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You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> YMCA Training v. Stewart [2006] UKEAT 0332_06_0612 (6 December 2006) URL: https://www.bailii.org/uk/cases/UKEAT/2006/0332_06_0612.html Cite as: [2006] UKEAT 332_6_612, [2006] UKEAT 0332_06_0612, [2007] IRLR 185 |
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At the Tribunal | |
On 19 October 2006 | |
Before
THE HOURABLE MR JUSTICE UNDERHILL
MR J MALLENDER
MS P TATLOW
APPELLANT | |
RESPONDENT |
Transcript of Proceedings
JUDGMENT
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For the Appellant | Mr E D Mallett (of Counsel) Messrs Curwens Solicitors Crossfield House Gladbeck Way Enfield Middlesex EN2 7HT |
For the Respondent | Mr Stewart (The Respondent's husband) |
Summary
Unfair dismissal Polkey deduction/ Automatically unfair reasons
Employment Tribunal wrong to find breaches of "step 1" and "step 2" of statutory dismissal procedure and accordingly wrong to find "automatic" unfair dismissal - Claim accordingly fails in its entirety by virtue of s. 98A (2) because Tribunal had made 60% "Polkey deduction" -Kelly-Madden applied
Observations on importance of focusing on the literal requirements of the statutory procedures and not imposing overlay based on "ordinary" unfair dismissal concepts or requirements of contractual procedure - Obiter observations on meaning of "after the meeting" in para. 2 (4) of step 2
THE HONOURABLE MR JUSTICE UNDERHILL
(1) On 8 September 2005 a more junior colleague of Mrs Stewart, a Miss Brackley, contacted Mrs. Coutts, who was both her and Mrs Stewart's line manager, making various allegations about her conduct. Although there were some general allegations, the most serious and specific was that she had falsified the training records of three trainees, to whom we will refer simply as Stephen, Daniel and Jason. The three of them had been sent on 7 September on a day placement at a hardware store called Wilkinsons in Dartford, but Ms Povey, the manager with whom Mrs Stewart had principally been dealing, had phoned to complain that they were being uncooperative, and they had come back to the Centre by mid-morning. The Appellant's procedures required employers to sign paperwork indicating that the trainees had completed the placement. According to Miss Brackley, Wilkinsons had unsurprisingly in the circumstances - not provided any such signatures; but she said that Mrs Stewart had told her that she would sign the forms herself, in order to conceal what had occurred, and warned her not to tell anyone else.
(2) Mrs Coutts asked Miss Brackley to send her copies of the documents with the forged signatures. Miss Brackley took photocopies of the documents for two of the trainees Daniel and Jason and sent them to Mrs Coutts by fax, under cover of a note saying that the third - Stephen - had not handed in his paperwork. The documents consisted of an "employer's contract", a "participant induction" sheet and a timesheet. The documents could perfectly properly be, and were, to some extent pre-completed at the Centre, but the induction sheet and timesheet had necessarily to be completed and signed by the employer after the induction and the day's work had been performed. In the case of both Daniel and Jason, both those sheets bore (illegible) signatures on the lines provided for the employer: Miss Brackley's allegation was that these signatures had been forged by Mrs Stewart.
(3) On the basis of that information, Mrs Coutts drafted a letter to Mrs Stewart asking her to attend an investigatory meeting. She spoke to her on the telephone on the evening of 8 September at about 4.30pm, and read her the letter. She told her that she was suspended and that she should leave the office forthwith.
(4) Mrs Coutts' letter of 8 September, which was received by Mrs Stewart the following day, was in the following terms:
Re: Invitation to attend an Investigatory Meeting on Monday 12 September
I should be grateful if you would attend a meeting to investigate concerns that I have in relation to your job performance.
The meeting will take place at 2.00pm on Monday 12 September at Maidstone. I will be accompanied by Louise Wildon-Jones.
You may bring a work colleague or trade union official with you to support you and take notes on your behalf.
I will be discussing the following items:
- Use of company time and resources for personal job search
- Not following rules and regulations laid down within the centres
- Not following reasonable request from colleagues and management
- Not participating within centre activities and being observed with your feet on the desk and sleeping on the job
- Signing documentation in place of the employer and providing inaccurate information regarding placements.
