MINISTRY OF DEFENCE v DR P GUELLARD [2009] UKEAT 0210_09_0109

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2009] UKEAT 0210_09_0109Case No Appeal No. UKEAT/0210/09/ZT UKEAT/0337/09Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MINISTRY OF DEFENCEAPPELLANTDR P GUELLARDRESPONDENT
Before
His Honour Judge McMullenSir Alistair Graham Kbe Mr R LyonsDate 1 September 2009
[1]APPEARANCES For the Appellant MR A SERR (of Counsel) Instructed by: The Treasury Solicitor (Employment Law Team) 1 Kemble Street London WC2B 4TS For the Respondent MR D BAYNE (of Counsel) Instructed by: Messrs Samuel Phillips & Co Solicitors Gibb Chambers 52 Westgate Road Newcastle upon Tyne NE1 5XU SUMMARY UNFAIR DISMISSAL Constructive dismissal / Contributory fault / Polkey deduction JURISDICTIONAL POINTS 2002 Act and pre-action requirements The Employment Tribunal did not err in assessing the last straw in a series of events leading to a constructive unfair dismissal. It did not err when it refused as a matter of case management on a remedy hearing to allow the admission of evidence which could have been brought when the tribunal decided contribution and Polkey issues. But it wrongly used prediction in assessing (past) contribution and the matter was remitted to the same Employment Tribunal. It did not err in fixing the uplift at the entry point of 10 per cent, rejecting the Respondent's argument that it should be "modest". HIS HONOUR JUDGE McMULLEN QC This case is about unfair dismissal and the assessment of compensation. The case also invokes Employment Tribunal procedure when dealing with evidence, for the purpose of contributory conduct and the application of Polkey v A.E. Dayton Services Ltd [1987] IRLR 503 HL.[2]This is the judgment of the Court to which all members, appointed by statute for their diverse specialist experience, have contributed. We will refer to the parties as the Claimant and the Respondent. Introduction[3]It is an appeal by the Respondent in those proceedings against judgments of an Employment Tribunal, chaired by Employment Judge Rogerson, sitting at Newcastle upon Tyne, registered with reasons, on 26 February and 24 June 2009, respectively the liability and the remedy judgments.[4]The Claimant was represented there by different counsel and today by Mr Dominic Bayne and the Respondent throughout by Mr Antony Serr. The issues[5]The essential issues were defined by the Employment Tribunal in the following way:
"The Claimant contended that he had been constructively dismissed and relied on the breach of the fundamental term of mutual trust and confidence. If successful, the Claimant sought a statutory uplift of any award of compensation made for the respondent's failure to comply with the statutory requirements in Part 2 of Schedule 2 of the Employment Act 2002 in relation to the claimant's grievance. The respondent denied dismissal and contended that there was consensual termination of the contract by the claimant to avoid disciplinary proceedings and in the alternative if there was a dismissal it was for the potentially fair reason of misconduct."
[6]The Tribunal decided in the Claimant's favour. It went on to calculate compensation and, having applied the statutory cap, awarded him the maximum of £63,000 plus a basic award of £495. The Respondent appeals against both judgments. Directions sending these appeals to a full hearing were given, in chambers, by Underhill P and HHJ Ansell. The legislation[7]The relevant provisions of the legislation are not in dispute. They are not cited by the Employment Tribunal, so we will. In respect of a reason for dismissal, the Employment Rights Act 1996 Section 98(1) allows conduct to be a potentially fair reason. Fairness is dealt with under Section 98(4). Section 123 deals with the assessment of contribution and provides as follows:
"(1) … the amount of the compensatory award shall be such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the complainant in consequence of the dismissal in so far as that loss is attributable to action taken by the employer. (6) Where the tribunal finds that the dismissal was to any extent caused or contributed to by any action of the complainant, it shall reduce the amount of the compensatory award by such proportion as it considers just and equitable having regard to that finding."
