|For the Appellant
||MR PAUL GILROY
(One of Her Majesty's Counsel)
Messrs Thompsons Solicitors
London WC1B 3LW
|For the Respondent
||MR SEAN JONES
Marks & Spencer Plc Legal Services
10th Floor East
Waterside House Mailroom 10.14
35 North Wharf Road
London W2 1NE
UNFAIR DISMISSAL: S.98A(2) ERA
Expressing an opinion about an employer's proposal, after consultation, to change an enhanced redundancy scheme which is discretionary does not amount, in this case, to a qualifying or protected disclosure.
THE HONOURABLE MR JUSTICE WILKIE
- This is an appeal by Mr Goode against the decisions of the Employment Tribunal held at London Central on 8, 11 and 12 May 2009 that:
i) The Appellant did not make a public interest disclosure either to Mr Raichura on 30 July 2008 or to the Times on 18 August 2008 or by completing the "Your Say" survey.
ii) The Appellant was not unfairly dismissed.
iii) The Appellant was not wrongfully dismissed.
- The Appellant appeals against those decisions on the following grounds:
i) That the Tribunal erred in law in failing to conclude that the disclosure to Mr Raichura was a qualifying disclosure; and/or
ii) That the Tribunal erred in law in failing to conclude that the disclosure to the Times was a qualifying disclosure; and
iii) That if the Tribunal had not so misdirected itself it would have concluded that the claimant had both been unfairly and wrongfully dismissed.
- The Appellant does not seek to appeal the decisions of the Tribunal in respect of the "Your Say" survey nor their conclusion that he was not unfairly dismissed pursuant to section 98 of the Employment Rights Act 1996. The focal point of this appeal is his contention that either the Raichura or the Times disclosures were qualifying and protected disclosures such that, if the reason (or if more than one the principal reason) for the dismissal is that he made a protected disclosure, such dismissal should be regarded as automatically unfair pursuant to section 103A of the 1996 Act.
The relevant law
- Part IVA of the 1996 Act concerns protected disclosures. Section 43A provides:
"…A "protected disclosure" means a qualifying disclosure (as defined by section 43B) which is made by a worker in accordance with any of sections 43C to 43H."
- Section 43B: entitled Disclosures Qualifying for Protection, provides:
"(1) In this part a "qualifying disclosure" means any disclosure of information which, in the reasonable belief of the worker making the disclosure, tends to show one or more of the following -…
(b) That a person has failed, is failing or is likely to fail to comply with any legal obligation to which he is subject,…"
- Section 43C entitled: Disclosure to Employer or other Responsible Person, provides:
"(1). A qualifying disclosure is made in accordance with this section if the worker makes the disclosure in good faith –
(a) to his employer…"
- Section 43G entitled: Disclosure in Other Cases, provides as follows:
"(1) A qualifying disclosure is made in accordance with this section if - …
(d) any of the conditions in sub section (2) is met and
(e) in all the circumstances of the case it is reasonable for him to make the disclosure.
(2) The conditions referred to in sub section 1(d) are - …
(c) that the worker has previously made a disclosure of substantially the same information –
(i) to his employer…"
- Section 43G(3) provides that, in determining for the purposes of subsection (1)(e) whether it is reasonable for the worker to make the disclosure, regard shall be had to a series of factors, which are then set out but which it is not necessary to enumerate in this judgment.
- Chapter II of the Trade Union and Labour Relations Consolidation Act 1992 sets out a statutory procedure for handling redundancies.
- Section 188 of the 1992 Act sets out the duty of an employer to consult representatives. It provides:
"(1) Where an employer is proposing to dismiss as redundant twenty or more employees at one establishment within a period of 90 days or less the employer shall consult about the dismissals all the persons who are appropriate representatives of any of the employees who may be affected by the proposed dismissals or may be affected by measures taken in connection with those dismissals.
(1A) The consultation shall begin in good time and in any event:
(a) Where the employer is proposing to dismiss 100 or more employees as mentioned in sub section 1 at least 90 days…before the first of the dismissals takes effect…"
- Section 195 of the 1992 Act, entitled "Construction of References to Dismissal as Redundant" provides:
"(1) In this chapter references to dismissal as redundant are references to dismissal for a reason not related to the individual concerned or for a number of reasons all of which are not so related.
