MR A J MCCALL v NORTHERN RAIL LTD [2007] UKEAT 0504_06_2501

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2007] UKEAT 0504_06_2501Case No Appeal No. UKEAT/0504/06Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MR A J MCCALLAPPELLANTNORTHERN RAIL LTDRESPONDENT
Before
His Honour Judge McMullenDate 25 January 2007
[1]APPEARANCES For the Appellant MR EDWARD LEGARD (of Counsel) Instructed by: Bridge McFarland Solicitors 3-9 Tentercroft Street Lincoln LN5 7DB For the Respondent MR SIMON ROBINSON (Solicitor) Messrs Ford & Warren Solicitors Westgate Point Westgate Leeds West Yorkshire LS1 2AX SUMMARY Unfair Dismissal – Reasonableness of dismissal Practice and Procedure – 2002 Act and pre-action requirements The Respondent dismissed the Claimant for three reasons. On appeal, two of the most serious fell away but the reason for dismissal remained the same. At the Employment Tribunal it was held that the procedure was unfair, but was rescued by the Employment Rights Act 1996 s98A(2). On appeal it was held that the relevant managers had never turned their minds to whether they would have dismissed for the one offence alone, and could not invoke s98A(2) by mere assertion. Employment Tribunal reversed. HIS HONOUR JUDGE McMULLEN QC This case is about unfair dismissal in the context of the arcane subject known as procedural unfairness under the reverse Polkey doctrine. The judgment represents the views of all three members. We will refer to the parties as Claimant and Respondent. Introduction[2]It is an appeal by the Claimant in those proceedings, against the judgment of an Employment Tribunal sitting at Manchester, Chairman Mr D N Jones, registered with reasons on 19 July 2006. The parties, as here, were represented respectively by Mr Edward Legard, of Counsel, and by Mr Simon Robinson, Solicitor.[3]The Tribunal defined the issues in the following way:
"3. It was common ground that the claimant had been dismissed and the reason for his dismissal had related to conduct. The issue which the Tribunal had to address was whether dismissal for misconduct was reasonable in all the circumstances having regard to the size and administrative resources of the respondent, equity and the substantial merits of the case. Within those considerations the matters set out by the Employment Appeal Tribunal in British Home Stores v Burchell [1978] IRLR 379 were material, namely did the respondent have a genuine and honest belief that the claimant was guilty of the misconduct alleged, did the respondent have reasonable grounds for that belief and had the respondent carried out a reasonable investigation in all the circumstances. It was also necessary to consider whether there had been a departure from proper procedures and, if there had, whether the claimant would have been dismissed, on a balance of probabilities, in any event had there been not such a departure."
[4]The Tribunal decided against the Claimant. He appeals. I gave directions sending this appeal to a full hearing and the parties' attention was drawn three authorities relevant to the appeal which had not been cited. The legislation[5]The relevant provisions of the legislation are found in the Employment Rights Act 1996 s98(1)(a) which provide the following relating to a reason for dismissal:
"(1) In determining for the purposes of this Part whether the dismissal of an employee is fair or unfair, it is for the employer to show— (a) the reason (or, if more than one, the principal reason) for the dismissal…"
Fairness is dealt with by s98(4) which provides the following:
"(4) Where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer)— (a) depends on whether in the circumstances (including the size and administrative resources of the employer's undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and (b) shall he determined in accordance with equity and the substantial merits of the case."
What is known under the heading of 'Procedural fairness' in the statute is provided for by s98A, which says this:
"(1) An employee who is dismissed shall he regarded for the purposes of this Part as unfairly dismissed if— (a) one of the procedures set out in Part I of Schedule 2 to the Employment Act 2002 (dismissal and disciplinary procedures) applies in relation to the dismissal, (b) the procedure has not been completed, and (c) the non-completion of the procedure is wholly or mainly attributable to failure by the employer to comply with its requirements. (2) Subject to subsection (1), failure by an employer to follow a procedure in relation to the dismissal of an employee shall not be regarded for the purposes of section 98(4)(a) as by itself making the employer's action unreasonable if he shows that he would have decided to dismiss the employee if he had followed the procedure."
