Afolayan v MRCS LTD (Unfair Dismissal : no sub-topic) [2011] UKEAT 0406_10_2308

EAT
Afolayan v MRCS LTD (Unfair Dismissal : no sub-topic)
[2011] UKEAT 0406_10_2308 · 2011-08-23
[1]This is an appeal by the Claimant from a decision of the Employment Tribunal at London South on 29 September 2009 (Employment Judge Milton and lay members) which partly dealt with issues of review and partly with remedies.[2]The case has a somewhat complicated procedural history. I shall explain the procedural history before we turn to the factual background. Procedural history[3]On 16 May 2006 the Claimant issued his ET1 claiming unfair dismissal, discrimination on the grounds of his race (he is of black African ethnicity) and wrongful dismissal.[4]On 11 September 2007 an Employment Tribunal, presided over by Employment Judge Gumbiti-Zimuto found in the Claimant’s favour that he had been unfairly dismissed (but subject to a 100 per cent contribution). It went on to dismiss his other claims.[5]The Claimant appealed to the Employment Appeal Tribunal, and on 4 June 2008 the Employment Appeal Tribunal, presided over by Nelson J, remitted the question of remedy and contribution to be heard by a fresh Employment Tribunal. It refused to remit the matter to the Tribunal presided over by Employment Judge Gumbiti‑Zimuto.[6]On 13 July 2008 in the Employment Appeal Tribunal Nelson J refused to award costs against the Respondent.[7]On 8 September 2008 at a case management discussion (CMD) Employment Judge Hyde gave directions in relation to an application by the Claimant for a preparation costs order.[8]On 21 November 2008 a further CMD took place before Regional Employment Judge Hildebrand. Meanwhile the Claimant applied to the Court of Appeal for permission to appeal against Nelson J’s refusal to make an order for costs. On 16 December 2008 Smith LJ granted permission.[9]On 14 January 2009 the Employment Tribunal, presided over by Employment Judge Milton (“Milton 1”) held that the Claimant had contributed to his dismissal to the extent of 40 per cent (as opposed to the 100 per cent of the Gumbiti‑Zimuto Tribunal). It made an award for compensation for loss of earnings and related losses together with interest; dismissed the Claimant’s application to debar the Respondent from contesting the issue of contribution, and adjourned the Claimant’s application for costs. We have observed that Nelson J had remitted all outstanding matters to be determined by a fresh Employment Tribunal. Among the issues that needed to be resolved was the application by the Claimant for an order for costs against the Respondent in the Gumbiti‑Zimuto Tribunal on the basis that the Respondent had behaved unreasonably, frivolously or vexatiously. The Employment Tribunal (Milton 1) declined to adjudicate upon this claim on the basis that it could only be dealt with before the Gumbiti‑Zimuto Tribunal which had dealt with the claim initially. It therefore adjourned that claim.[10]Both the Respondent and the Claimant made applications to review the decision in Milton 1. On 25 February 2009 Regional Employment Judge Hildebrand directed that there should be a costs hearing to be heard together with the review.[11]The review application commenced before the Milton Tribunal on 2 June 2009.[12]On 24 July 2009 the Court of Appeal dismissed the Claimant’s appeal against the refusal to award him costs in the Employment Appeal Tribunal. He made assertions of fabrication and bad faith; these allegations were not supported by the findings of the Employment Appeal Tribunal.[13]The ‘Milton 2’ Tribunal Judgment was entered on the register and sent to the parties on 22 September 2009. It dealt with outstanding remedy issues, but notwithstanding the order of Regional Judge Hildebrand it again declined to give any ruling in relation to the costs prior to 17 December 2008 on the basis that:
“It would be wholly inappropriate for us to give any ruling about the costs of the proceedings prior to 17 December 2008, since we have not been the Tribunal involved in any of those proceedings, and we believe that it would be wrong in principle for us to reach any conclusion about those.”
[14]The Tribunal stated, “we remain of the view that it was impossible for us to deal with the question of any costs prior to the first day of our proceedings”; accordingly, it declined to review its earlier decision not to deal with costs.[15]On 29 October 2009 the Claimant issued his Notice of Appeal, which came before HHJ McMullen QC on the “sift”. On 14 April 2010 he disposed of the Notice of Appeal under rule 3(7) of the Employment Appeal Tribunal Rules of procedure on the basis that it did not disclose reasonable grounds for bringing the appeal. On 26 August 2010 the matter came before me under rule 3(10). I determined that certain matters only should go to the full hearing, and required the service of a fresh Notice of Appeal to be drafted by counsel, who had appeared under the ELAA Scheme. In the hearing before me the Claimant was fortunate to be represented by Matthew Purchase of counsel under the ELAA Scheme. He drafted an amended Notice of Appeal, but by reason of time constraints his Notice of Appeal and skeleton argument had not been fully considered by the Claimant. The factual background[16]On 10 June 2002 the Claimant commenced work for the Respondent as a care worker at a care home run by the Respondent. He was assaulted by a resident. The care home housed children who could not be placed in foster care, and, as Nelson J observed in the Employment Appeal Tribunal, the job was enormously demanding, residents were commonly violent, some had learning difficulties, and the fact that they could not be placed in foster care speaks of the difficulty of providing care for them.[17]We need not deal with the circumstances of the assault; the Respondent considered that the Claimant, although the victim of the assault, had been guilty of gross misconduct and was summarily dismissed. The Employment Tribunal (Milton 1) reduced the contribution on the part of the Claimant from 100 per cent as held by the Gumbiti-Zumito Tribunal to 40 per cent; the effective date of termination of the Claimant’s employment with the Respondent was 17 February 2006. On 17 May 2007 the Claimant commenced employment with the Ministry of Justice. This employment terminated on 31 March 2008. On 28 August 2008 the Claimant commenced employment with ACAS. It was known to the Employment Tribunal that this was not a permanent post.[18]At the time of the decision in Milton 1 (14 January 2009), the Claimant was in employment with ACAS. This employment, however, came to an end on 1 March 2009.[19]We now turn to consider the decision of Milton 1. It set out the facts, considered anew the issue of the Claimant’s contribution to his dismissal in the light of the decision of the Employment Appeal Tribunal, and concluded, having regard to the history of friction between the Claimant and the resident in question, he should have been aware as a professional not to go into the resident’s room where the assault took place. The Employment Tribunal declined to debar the Respondent from raising the issue of contribution, and at paragraph 35 dealt with the costs issue in these terms:
“The Claimant, in order to succeed in an application of this kind would need to establish that the Respondents behaved unreasonably frivolously or vexatiously. It is absolutely impossible for us to comment other than in the very general terms we have already used about the chances of success of such an application. In our judgment the only forum where this application can be made would be to the original Tribunal and we therefore adjourned that claim. The Claimant must reach a conclusion as to whether he wishes to pursue this argument within 28 days of the promulgation of our own judgment.”