(2) For the purposes of any proceedings under this chapter where an employee is or proposed to be dismissed it shall be presumed unless the contrary is proved that he is or is proposed to be dismissed as redundant."
The facts as found by the Employment Tribunal
- The Appellant commenced his employment with the Respondent on 19 September 1983. He was dismissed summarily on 3 September 2008. At that time he was the Manager of the Customer Relations Management Database.
- On 30 July 2008 the Claimant overheard colleagues discussing the possibility of potential changes to the Respondent's discretionary enhanced terms of redundancy. He learned that the Respondent had been in contact with the representative body for staff of the Respondent ("BIG") putting to them various proposals which would result in changes to the discretionary enhanced redundancy terms. That proposal was dated 11 July 2008 and was before the Tribunal.
- That document, on its first page, stated amongst other things as follows:
"We have therefore completed a review of our discretionary redundancy terms and I am writing to let national BIG know about some changes we propose to make with effect from 1st September 2008 and gain feedback on these proposals through the consultation process…I would welcome any feed back from national BIG by 4th August so that we can communicate the outcome in good time for the intended implementation date of 1st September 2008."
- The proposed changes were set out on the following two pages of that document. They were, in so far as is relevant, to reduce the multiplier in respect of each completed year of service to twice the statutory formulation (previously it had been 2.5 times the statutory formulation) and to reduce the cap from 70 to 52 weeks' salary. The document concludes:
"The Company's enhanced redundancy terms remain discretionary and the company reserves the right to make changes from time to time."
- The Tribunal found that, at that time, representatives were in the process of being elected by staff to BIG. There was to be a meeting of all representatives following their election. National BIG waited until the election was over and then sent an e-mail, on 25 July 2008, to those representatives requesting feedback. The Claimant was, on 30 July 2008, sent a copy of the e-mail from BIG setting out the proposal. The Tribunal recorded his evidence given in a witness statement at paragraph 36 in which he says, of 30 July:
"I spoke to Mr Raichura saying I thought the proposals were disgusting and asking him what he thought. Mr Raichura said I should raise my concerns with BIG. I said I had just seen the proposals and there was no time to consider and respond that day. He appeared very disinterested throughout our conversation and it was clear to me that Mr Raichura did not want to listen to my concerns."
- The Claimant set out his concerns about the proposals in an e-mail of 30 July 2008 to Mr Heaven, the chairman of BIG. Amongst other things he stated that he was very disappointed about this proposal and that they all knew that the company were trying to push this through on 1 September so they could announce redundancies soon after. He stated that it was about time that the employees of Marks and Spencer made a stand and said enough is enough. He hoped the BIG group would do this. He concluded that in many ways he was ashamed to work for M&S and he hoped this along with the "Your Say" survey results would get leaked to the press.
- The Tribunal found that the Claimant, also on 30 July, e-mailed the Times asking whether, if he supplied a story on M&S, he would receive anonymity. The deputy news editor of the Times said that he would, but suggested using another e-mail address. The Claimant then asked the Times for a fax number and went on holiday. He returned on 18 August.
- Negotiations between the Respondent and BIG continued. BIG put forward a counter proposal which, in the end, was accepted by the Respondent and an agreement reached. That counter proposal, in so far as relevant, was to fix the cap for enhanced redundancy payments at 62 rather than at 52 weeks salary, which had been the original proposal.
- Upon his return to work on 18August, the Appellant was annoyed at being blamed by his Line Manager, Mr Raichura, for something which had happened whilst he was away. This so affected him, in the light of his ongoing feelings of despair about the management culture at M&S, that he felt that he had no option other than to send a letter, which he had drafted whilst on holiday, to the Times. It was e-mailed on 18 August though dated 10 August and is entitled "M&S deal another blow to staff."
- The relevant passages, for the purpose of this appeal, are as follows:
"Marks and Spencers have announced internally proposals to drastically reduce redundancy benefits to start a bid to save costs.