[6]Indirectly relevant to these proceedings are the provision for compensation under s123, which requires the principle of justice and equity to inform a Tribunal's judgment, and it may reduce compensation in accordance with the principles known as Polke y. The facts[7]The Respondent is a railway undertaking, plying its trade in the north-west of England. The Claimant was employed, according to the findings of the Tribunal, as follows:4.1 The claimant was employed as a train conductor by the respondent from the 19 January 1990 to the 30 August 2005, a period of 15 1 / 2 years. He was dismissed on the 30 August 2005 for having committed acts of gross misconduct.4.2 The claimant had been working on the 3 July 2005, a Sunday. He had been the conductor on a train which was travelling from Alderley Edge to Southport. On leaving the station Salford Crescent, the claimant approached 2 female passengers. They looked to be child passengers. They told the claimant that they did not have enough money to pay for the full fare, having boarded the train at Manchester. The claimant decided to sell the passengers return tickets from Burscough Bridge to Southport, a shorter journey than the one they should have paid for from Manchester.4.3 In his evidence the claimant told the Tribunal that 'the 2 girls gave me a sob story and / believed them. One of them told me her father was ill in Southport. I had had a good day. / took her story on board. I said I could get them in and out of Southport but after that they were on their own. They looked like kids to me. I didn't have anything to hide'.4.4 So the 2 passengers paid £1.50 for each ticket, the cost of a child return from Burscough Bridge to Southport. The cost of a child return ticket from Manchester to Southport was £4.45, a difference therefore of £2.95…4.5 The 2 passengers left the train at Southport and spent several hours there before catching a return trip at 20.14. On the return journey the conductor was Mr Spain. Mr Spain approached the 2 passengers after Burscough Bridge in order to check they had valid tickets. The tickets they had purchased from the claimant had, of course, covered only the journey up to Burscough Bridge. The only evidence we have of the discussion which took place is in the form of a note taken from Mr Spain, after the event. The 2 passengers attempted to avoid payment by ignoring him and then, when spoken to, claimed they had insufficient funds. Mr Spain informed the 2 young women that as they did not have the funds to pay they would have to leave the train at the next station which was staffed, Wigan Wallgate."[8]The Tribunal went on to record that the two passengers then complained to Mr Spain, a conductor on that train. Mr Spain referred them to the duty manager at Manchester Piccadilly at the end of their journey. There they spoke to two female managers relating to the complaints they made which where of inappropriate behaviour by the Claimant. An investigation was conducted by a senior manager, Mr Peers, the police were involved and the Claimant was suspended on three charges:
"4.8 The claimant was suspended and was subsequently summonsed to attend a disciplinary hearing in relation to 3 matters. They were, firstly, that he knowingly issued 2 return tickets from Burscough Bridge to Southport to 2 customers who boarded the train at Manchester thereby depriving Northern Rail of revenue. Secondly, in allowing the customers to travel in his cab he contravened the rule book and, thirdly, that the subsequent behaviour towards the 2 female customers was inappropriate and unacceptable."
[9]The first hearing was conducted before Mr Hornby. The Claimant admitted the first charge (the procedure in this organisation uses the language of criminal law) but denied the second and third charges.[10]Dealing with the first charge, it was apparent that there were in place three alternative methods to the one chosen by the Claimant for dealing with the inability of the passengers to pay the fare. The first relates to the Unfair Notice System (UFN). This was not effective and there was no confidence in it. The second was the 'silk system', where there could be a radio ahead so that parents of young children could meet those who could not meet their fares. This was not satisfactory. The third option was that a passenger could be escorted from the train at a serviced station and the issue then be dealt with. The Tribunal held that this was the appropriate procedure for the Claimant to have adopted.[11]Mr Hornby found that the Claimant was guilty of the matters put against him, and decided to dismiss him summarily. The procedure in place includes as examples of gross misconduct: theft, fraud, and deliberate falsification of records. Different procedures apply according to whether the allegation is of gross misconduct or something less but the preamble to all of the disciplinary procedures contains the following:
"The following procedure will apply after full consideration of all the facts including, where appropriate, evidence gained from a detailed and thorough investigation."
