Ham v Beardwood Humanities College (Unfair Dismissal: Reasonableness of dismissal) [2015] UKEAT 0179_15_2310

EAT
Ham v Beardwood Humanities College (Unfair Dismissal: Reasonableness of dismissal)
[2015] UKEAT 0179_15_2310 · 2015-10-23
[1]I refer to the parties as the Claimant and the Respondent, as below. This is the Claimant’s appeal against a Judgment of the Manchester Employment Tribunal (Employment Judge Sherratt, sitting with members at a remitted hearing on 22 August 2014; “the ET”). The Claimant then appeared in person, but has been represented on appeal by Ms Niaz of counsel. The Respondent was then represented by Mr Morgan of counsel, as it is today. That hearing followed an order for remission as a result of a previous successful appeal by the Respondent, heard by the EAT (HHJ Peter Clark presiding) on 4 February 2014. In its original decision - following a long Full Merits Hearing in August 2012 (Judgment sent out on 29 October 2012) - the ET had found the Claimant’s dismissal was unfair. On the remitted hearing, the ET held that the dismissal had in fact been fair. It is now the Claimant who appeals.[2]The proposed grounds of appeal were initially considered on the papers by HHJ Hand QC to disclose no reasonable basis to proceed. On hearing the Claimant’s application under Rule 3(10) of the Employment Appeal Tribunal Rules 1993 , HHJ David Richardson took the view that this matter should progress to a Full Hearing on the basis of an amended Notice of Appeal; thus the appeal comes before me. The Factual Background[3]The Claimant was employed by the Respondent as Head, subsequently Director, of Science, from September 1994 until May 2011. After a disciplinary hearing in her absence, the Claimant was summarily dismissed, with effect from 23 May 2011. The dismissal was on various conduct grounds, none of which were regarded, in isolation, as amounting to gross misconduct. There was an incident of safeguarding relating to pupils’ access to a laboratory and a series of complaints about consistently failing to attend a meeting and behaving rudely and intransigently. The Claimant appealed against her dismissal but was unsuccessful.[4]The Full Merits Hearing of the Claimant’s claim took place in August 2012. At that stage the Claimant was represented by her trade union representative, the Respondent by its solicitor. There were other issues then before the ET, including the question of whether the Claimant had been dismissed by reason of her trade union activities. The issues for the ET were set out in a long series of questions, as recorded within the original Liability Judgment. The ET’s conclusions on liability in that Judgment take the form of answers to each of the questions thus identified. The ET rejected the trade union activities claim, concluding that the primary reason for the Claimant’s dismissal related to her conduct. It found the Respondent’s investigation to have been fair (paragraph 280). It further found that the original disciplinary panel had a genuine and reasonable belief that the Claimant was guilty of the misconduct alleged, but found that the panel’s decision was unfair because it was made in the Claimant’s absence. The ET observed, however, that a decision to dismiss was potentially within the band of reasonable responses (paragraph 287). It considered all the matters raised by the Claimant in respect of the appeal, but rejected her case on each. It expressly found:
“292. … The appeal panel was properly constituted. It was a full re-hearing rather than a review. The claimant was present and represented and all of her paperwork was made available. The actions of the appeal panel were capable of rendering the dismissal a fair one.”
[5]The appeal panel had upheld the original decision to dismiss having concluded (paragraph 294) that “the allegations as a cumulative constituted gross misconduct”. The ET disagreed. The matters relied on as justifying the Claimant’s dismissal did not individually constitute acts of gross misconduct, as defined by the Respondent’s disciplinary policy, and:
“295. … It is not right for a reasonable employer to “gross up” individual allegations of misconduct to make them together constitute gross misconduct. …”
[6]The ET also felt that the decision was unfair given that the Claimant - who had 17 years of service - would have been made redundant in any event on 31 August 2012, when the school was due to close (paragraph 296).[7]On the first appeal, the EAT allowed the Respondent’s challenge to the ET’s original decision on the following grounds. First, the question for the ET had not been whether the allegations constituted “gross misconduct”, but whether it was reasonable to dismiss applying section 98(4) of the Employment Rights Act 1996 (“ERA”). Second, the ET had taken into account a wholly irrelevant factor, namely that the Claimant’s employment was due to end by reason of redundancy on the closure of the school. The case was remitted for rehearing to the same ET on the reasonableness of sanction issue. The EAT observed that this might be determined on the basis of submissions; no further evidence was needed.[8]In allowing the Respondent’s appeal, the EAT stated that the first question for the ET was whether it accepted the Respondent’s evidence as to the findings of the appeal panel on the charges levelled against the Claimant. If so, it was that conduct against which the section 98(4) question would then fall to be judged. In answering that question the EAT further stated that the ET needed to have regard to whether “the conduct in its totality amounted to a sufficient reason for dismissal under section 98(4)” (paragraph 16 EAT Judgment).[9]It is relevant to record that prior to the hearing of the first EAT appeal, on 18 March 2013, a Remedy Hearing had taken place before the ET. Declining to make any reduction to the Claimant’s compensation on Polkey grounds, the ET reasoned:
“5. … if the claimant had been managed properly and had any warnings been in place the claimant would not have been dismissed for issues relating to her conduct before she would have come to the end of her employment by reason of redundancy when the school was scheduled to close … Looking at the loss from our sense of justice, common sense and experience, we take a view that a Polkey [ vAE Dayton Services Ltd [1987] IRLR 503 ] reduction is not appropriate.”