[8]The Tribunal directed itself in terms which have not been criticised by either counsel in respect of the jurisprudence which flows from those provisions. The application of those provisions is the subject of sustained attack by the Respondent. The facts[9]The Tribunal introduced the parties in the following way:
"2.1 On 5 March 2007, the Claimant commenced his employment with the respondent as a civilian medical practitioner at Albermarle Barracks. The claimant was issued with a statement of written particulars of employment on 15 August 2007 and also a job description, which provided that he was employed to work 37 hours per week, working a 5 day week. His line manager was Colonel Dickinson and his duties included 'attendance at the medical centre daily at times agreed with the RCD or CO (CO was Commanding Officer)'. He was only required to work extra hours in cases of emergency. 2.2 On a day to day basis the claimant was responsible for maintaining medical standards and administration of the unit medical centre. His time was spent equally between looking after the medical needs of the staff and grading soldiers to ensure that they were medically fit for duty. He was the only doctor at Albermarle and was the lead clinician so that all the clinical staff reported to him. The management of the practice was left to the practice manager. 2.3 The Claimant's salary was £70,060.00 per annum and he was also a member of the Ministry of Defence pension scheme."
[10]Albermarle Barracks is located 10 miles from Newcastle upon Tyne and forms part of Catterick Barracks. The Claimant's hours were regulated by a statement of terms and the Tribunal found that he was working 40.5 hours, against a contractual requirement of 37 which included lunch breaks. Colonel Dickinson was the senior medical officer responsible for the practice which the Claimant was conducting, as a civilian, for the Barracks and he features substantially in the events.[11]In October 2007 a new area manager, Alison Frankland, took over from Mr Tony McGraw and, at their first meeting, things began badly with the Claimant and got worse.[12]That first meeting, which is not dated by the Tribunal or the parties, occurred during November 2007. Each gave an account of it. The Tribunal preferred the evidence of the Claimant for reasons which it gave, since he had a clear and detailed recollection of the meeting. The upshot was that Miss Frankland was attempting to change the hours of the Claimant, to increase them to 42 hours, without any increase in pay. She behaved in a way which was degrading, intimidating and humiliating.[13]The Claimant had a medical appraisal on 3 December 2008. No issue seems to have arisen from that but the medical centre was reviewed by an independent team called the QTD on 5 December 2007 and the report was given to Colonel Dickinson and Mrs Frankland on 12 December 2007, in the following terms:
"The newly appointed practice manager has identified a number of areas of concern which are as follows: The doctor is employed for 37 hours but in practice this is not the case, at most he worked for 28 hours and that includes working through lunch. [Employment Tribunal emphasis) The practice itself appears to be without any clinical cover or a number of hours during the week as the doctor and practice nurse seem to finish work by lunchtime on certain days. The liaison with the unit appears to be superficial and it is not clear whether the CO is aware of the services that the medical centre can offer his troops. The physio is very angry about her branding following the agenda for change. A number of pharmacy related practices need urgent review. In summary, the whole practice appears dysfunctional and requires additional support from the region to overcome a number of legacy issues."
The matter was referred to the Claimant.[14]Contemporaneously with the QTD were a number of complaints made, by co-workers, about the Claimant's conduct. Some of these were ancient - the one from Mr Chapel for example - but by 14 January 2008, complaints had reached such a state that the Claimant was suspended. An issue arose as to whether or not contact would be made with the local general practice to which he gave his services during times when he was paid, by the Respondent, to do so, so that he could complete his CPD. That was a subject of one of the Claimant's subsequent claims before the Employment Tribunal.[15]The immediate outcome of the suspension was that on 16 January 2008, the Claimant raised a grievance against Mrs Frankland, contending she was a bully.[16]The Claimant had the advantage to be assisted by Mr Carter, a representative of the BMA, and in the light of interventions by him, and further discussions between the actors in this drama, on 13 February 2008 the Claimant submitted his resignation. That was within five days of his receipt of an email from Colonel Dickinson, dated 8 February 2008 (wrongly cited by the Tribunal, in a rare lapse, as 8 March 2008). It occurred at a time when there appeared to be negotiations about the parting of the ways on an appropriate period of notice less than three months.