I enclose a witness statement which I will be asking you about during the meeting.
I confirm that you will remain suspended from work on full pay pending this meeting. You have been suspended as I feel that the concerns that I have are extremely serious. I feel that it would be inappropriate for you to continue working until I am satisfied with your involvement in this matter.
You should not contact any student, employers, external agencies or any other member of staff without my authorisation while you are suspended from work. Any breach of this instruction will be treated as an act of gross misconduct.
You should be aware that I may have to consider the termination of your employment with YMCA Training.
Please contact the area office to confirm your attendance at the meeting.
(5) As the letter indicated, a witness statement was enclosed. This was a two-page
witness statement from Miss Brackley setting out in some detail what she said
happened about the handling of the three trainees. As regards the falsification of the
documents, it said:
"Adriana then said to me I am going to sign the employer participant contracts to say they have been there but don't tell Maggie or management as you will get a bollocking and you will get a bollocking for sending three people to the one placement. I will not be cover up [sic] or want to have anything to do with forgery being done by another work colleague when it is dealing with an employer that has people on basic skills on long term placement or forgery towards the Job Centre."
(6) The investigatory meeting duly took place on 12 September 2005. A fairly full
note was kept (though the Tribunal found that it was not entirely complete). Mrs
Stewart tabled a letter rebutting the allegations against her. There was a discussion of
all the charges raised in Mrs Coutts' letter. As regards the alleged falsification, the photocopies supplied by Miss Brackley were produced to Mrs Stewart. She denied having forged the employer's signature. She said that Mrs Coutts should contact Wilkinsons for their evidence as to who signed the forms in question. The Appellant was not able to produce the originals from which Miss Brackley had taken the copies: they were not found on the file where they should have been. (There appears to have been a suspicion that it was Mrs. Stewart who had removed the originals, on the evening of 8 September following her phone conversation with Mrs Coutts; and the position was further confused by Mrs Stewart herself producing some original documents at the meeting, though as we understand it these were in fact the documents relating to Stephen, which Mrs Stewart had received from him and had never filed in the first place.)
(7) Following the meeting Mrs Coutts, as asked, spoke by telephone to a manager at Wilkinsons, who (according to her record of the conversation) "confirmed that he had not signed or kept any contracts or timesheets for the three clients, nor had his colleague or anybody else at Wilkinsons". She did not however send copies of the documents in order to see whether the signatures were recognised.
(8) On an unspecified date thereafter Mrs Coutts asked Mrs Stewart to attend a disciplinary meeting on 20 September 2005. The request was made on the telephone. Nothing was put in writing to Mrs Stewart prior to the meeting, nor was she given any information about the results of Mrs Coutts' further enquiries with Wilkinsons.
(9) The disciplinary meeting duly took place on 20 September. Again, a full note was kept. Mrs Coutts started the meeting by saying that its purpose was "to conclude the investigation" and "to convey her decision with regard to disciplinary action". She proceeded to give a fairly full account of her view of the facts, including her conversation with Wilkinsons, culminating in the statement that:
" All of the above led her to believe that [Mrs Stewart] was not being honest and she had great concerns over honesty and performance and did not have any option but to terminate [her] appointment with immediate effect for gross misconduct."
She then proceeded to deal with the formalities relating to the dismissal and explain Mrs Stewart's right of appeal. Mrs Stewart was asked at the end if she had any questions: she had none. Although Mrs Stewart did interject at one point during Mrs Coutts' account, the meeting was plainly in substance the announcement of a decision already made rather than an opportunity for discussion.
(10) A formal dismissal letter was sent on 28 September 2005. It confirmed that Mrs Stewart was being dismissed primarily because Mrs Coutts believed that she had forged the employer's signatures on Daniel's and Jason's documents, although there was reference also to her poor performance in other respects.
(11) Mrs Stewart appealed to the Regional Director, but her appeal was unsuccessful.