[10]On the question of contribution the ET further concluded:
“6. … We did not find that any acts of the claimant were acts of gross misconduct; if there were acts of misconduct and they had been dealt with properly under a process and the claimant was aware of the likely consequences to her of going outside of the rules, then we are satisfied that the acts of the claimant that we were taken to, none of them was sufficient to warrant any contribution towards the dismissal that the claimant was subjected to by the respondent in advance of the claimant’s anticipated redundancy date …”
The ET’s Conclusions and Reasoning on Remission[11]Answering the first question identified by the EAT (see paragraph 8 above), the ET made clear that it accepted the Respondent’s case as to the findings at the appeal stage. It was, therefore, that case that it had to consider when asking the question raised by section 98(4): whether the conduct in its totality amounted to a sufficient reason for dismissal. It is common ground that the ET then proceeded to correctly direct itself as to the approach it had to adopt. It then referenced back to the original Judgment on liability, where it had found that the decision to dismiss was on the basis of the four charges accepted as proven at the appeal stage, i.e.:
“1. Repeated failure to follow reasonable management requests to meet to discuss leadership and management issues. 2. Failure to follow and comply with health and safety regulations which resulted in a safeguarding incident … Subsequent refusal to meet within a reasonable timeframe to ensure that appropriate health and safety and safeguarding arrangements are adhered to. 3. Communicating in an unreasonable and intimidating way on a number of occasions (verbally and written) including inappropriate emails. 4. Unreasonable and uncooperative behaviour with work colleagues causing a breakdown in working relationships.”
[12]Those matters were dealt with in some detail in the appeal outcome letter, as set out in turn in detail in the ET’s Liability Judgment, at paragraph 171.[13]Having reminded itself of the band of reasonable responses test, on the basis of the findings of the appeal panel, the ET concluded that the decision to dismiss the Claimant was within the range, albeit at the extreme end (paragraph 8, remitted hearing Judgment). The Appeal[14]The central point raised by the appeal is whether - the Claimant’s conduct having been found not to be gross misconduct - the ET erred in failing to consider whether it was reasonable to impose the sanction of dismissal when the Claimant had not been warned. Relevant to this question was the ET’s finding on the Remedy Hearing that, had the Claimant been made aware of the likely consequences of her actions or warned, she would not have been dismissed.[15]The Respondent resists the appeal. It relies on the ET’s reasoning but also observes that the Claimant’s case below had not been put on the basis that the decision to dismiss was unfair because the Respondent had failed first to issue disciplinary warnings. Submissions The Claimant’s Case[16]The Claimant relies on the importance of warnings when the conduct in issue does not amount to gross misconduct. She places reliance on the guidance given in the ACAS Code of Disciplinary and Grievance Procedure 2015 (“the ACAS Code”) in this regard and to various of the older cases, emphasising the importance of warnings in a fair disciplinary process.[17]Although the Respondent’s original disciplinary panel had concluded:
“107. … A warning was not considered appropriate as [the Respondent] had no trust and confidence that the claimant would engage in a performance management procedure. …”
The ET had not considered that panel’s conclusions were determinative. It had made its findings based on the decision and reasoning of the appeal panel. On the issue of the warning the ET’s conclusions should be taken from its decision on remedy; relevantly, on the question of any reduction on Polkey or contribution grounds. Although the Remedy Judgment fell away once the original Liability Judgment was reversed by the EAT, the original findings in that regard could not be considered irrelevant. On the contrary, when considering the legal test under section 98(4) at the remitted hearing, it was necessary for the ET to follow through the logic of its own view on the effect of a