[20]The Employment Tribunal then turned in paragraphs 36 and 37 to consider the Claimant’s financial claims. It determined (rejecting the Claimant’s assertion it had been agreed he should be paid a regular amount of overtime) that his loss of earnings was at the rate of £254.46 per week. It noted that the Claimant had obtained fixed‑term employment with the Ministry of Justice from 17 May 2007 to 31 March 2008 and a further fixed‑term appointment with ACAS from 28 August 2008 due to expire in March 2009. The Employment Tribunal noted the Claimant was a middle‑aged man and accepted:
“[...] in these difficult times that there may be a risk that his fixed‑term appointment is not renewed and that he may have difficulty in obtaining further employment. Equally we take into account that he has demonstrated in his handling of these proceedings a thorough grasp of paperwork and administrative skills, and we feel that should stand him in good stead for that kind of employment, which is plainly the area of employment on which he is now concentrating.”
[21]The Employment Tribunal noted it was reasonable for the Claimant to conclude that he was unlikely to receive a, “decent reference from his past working in the care field.” The Employment Tribunal rejected the Claimant’s argument that he had a long career ahead of him, nor did it accept the Respondent’s submission that he would have been likely to have been dismissed in any event within a few months; but nevertheless, the Employment Tribunal concluded:
“Having regard to the frequency with which he was having confrontations with young men in the care home, and that it was a stressful and difficult job for him, it was by no means certain he would have remained in employment, for example, in the autumn of 2008. He did not have a very lengthy period of past employment in any event.”
[22]At paragraph 40 the Employment Tribunal stated:
“We find that as he has now achieved a second reasonable period of employment with a state employer that with his skills, experience and abilities there is no reason why he should not have a decent chance of either a further external appointment or something very similar within a short space of time. We find therefore that the chain of causation flowing from the original unfair dismissal has now been broken and his loss of earning claim should be cut off as of the day of today’s proceedings.”
[23]The Employment Tribunal therefore concluded that the Claimant was entitled to loss of earnings, and that the overall period of potential loss was 148 working weeks, terminating at the commencement of the Milton 1 proceedings. The Employment Tribunal applied a notional weekly rate of £154.46 per week [1] , from which had been deducted the actual earnings he had received from his two employments and Jobseeker’s Allowance. This was calculated as a gross sum of £37,660, from which had been deducted the sums of the net earnings from the Ministry of Justice and ACAS, which amounted to £5,023.92. He was entitled, therefore, to 60 per cent of that sum.[24]The Employment Tribunal then went on to consider the appropriate basic award and certain additional sums claimed by the Claimant in respect of loss of ability to obtain mortgage protection insurance policy and credit card payments, as well as the cost of looking for alternative employment. He received compensation under all of these heads. The Employment Tribunal also awarded the Claimant a sum of £120 for the considerable amount of preparation and submission of documents and copying for the purposes of his job search.[25]The Employment Tribunal left over for agreement or further determination the calculation of his wages to the date of the hearing from his current employment with ACAS, together with any notional wage increases to which he might have become entitled had he remained in employment with the Respondent. He was reminded that he had to clarify within 28 days of the Judgment whether and on what basis he proposed to pursue his application for costs.[26]We have already noted that the Claimant did give such notice, and Regional Employment Judge Hildebrand had directed that the costs issue that had been remitted by Nelson J be determined at the same time as the review application; ie before the Milton Tribunal. We now turn to consider the decision in Milton 2, sent to the parties on 22 September 2009.[27]A principal issue the Milton 2 Tribunal had to consider was an application for review of the quantum of the Claimant’s loss. The Claimant sought review of a number of other matters, so far as is relevant to this appeal and, as we have said, the principal issue related to loss of earnings. By the time of Milton 2 the Claimant’s job with ACAS had come to an end; it had not been renewed. At paragraph 6 the Employment Tribunal sets out the matter in this way:
“Our conclusions about the reasons for our judgment on the future loss issue are mainly set out under paragraph 38-40 of our original judgment. The principles we applied summarised at paragraph 40 are the principles which were laid down we point out in the decision of Dench v Flynn & Partners [1998] IRLR 63 where the Court of Appeal adopted a more liberal interpretation of Section 123(1) ERA 1996 in holding that as a matter of justice and equity loss consequent upon dismissal does not necessarily cease when the Claimant finds a new job at an equivalent or higher salary if that job turns out to be temporary. We concluded that we did not accept that the Claimant necessarily had a long career in social work related employment and that was borne out by the contracts which he achieved at the Ministry of Justice and ACAS. At the adjourned hearing the Claimant argued that the period of future loss should be increased because he has since again become unemployed. We direct ourselves that it was our task to assess the situation as at the date of our hearing. It is one of the most difficult tasks for an Employment Tribunal to assess what is the just and equitable period to award for future loss. We do not accept therefore that there are any valid grounds on which we should review that conclusion.”