(a) The Tribunal found that Mrs Stewart had been "automatically" unfairly dismissed, by virtue of s. 98A (1) of the Employment Rights Acts 1996 i.e. that the Appellant had failed to comply with the minimum requirements of the statutory disciplinary and dismissal procedure. It is clear from its comments at various points in the judgment (see in particular para. 64) that the Tribunal was critical of the Appellant's procedures in a way which under the law as it stood prior to the Employment Act 2002 would probably have led to a finding of unfair dismissal. In particular, it did not believe that the enquiries made with Wilkinsons were adequate, and it believed that at the meeting of 20 September Mrs Stewart should have been given an opportunity to deal with the case which Mrs Coutts was then putting forward rather than simply being presented with a final decision. However, the Tribunal's decision was not made on the basis of "ordinary" unfair dismissal (and indeed any such finding would have been precluded by s. 98A (2): see para. 24 below).
(b) It decided that there should be a "Polkey reduction" of 60%: that finding meant that the Tribunal believed that it was more likely than not that Mrs Stewart would have been (fairly) dismissed if the Appellant had followed a proper procedure.
(c) It declined to make any finding of "contributory fault" pursuant to s. 123 (6) of the 1996 Act.
(d) It assessed Mrs Stewart's loss at £7,992, incorporating an element of £4,852 in respect of loss of pension rights (but excluding "notice pay", which was awarded separately see (e) below). That amount fell to be reduced by 60% because of the Polkey reduction; but the Tribunal then applied a 10% uplift under s. 31 (3) of the 2002 Act. The total compensatory award as a result was £5,421.68. The basic award was £1,120.
(e) The Tribunal held that Mrs Stewart had been wrongfully dismissed and awarded £1,060.20 by way of damages (described as "notice pay").
(f) The claim for holiday pay was dismissed.
(A) Unfair dismissal
(B) The Polkey reduction
(C) Contributory fault
(D) Wrongful dismissal
(E) Quantum
(A) UNFAIR DISMISSAL
STEP 1: STATEMENT OF GROUNDS FOR ACTION AND INVITATION TO MEETING
1. (1) The employer must set out in writing the employee's alleged conduct or characteristics, or other circumstances, which lead him to contemplate dismissing or taking disciplinary action against the employee.
(2) The employer must send the statement or a copy of it to the employee and invite the employee to attend a meeting to discuss the matter.
STEP 2: MEETING
2. (1) The meeting must take place before action is taken, except in the case where the disciplinary action consists of suspension.
(2) The meeting must not take place unless
(a) the employer has informed the employee what the basis was for including in the statement under paragraph 1(1) the ground or grounds given in it, and
(b) the employee has had a reasonable opportunity to consider his response to that information.
(3) The employee must take all reasonable steps to attend the meeting.
(4) After the meeting, the employer must inform the employee of his decision and notify him of the right to appeal against the decision if he is not satisfied with it.
We should also note that para. 13 (2) of Schedule 2 provides that meetings "must be conducted in a manner that enables both employer and employee to explain their cases".
statutory procedure are set out in paras. 60-64 of its Judgment as follows:
"60. The Tribunal concluded that steps 1 and 2 of the Dismissal and Disciplinary Procedures set out in Schedule 2 of the Employment Act 2002 had not been completed.
61. Step 1 provides that:
(1) The employer must set out in writing the employee's alleged conduct or characteristics, or other circumstances, which lead him to contemplate dismissing or taking disciplinary action against the employee.
(2) The employer must send the statement or a copy of it to the employee and invite the employee to attend a meeting to discuss the matter."
62. Whilst a letter was sent to the Claimant inviting her to an investigatory meeting to cover a range of matters, no letter was sent to her before the disciplinary meeting and therefore she was unaware of the particular matter (the alleged falsification) which Mrs Coutts was considering might lead to her dismissal.
63. Step 2 of the Dismissal and Disciplinary Procedures provided that "the meeting" must take place before the action is taken. It goes on to say that the meeting must not take place unless the employee has been informed of the basis for including in the statement under step 1 the grounds for the statement and the employee has had a reasonable opportunity to consider his response to that information. Step 2 also provides that the employer must inform the employee of the decision "after the meeting". The Tribunal concludes that neither the provision nor the spirit of the provision has been met in this case. At the disciplinary meeting, the Claimant had not been informed of the outcome of the investigation and therefore did not know the basis for the statement (as there was not a statement leading to the disciplinary meeting) or the grounds for it. She was not given a reasonable opportunity to consider her response to that information because she was unaware of the subject matter of the disciplinary meeting. Lastly, the decision was reported to the Claimant during the course of the disciplinary meeting and had clearly been made before the start of that meeting.