warning. Although the Claimant, representing herself at the remitted ET hearing, had not specifically raised the warning issue, it was incumbent on the ET to take it into account in any event. This was not a case where the ET could avoid dealing with this issue even if not raised by the Claimant; not least because the ET had addressed the question of warning at the remedy stage (albeit that Judgment had then fallen away). In any event, it was a matter inherent in answering the question of fairness under section 98(4). The Respondent’s Case[18]The Respondent observed that the Claimant had not raised the issue of warning or lesser disciplinary sanction either at the remitted ET hearing or at the original hearing; it had been no part of the Claimant’s case at any earlier stage. She had made no concession that she had been guilty of any form of misconduct. No criticism was made of the Claimant for failing to take the point below, but it was not then open to her to criticise the ET for not taking the point for her.[19]Further, the Claimant had sought to distinguish the disciplinary hearing from the appeal hearing, but that would not be the appropriate course. The ET was bound to look at the entire process when determining whether or not the dismissal was fair and that is what it did. It found that the appeal remedied any failing that might have arisen at the original disciplinary stage.[20]As for the ET’s task on the remitted hearing, the first question was whether it accepted the evidence of the chair of the appeal panel as to the panel’s findings on the four charges against the Claimant (paragraph 3). It did (paragraph 4). That set the context for the ET’s deliberations as to whether the sanction of dismissal had fallen within the range of reasonable responses. The ET gave itself a correct self-direction as to the law and then expressed its conclusion on that exercise (paragraph 8). It asked whether the Respondent could fairly dismiss on the basis of the conduct found and how a reasonable employer could reasonably respond to that state of affairs. In a shorthand way, the ET was saying it had taken all of those matters into account. It plainly had regard to the possibility of other options - which would have included warnings or sanctions less than dismissal - and the fact that it saw this decision as being at the extreme end meant that it must have had in mind that there were lesser sanctions. It was entitled to give its reasons shortly on this point given the length of the earlier Liability Judgment. There was no error of law, and it was not open to the EAT to interfere. The Claimant in Reply[21]Ms Niaz stressed that the ET’s decision on the remitted hearing was very much based on the reasoning of the appeal panel. The Respondent was attempting to read into paragraph 8 matters that could not properly be inferred from the reasons provided. The Relevant Legal Provisions[22]The focus of this appeal is on section 98(4) of the ERA 1996 , which provides:
“(4) Where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer) - (a) depends on whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and (b) shall be determined in accordance with equity and the substantial merits of the case.”
[23]The Claimant further relies on the ACAS Code , which, relevantly, provides:
“19. Where misconduct is confirmed or the employee is found to be performing unsatisfactorily it is usual to give the employee a written warning. A further act of misconduct or failure to improve performance within a set period would normally result in a final written warning. 20. If an employee’s first misconduct or unsatisfactory performance is sufficiently serious, it may be appropriate to move directly to a final written warning. This might occur where the employee’s actions have had, or are liable to have, a serious or harmful impact on the organisation. 21. A first or final written warning should set out the nature of the misconduct or poor performance and the change in behaviour or improvement in performance required (with timescale). The employee should be told how long the warning will remain current. The employee should be informed of the consequences of further misconduct, or failure to improve performance, within the set period following a final warning. For instance that it may result in dismissal or some other contractual penalty such as demotion or loss of seniority.”