They have announced proposals they wish to take effect on 1st September prompting the inevitable speculation that compulsory redundancies will be made shortly after reduced costs…
As there is little or no union representation within M&S, the Business Involvement Groups will be consulted on these proposals as they are elected representatives. There is little expectation though that they will be able to counter these proposals with the outcome being that many staff will be made redundant in a cost cutting exercise that will see their redundancy packages slashed…"
- Following upon his sending this e-mail, he was identified as its source and, after disciplinary proceedings, he was summarily dismissed on 3 September 2008, confirmed after an appeal on 26 September. The reason for his dismissal was that he sent the e-mail, together with supporting documents (which included the proposal of 11 July) to the Times.
The Appellant's case in the ET1
- As part of the ET1 there was a section in the narrative entitled "Changes of Terms and Conditions". Paragraph 7 read:
"Like many of his colleagues the Claimant regarded the Respondent's redundancy payment scheme as being a term of his contract of employment and as different from some of the other employment benefits which the Respondent had withdrawn unilaterally…"
He claimed that his dismissal was unfair on a number of grounds including that he had disclosed to Mr Raichura, the impending unilateral change in redundancy terms and that the dismissal was unfair contrary to section 103A of the 1996 Act.
- The Respondent's case in the ET3 was, insofar as it is relevant, that the communication with the Times was not a qualifying disclosure since the Claimant could not reasonably have believed that he had a contractual entitlement to any discretionary redundancy payment. The disclosure was not a protected disclosure because it was not made to, amongst others, the Respondent and was not a protected disclosure within section 43G because, amongst other things, he could not allege that any of the conditions set out in section 43G(2) were met.
- In his written closing submissions before the Tribunal, the Appellant's case on section 103A was put as follows:
"Cs case is simple, he was dismissed for making disclosures to the Times newspaper and his Line Manager. Those disclosures are related to his concerns about the proposed changes to Rs redundancy policy and were of a qualifying nature pursuant to section 43B(1)(b)…Furthermore, by custom and practice it is averred that R's prima facie non contractual discretionary redundancy scheme became contractually binding upon R to the extent that the manner in which it set about introducing the revised scheme constituted a failure to comply with a legal obligation. The ET will recall Cs evidence that during his 25 years in Rs employ he was unaware of any employee receiving anything other than the full entitlement under the redundancy policy."
- In relation to section 43G and, in particular, the conditions in sub-section 2 he relied on section 43G(2)(c)(i) namely: that he had informally spoken to Mr Raichura regarding his concerns. In relation to section 43G(3) he said that, having approached the two most obvious sources of redress namely BIG and Mr Raichura and having received no satisfactory response from either source, he was left with little option but to take his concerns outside the Respondent, especially bearing in mind the tight timetable that was in place for implementation.
The ET's reasons for their decision in respect of section 103A
- In paragraph 31 of the decision the ET says as follows:
"The Claimant's representative indicated that the disclosures were made under section 43B(1)(b) (Breach of a Legal Obligation) namely that the Claimant's contractual terms were to be unlawfully changed and secondly that the Respondents are in breach of the legal obligation to consult more widely and adequately. This latter contention was introduced only in closing submission."
- The Tribunal posed the question "What were the protected disclosures?" and, in paragraph 32, said as follows:
"First it was alleged that the Claimant made a protected disclosure to Mr Raichura on 30th July 2008. What was that disclosure? The Claimant's evidence on this point which is at paragraph 36 of his statement reads….(they then repeat what is set out above)."
The Tribunal then went on to say as follows:
"Can any of the words used in that exchange constitute a protected disclosure – in the opinion of this Tribunal the answer is No. The Claimant did not disclose information which tended to show that the Respondents were in breach of a legal obligation. Merely to say that the proposals were disgusting and asking someone, albeit his Line Manager, what he thought cannot in our view amount to a protected disclosure."
- In paragraph 33 the Tribunal went on to consider whether or not the letter to the Times was a protected disclosure. Their answer was, again, "No". They then repeated the extracts from that letter to which we have referred above and upon which the Appellant relied. In paragraph 34 they say as follows:
"There is no disclosure in those paragraphs of information which tends to show that the Respondent's (sic) are in breach of a legal obligation. The redundancy scheme was discretionary. Even if it was not discretionary there was no information disclosed to the effect that there was likely to be a breach of a legal obligation. All that was disclosed is that the Respondent wished to discuss proposals relating to the scheme.
Furthermore the accompanying enclosure attached to that e-mail sent to the Times set out the Respondent's proposed changes to the redundancies terms which state quite clearly that 'the company's enhanced redundancy terms remain discretionary and the company reserve the right to make changes from time to time'."