[17]The Tribunal considered the steps taken by the Claimant up to his resignation, in the light of actions by the Respondent. For the most part, the Claimant's account of disputed events was accepted in preference to the Respondent's. It came to the conclusion that a series of acts constituted a breach of the implied term of trust and confidence by the Respondent. Four were identified. The Tribunal considered, in aggregate, that they were part of a series cumulatively breaching the implied term of trust and confidence.[18]The trigger for the resignation was the email of 8 February 2008. The Tribunal directed itself correctly that a last straw must be something which is more than trivial, notwithstanding the image in which insubstantial straws being added to an over-laden camel's back is conjured. The letter considered what would happen to the Claimant on his return to full duties. It is accepted that, on its own, this letter, as a matter of construction, is anodyne. But Mr Bayne says the letter can only be read in context and the context was the previous events and thus was not anodyne.[19]The Tribunal decided that the intention of both Colonel Dickinson and Miss Frankland was that the Claimant should return to work once the procedure had been exhausted. It did find against the Claimant in respect of his approach to the disciplinary proceedings, in that these were not a sham and the matters put against the Claimant, causing the suspension, were sufficient, lawfully, to cause the Respondent to suspend him.[20]The Tribunal then considered whether or not he had resigned in response to these actions and found, comprehensively in favour of the Claimant, that his actions were in response to the Respondent's actions against him and were not in order to dodge the disciplinary proceedings or because the grass was greener wherever he was going. Remedy[21]It followed up this finding in relation to contribution and the Polkey principle:
"6.8 The respondents submitted that if there was a constructive dismissal it was fair and that the reason was gross misconduct and that we should decide that if the disciplinary proceedings had continued, the claimant would have been dismissed for gross misconduct. We had found that the reason for resignation was not misconduct but was breach of the implied term of trust and confidence. That was not a potentially fair reason for dismissal, even if the reason for dismissal had been misconduct we could not have predicted what the disciplinary outcome would have been and given Colonel Dickinson and Mrs Frankland's comments to the claimant that he would be returning, it was not possible to say that the definite outcome of the disciplinary proceedings would have been the claimant's dismissal. That would have been a matter of speculation. Similarly, we did not find that Polkey would have applied or that we could find any contributory conduct on the part of the claimant. In those circumstances the claimant's claim for unfair dismissal succeeds and the matter will be listed for remedy."
[22]At the remedy hearing an issue arose as to whether or not live evidence could be called to support the Respondent's contentions in respect of contribution and remedy. On a preliminary application by the Respondent to adduce the live evidence of two of the complainants who had formed the basis of the Respondent's decision to suspend, the Tribunal said this:
"7.1 The Tribunal had determined the Polkey reduction and the contributory fault issue in its decision on liability as it had been invited to. 7.2 It would have been apparent to the respondent at that hearing having invited the Tribunal to make those findings that those witnesses should have been called if the respondent wanted to rely on that evidence. The respondent had the opportunity to do so at the liability hearing, and chose not to. 7.3 The issue of Polkey/contribution had already been determined. The cases relied on by the respondent could be distinguished on their facts. The case of Egan involved an unrepresented respondent and the Employment Tribunal considered that the evidence of the witnesses was irrelevant on all issues including contributions. Here counsel for the respondent had represented the respondent at the liability hearing and could have adduced that evidence and made no application to do so, and was now seeking to make an application after the issue had been determined. The Software case was also a case that could be distinguished on its facts. In the Software case the Employment Appeal Tribunal held that if the employer seeks to contend that the employee would or might have ceased to be employed in any event had fair procedures been followed, or alternatively would not have continued in employment indefinitely, it is for the employer to adduce any relevant evidence on which he wishes to rely. The Tribunal applied the guidance given in that case that the Polkey process must be addressed, on however a speculative basis, if you have some evidence but here there was none. We agreed wit the claimant's counsel submission that that was an attempt to reopen an issue that had already been determined and was subject to an appeal by the respondent. In those circumstances we refused the application to hear evidence by the respondent on the issue of Polkey and contribution."