[28]The Employment Tribunal then went on to consider an argument by the Claimant that the Employment Tribunal had failed to consider the possibility of reinstatement and re‑engagement. The Employment Tribunal stated:
“We disagree. The Claimant did indeed mention these possibilities, but at the time of our hearing he was employed, and there had been a considerable passage of time, and we have made a finding of no means insubstantial contributory conduct. We had found the contributory conduct involved conduct which could be described as blameworthy, and that in that it fell short of the professional standards required. However, the Claimant was in fact working at the time of the hearing and put forward no proposals that he should abandon that employment [...].”
[29]The Employment Tribunal then went on to correct certain typing errors (£254.46 for the average weekly loss had been transcribed as £154.46). The Employment Tribunal then dealt with arguments raised by the Claimant in relation to overtime, which it rejected and declined to review its earlier conclusion that the correct starting figure for the Claimant’s loss of earnings was £254.46 per week. We need not deal with other issues dealt with by the Employment Tribunal, and we have already drawn attention to the contents of paragraphs 29 and 30 of the decision in Milton 2 as to why it declined to deal with the costs prior to the hearing before Milton 1.[30]The Employment Tribunal then went on to reject the claim for costs of the proceedings before the Milton Tribunal:
“31. In so far as the Claimant now urges us to make an order for the costs of these proceedings we reject that application. The question of contribution, remedy and compensation were by no means straightforward and we plainly had to have evidence about a variety of issues both of conduct and earnings in order to reach our conclusion. The original hearing was not a particularly lengthy hearing and we do not accept that the fact that we have reached a conclusion which is partly unfavourable to the Respondents means that the Respondents have behaved unreasonably. We were directed by the Employment appeal Tribunal to investigate the issues which we did investigate. 32. The extensive further enquiry into the Review issues and financial issues have been lengthy probably mainly because the Claimant has put forward a considerable number of arguments about almost every aspect of the decision with which he disagrees. That is of course his right and we do not consider that it is just that he should be penalised for exercising his right to argue questions of Review. He has certainly argued all his points at considerable length and with considerable documentation and it cannot in our judgment be said that the somewhat protracted extent of these subsequent proceedings and documentation has been occasioned by unreasonable or improper behaviour by the Respondents. We do not accept therefore that there should be an order for costs of any kind in favour of one party or the other.”
[31]Having regard to its revision of the figures, the Claimant’s overall loss of earnings was £15,131.46, of which he received 60 per cent, namely £9,078.88. The Milton Tribunal (‘Milton 3’) considered various written representations from the parties in a decision dated 10 March 2010 in relation to interest, the calculation of his earnings at ACAS and in relation to the calculation of his basic award. Notice of Appeal[32]The grounds in the amended Notice of Appeal that I permitted to go to a full hearing were the following:(a) The Employment Tribunal failed to deal with the application for costs in the Gumbiti‑Zimuto Tribunal.(b) The Employment Tribunal had failed to give proper consideration to the issue of reinstatement.(c) The Employment Tribunal gave inadequate consideration to the issue of future loss on the basis that the Claimant had only found temporary jobs and might not find a permanent post.[33]The Claimant also sought permission to raise issues as to the overtime payment and a preparation time costs application in relation to the review hearing before the Milton Tribunal.[34]We now turn to deal briefly with the submissions on the various points, before coming to our conclusions. Failure to deal with the costs of the Gumbiti‑Zimuto hearing[35]The Claimant points to the decision of the Employment Appeal Tribunal, presided over by Nelson J, and the direction of Regional Employment Judge Hildebrand. He submitted there was no reason why the application for costs could not be dealt with by a different Employment Tribunal to the Gumbiti‑Zimuto Tribunal if that was appropriate. He did, however, ask that it should not be heard by the Milton Tribunal, which had refused to deal with the matter because, he submitted, it might not deal with the issue fairly. The Respondent sought to suggest that only the Tribunal originally seized of the case could form the necessary “opinion” under rules 42‑44 of the Employment Tribunal Rules that the Respondent had acted vexatiously, abusively, disruptively or otherwise unreasonably. It would be unfair for this matter to be decided by the Milton Tribunal. We observe that at no time has the Respondent sought to challenge either the direction of Nelson J or that of Regional Employment Judge Hildebrand. Reinstatement[36]It is clear that there is no explicit reference to reinstatement in Milton 1. The Claimant did raise the point, and the Employment Tribunal should have dealt with it; it did, of course, deal with the matter in Milton 2. I would interpolate here that where it appears that an Employment Tribunal has omitted a material matter from its decision an immediate request should be made to invite the Employment Tribunal to amplify its reasoning; I have suggested that it is the duty of advocates to seek clarification from the Employment Tribunal promptly in any such case where there might otherwise be an appeal based on alleged insufficiency of reasons. It is much easier for Tribunals to deal with requests for clarification when the facts and arguments are fresh in their minds, and the amplification of insufficient reasons and findings will save the parties time and expense and may in some cases obviate the need for an appeal and subsequent remission of the case; see Bansi v Alpha Flight Services [2007] ICR 308 . It is a matter of great regret this omission was not picked up at the time; the Claimant, although a litigant in person, clearly has some experience in these matters, and the Respondent was legally represented before Milton 1.[37]The Claimant submits that the Reasons given in the review Judgment are very short; no consideration had been given to the practicability of ordering reinstatement. The Employment Tribunal ignored the fact that he was unemployed at the time of the review hearing. He submitted that the decision of the Tribunal in Milton 2 was perverse. He went so far as to suggest that as he had been “unlawfully dismissed” the Employment Tribunal was bound to order reinstatement or re-engagement.