- The Tribunal went on to consider in paragraphs 35 and 36 what the Claimant, in respect of the Times disclosure, would need to do to satisfy the Tribunal that he had complied with the terms of section 43G. In particular they considered whether he could satisfy them that there was a compliance with any of the conditions in sub-section 43G (2). They focussed on subsection (c) (i): that the worker has previously made a disclosure of substantially the same information to his employer. The Tribunal then stated in paragraph 37 as follows:
"All that the Claimant relies on is his conversation with Mr Raichura. We have decided for the reasons set out above that that was not a protected disclosure."
- The Tribunal noted that it also had to be satisfied, in accordance with section 43G(1)(e), that it was reasonable for the Claimant to make the disclosure and that this is decided by looking at the matters raised in 43G(3). In that regard the Tribunal said as follows:
"38…The Tribunal do not consider the Claimant had satisfied that requirement, as no evidence was led to show that it was reasonable to make such disclosure."
Submissions and conclusions
The Raichura disclosure
- The Tribunal is criticised by the Appellant for not explicitly considering, of this disclosure, whether the Appellant held the reasonable belief that the proposed changes tended to show that the Respondent was likely to fail to comply with any legal obligation to which it was subject. It is also said that the terms of paragraph 32 are such that it fails to explain why the words said to Mr Raichura could not amount to a protected disclosure. It is also said that their decision that it could not is perverse. It is said that the Tribunal has failed to contextualise what the Appellant said to Mr Raichura by reference to earlier parts of his witness statement in which he stated that he felt that the consultation process was a sham, that it was obvious that the change in redundancy terms foreshadowed redundancies and confirmed his frustration that the employer was no longer a caring employer. It is argued that, when seen in that context, what he actually said to Mr Raichura could properly be described as a qualifying and, therefore, a protected disclosure had the Tribunal applied itself to the full statutory test rather than expressing itself in the truncated way in which it did.
- The Respondent says that the disclosure to Mr Raichura as stated by the Appellant in his witness statement, fell so far short of anything that could be a qualifying disclosure as defined in the statute, that the Tribunal was entitled to express itself in a forthright way and, in effect, to say that no person could reasonably conclude that such information as was disclosed tended to show that the Respondent was likely to fail to comply with any legal obligation to which it was subject.
- Mr Jones, for the Respondent, draws our attention to the case of Cavendish Munro Professional Risk Management Ltd v Geduld  ICR 325, where the concept of "information" is considered in a judgment of the EAT, Mrs Justice Slade presiding.
- In that case the distinction is drawn between, on the one hand, conveying information in the form of fact and, on the other, making a statement of a person's position or making an allegation.
- In our judgment the Employment Tribunal was entitled to conclude that what was disclosed to Mr Raichura was, at its highest, only "information" in the sense of being a statement of his state of mind, namely that he was "disgusted" with the proposals which had been put forward on 11 July and communicated to him on 30 July.
- Insofar as one can go further and imply, as embedded within his disclosure, the contents of the letter of the 11 July 2008, comprised the shared understanding of the Appellant and Mr Raichura, there is nothing in that document which anyone could reasonably believe tended to show that it was likely that the Respondent would fail to comply with any legal obligation in respect of the enhanced redundancy payment scheme. All the document does is put forward a proposal for changing the terms of a discretionary scheme for consultation with the appropriate representative staff bodies.
- In our judgment the Tribunal was entitled to conclude that an expression of opinion about that proposal could not amount to the conveying of information which, even if contextualised by reference to the document of 11 July, could form the basis of any reasonable belief such as would make it a qualifying disclosure.
- In our judgment the Tribunal was entitled to express itself briefly because the point was such an obvious one and they made it so that the Appellant would know why he had lost that part of the case.
The consequence of this conclusion for "the Times' disclosure"
- On that basis the Tribunal, at paragraphs 35, 36 and 37 went on to consider whether, even if the letter to the Times did contain information which potentially fell within the description of a qualifying condition, it did so by reason of their conclusion about what was said to Mr Raichura. The Tribunal concluded in paragraph 37 (albeit they did not make it abundantly clear) that, by reason of their conclusion in respect of the Raichura disclosure, the Appellant could not satisfy the requirement of section 43G(1)(d) by satisfying any of the conditions set out in 43G(2) and, in particular, (c)(i).
