for completion, and claimed the statutory enhanced award? This would indeed be Mr Bevan's remedy if the extended, six month, time limit was about to expire. But at the 3 month stage it was a proper stance for him to wait until he knew the result of the internal procedure.[43]I turn finally the argument that the Tribunal Chairman supplanted the "reasonably practicablity" test with a test as to what is just and equitable. This is plainly not the approach he took. Rather, he applied the "reasonable practicability" test and noted that on its proper application it remedied what would otherwise have been an injustice. If one grants that it can be reasonable for an employee to await the result of a procedure before commencing proceedings while he is within the 6 month period, then the Chairman was right to conclude that Mr Bevan would have suffered an injustice by reason of the last minute notification that his appeal was dismissed. For the reasons I have already given, the Chairman was entitled to take the view he did. Further reasonable time[44]I see no error of law in the Chairman's conclusion on the question of what further time was reasonable; it is very much a question of fact for the Tribunal. The Chairman was wrong to think that 12 April was a Saturday, but the overall period, and the overall number of working days, remained the same. Nor do I think for a moment that he supplanted the "such further period as the tribunal considers reasonable" test with a test based on prejudice to the respondent. His closing comment to the effect that there was no suggestion of any prejudice to the respondents was simply a parting shot. Conclusions[45]For these reasons, the appeal will be dismissed, and the unfair dismissal claim will proceed to hearing as the Chairman directed.[46]For the sake of completeness, I note that there was also a wrongful dismissal claim, in respect of which there was no appeal before me. I was told that Mr Bevan was paid for his notice period.