[38]The Respondent submitted that the Employment Tribunal’s reasoning in the review Judgment (Milton 2) was impeccable. The Employment Tribunal had correctly identified issues of contribution, which were highly relevant to practicability. The Claimant had been guilty of blameworthy conduct falling short of professional standards. It noted the considerable lapse of time between the dismissal and the application being determined, and the Claimant had put forward no reasons why he should abandon his new employment. The Employment Tribunal did not have to set out every factor and piece of evidence upon which it relied, and the decision of the Employment Tribunal was plainly and unarguably correct. Future loss[39]Mr Afolayan complained that the Employment Tribunal had failed to give adequate consideration of the fact that since his dismissal by the Respondent he had only found temporary jobs and possibly would not find a permanent post. Temporary employment does not break the chain of causation (it might be more accurate to say that it does not necessarily break the chain of causation). Reference was made to the decisions in Whelan v Richardson [1998] ICR 318 and Dench v Flynn & Partners [1998] IRLR 653 . The Claimant submitted that his loss did not cease until he had found a new job at the same rate, and at the review hearing the Employment Tribunal should have had regard to the fact that his temporary employment with ACAS had ended. This would constitute new evidence not available on the date of the original hearing (Milton 1) and thus admissible on a review; see Employment Tribunal rule 34(3). The Claimant also sought to challenge the calculations on the basis that he was entitled to overtime; that is not a matter set out in the amended Notice of Appeal for which I gave permission, and the Employment Tribunal had found as a fact that overtime was not a contractual right.[40]The Respondent submitted that the Milton Tribunal’s decision was correct both initially and on review. The Employment Tribunal applied section 123 of the Employment Rights Act 1996 and there was of necessity a degree of speculation as to whether future loss was inevitable; see Scope v Thornett [2006] IRLR 155. The Employment Tribunal was entitled to conclude there was a reason for the Claimant to have decided to switch to different employment and to reject his claim he had a long career ahead of him in care. The Employment Tribunal had correctly directed itself by reference to Dench and assessed loss as at the date of hearing, as it was required to do. There was no new evidence as such, because the fact that the Claimant’s appointment with ACAS was for a fixed term was known to the Employment Tribunal in Milton 1 and explicitly referred to.[41]The Claimant sought permission to raise the issue of the overtime payment and a preparation time application in relation to the review hearing. We did not give permission for these matters to be further explored. It was quite unclear to us whether the application for a preparation time order in respect of the Milton Tribunal had ever been made. Indeed, there was nothing to suggest that it had been made. Any application for those costs should have been made to the Milton Tribunal, and we say no more about it.[42]We now turn to consider the law, and we remind ourselves of important principles relating to appeals from Employment Tribunals. These principles are well known, but we do not apologise for reminding ourselves of them. In RSPB v Croucher [1984] ICR 604, Waite J said this in the Employment Appeal Tribunal at page 609: “We have to remind ourselves also of the important principle that decisions are not to be scrutinised closely word by word, line by line, and that for clarity’s and brevity's sake Industrial Tribunals are not to be expected to set our every factor and every piece of evidence that has weighed with them before reaching their decision. So it is for us to recall that what is out of sight in the language of a decision is not to be presumed necessarily to have been out of mind. It is our duty to assume in an Industrial Tribunal’s favour that all the relevant evidence and all the relevant factors were in their minds, whether express reference to that appears in their final decision or not; and that has been well established by the decisions of the Court of Appeal in the Retarded Children's Aid Society v Day [9781 IRLR 128.[43]We also draw attention to the well‑known dicta of Bingham LJ in Meek v City of Birmingham District Council [1987] IRLR 250 , to the effect that the Tribunal decision was not to be:
"…an elaborate formalistic product of refined legal draftmanship" but rather "…the parties are entitled to be told why they have won or lost. There should be sufficient account of the facts and of the reasoning to enable the EAT or, on further appeal, this court to see whether any question of law arises…"
[44]The approach to compensatory awards in cases of unfair dismissal is defined in section 123 of the Employment Rights Act 1996 :
“ Compensatory award E+W+S (1) Subject to the provisions of this section and sections 124, 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. (2) The loss referred to in subsection (1) shall be taken to include— (a) any expenses reasonably incurred by the complainant in consequence of the dismissal, and (b) subject to subsection (3), loss of any benefit which he might reasonably be expected to have had but for the dismissal. (3) The loss referred to in subsection (1) shall be taken to include in respect of any loss of— (a) any entitlement or potential entitlement to a payment on account of dismissal by reason of redundancy (whether in pursuance of Part XI or otherwise), or (b) any expectation of such a payment, only the loss referable to the amount (if any) by which the amount of that payment would have exceeded the amount of a basic award (apart from any reduction under section 122) in respect of the same dismissal. (4) In ascertaining the loss referred to in subsection (1) the tribunal shall apply the same rule concerning the duty of a person to mitigate his loss as applies to damages recoverable under the common law of England and Wales or (as the case may be) Scotland. (5) In determining, for the purposes of subsection (1), how far any loss sustained by the complainant was attributable to action taken by the employer, no account shall be taken of any pressure which by— (a) calling, organising, procuring or financing a strike or other industrial action, or (b) threatening to do so, was exercised on the employer to dismiss the employee; and that question shall be determined as if no such pressure had been exercised. (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. (7)If the amount of any payment made by the employer to the employee on the ground that the dismissal was by reason of redundancy (whether in pursuance of Part XI or otherwise) exceeds the amount of the basic award which would be payable but for section 122(4), that excess goes to reduce the amount of the compensatory award. (8)Where the amount of the compensatory award falls to be calculated for the purposes of an award under section 117(3)(a), there shall be deducted from the compensatory award any award made under section 112(5) at the time of the order under section 113.”