64. For all those reasons, the Tribunal finds that the dismissal was automatically unfair as there had been a failure by the Respondent to complete the formal statutory procedure."
(B) THE POLKEY REDUCTION
"66. A reasonable investigation would have shown that Ms Povey had signed one form. The remaining five signatures may have remained a mystery (although there is a chance that another manager may have confirmed that he/she signed). A reasonable investigation is likely to have confirmed that the original paperwork had disappeared in suspicious circumstances at or around the time that the Claimant had been suspended (according to Miss Brackley). A reasonable investigation would have included speaking to other colleagues who Miss Brackley reported had been present during the conversations, about the Claimant's conduct in respect of the three learners whose documentation was the focus of the dismissal. This may have shed some light on the situation. As it was, the Respondent put a significant amount of weight on what Miss Brackley said, against what the Claimant, a longer-serving employee, said. Having carried out a reasonable investigation, a reasonable employer would have completed the process by following the statutory disciplinary procedure properly. The Claimant would have had an opportunity to state her case knowing the specifics of the allegations against her, and having had time to prepare herself. Weighing up all of these factors, and given that Mrs Coutts appeared to accept that Miss Brackley was a credible witness, the Tribunal concluded that there was a 60% chance that, had a fair procedure been followed, the Claimant would have been dismissed."
The reference to Ms Povey's signature at the beginning of that passage is to the fact that she had signed the "employer contract" in Daniel's case. That was confirmed by an endorsement from her which Mr Stewart (following the dismissal) asked her to sign on a copy of the contract. Mr Stewart also obtained from Jason a short letter stating that a manager at Wilkinsons ("a man as far as I could see") had signed "the paperwork". Both these documents were before the Tribunal: there appeared at one point to be a question as to whether the Tribunal had ruled them inadmissible because they were disclosed late, but we are satisfied that they were in fact taken into account.
"Subject to subsection (1), failure by an employer to follow a procedure in relation to the dismissal of an employee shall not be regarded for the purposes of section 98(4)(a) as by itself making the employer's action unreasonable if he shows that he would have decided to dismiss the employee if he had followed the procedure."
It is now established that that provision is not to be interpreted narrowly. "Failure to follow a procedure" embraces any step which the employer ought to have taken before deciding to dismiss the employee: see Alexander (above), at para. 57 (p. 1292), as confirmed in Kelly-Madden v. Manor Surgery (not yet reported UKEAT/0105/06). In the present case the Tribunal's finding as set out in para. 21 above means that the Appellant has shown, on the balance of probabilities, that if it had followed a fair procedure Mrs Stewart would have been dismissed. Since there is here no question that Mrs Stewart's dismissal was for an admissible reason, and the only issue is thus the reasonableness of that dismissal, to be determined in accordance with s. 98 (4), the effect of s-s. (2) is that any claim for "ordinary" unfair dismissal must fail. In those circumstances, the appeal on "automatic" unfair dismissal having succeeded, the case does not fall to be remitted and Mrs Stewart's claim for unfair dismissal falls to be dismissed in its entirety. This may perhaps seem a harsh result; but it was Parliament's plain intention in enacting s. 98A (2) to deny any compensation in cases where the employer has been able to show that whatever inadequacies there may have been in his procedures made no difference to the result. That is what the Appellant has shown here.
(C) CONTRIBUTORY FAULT
"With regard to contributory fault, the Tribunal were satisfied that no deduction should be made because there was no compelling evidence on which we could base a finding that the Claimant had caused or contributed to the dismissal."
(D) WRONGFUL DISMISSAL
"69. The Tribunal has to decide whether or not the Claimant repudiated the contract of employment by carrying out the alleged misconduct.
70. In the absence of a reasonable investigation the Tribunal is not satisfied that there is sufficient evidence to support a finding that the Claimant did carry out the alleged misconduct."
(E) QUANTUM