- The Appellant contends that the Tribunal erred by concluding that its finding that the disclosure to Mr Raichura was not a qualifying disclosure meant that this requirement of section 43(G) could not be met. He points out, correctly, that section 43G(2)(c )(i) simply requires that the worker has "previously made a disclosure of substantially the same information to his employer".
- However, as Mr Jones has pointed out, the disclosure made to a third party has itself to be a qualifying disclosure. If, therefore, there is an additional requirement that the worker has previously made a disclosure of "substantially the same information" to his employer then, he says, it is impossible to conceive of a situation in which what was disclosed to his employer - being substantially the same information as is then disclosed to the third party - was itself not a qualifying disclosure. As they had concluded that what was disclosed to Mr Raichura did not amount to a qualifying disclosure then, it follows, section 43(G)(2)(c )(i) could not be satisfied.
- To put it the other way round, if what was disclosed to the Times could be a qualifying disclosure, but what was disclosed to Mr Raichura could not, then what was disclosed to the Times could not be "substantially the same information" as that which had been disclosed to Mr Raichura for, if it were, then that too would be a qualifying disclosure. If all that the Appellant disclosed to Mr Raichura was his disgust at the proposals then that is not "substantially the same information" as was disclosed to the Times in the extracts from the e-mail relied upon.
- We agree with that submission. Thus, even if the Times' disclosure were capable of being a qualifying disclosure, (to which we return below) it could not in fact be a qualifying disclosure giving rise to protection under section 103A.
- These two conclusions are sufficient to dispose of this appeal which must fail.
The Times' disclosure
- Applying the Cavendish analysis to the extracts relied upon in the email to the Times, in our judgment there were a number of pieces of information and a number of statements of opinion or belief. The information was as follows:
a. the Respondent had announced, internally, proposals to reduce redundancy benefits;
b. it wished those proposals to take effect on 1st September 2008;
c. the BIG would be consulted on these proposals, as they are elected to represent staff;
The following expressions of opinion were disclosed:
a. there is inevitable speculation that compulsory redundancies will be made shortly after 1st September;
b. there is little expectation that the BIG will be able to counter these proposals; and
c. the outcome will be that many staff will be made redundant with reduced redundancy packages.
- The Appellant's case before the ET was that he believed that there was a contractual entitlement to those redundancies terms which had arisen, at least, by custom and practice. However, enclosed with the Times e-mail was the document of 11 July which refers to the fact that the redundancy terms are discretionary, had been changed in August 2006, and that the company reserved the right to make changes from time to time. Furthermore, the document described a process by which the BIG would be consulted and would engage in a consultation process the outcome of which would be reported to the company.
- It is against that background that the Tribunal concluded, at paragraph 34, that nothing that was disclosed to the Times by way of information could reasonably be believed to have a tendency to show that the Respondent to likely to fail to comply with any legal obligation to which it was subject. It found that all that was disclosed was that the Respondent wished to discuss proposals relating to the redundancy scheme. In our judgment that was a conclusion to which the Tribunal was entitled to come on the case that was presented to it. It did so on two alternative bases: that the scheme was discretionary and that it was not.
- Before us, two new ways of arguing the case have been developed. The first is reliant on a line of authorities to the effect that, even where an employer's scheme is said to be discretionary, it is not devoid of the legal obligations to which the employer is subject in operating and applying it. There is ample authority to the effect that, in operating and applying such a scheme, there is a legal obligation on the employer not to act arbitrarily, capriciously or irrationally and, arguably, to engage in some process of appropriate consultation where decisions are to be taken affecting the operation or application of such a discretionary scheme.
- Although the Appellant said, in his witness statement to the ET, that he considered the consultation exercise to be a sham the difficulty for the Appellant in pursuing such an argument is that there is nothing in what was disclosed to the Times, whether in the e-mail or enclosures, which even hints at the Respondent having a tendency to act capriciously, irrationally or in bad faith or without any proper consultation in respect of its proposals to change this scheme. On the contrary, the document of 11 July explicitly envisages a process of consultation, the outcome of which would be considered by the Respondent. The e-mail says that BIG is an elected body. The only misgivings expressed are whether it is strong enough to counter the proposals. That falls very short of amounting to an assertion of opinion, let alone conveying information, tending to show that the Respondent would not meet its legal obligations in respect of the operation of a discretionary scheme. Thus, in our judgment the Appellant could not have succeeded on that basis. In any event, the legal obligations which attach to the operation of a discretionary scheme were not the focus of the case which was presented by the Appellant before the Tribunal.