[23]It then went on to decide the arithmetic and awarded him £108,563. This included an uplift of 10 per cent, because the Respondent had failed to complete the procedure set out in Section 32 of the Employment Act 2002 , whose passing has been little mourned. It awarded the entry point, 10 per cent uplift, because the Respondent had failed to deal with his grievance. The basis of that was that Colonel Dickinson considered that it contained none of the elements for a grievance and so he would not accept it or act upon it. The condemnation of the Respondent was visited by the minimal uplift which it could award in the Claimant's favour, of 10 percent, against arguments by the Respondent that it should be a modest figure, presumably something less than 10 per cent.[24]As to contribution, Mr Serr argued for a substantial contribution something like 75 per cent so there was much at stake. As it happens, the figure was capped because the Claimant had reached the statutory maximum and so any contribution less than 36 per cent would be academic. The legal principles[25]The legal principles in this case emerge from the correct direction of the Employment Tribunal as to what is a constructive dismissal, as to which see Western Excavating (ECC) Ltd v Sharp [1978] IRLR 27 CA.[26]It is common ground that a failure to address a grievance, or to address it within a reasonable time, constitutes a breach of contract W A Goold (Pearmark) Ltd v McConnell [1995] IRLR 516 .[27]When considering contentions that a Tribunal reached a perverse judgment, there is a very high threshold to be surmounted by a successful appellant, see Yeboah v Crofton [2002] IRLR 634 .[28]When considering the last straw doctrine, that is that a person resigned in response to a series of actions which, together, constitute a fundamental breach, the last of the actions must be more than trivial. In aggregate, all of the actions constitute a breach, even if none of them, individually, is a fundamental or even any breach, see London Borough of Waltham Forest v Omilaju [2005] IRLR 35 as refined and explained by HHJ Peter Clark and members in GAB Robins (UK) Ltd v Triggs [2007] IRLR 857 , which part of the judgment was upheld by the Court of Appeal: [2008] IRLR 317 .[29]A decision in relation to a finding of constructive dismissal, while satisfying the breach of contract test, is generally a matter for an Employment Tribunal on the facts, see Lord Denning MR in Woods v WM Car Services (Peterborough) Ltd [1982] IRLR 413 at paragraph 15. Discussion and conclusions[30]Applying the above principles, we will take the arguments of counsel and give our conclusions upon them, as we treat each one, The meetings[31]It cannot seriously be contended that the Tribunal made impermissible findings about the meeting in November 2007. It is acknowledged, in Mr Serr's skeleton arguments, that the allegations the Claimant made against Mrs Frankland, in respect of this meeting, were serious. Since the Tribunal found that it preferred the evidence of the Claimant and it had given cogent reasons why it did so, this finding is impenetrable on appeal. The finding that Mrs Frankland behaved in a way which was degrading, intimidating and humiliating would be sufficient to constitute one of the steps in the series, as to which there are four. The finding that it damaged trust and confidence and amounted to a breach of the implied term would, in itself, be enough. No point is taken as to whether that was affirmed and it is sufficient to indicate the context in which the relationship between the two continued.[32]The meeting on 13 December 2007 is also the subject of a finding in similar terms and we see no serious damage being inflicted upon these findings by the able arguments of Mr Serr. These are perversity points which fail to scale the threshold which we have cited. Notification to the surgery[33]The finding in relation to Miss Frankland's notification to the Stocksfield surgery, that is the medical practice which to the Claimant was attached, is one of fact. We can see that Miss Frankland may have been upset that her live evidence did not satisfy the Tribunal, whereas an anonymous doctor, who reported this matter, was accepted. But that is a matter for the Employment Tribunal of weight and of balancing what it knew in the light of its findings already made about Miss Frankland's lack of credibility. No point of law cast as perversity can succeed. Grievance[34]The Claimant marshalled Colonel Dickinson's failure to deal with his grievance as a further reason for his resigning. Looking at the evidence by Colonel Dickinson in his witness statement and the content of the grievance, we have no doubt that the Claimant was raising a grievance. It did satisfy the terms of the Employment Act 2002 regime and it was not completed because of Colonel Dickinson's idiosyncratic view of what a grievance should consist of. The whole point of these grievance procedures was that they should make clear what people's rights and duties were. This was a grievance properly raised. It was, no doubt, within the context of the suspension of the Claimant but it required to be dealt with and it was not. It was capable of being a breach of contract if that was necessary. Under WA Goold (Pearmark) , failure to deal with a grievance timeously can constitute a breach but, since we are looking here only at events which, in aggregate, form a repudiatory breach, this was one which could properly be added to the pot. Suspension and resignation[35]As to the suspension itself, the Employment Tribunal found against the Claimant. On the material before the Respondent it was correct and lawful to suspend him while these matters were investigated. We consider that, since there were other matters contributing to the Claimant's dissatisfaction shortly after receiving the email of 8 February 2008, the fact that he got wrong the approach to the suspension does not invalidate the other aspects which the Tribunal held, correctly in our view, were matters forming a repudiatory breach of contract.