Dillon & Ors v Todd & Anor [2011] UKEAT 0010_11_2109

EAT
Dillon & Ors v Todd & Anor
[2011] UKEAT 0010_11_2109 · 2011-09-21
[1]The Appellants, who number 28, were all as at 4 January 2008 employed by the First Respondent, Ms. Sheena Todd, at a care home owned and operated by her in Port Glasgow. As from that date, the home was sold to the Second Respondent, Care Concern GB Ltd. (“Care Concern”). They form part of a rather larger group of employees who brought proceedings against both Respondents under regulation 15 (1) of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE”), complaining that Ms. Todd had failed to comply with her consultation obligations under regulation 13. I should set out the relevant provisions. Regulation 15 (1) begins:
“Where an employer has failed to comply with a requirement of regulation 13 ..., a complaint may be presented to an Employment Tribunal on that ground […]”
Paragraph (8) sets out what the tribunal should do where it finds the complaint under paragraph (1) well-founded. It reads as follows:
“Where the tribunal finds a complaint against a transferor under paragraph (1) well‑founded it shall make a declaration to that effect and may— (a) order the transferor, subject to paragraph (9), to pay appropriate compensation to such descriptions of affected employees as may be specified in the award; or (b) […]”
Paragraph (9) reads as follows:
“The transferee shall be jointly and severally liable with the transferor in respect of compensation payable under sub‑paragraph (8) (a) or paragraph (11).” “Appropriate compensation” is defined in regulation 16 (3) as follows: “... such sum not exceeding thirteen weeks’ pay for the employee in question as the tribunal considers just and equitable having regard to the seriousness of the failure of the employer to comply with his duty.”
[2]The claim against Ms. Todd was upheld by an Employment Tribunal sitting in Glasgow, which ordered, pursuant to regulation 15 (8) (a), that thirteen weeks’ pay be paid to the affected employees; but the claim against Care Concern, based on regulation 15 (9), was dismissed. A rather curious procedure was followed in relation to the promulgation of the Tribunal’s decision, which was in effect delivered in two stages: however, for present purposes it is enough to say that the parties have proceeded on the basis that the decision of the Tribunal was promulgated on 14 September 2009.[3]Ms. Todd appealed not only against the award against herself, as regards both liability and quantum, but also against the Tribunal’s failure to make an award against Care Concern under regulation 15 (9). By a decision of this Tribunal (myself presiding) promulgated on 28 July 2010 (reported, sub. nom. Todd v Strain , at [2011] IRLR 11 ), the appeal as regards liability was dismissed; but the amount of compensation was reduced to seven weeks’ pay, and Care Concern was declared to be jointly and severally liable for the sums awarded.[4]Neither Respondent has paid to the Appellants any part of the sums awarded. However, the structure of this part of TUPE, in common with the provisions relating to other failures of collective consultation, is that the original award of a tribunal, which is made in favour of a class of employee rather than of individuals as such, is not enforceable in its own right. Rather, employees in the class in question are obliged to bring separate proceedings asserting that they are beneficiaries of the award and have not been paid. The relevant provision is paragraph (10) of regulation 15, which reads as follows:
“An employee may present a complaint to an employment tribunal on the ground that he is an employee of a description to which an order under paragraph ... (8) relates and that— (a) […]; (b) in respect of an order under paragraph (8), the transferor or transferee, as applicable, has failed, wholly or in part, to pay him compensation in pursuance of the order.”
There are time limits for any such claim. Regulation 15 (12) reads (so far as material) as follows:
“An employment tribunal shall not consider a complaint under paragraph (1) or (10) unless it is presented to the tribunal before the end of the period of three months beginning with— (a) […]; or (b) in respect of a complaint under paragraph (10), the date of the tribunal’s order under paragraph ... (8), or 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 the period of three months.”