It also provides for an appeal, and the appeal was conducted before Mr Hornby. Mr Hornby had, this time, new evidence, for the allegations made by the two young women were retracted in statements given to the police. Nevertheless, Mr Rushton (having reviewed Mr Hornby's decision that "it was based upon the information available to him at the time and which was entirely appropriate for him to do. It is my decision that the hearing officer's decision to dismiss was appropriate.") upheld Mr Hornby's decision, albeit Mr Rushton was in possession of the retraction statements. The Tribunal found that he continued to believe the complaints made by the two young girls, notwithstanding the changing scenery in which they were made.[12]The Tribunal found this:
"4.16 Mr Rushton dismissed the appeal. He said that he did not accept the account given by the claimant but preferred the account given by the passengers. He said in his statement at paragraph 42 "
I did not believe I needed to interview the girls as Beverly Burns and Pam Burns had spoken to them and they had in turn been interviewed by Chris Peers". He added that witnesses were not usually present at either disciplinary or appeal hearing and that the disciplinary officers are presented with written statements and the employee has the opportunity to-state his case. He set out in detail the shocking abuse of trust consequent upon his findings, namely 2 young women who were in a vulnerable position having being spoken to in sexually inappropriate terms. 4.17 Mr Rushton did not distinguish between the different charges insofar as to whether each of itself constituted an act of gross misconduct. Although he said in his statement, at paragraph 49, that he found that there was gross misconduct in respect of each charge, having heard his evidence we are not satisfied that was the was way he actually analysed the case. The notes we have of the hearing indicate that in concluding there had been gross misconduct he summarised the findings in respect of all of the allegations rather than address each individually." The Tribunal addressed itself in accordance with the judgment of the EAT in British Home Stores v Burchell [1980] ICR 303 and also addressed itself to s98A. It made swingeing criticisms of the procedure adopted by the Respondent in the appeal up to Mr Rushton. It noted that the two complainants had lied. The Tribunal found the whole process significantly deficient and made this overall conclusion:
"12. We therefore find that no reasonable employer could have found there to have been gross misconduct in respect of the second and third allegations, on the evidence available and given the procedures adopted. What then of the first allegation? Whilst the witnesses of the respondent Mr Hornby and Mr Rushton both said in evidence and in their witness statements that they would have dismissed the claimant on charge one alone it is plainly the case, in our view, that they did not analyse the matter in that way when they handled the disciplinary proceedings. Having come to the conclusion that a quite shocking breach of trust had arisen they came to the understandable view that there was no option but to dismiss. We are satisfied that they came to a genuine belief in that respect. 13. Having found the proceedings to have been procedurally deficient in respect of the second and third allegations, and having found that neither Mr Hornby nor Mr Rushton actually considered and imposed a sanction of summary dismissal in respect of the first allegation, we must answer the question whether they would have so dismissed for that matter, as they say in evidence. Mr Legard asks us to treat this assertion as self serving and untenable."
[13]The Tribunal then went on to consider in detail whether the Respondent would have dismissed the Claimant in respect of charge 1, and addressed itself on the law in the following terms:
"14. In this respect we take the view that the provisions of section 98A(2) of the Act must be applied. If the respondent had adopted fair procedures, and assuming (as we must) that no further evidence had come to light in respect of the second and third allegations at the appeal, those complaints would have been dismissed and the claimant would have fallen to be dealt with for admitting selling a ticket for a lesser fare than he knew was appropriate. We discount any other finding in respect of the second and third charges because it is impossible to know what other evidence would have come to light and such a course would be to reconstruct the world as it never [was]?, the approach disavowed in King v Eaton No 2 [1998] IRLR 686. "