[45]There is considerable guidance in the authorities as to the approach to be taken by Employment Tribunals to future loss. An Employment Tribunal is entitled to take account of the fact that the Claimant has obtained a new job at the same salary, or that he has lost what had appeared to be stable employment, so if these matters were to be ignored an award might be made that was not just and equitable. An Employment Tribunal is entitled but not bound to take such matters into account; see Dench v Flynn & Partners [1998] EWCA Civ 934 , in which Beldam LJ had this to say:
“Although causation is primarily a question of fact, the principle to be applied in deciding whether the connection between a cause, such as unfair dismissal, and its consequences is sufficient to found a legal claim to loss or damage, is a question of law. The question for the Industrial Tribunal was whether the unfair dismissal, could be regarded as a continuing course of loss she was subsequently dismissed by her new employer with no right to compensation after a month or two in her new employment. To treat the consequences of unfair dismissal as ceasing automatically when other employment supervenes, is to treat as the effective cause that which is simply closest in time. Causes, in my view, are not simply beads on a string or links in a chain, but, as was said many years ago, they are influences or forces which may combine to bring about a result. A tribunal of fact has to consider the appropriate effect of the wrongful or unfair dismissal and the effect of the termination of any employment which is subsequently obtained. That is a function which an Industrial Tribunal is called upon frequently to perform and, provided it does not regard itself as rigidly bound in every case to take the view that a subsequent employment will terminate the period of loss, it seems to me that it will be able, fairly and equitably, to attribute to the unfair dismissal the loss which has been sustained.”
[46]Helpful guidance was also given by HHJ Peter Clark in Whelan :
"The correct approach In the light of the authorities on this topic it is clear that there has not been unanimity in the approach to be taken to this important question of assessment of loss, which constantly arises before industrial tribunals. With the benefit of the learning to date and our experience of the way in which industrial tribunals approach this task, we venture to offer the following guidance. We begin with some general, possibly trite, observations. Each case must depend upon its own facts. The parties will select whichever authority best suits their cause on the facts of the particular case. Industrial tribunals are charged with doing justice between the parties. Compensation is to be assessed in such a way as to compensate the employee, not penalise the employer, in relation to the compensatory, as opposed to an additional or special award. Neither party should gain a "windfall."
Compensation must be that which is just and equitable. Parliament has thereby granted a discretion to industrial tribunals which ought not to be placed in a straitjacket by too rigid statements of principle handed down by this tribunal in appeal decisions. However, that discretion must be exercised in accordance with clear principles, to some extent imported into this field from the common law by the words of the statute. Against that background we turn to the earlier cases with a view to resolving any real or apparent conflicts in approach. … (1) The assessment of loss must be judged on the basis of the facts as they appear at the date of the assessment hearing ("the assessment date"). (2) Where the applicant has been unemployed between dismissal and the assessment date then, subject to his duty to mitigate and the operation of the recoupment rules, he will recover his net loss of earnings based on the pre-dismissal rate. Further, the industrial tribunal will consider for how long the loss is likely to continue so as to assess future loss. (3) The same principle applies where the applicant has secured permanent alternative employment at a lower level of earnings than he received before his unfair dismissal. He will be compensated on the basis of full loss until the date on which he obtained the new employment, and thereafter for partial loss, being the difference between the pre-dismissal earnings and those in the new employment. All figures will be based on net earnings. (4) Where the applicant takes alternative employment on the basis that it will be for a limited duration, he will not then be precluded from claiming a loss down to the assessment date, or the date on which he secures further permanent employment, whichever is the sooner, giving credit for earnings received from the temporary employment. (5) As soon as the applicant obtains permanent alternative employment paying the same or more than his pre-dismissal earnings his loss attributable to the action taken by the respondent employer ceases. It cannot be revived if he then loses that employment either through his own action or that of his new employer. Neither can the respondent employer rely on the employee's increased earnings to reduce the loss sustained prior to his taking the new employment. The chain of causation has been broken."[47]This last proposition (5) was qualified by Beldam LJ in Dench at para 19:
“I consider that statement needs qualification. No doubt in many cases a loss consequent upon unfair dismissal will cease when an applicant gets employment of a permanent nature at an equivalent or higher level of salary or wage than the employee enjoyed when dismissed. But to regard such an event as always and in all cases putting an end to the attribution of the loss to the termination of employment cannot lead in some cases to an award which is just and equitable.”
[48]As was pointed out in submissions it is inevitable there will be an element of speculation when an Employment Tribunal carries out its duty to assess what is just and equitable by way of future loss; see the Judgment of Pill LJ at paragraph 36 of Scope :
“The EAT appear to regard the presence of a need to speculate as disqualifying an employment tribunal from carrying out its statutory duty to assess what is just and equitable by way of compensatory award. Any assessment of a future loss, including one that the employment will continue indefinitely, is by way of prediction and inevitably involves a speculative element. Judges and tribunals are very familiar with making predictions based on the evidence they have heard. The tribunal's statutory duty may involve making such predictions and tribunals cannot be expected, or even allowed, to opt out of that duty because their task is a difficult one and may involve speculation. Giving judgment in the leading case on loss of earning capacity, Moeliker v A Reyrolle & Co Ltd [1977] 1 WLR 132, an important head of damage in personal injury cases, Stephenson LJ when seeking words to define the correct approach to be followed stated, at page 144: ‘I avoid "speculation" because this head of damage can really be nothing else.’”