- The second way of putting it concerns the contention that the information conveyed could reasonably be believed to have a tendency to show that the Respondent was likely to fail to comply with the legal obligation to consult more widely and adequately. The way this argument was developed before us was on the basis that the legal obligation triggered was section 188 of the 1992 Act. The likely breach was the statutory obligation to begin consultation at least 90 days before the proposed change was to be implemented. The period envisaged in the 11 July document was of the order of 50 days.
- The difficulty with this argument is that section 188 is only triggered where there is a proposal by an employer to "dismiss as redundant" 20 or more employees within a 90 day period. The difficulty for the Appellant is that there is nothing at all in the information disclosed to the Times which remotely suggests that there is any proposal to dismiss as redundant any employee let alone 20 or more. In order to counter this difficulty, Mr Gilroy refers us to the case of GMB v Man Bus and Truck UK Ltd  IRLR 636. In that case there was an attempt, in the context of a merger, to harmonise the terms and conditions of employment of two groups of employees. The mechanism used was to terminate the contracts of all the employees and then offer them immediate re-employment on the new terms. In those circumstances it was decided that the section 188 obligation to consult was triggered because the dismissals were "by reason of redundancy" as defined by section 195 of the 1992 Act, to which we have referred above.
- The distinction between that case and the present is that in the GMB case, there was a proposal to dismiss all the employees as part of the mechanism to achieve harmonisation which triggered the obligation to consult under section 188.
- In the present case there is no such proposal. Indeed, in the Times e-mail the Appellant expressed the opinion that he feared that the duly elected representatives on the BIG would not be strong enough to counter the proposals and (by implication) that they would agree to them. Thus, even if the Appellant thought there might be a long stop plan that, if all else failed, everyone's contracts would be terminated and they would be offered new terms with a different redundancy scheme attached, this fear was not disclosed in the email to the Times, or in the enclosures, or in the expressions of opinion contained within it.
- In our judgment this is a hopelessly speculative basis for asserting that the Tribunal erred in law in coming to the conclusion that the email to the Times was not a protected disclosure.
- For all these reasons, in our judgment, the decision of the Employment Tribunal to reject the claim under section 103A based on the disclosures to the Times cannot be criticised. Such information as was disclosed by the email and enclosures was not such as could be the subject of a reasonable belief that it tended to show that the Respondent was likely to fail to comply with any legal obligation to which it was subject.
- Accordingly this appeal must be dismissed.
- There are two further matters upon which we should comment. First we are less than happy with the way in which the Tribunal dealt with the question whether, if all the other conditions were satisfied, it was, in all the circumstances, reasonable for the Appellant to make the disclosure to the Times so as to satisfy section 43G 1(e). In our judgment the Tribunal did not approach that particular fact finding exercise with sufficient energy or rigour. It was plain from the Appellant's witness statement, as well as what was said on the Appellant's behalf in closing, that there was ample evidence showing the reasons why he felt obliged to make the disclosure to the Times. Had this been the only basis upon which the section 103A claims failed we would have been minded to have upheld the appeal. However, we have dismissed the appeal on all the other grounds and this ground is now irrelevant.
- Second, we did not find persuasive the argument, put forward by Mr Jones, that, if all else failed, the Appellant's section 103A claim must fail because the Employment Tribunal did not find that the extracts said to be the protected disclosures were the/or the principal reason for the dismissal. True it is that the Tribunal concluded that the Appellant was dismissed for sending the letter and supporting documents to the Times newspaper and that there were a number of matters of concern within that letter, apart from the disclosures relied upon by the Appellant as being protected disclosures. However, by that part of their reasons the protected disclosure issue had fallen by the wayside and the ET was addressing the fairness of the dismissal under section 98. Had we been otherwise persuaded that the appeal should succeed we would not have been persuaded to dismiss the appeal on this ground.
- However, for the reasons we have set out above this appeal is dismissed.