[14]In this regard it operated on the hypothesis that charges 2 and 3 had fallen away, and concentrated solely on charge 1. It found as follows:17. On this allegation, the question as to whether the admitted actions constituted an act of gross misconduct which would warrant summary dismissal depend on whether there had been dishonesty on the part of the claimant. The disciplinary procedure of the respondent, in our papers, illustrates acts of gross misconduct and includes theft, fraud and deliberate falsification of records. Whilst that list is not exhaustive it is plain, in our judgment, that it would be necessary for the claimant to have had committed more than a simple act of misjudgement to warrant summarily dismissal for gross misconduct. He would have to know that he had deprived his employer of a fare without authority or justification and in doing so he would have to know such was a dishonest act.18. We have considered carefully the claimant's own account as to what he did. His evidence has been set out in our findings. He had had a good day and felt sorry for the passengers. He said that he would "get them in and out of Southport but after that they were on their own" [our emphasis]. It is quite apparent from that remark and the rest of his evidence, that the claimant realised that he was not authorised to charge the fare he did and he said as such in terms when he was cross-examined. He said he realised that the management would not agree with what he had done. He said "the management had never given me any idea that I had a discretion". Similarly Mr Dooley acknowledged in his evidence that the management had not authorised the acceptance of lesser fares in the circumstances which arose and that there were other alternative procedures which had been provided, notwithstanding they were unpopular and in some instances impractical…19. It is true to say that the witnesses of the respondent did not have a completely clear idea of the policies which would be adopted, because they seemed to overlook the fact that the unpaid fare notice could not be issued to a child, notwithstanding it was suggested the claimant should have adopted such a course in the disciplinary hearings. However after careful analysis, we have come to the conclusion that the claimant knew that he had no authority at all to accept a lesser fare. He was bestowing a favour he knew it was not his to bestow. He knew he should have adopted alternative procedures to attempt to recover the proper fare at some later stage, and not sell cheap tickets and connive with the passengers to ensure the fare evasion would not be discovered. In so doing he was acting dishonestly and his employer was deprived of a proper fare, or the chance to take steps to recoup the full fare. His comment that he had nothing to hide does not sit comfortably with the rest of his evidence and was plainly not true." It came to the conclusion that the Respondent would have dismissed the Claimant had it carried out the proper procedures. The Claimant's case[15]Five principal grounds are advanced on behalf of the Claimant. First, it is contended that the Tribunal failed to correctly apply what is described by Mr Legard as the burden of proof in relation to matters under s98A. The Tribunal has accepted mere assertion rather than evidence. There was a catalogue of failures which go beyond mere procedural deficiencies and go to the heart of the decision-making in this case, so as to undermine the Tribunal's judgment on charge 1.[16]Secondly, it is contended that the Tribunal was wrong to embark in the first place upon an exercise under s98?A?(2) because of the deficiencies.[17]Thirdly, it is plain that the Tribunal had not determined correctly whether the Respondent had established the reason for dismissal as being charge 1. On these findings the reason for dismissal was the upholding by Mr Rushton of the allegations under the three charges, and those latter two were so fatally flawed - by the investigation and by the way in which the Respondent treated those - that it was not appropriate to conduct a 98A(2) exercise at all. The Tribunal had gone beyond its remit in seeking to establish what would have happened had the Respondent put forward ground one alone. This it never did.[18]Fourthly, it is contended that the Tribunal erred in allowing this matter to be raised at all.[19]The circumstances in which it occurred were these. The hearing first took place with live evidence on 6 April 2006. The legislation relating to s98A was introduced 18 months earlier, but the lead judgments in this area appeared on 12 April 2006; that is, Alexander v Bridgen Enterprises Limited [2006] IRLR 422 , and Mason v Governing body of Ward End Primary School [2006] IRLR 432. When the parties reconvened for written and oral submissions by the advocates on 23 June 2006, the Chairman, before beginning to hear the closing speech of Mr Legard, asked the representatives if they knew about the new case. Mr Robinson said, "Do you mean Alexander? I have a copy of it." and the Chairman agreed that that was what he was referring to. This deals of course with s98A. Mr Robinson had the case with him because he was about to make submissions on it, and would have done so whether provoked by the Chairman or not. Thus, the submission is made by Mr Legard that it was wrong for the matter to be canvassed when it was never part of the Respondent's case.[20]It is right to point out that Mr Legard adapted flexibly to the point being raised by the Chairman and he does not say that he had no opportunity to deal with the point or did not understand it, but he takes a more fundamental issue which is that the point has got to be raised by a Respondent in order for it to be considered on appeal.