[49]The approach to be adopted by appeal courts considering decisions of Employment Tribunals on future loss is helpfully summarised by Peter Gibson LJ in Bentwood Brothers (Manchester) Ltd v Shepherd [2003] IRLR 364 at paragraphs 10 and 11: “10. In considering whether or not the Tribunal has been perverse in their award of 10 years pension payments, I bear in mind that there are many statements in the authorities on the narrow circumstances in which it would be proper for an appellate body to interfere with the assessment of damages by a tribunal. We were referred in particular to Gbaja-Biamila v DHL Ltd [2000] ICR 730 at page 742 paragraph 36 where Lindsay J, the then President of the Employment Appeal Tribunal, said this: ‘An appellate court, when reviewing the quantification of compensation by an employment tribunal, should not act as it would when reviewing an award of damages by a jury. In contrast to a jury, the tribunal is expected to give reasons and hence can be judged by those reasons: Skyrail Oceanic Ltd v Coleman [1981] I.C.R 864, 872. That is not to say that the employment tribunal's sovereignty as to facts is here in question. Only if, firstly, a tribunal's given reasons expressly indicate that it has adopted a wrong principle of assessment, or, secondly, (that not appearing by reason of its either correctly stating the principles or stating none) it has arrived at a figure at which no tribunal properly directing itself by reference to the applicable principles could have arrived, will the assessment demonstrate an error of law, the only class of error which this appeal tribunal can correct. That second category may fairly be described as one where the award has been perverse, an award so high or low as to prompt in those aware of the relevant facts found and the applicable principles a reaction that the award was wholly erroneous, even outrageous: see also the collection of definitions of perversity in Steward v Cleveland Guest (Engineering) Ltd [1996] ICR 535 , 541.’[11]This court, like the Appeal Tribunal, will interfere with such assessments with reluctance, given that the Tribunal as the industrial jury can be expected to make broad brush assessments which reflect the Tribunal's local knowledge and experience. ”[50]For the sake of completeness, we refer to the decision of HHJ McMullen QC in Islam Channel v Ridley [2009] UKEAT/0083/09:
“Applying those principles it seems to us that there is no requirement on an employment tribunal faced with an employee who presents with mitigated loss to operate a guillotine at any stage. That is only likely to occur in a case which fits the EAT's Guideline 5 in Whelan . It must be borne in mind that the Tribunal is doing what is just and equitable in having regard to the loss sustained by the Claimant as a result of the Respondent's unfair act. It operates as a double test of causation, as Sir Christopher Staughton pointed out. A tribunal may, if it is just and equitable, take an overall approach, look at all of the actual and probable losses and deduct all of the mitigation. On the other hand it may, permissibly, decide to draw a line between past and future losses and apply different tests. After all, what a tribunal is required to do is to speculate as to the future, see Scope v Thornett [2007] IRLR 155. It is an essentially different exercise from that of assessment of past losses, which can be decided as a matter of fact. As to the future, based upon an impression of what is likely to occur, the tribunal must to some extent speculate. If a tribunal decided to approach past and future losses in that different way, it would be committing no error of law in our judgment.”
[51]In so far as orders for reinstatement are concerned, we draw attention to sections 113 and 116 of the Act:
“113. The orders E+W+S An order under this section may be— (a) an order for reinstatement (in accordance with section 114), or (b) an order for re-engagement (in accordance with section 115), as the tribunal may decide. [...] 116. Choice of order and its terms E+W+S (1) In exercising its discretion under section 113 the tribunal shall first consider whether to make an order for reinstatement and in so doing shall take into account— (a) whether the complainant wishes to be reinstated, (b) whether it is practicable for the employer to comply with an order for reinstatement, and (c) where the complainant caused or contributed to some extent to the dismissal, whether it would be just to order his reinstatement. (2) If the tribunal decides not to make an order for reinstatement it shall then consider whether to make an order for re-engagement and, if so, on what terms. (3) In so doing the tribunal shall take into account— (a) any wish expressed by the complainant as to the nature of the order to be made, (b) whether it is practicable for the employer (or a successor or an associated employer) to comply with an order for re‑engagement, and (c) where the complainant caused or contributed to some extent to the dismissal, whether it would be just to order his re‑engagement and (if so) on what terms. (4) Except in a case where the tribunal takes into account contributory fault under subsection (3)(c) it shall, if it orders re-engagement, do so on terms which are, so far as is reasonably practicable, as favourable as an order for reinstatement. (5) Where in any case an employer has engaged a permanent replacement for a dismissed employee, the tribunal shall not take that fact into account in determining, for the purposes of subsection (1)(b) or (3)(b), whether it is practicable to comply with an order for reinstatement or re-engagement. (6) Subsection (5) does not apply where the employer shows— (a) that it was not practicable for him to arrange for the dismissed employee’s work to be done without engaging a permanent replacement, or (b) that— (i) he engaged the replacement after the lapse of a reasonable period, without having heard from the dismissed employee that he wished to be reinstated or re-engaged, and (ii) when the employer engaged the replacement it was no longer reasonable for him to arrange for the dismissed employee’s work to be done except by a permanent replacement.”