Discussion and Conclusions[24]There is a degree of artificiality in this appeal. The focus is on the reasoning given at the remitted hearing, which is subjected to critical scrutiny because it fails to expressly address the question of the fairness of the decision to dismiss when the Claimant had not first been subjected to disciplinary warning. It is right to say, as Ms Niaz has stressed before me, that the use of warnings as an early response to misconduct is an important consideration - and nothing I say in this Judgment should be taken to detract in any way from the guidance given in the ACAS Code in this respect - but the Claimant’s case was never put as one where the unfairness was alleged to have arisen from the failure to first issue warnings to her or from the choice of dismissal rather than some lesser disciplinary sanction such as a warning. It is difficult to criticise the ET for addressing the case that was before it rather than some other, that was not.[25]Ms Niaz objects that the Claimant was representing herself at the remitted hearing and could not be expected to take every point; in any event, the issue of warnings was of such obvious importance that the ET ought properly to have taken the point itself.[26]That assumes, however, that I should only have regard to the ET’s reasoning in its remitted hearing Judgment, but that would be wrong. The ET on the remitted hearing was engaged in a limited reconsideration of its earlier conclusion. It was entitled to draw and rely upon the findings it had previously made on the fuller case presented before it at the original, Full Merits Hearing (when the Claimant was, moreover, represented by her trade union representative). At that stage, the very long detailed list of questions did not specifically raise the issue of warnings. Although reference was made to the ACAS Code , that was not to the paragraphs upon which Ms Niaz now seeks to rely.[27]It was in that fuller Judgment that the ET considered the detail of the matters that would go to the questions raised by section 98(4). Aside from the matters upon which the EAT adjudicated in the first appeal, none of those earlier findings were subject to challenge. That meant that, at the remission hearing, the ET was proceeding on the basis of its earlier finding that there had been a fair investigation and that the decision of the original disciplinary panel - which had expressly rejected alternatives to dismissal, including warnings - was potentially within the band of reasonable responses (only being rendered unfair because that decision had been reached in the Claimant’s absence). In reaching that conclusion, the ET had addressed the various - very detailed - points raised by the Claimant (then represented). It was persuaded by her objection to the disciplinary panel proceeding in her absence, but not otherwise.[28]The ET then considered the appeal panel’s decision. That was correct, because a disciplinary process has to be considered in total, not in separate parts. Bringing in its reasoning on the remitted hearing, it is clear that the ET accepted the Respondent’s evidence as to the findings of the appeal panel. That provided the immediate context for the ET’s finding as to the reasonableness of the dismissal for that reason. It was not, however, set in isolation. It did not mean that the ET’s earlier positive findings as to the original disciplinary panel’s decision had no relevance. Indeed, that would make no sense, given the need to consider the process as a whole and given the appeal panel’s express upholding of the earlier decision.[29]Considering paragraph 8 of the remitted hearing Judgment necessarily imports the earlier reasoning in the original liability Judgment, absent those matters overturned by the EAT on the first appeal. It is simply artificial to read paragraph 8 in a vacuum. An ET in the normal course is entitled to expect its reasoning to be read as a whole. That must be all the more so where, as here, the ET has been required to carry out a limited reconsideration of its earlier conclusion and has already provided a fully reasoned Judgment, most of which still stands.[30]Adopting this approach and thus having regard to the totality of the reasoning from both Judgments, I am satisfied that the ET had in mind the entirety of its earlier findings. Those included its finding that the original disciplinary panel’s decision to dismiss had potentially fallen within the range of reasonable responses; that decision including, as it did, the rejection of lesser sanctions such as warnings because it was considered that the Claimant would simply not co-operate and that trust and confidence had been lost. The only unfairness identified at that stage was that the decision was made in the Claimant’s absence. It was that unfairness that was remedied on appeal. Having reached its findings on the specific allegations, the appeal panel took the same view as the original disciplinary panel that dismissal was the appropriate sanction. That decision importing, by implication, the rejection of any lesser sanction. The ET found that fell within the range of reasonable responses. That the ET itself had been alive to the issue of possible lesser sanctions is implicit from its reference to the range; all the more so from its observation that the decision was at the extreme end of the range. I do not think this can be read as failing to have regard to the possibility of warnings: the ET was satisfied that this dismissal fell within the range of reasonable sanctions open to the Respondent. The other possible sanctions in the range must have included the possibility of disciplinary warning.[31]Although not the focus of oral submissions before me, for completeness I should say that I do not consider that this conclusion could in any way be affected by the ET’s earlier Remedy Judgment. In considering a Polkey reduction or contribution an ET is engaged in a different task to that facing it when considering liability for unfair dismissal. Moreover, when making its earlier decisions on remedy this ET had been proceeding on the mistaken premise that it was simply not open to the Respondent to fairly dismiss on the basis of an accumulation of acts of misconduct. It was therefore considering what might have happened if warnings had been given instead. Set right by the EAT, on the remitted hearing the ET was not undertaking the same exercise. It was concerned solely with the question whether it was within the range of reasonable responses to dismiss on the basis of the matters found proven at the appeal stage, rather than to impose some lesser sanction. As Ms Niaz acknowledged, the earlier Remedy Judgment had fallen away as a result of the EAT’s Judgment on the first appeal. The ET was not bound by those earlier conclusions. The Remedy Judgment cannot assist the Claimant.[32]Despite Ms Niaz’s valiant efforts, I am satisfied that no error of law has been disclosed, and I duly dismiss this appeal.