[21]The fifth ground on which this judgment is attacked is combined with the sixth and seventh grounds. This is that it was wrong, whether put as a matter of perversity or one of straightforward misconstruction of law, for the Tribunal to have concluded on the material here that the allegation made against the Claimant under charge 1 was one of dishonesty, for the Tribunal made this judgment which was not the judgment contemporaneously made by the relevant officers. The Respondent's submissions[22]On behalf of the Respondent, Mr Robinson contends that the position of the Respondent in this case was uncompromising in respect of fare-dodging. Ample illustrations were given of its zero-tolerance policy in respect of passengers and that would be read across to those in positions of trust, such as revenue protection officers like the Claimant. By implication, he says, the charge in charge 1 is one of dishonesty.[23]Secondly, he contends that the investigation in respect of the allegations by the Complainant was flawed. It is not the subject of appeal by him and it is inappropriate to look at how the investigation would have been conducted in the light of the admission by the Claimant (which we have recorded above) that he knew that the issuing of a short fare (as it is called) was unauthorised. He accepts that the officers did not go into detail on charge 1 because of the more serious charges upheld in respect of the two complaints. The legal principles[24]The legal principles to be applied in this case appear to us to emerge from the following authorities, and the statement of the law advanced by Mr Legard is not in dispute:
"3.3 A reason for the dismissal of an employee "... is a set of facts known to the employer, or it may be beliefs held by him, which cause him to dismiss the employee " per Cairns LJ in Abernethy v Mott Hay & Anderson [19741 ICR 323 and approved by the House of Lords in W Devis & Sons v Atkins [1977] 3 All ER 40 . 3.4 The burden of proving the reason is upon the employer and if it fails to discharge the burden of establishing the true reason the dismissal will be unfair - Babar Indian Restaurant v Rawat [1985] IRLR 57. 3.5 The question is whether the employer has proved that a particular allegation is the real reason for dismissal. "
It does not follow...that whenever there is misconduct which could justify a dismissal a Tribunal is bound to find that this is indeed the operative reason" - per Elias J in ASLEF v Brady [2006] IRLR 576 . 3.6 In cases where misconduct is alleged, the Tribunal will, when determining the question of whether the employer acted reasonably, adopt the guidance as set out in Burchell v British Home Stores. This entails consideration of whether the employer had a genuine and reasonably held belief in the misconduct and that the belief was the product of a reasonable investigation. … 3.9 When considering s.98A(2) the Tribunal must have a proper evidential basis for concluding that the employer would have acted in the same way in any event, "mere assertion" is insufficient — per Elias J in Alexander v Bridgen Enterprises Ltd [2006] IRLR 422 . It is, of course, for the employer to show (i.e. prove) that it would have so acted - Alexander (supra.): Mason (supra.) "[25]There is a distinction to be drawn between the approach of a Tribunal dealing with Polkey , which is a compensation-based approach, and s98A(2). Often they will be run in parallel, with evidence being called which will enable submission to be mobilised on both. They must not however be treated as the same thing, for whereas the Polkey exercise is based on the premise of an unfair dismissal, s 98?A?(2) aims at turning that unfair dismissal into a fair one.[26]So, there are four outcomes. First, if on the evidence the Tribunal is satisfied that fair procedures have been complied with (and the onus is on the employer to do this on the balance of probability) and a dismissal would have occurred in any event, then the dismissal is fair. Secondly, if there was a chance of dismissal but it was less than 50%, it will be an unfair dismissal but compensation will be reduced accordingly. Thirdly, if the employment would have continued for a limited period, evidence might show a dismissal for unrelated circumstances and the compensation will be capped. Fourthly, the employment might have continued indefinitely (see also the analysis accepted by the Court of Appeal given in Gover v Property Care Limited [2006] EWCA Civ 286 ).[27]In a case involving misconduct, the approach set out in Burchell should be adopted. As for the raising of the issue, it can be done at any stage, as with any other point which is to be taken. It is best practice at the outset of a case for a Tribunal to set out what the issues are it has to determine, and this will be obtained from analysing the claim and the response and seeking the parties' agreement on those issues. It might also arise during the course of the hearing from evidence, in which case it needs to be clearly spelled out that a point will be taken. It might exceptionally arise during the course of closing submissions. At this stage it is likely to succeed, but nevertheless, provided evidence were there to make the point under s98A(2) the point can be taken. Sensibly, it might involve a formal amendment to the response or, in order to deal with the matter expediently, it might be accepted to be in play, as it was sensibly in this case.