[52]With these authorities in mind, we now turn to our conclusions. Costs before Gumbiti‑Zimuto Tribunal[53]Employment Judge Milton has on two occasions declined to deal with the Claimant's application for costs of the hearing before Employment Judge Gambiti-Zumoto despite directions from the Regional Employment Judge, Judge Hildebrand and the order of Nelson J.[54]We appreciate the reasons Employment Judge Milton has given, namely that it is extremely difficult for him to deal with matters of the Respondent's conduct before the Gambiti-Zumoto Tribunal in respect of which neither he nor his lay members have any direct knowledge. We have considerable sympathy for his reluctance to embark upon the exercise of making an order for costs in respect of conduct before an Employment Tribunal presided over by one of his colleagues in these circumstances.[55]On the other hand the Employment Appeal Tribunal presided over by Nelson J concluded that the decision of the Employment Judge Gambiti-Zumoto Employment Tribunal should be reversed and referred to a fresh Employment Tribunal because it would be difficult for the same Employment Tribunal to bring a truly fresh independent mind to bear upon the matter.[56]As it seems to us we have three options:a. to remit the matter to the Employment Tribunal presided over by Employment Judge Gambiti-Zumotob. to remit the matter to be heard by a fresh Employment Tribunalc. to remit the matter to the Milton Tribunal.[57]The EAT (Nelson J and lay members) made a careful decision, taking into account the principles set out in the case of Sinclair Roche & Temperley v Heard [2004] IRLR 763 , that it would be inappropriate to ask Employment Judge Gumbiti-Zimuto and his colleagues to go over the case again as, after a long hearing in which several errors were made, “it would be difficult for the same Employment Tribunal to bring a truly fresh independent mind to bear upon the matter”. It would therefore be difficult for the Claimant now to have confidence in the impartiality of that Tribunal were they to be asked to consider the matter of costs. Further, the passage of time since their hearing in 2007 means that they are unlikely to have much of a recollection of what transpired at the hearing. In these circumstances we do not consider it appropriate to remit the costs issue to Employment Judge Gumbiti-Zimuto and his colleagues.[58]We also do not consider it appropriate to remit the matter to be heard by a fresh Employment Tribunal. The Milton Tribunal has dealt with the substance of the case on two occasions and is familiar with the case, the Claimant and the background. Were we to remit the matter to a fresh Tribunal we should simply be adding to the expense by requiring the fresh Tribunal to familiarise themselves with matters already within the knowledge of Employment Judge Milton and his colleagues.[59]In the circumstances, and although we recognise the difficulties that this course will cause to Employment Judge Milton and the lay members, we consider remission to the Milton Tribunal is the least unsatisfactory course. The Claimant has opposed this course because he suggests that Employment Judge Milton and his colleagues will in some way be prejudiced against him because we are reversing their decision not to hear the costs application. We reject that view entirely. We do not doubt that they will hear the application with their usual fairness and impartially, despite the difficulty of establishing the necessary facts.[60]We would suggest that the matter is listed before them for directions.[61]This claim has been running for over five years. It has been at least twice to the Court of Appeal, to the Employment Appeal Tribunal on about six occasions, and on more occasions than we can identify before the Employment Tribunal. There must be some finality, and the proceedings should be brought to an end as soon as possible.[62]We have no doubt that the Employment Tribunal will have this well in mind, and will doubtless wish to give robust directions with a view to a speedy determination of the outstanding issue as to costs. Reinstatement[63]There is no question that there was no explicit mention of the decision to refuse reinstatement or re‑engagement in the Milton 1 decision. However, on the findings made by the Employment Tribunal it is inconceivable it could have made such an Order. The Claimant sought to argue on the basis of a pre‑dismissal appraisal, and courteous interchanges with the Respondent’s witness at the Employment Tribunal, and in the absence of any reference in the Respondent’s skeleton argument, or ET3, to opposition to reinstatement; that he believed the Respondent had no objection to his being reinstated or re‑engaged. This suggestion by the Claimant lacks all credibility in the light of there having been a bitterly fought case in which the Respondent consistently maintained the Claimant was guilty of gross misconduct and unprofessional behaviour, and we have no doubt that the Claimant has always been well aware that the Respondent would not be willing in the circumstances for him to be either reinstated or re‑engaged.[64]We note that the Claimant did not raise this matter in his ET1, although he did raise it rather later in his skeleton argument. The question of reinstatement was clearly not picked up by the Respondent. We have no idea whether it was raised in evidence or on cross‑examination in Milton 1, and then again we would have found it of great assistance to know what if anything the Claimant put to the Respondent’s witnesses.[65]If the absence of reference to reinstatement had in fact been raised when the Milton 1 Judgment was sent to the parties, there could be no possible criticism of the Employment Tribunal in dealing with an obvious omission; nor, had the decision been appealed to the Employment Appeal Tribunal, could there have been any objection to its having made a Burns/Barke Order to secure reasons for a decision on the point.[66]The Claimant has alleged that in Milton 2 the Tribunal was simply covering up for an earlier mistake. We see no reason whatever to doubt the integrity of Employment Judge Milton and the lay members who sat with him. This is another unfortunate example of Mr Afolayan casting aspersions upon the integrity of others without any evidential foundation.[67]There was ample evidence to support the finding by the Employment Tribunal that it was inappropriate to order reinstatement or re‑engagement; we refer in particular to the passages at paragraph 7 of Milton 1, together with paragraphs 22‑24 and 26‑30.[68]We also bear in mind that at the time of the hearing before Milton 1 some three years had elapsed since the effective date of termination of the Claimant’s employment. The Claimant did not seek immediate re‑engagement or reinstatement, but wished to have it deferred for 12 months while he sought other employment, and wished for reinstatement only after those 12 months had elapsed.