The wording of that paragraph adopts the very well-known language of section 111 (2) of the Employment Rights Act 1996 , which prescribes the time limits for the presentation of a claim for unfair dismissal.[5]The Appellants have all brought claims under regulation 15 (10) (b) against both Respondents. The claims were presented on 4 October 2010, or within a day or two thereafter. The Respondents took the point that the claims were out of time. The Appellants contended that time ran only from the date of the decision of this Tribunal, i.e. 28 July, so that the claims were in time; in the alternative, they contended that it had not been reasonably practicable for them to bring their claims in time. That issue was decided by Employment Judge Muir, sting in Glasgow, on 30 November 2010. He held that time did indeed run from the date of the original decision of the Employment Tribunal, i.e. 14 September 2009, and that the Appellants were unable to show that it had not been reasonably practicable for them to bring proceedings within the period of three months from that date. Accordingly he held that the Tribunal had no jurisdiction to entertain the claims.[6]The Appellants have appealed against that decision. The First Appellant, Mr Robert Dillon, appearing in person, has represented all of them. Ms. Todd has been represented by Mr Tony Caplan of Anderson Fyfe. Care Concern has been represented by Mr Ian MacLean of Peninsula Business Services. The Appellants have challenged both aspects of Judge Muir’s decision, that is to say his decision as to the date from which time ran and also his decision that it was reasonably practicable for them to have brought their claims in time.[7]The hearing of the appeal took a rather unusual course. My firm view when I first considered the papers was that the Judge was wrong in his finding as to the date from which time ran and that it in fact ran only, as the Appellants had understood, from the date of the decision of this Tribunal, in which case the reasonable practicability issue did not arise. I asked Mr. Caplan and Mr. MacLean to address me on that aspect first. They failed to persuade me to a different view, and I accordingly delivered an oral judgment allowing the appeal. However, in the course of listening to my judgment Mr. Caplan thought of another way of putting Ms. Todd’s case. Although it was not foreshadowed in his Respondent’s Answer or in his skeleton argument I thought it right to allow him to address me on it. Mr. MacLean associated himself in Mr. Caplan’s further submissions. In the circumstances I thought it right to reserve my decision, and as a precaution I heard submissions on the other point as well.[8]I will start by setting out my original reasoning, before turning to Mr. Caplan’s new point.[9]I began by considering the position of Care Concern. It seemed to me that if the time for bringing enforcement proceedings against it ran from the date of the original decision that would produce a nonsensical result. The Employment Tribunal had in its decision of 14 September made no order requiring Care Concern to make any payment to the affected employees: such an order was not made until the later decision of this Tribunal. Accordingly, the Appellants could not have commenced proceedings against it under paragraph (10) at any time before the decision of this Tribunal was promulgated because they could not have asserted the fundamental fact required by paragraph (10) (b), namely that “the … transferee … [had] failed … to pay [them] compensation in pursuance of the order ”. The regulation would thus only work if the order referred to in paragraphs (10) (b) and (12) (b) were taken to be the order of this Tribunal. I took the view that, although there might be some slight verbal difficulties about construing the provisions so as to achieve that result, there was no difficulty of substance. It had to be borne in mind that the rights of employees under TUPE derive from the Acquired Rights Directive, and it was unacceptable that there should be no effective remedy for claimants in circumstances, such as have arisen in this case, where an order under regulation 15 (8) or (9) is not made at first instance and is made for the first time on appeal. I also took into account the fact that when this Tribunal makes an order on appeal it is in effect exercising the powers of the employment tribunal: see section 35 of the Employment Tribunals Act 1996 .[10]I accepted that the position as regards the liability of Ms. Todd was not quite so straightforward. Unlike in the case of Care Concern, the Appellants could have initiated proceedings under paragraph 15 (10) in respect of the Tribunal’s original order, which made an award in favour of the affected employees amounting to thirteen weeks’ pay; and I did not see that the fact that Ms. Todd had appealed could stop the clock under paragraph (12) (though it might well be grounds for having any such claim sisted pending the outcome of the appeal). The real question, however, was whether a different clock started in relation to the order made by this Tribunal at the conclusion of the appeal. It seemed to me that it did. Once it was accepted, as I had already concluded, that the “tribunal” referred to in paragraphs (10) (b) and (12) (b) could include this Tribunal exercising its powers under section 35 of the 1996 Act, I could not see why in principle that should not be the case where this Tribunal made a different award from that made by the employment tribunal (i.e. rather than only where the employment tribunal had made no award at all). Again, that would accord with reality. If the Appellants had obtained an order under paragraph (10) (b) in relation to the Tribunal’s original award, i.e. one for thirteen weeks’ pay, that would have been an order in relation to the wrong amount. An order in relation to the right amount could only have been made once this Tribunal had made its own, different, order.