[28]We are firmly of the view that the point should be raised by the Respondent. If it is not, we accept that Polkey is fundamental, see the judgment of Tucker J and members in Red Bank Manufacturing Co. Ltd v Meadows [1992] IRLR 209 . It follows that it is even more fundamental, if that is possible, to raise an issue on s98A(2), since that affects liability and does indeed reverse liability when it is properly mobilised and found.[29]On a number of occasions appeals have been made to the EAT which criticise Employment Tribunal Chairmen for failing to raise an issue, but in this case a criticism in an inchoate form was raised in relation to the Chairman raising the point of a possible defence. On the facts, that does not arise here, because Mr Robinson was about to raise the point himself and there is no prejudice because the Claimant was, ably represented by experienced Counsel, able to adapt to the new position. We hold that what occurred was, effectively, an identification of the issue based upon the evidence given, albeit said to be mere assertion, but at least it is evidence given by the two officers as to what they would have done in relation to dismissal on charge 1. Thus the point was properly raised, albeit late in the day. We make it clear that since this is a defence, it ought to be raised squarely long in advance by a Respondent seeking to rely upon it. Conclusions[30]We prefer the arguments on the substantive points raised on behalf of the Claimant, and will allow the appeal. Taking the points in the order in which they were raised before us, we uphold the submission that the Tribunal failed to apply the correct standard of proof. A submission was made to it, based upon the evidence of the two witnesses, that this amounted to mere assertion and mere assertion is (see Alexander ) insufficient. We agree. The findings by the Tribunal plainly show that the witnesses did not analyse the case against the Claimant in the way in which it was necessary for it to be done in order for the burden of proof, placed firmly upon the Respondent, to be discharged by it. This was simply insufficient evidence. Because the managers never thought of it in this way, as a discrete issue, they could not discharge the onus of showing what they would have done had an analytic approach been taken to these. As a matter of fact, neither of them imposed a sanction of summary dismissal in respect of the first allegation, which is the finding of the Tribunal. Thus, there is substance in this submission.[31]There is also a construction which assists in this approach. It is not disputed in the authorities that the onus is upon the Respondent. This comes from the use of the word "shows" in s98A(2), which echoes the requirement for an employer to show a potentially fair reason in s98(1)(a). Thus, evidence must be produced to satisfy the Tribunal as to what would have occurred.[32]We then turn to consider whether or not s98A(2) should have been used in this case. We acknowledge that there are seismic flaws in the Respondent's case about the effectiveness of its investigation. Nevertheless, the Tribunal took account of all those matters and it did not fall into the trap of looking solely at procedural on the one hand or substantive issues [on the other ?]. We are satisfied that it considered all of the bad points, together with what good points could be rescued. This was a case in which s 98?A?(2) was advanced before it, and we cannot say that it was wrong to base its judgment upon that section. We agree that there were fundamental criticisms of the Respondent's approach, but insofar as it is helpful - and we have to say that it is helpful in this case - to depict these as procedural deficiencies, that is what they were. In any event, the Tribunal was bound to deal with the submission.[33]As to the connection between the reason given by the Respondent and the reason given by the Tribunal, we uphold Mr Legard's submission. It is this. Since the reason for dismissal given by both Mr Hornby and Mr Rushton was the combination of the three charges put against the Claimant, it has not been shown, by reference to s98A(2) that the reason can now be operated, shorn of charges 2 and 3. The Respondent did not dismiss on charge 1; it dismissed on charges 1, 2 and 3. That was the reason and, in accordance with Abernethy (above), that is the reason which it showed and which was upheld by the Tribunal. Therefore Mr Legard is right in suggesting that the operative reason was those three, and it was not available to the Respondent to then rely solely on charge 1.[34]As to the procedure adopted in this case, we have given our views as we summarised the legal principles. There can be no criticism of the Chairman for raising the issue in this case. An experienced Employment Tribunal Chairman, and even the members, may well be aware of a legal authority or a legal provision which they think is relevant in the proceedings, and if they have that in mind it is appropriate for them to raise it with the parties and with their representatives. No harm is done in this case, because Mr Robinson was on his way to raise the point anyway and Mr Legard was able to deal with it. So, the point was fully in play and therefore no criticism can be made for it being raised, subject to our comments above that when it is raised it has to be raised by the Respondent as a defence.[35]As to the final three grounds of appeal, we uphold the contention that, relating to the finding by the Tribunal of dishonesty, the central finding - based upon a construction of the discipline procedure and the Claimant's evidence - is that there was against him a charge of dishonesty. In the directions earlier in this case, attention was drawn to the judgment of the Court of Appeal in Strouthos v London Underground Ltd [2004] EWCA 402, [2004] IRLR 636 , where Pill LJ, in relation to the dismissal of a railway worker who took a company car without authority across the channel, said this:
"35. However, I do return to the point I mentioned earlier, which has only arisen in the course of today, in relation to the framing of the charge and the disciplinary proceedings which followed. I have expressed my view as to what the charge meant and that it did not include an allegation of dishonesty in the initial taking by the appellant of the motor vehicle. I accept that, without objection, that issue – what happened between the appellant, Mr Palmer and Mr Bate – was the subject of evidence before the employment tribunal and they made findings upon it. However, we have been referred to the deliberations of the disciplinary panel. The issue of credibility as between the appellant and Mr Palmer was the subject of evidence. However, the findings of the chairperson, Mr Lerigo (service control manager), did not include any finding that the appellant had been dishonest. There is a finding that: 'The panel feels that the sentiment of the memo [that is the memo to which I have referred at paragraph 3] clearly indicates Mr Strouthos should not use LUL facilities on behalf of the L T Rifle Club. The panel accepts that DMT Bates [sic] did not require persuasion in releasing the line car to Mr Strouthos on request.'"
[36]There is an uncanny resemblance to the treatment in our own case. The allegation of dishonesty is not explicitly made in the charge, and there are a number of answers to it. Notwithstanding the Claimant's admission of the facts, he had a number of other explanations. This is not straightforward fraud, nor is it straightforward theft. It was the case that the Respondents received slightly less than they should have done from these two children but, as was contended on the Claimant's behalf by his union representative at the internal proceedings, this was a misjudgement, and was misconduct, but was not gross misconduct forming the part of dishonesty.[37]We have no doubt that the principal focus throughout these proceedings was upon the second and third charges which evaporated. We also accept the submission made in the written skeleton of Mr Legard and not resisted by Mr Robinson, that the central focus (if there was one) at the disciplinary hearings on charge 1, was on the Claimant's failure to issue a UFN. Yet the procedure for a UFN was not available to a person under 18, so it did not apply in the first place. The alternative systems which he could have adopted, short of issuing the short ticket, were both discredited (the silk system, and putting a young child off the train) by reference, for example, to the judgment in Lock v Cardiff Rail Company [1998] IRLR 358 , where a railway employee was dismissed for doing just that.[38]The Claimant was guilty of accepting, perhaps naively or generously, a sob story by two girls on the train. There was no deliberate attempt to defraud the Respondent. His length of service does not seem to have been taken into account. We were asked by Mr Robinson to consider what more could have been done in relation to charge 1 if it stood alone. It is not for us to answer that, but there are plainly matters of further investigation concerning the allegation that the practice was widespread, that there was no confidence in the alternative systems that we have described, that the Claimant had unblemished service of 15 years, and that he had been guilty - at the highest - of accepting an improbable sob story from people held subsequently to be liars by the Tribunal.[39]For those reasons, we accept the contention that the finding (made by the Tribunal on its own account and not by the Respondent's officers) of dishonesty was one which it was not theirs to make on this material. Given that the officers had not formed that conclusion, we consider it was not the position of the Tribunal to do it for them. And for that reason, the judgment will be set aside in respect of that.[40]Given that we have formed that conclusion, the advocates at the outset indicated that, if that were to be our view, there would be no application for a remission but that there should be a simple substitution of our judgment. This is a narrow judgment that we have to make. There is all the primary material before us. We are invited by the advocates to do that. We will do so, and uphold the claim of unfair dismissal, leaving remedy to be determined by this same Tribunal, unless we hear to the contrary.[41]We would like very much to thank both the advocates for the help they have given us, and for the succinct way in which they have put their cases.