[69]In coming to this conclusion we have not taken into account the Employment Tribunal’s findings as to what the Claimant is said to have said in cross‑examination as to not seeking a further social work post. It is unfortunate that the notes from the Employment Tribunal are not available. When I dealt with the matter at a preliminary hearing I made the standard Order requiring the parties to attempt to agree notes of evidence. The Claimant made an extravagant request to the Employment Appeal Tribunal dated 6 September 2010 for all of the notes of Employment Judge Gumbiti‑Zimuto and the lay members in respect of the hearing before them, which lasted some ten days, as well as for the notes of Employment Judge Milton and the lay members who sat with him during the remedy proceedings, which lasted four days. The Employment Tribunal wrote to remind the Claimant that he should first attempt to agree a note of evidence with the Respondent. The Claimant chose not to do so on the basis that he did not believe the Respondent would co‑operate, and took no further steps to secure agreement or notes of the Employment Judge. We again draw attention to the fact that although the Claimant is a litigant in person he has considerable experience of litigating in the Employment Tribunal and Employment Appeal Tribunal as well as the Court of Appeal. Future loss and breaking the chain of causation[70]The Employment Tribunal directed itself correctly in relation to the relevant authorities such as Dench and Whelan .[71]We note that on the subject of credit for his earnings the Claimant received compensation for 148 weeks; almost 3 years. We all considered that the award was most generous in the circumstances bearing in mind the Claimant’s undoubted abilities as found by the Tribunal. The Employment Tribunal was entitled to conclude for the reasons given at paragraphs 38‑40, to which we have referred, that the chain of causation flowing from the original unfair dismissal had been broken as at the date of the hearing in December 2008 before Milton 1. The Employment Tribunal, for example, had well in mind that the Claimant’s appointment with ACAS was due to expire in March 2009, and that there might be a risk that this appointment was not renewed, and that he might have difficulty in obtaining further employment. However, it took into account that the Claimant had demonstrated during the proceedings a thorough grasp of paperwork and administrative skills, and that, having regard to the frequency of his confrontations with young men in the care home and the fact that it was a stressful and difficult job for him, it was by no means certain he would have remained in employment with the Respondent. The Employment Tribunal, as we have already noted, concluded that he had achieved a second reasonable period of employment with a state employer, and that with his skills, experience and abilities there was no reason why he should not have a decent chance of either a further external appointment or something very similar within a short space of time.[72]At the review hearing (Milton 2), the Employment Tribunal reiterated its views on future loss by reference to Dench , and that loss consequent upon dismissal did not necessarily cease when the Claimant found a new job at an equivalent or higher salary if that job turned out to be temporary. The Employment Tribunal concluded that it did not accept the Claimant necessarily had a long career in social work‑related employment. At the review hearing the Claimant had argued that the period of future loss should be increased because he had since again become unemployed. The Employment Tribunal directed itself that its task was to assess the situation as at the date of the first hearing. As it said:
“It is one of the most difficult tasks for an Employment Tribunal to assess what is the just and equitable period to award for future loss. We do not accept [...] that there are any valid grounds on which we should review that conclusion.”
[73]As we have said, we have not taken into account evidence as to whether or not the Claimant had asserted he was no longer seeking a job in social work in coming to our conclusion. The Claimant’s case in relation to the alleged failure of the Milton Tribunals to award him an adequate sum for future loss is a very long way from the high threshold required for perversity appeals.[74]The fact that the jobs obtained by the Claimant at the Ministry of Justice and ACAS were not permanent was of no consequence, because the lack of permanence in these jobs had already been factored in by the Employment Tribunal.[75]This ground of appeal, therefore, does not succeed. Preparation time costs of the review hearing[76]We decline to give permission to Mr Afolayan to raise this matter. As was made clear at the hearing, Mrs Russell, who appeared for the Respondent, was not anticipating any such claim and was in no position to deal with it. The allegations the Claimant wished to make involved criticisms of the Respondent’s conduct, lateness and non‑compliance with Orders; this would have led to an examination of other documents we have not seen and were probably not included in the bundle. In coming to the conclusion that we should not allow an amendment, we had regard to the fact that the reasons given by the Employment Tribunal at paragraph 31 for rejecting the Claimant’s application seemed to be a perfectly proper and sensible exercise of its discretion. It was entitled to conclude that, it could not be said that “the somewhat protracted extent of these subsequent proceedings and documentation has been occasioned by unreasonable and improper behaviour by the Respondent.” We, therefore, exercise our discretion, have regard to the principles set out in Khudados v Leggate [2004] UKEAT/0026/04. In particular we take into account the fact that no satisfactory explanation has been given for the delay in seeking permission to amend. The amendment, if allowed, will cause prejudice to the Respondent, which was not prepared to deal with the point, and will also take a significant amount of additional time for the consideration of new material on the part of the parties and the Employment Appeal Tribunal. We also of course bear in mind that prima facie the Employment Tribunal remains a no costs environment and, as we have said, the manner in which it exercised its discretion appears to be unimpeachable. Overtime[77]The Claimant does not have permission to raise issues as to the overtime, and again, in the exercise of our discretion, we would refuse permission to amend his Notice of Appeal to raise this issue, on similar grounds to the reason that we refused permission to raise the issues relating to costs.[78]In the circumstances save in relation to the costs of the proceedings prior to Milton 1, including in particular the costs of the Gumbiti‑Zimuto Tribunal, the appeal stands dismissed. [1] This was a typographical error as the correct figure should have been £254.46 per week.