[36]Since a good deal of attention has been given to the final straw - the email – it is important that we acknowledge the considerable background the Tribunal has provided to it. We agree with Mr Serr that, on its face, this email is innocuous but, as Lord Steyn so memorably put it, in law, context is everything. The Claimant, receiving this on 8 February 2008, was entitled to view it in the context of all which had gone before and to treat it as the final straw. This was not an entirely trivial matter and in context he recognised that he would be coming back to the MOD on his full duties. That can only mean the full duties as envisaged by Mrs Frankland, which was for an increase in his working hours without pay and thus was part of the preceding pattern set by Mrs Frankland. We have no doubt that the reason for the resignation was as the Claimant put it and that potent reason was not invalidated by his inclusion in it of his suspicion that he was being suspended for improper reasons.[37]As to the contentions in both the liability and the remedy appeal, the passage we have cited is important (paragraph 6.8 in para 22 above). We accept the approach to this, which Mr Seer has advanced in the following respects. It looks to us as though the Tribunal, in the finding against a potentially fair reason for dismissal, is treating that as conclusive. In other words, since the employer, in the rather artificial and tortured way in which we must look at a reason for a constructive dismissal, has not shown a potentially fair reason, it is not open to a tribunal to reduce compensation. That is incorrect for in Polentarutti v Autocraft Ltd [1991] IRLR 457 Knox J and members said:
"35 … In our judgment they are, indeed, as the Court of Appeal in Northern Ireland said, quite separate and distinct processes and there can be, in our view, a reduction under s. 74(6) both where the employer has – to continue the metaphor – cleared the hurdle in s. 57(1) and where he has failed to do so. Of course, if he clears both the hurdles in s. 57(1) and 57(3) the question does not arise at all. … 55 There is no doubt that the latter was not directly and solely caused by the former and had that been the requirement of the Act under s. 74(6) this would, indeed, have been a serious ground for criticism but when one looks at what the Act requires, which is a finding that the dismissal was to any extent caused or contributed to by any action of the complainant it is, in our judgment, clear that no such direct and exclusive causal connection as a sole or principal or operative cause, is to be discerned in the statutory requirements. It is much looser than that and we are satisfied that there was material upon which the Industrial Tribunal could find a sufficient link to justify their making the award that they did make."
[38]That, then, is an error of law. The Tribunal did go on, because it predicted the outcome of the disciplinary hearing. It is unclear to us whether this passage is dealing with contribution or Polkey . We do not say that a tribunal errs in law if it does not cite the relevant provision of the statute, but it is at risk of going wrong if it does not start with that and we consider that the Tribunal did not consider the impact of Section 123(6).[39]In our judgment, the requirement to predict an outcome is not part of a contributory conduct finding. The Tribunal had the statements of the complainants and witnesses of the complaint and it had a report from the GMC. That is important for it is the conclusion of the regulator of a medical practitioner's work and is in response to a complaint by an officer in the medical centre, acting on behalf of Colonel Dickinson. It outlines the function of those people who receive a complaint. It is handed over to case examiners, senior GMC staff appointed to make decisions at the end of an investigation. All decisions are made by two, one a medical and the other a non-medical person. Conclusions are given, together with what further steps should be taken. The case examiners accepted the complaints made by the complainant for they had little else to go on, the complainant declining to comment on the allegations. They said this:
"Given that there appear to be a number of witnesses to the three incidents described it would appear that the doctor did lose his temper and behaved inappropriately. It may well be that in the case of the administrative issues Dr Guellard had a legitimate complaint and was feeling considerable frustration. It was however both inappropriate, unprofessional and a breach of Good Medical Practice for him to shout at a patient and manhandle and shout at other members of staff and to complain about colleagues in a derogatory manner in front of a stranger. The Case examiners have however taken into account the fact that there is no indication that the doctor's clinical practice was compromised in any way and note that his other employers have not raised any concerns. They have therefore concluded that there is no realistic prospect of demonstrating that the doctor's fitness to practice is impaired but would advise the doctor strongly that I future he pays close attention to paragraphs 22a and 46 of Good Medical Practice."