[11]Mr. Caplan’s new point was that the structure of regulation 15 did not require any order to be made against Care Concern at all. What paragraph (8) provides for is for an order to be made against the transfer or . As regards the transfer ee , paragraph (9) provides that it will be jointly and severally liable for the amount awarded under paragraph (8), but the tribunal is not empowered to make any order to that effect: it is simply a legal consequence. Thus the first step in my reasoning, as set out at paragraph 9 above, was wrong: the order that matters, even as regards Care Concern, is the order made against the transferor, which was made by the Tribunal in September 2009. Of course Mr. Caplan was not directly concerned with the order against Care Concern, but only with the order against Ms. Todd; but my reasoning in relation to the latter rested in large part on my reasoning in relation to the former.[12]I should start by noting that that submission is flatly contrary to the position adopted by Ms. Todd at the previous appeal, when it was accepted (indeed, as I recall, positively argued) by her counsel that the Tribunal had erred in making no order against Care Concern. Nevertheless I should consider it. In my view Mr. Caplan is wrong. If a party is to be made liable as the result of the order of a tribunal, which is the effect of paragraph (9), it is right in principle that he should be a party to the proceedings in question, so that he can have the opportunity to contest his liability: if he is not joined by the claimant, he can be joined by the primary respondent or by the tribunal – see rule 10 (2) (k) and/or (r) of the Employment Tribunal Rules of Procedure . It is true that in a TUPE case like the present the transferee’s liability will depend on the acts or omissions of the transferor, of which the transferee may in practice have little knowledge. But that makes no difference in principle; and the reality is that in TUPE cases the transferor is often unwilling or unable to defend the claim and the transferee is the only person who can even if he is at some disadvantage in doing so. If, therefore, the transferee has been a party to the proceedings, as Care Concern was here, on the basis that it would be jointly and severally liable for any award made against the transferor, it would be very odd if any eventual order were not made against it. I accept that paragraph (8) does indeed refer only to “the transferor”; but that is explicitly subject to paragraph (9), and while I agree that the drafting is clumsy I think that that can be read as empowering the tribunal to make an order as to the joint and several liability of the transferee – as we indeed did in the present case. That view is supported by the wording of paragraph (10) (b), which clearly proceeds on the assumption that the transferee will be liable to the affected employees “in pursuance of the order [sc. under paragraph (8)]”.[13]Accordingly I adhere to the decision which I announced orally. The appeal is allowed, and the case must be remitted to the Tribunal to decide (if this cannot be agreed) what amounts are due to each of the Appellants.[14]In case I am wrong in my reasoning above, I will briefly add that even if the claims were out of time I would hold that it was not reasonably practicable to bring them within time. My reasons can be summarised as follows.[15]It is clear from the correspondence which I have seen, and is confirmed by Mr. Dillon, that the Appellants were initially ignorant of the correct procedure for enforcing an award under regulation 15 (8). Mr. Dillon is not a lawyer, though he writes a good letter. He relied on the booklet entitled “the Judgment” which is sent to successful claimants. This says nothing about collective claims of the present kind and simply advises successful claimants that if they wish to enforce the judgment they should do so in (in Scotland) the Sheriff’s Court, for which purpose they would need a extract of judgment: the guidance says that they should not seek an extract until the expiry of the time limited for appealing, which carries the implication – which would accord with common sense – that enforcement proceedings could not be pursued if there was a pending appeal. On that basis, the Appellants took no action until after the decision of this Tribunal was promulgated on 28 July 2010. Mr. Dillon further waited until the expiry of the time for appealing to the Inner House and then, on 10 September, wrote to the Secretary of the Tribunals asking for an extract of judgment. It was only when the Secretary replied, on 24 September, explaining that the earlier award was unenforceable as such and that fresh proceedings would be required, that he went back to regulation 15 and was able to understand the position. The current proceedings were, as I have said, commenced in early October.[16]I consider that that ignorance was reasonable: the procedure for enforcing awards under regulation 15 (8) is indeed unusual, and the official booklet gave no help. I believe that it was reasonable for Mr. Dillon to think that he could – indeed should – await the outcome of the appeal before taking enforcement measures. It is well established, in the context of the cognate provisions of section 111 (2) of the 1996 Act, that reasonable ignorance of time limits (by a person who is not represented by solicitors or other skilled advisers) will render it not reasonably practicable for him to comply with those limits: see, most recently, paragraph 9 of my judgment in John Lewis Partnership v Charman (UKEAT/0079/11), referring to the older authorities. For the reasons given, this is in my view such a case. The Appellants unquestionably acted within a reasonable time once they understood the true position.