[40]We understand the purpose of this ongoing investigation is, as Mr Serr engagingly put it, to prevent people jumping ship while disciplinary proceedings are hanging over them. Disciplinary proceedings, in the formal setting of an employment relationship, usually cease on termination. Where a professional subject to outside regulation is involved, he tells us that it is the policy of medical practitioners and the duty of persons in the position of Colonel Dickinson, employers of such people, to make such reports. It is obvious that the GMC, in the public interest, would wish to determine any complaint made, even if the subject of the complaint had moved. So there was, before this Employment Tribunal, evidence of the complainants, in written form, and the report of the GMC and this indicated, in our judgment, material upon which it should have made findings in relation to contributory conduct. The direction it gave itself, as to whether it could definitely have predicted what the disciplinary outcome would have been, is not the appropriate test for a tribunal when considering contribution. We will direct that the Employment Tribunal now consider, in the light of the judgment of the Court of Appeal in London Ambulance Service NHS Trust v Small [2009] IRLR 563 , its findings in relation to the evidence of contributory conduct, in the form which it was in at the liability hearing. Case management[41]As to the additional material sought to be introduced by way of the second appeal, we hold that this was a matter of case management for the Employment Tribunal. It had properly made the decision, as Mr Serr accepts, in relation to contributory conduct and Polkey . Indeed, in his submission it would be inconsistent for him to be saying that the Tribunal got these points wrong and inadequately reasoned them in the liability judgment if he were correct as to the grounds of appeal in the remedy judgment. The Tribunal was correct to refuse to allow these matters to be re-opened before it.[42]We are told that the notice of hearing for this case, in its original form, was to consider all issues of liability and remedy and so it was open to the Respondent to put issues relating to contributory conduct and to Polkey . Mr Serr accepts, and it is indeed our experience, that these issues are generally run at the very first stage, leaving issues of arithmetic if the Tribunal were to find in favour of the Claimant. That is what occurred here and so, on a controlled remission to this same Employment Tribunal, there will be consideration of the material which it had and the finding by the GMC, which figures nowhere in this judgment. Polkey[43]Linked to this is the Polkey appeal. We did have reservations about the way in which this Employment Tribunal has decided that there was no chance of a different outcome. It has used the words, "Not possible to say what the definite outcome would be" and under Polkey what one is looking for is a percentage chance. However, in the circumstances of this unusual case, both the Respondent's leading lights, Miss Frankland and Colonel Dickinson, envisaged the Claimant not losing his job. Indeed, the words "definitely not" are used by Mrs Frankland in the evidence which the Tribunal accepted coming from the Claimant's account. If Mrs Frankland had definitely thought he was coming back and Colonel Dickinson thought that too, the Tribunal was entitled to come to the conclusion that the outcome would be the same. We consider it properly adjudicated the issue which was before it at the liability hearing on Polkey and made no error. Uplift[44]Finally, we turn to the uplift under the 2002 Act regime. The difference here may be small, since Mr Serr argued for something less than 10 per cent and the Tribunal awarded that. It may not matter if the Tribunal does not award the Claimant any less than is presently awarded but, in our judgment, the issue should be put beyond doubt. The figure of 10 per cent is the starting point, unless there are exceptional circumstances. The Employment Tribunal was entitled to take the view that the Claimant had submitted the grievance correctly and that there had been no proper completion of that process by the Respondent, because Colonel Dickinson did not consider that it had crossed the Ts and dotted the Is. He was wrong about that. The fault, therefore, in failing to complete the grievance procedure was the Respondent's and it was visited by what has to be said is the minimum uplift which it could make. Disposal[45]We heard perfunctory submissions in relation to the destination of our remission. In the light of the factors in Sinclair Roche & Temperley [2004] IRLR 763 EAT, we hold that it should go back to the same Employment Tribunal. It has been seised of this case for six days or so. We have upheld the vast majority of its findings as being correct in law and we have every confidence now that, with the direction we give, it will be able to come to a conclusion on the material which it had before it and to complete its duty. The appeal is allowed in part. [Permission to appeal the refusal to remit the Polkey point refused; reasons not transcribed.]