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Cite as: [2010] UKEAT 0307_10_1712

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BAILII case number: [2010] UKEAT 0307_10_1712
Appeal No. UKEAT/0307/10

             At the Tribunal
             On 17 December 2010







Transcript of Proceedings



© Copyright 2010



    For the Appellant MR CHRIS BRYDEN
    (of Counsel)
    Instructed by:
    Messrs Borneos Solicitors
    Chancery House
    199 Silbury Boulevard
    Central Milton Keynes
    MK9 1JL
    For the Respondent MR DAVID CAMPION
    EAD Solicitors LLP
    The Media Centre
    7 Northumberland Street
    HD1 1RL



    PRACTICE AND PROCEDURE – Appellate jurisdiction/reasons/Burns-Barke

    UNFAIR DISMISSAL – Polkey deduction

    The employer's advocate did not raise a Polkey argument at the Employment Tribunal and the EAT refused to allow it to be raised on appeal: CELTEC applied. But in any event there were sufficient findings on unfair and wrongful dismissal, and lack of contributory fault, to defeat any such argument.



  1. This case is about compensation for unfair dismissal under the principle in Polkey v A E Dayton Services Ltd [1988] ICR 142. It also invokes the procedure of the EAT for dealing with new points on appeal under what is generally known as the Kumchyk v Derby City Council [1978] ICR 1116 principle. This is the judgment of the court to which all members appointed by statute for their diverse specialist experience of employment relations on the ground have contributed. We will refer to the parties as the Claimant and the Respondent.
  2. Introduction

  3. It is an appeal by the Respondent in those proceedings against the judgment of an Employment Tribunal sitting at Manchester over two days, registered with Reasons on 25 March 2010 under the chairmanship of Employment Judge Howard. The Claimant was represented by counsel and today has the advantage to be represented by Mr David Campion, solicitor. The Respondent was represented by its Human Resources Manager experienced in employment relations, and today by Mr Chris Bryden of counsel.
  4. The Claimant contended he was unfairly and wrongfully dismissed. The Respondent contended it dismissed him for misconduct summarily, having followed a fair procedure. The Employment Tribunal upheld both the Claimant's claims. It rejected contentions that there should be any reduction in compensation to be awarded to him on the basis of the Polkey principle, or on the basis that he had contributed, through culpable conduct, to his own dismissal, pursuant to section 123 of the Employment Rights Act 1996.
  5. The Respondent appeals against the Polkey point alone. HHJ Serota QC on the sift of this Notice of Appeal sent the two then grounds to a full hearing, but prior to today the first ground was abandoned with consent, leaving only the ground which we now deal with.
  6. The legislation

  7. The relevant legislation is not in dispute. It is essentially section 123(1), which deals with a just and equitable approach to compensation and the jurisprudence which stems from Polkey. The Employment Tribunal directed itself in accordance with Polkey.
  8. The facts

  9. The Respondent is a large organisation. It runs security at The Mall Shopping Centre at Blackburn, Lancashire. The Claimant was employed by it as a security team leader, having been employed for some 18 months. On 5 May 2009 he was on duty. He asked two individuals to leave the premises; one at least had been banned previously. He returned into The Mall, following which the two individuals abused and threatened security officers. The Claimant went back outside where one of them was, grabbed his arm and moved him away from the ramp. The ramp was recorded on CCTV. The Claimant admitted a defensive punch to the face of the abuser. He acted in self-defence. This was not recorded.
  10. The first person to investigate this matter, Mr O'Keefe, considered that he had taken the individual out of sight of the camera to have a fight with him and dismissed him for gross misconduct on 13 May 2009. On appeal, Mr Rogers took a different view. He upheld the dismissal but decided it was on the basis of using excessive force. The Employment Tribunal had evidence from both of them and the Claimant who called a police officer who had been called to the scene, PC Leo Noctor. There were documents and CCTV.
  11. The Tribunal concluded that every stage of the procedure adopted by the Respondent fell outside of the approach a reasonable employer should take. The Tribunal directed itself specifically in accordance with British Home Stores Ltd v Burchell [1978] IRLR 379, taking care not to commit the solecism of imposing the burden of proof upon the Respondent beyond simply showing the reason for dismissal. It also directed itself in accordance with Iceland Frozen Foods v Jones [1982] IRLR 439 and observed that after Sainsbury's Supermarket Ltd v Hitt [2003] IRLR 23 CA a Tribunal must examine each stage in the Burchell test against a band of reasonable responses.
  12. In relation to the procedure adopted by the employer, the Tribunal decided in the following way:
  13. "22. Applying Section 98(4) of the Act, the Tribunal was satisfied that the respondent's decision to dismiss the claimant fell well outside the range of reasonable responses open to a reasonable employer in the circumstances. The investigation into the incident was not conducted reasonably in that Mr O'Keefe formed an immediate and settled view as to the claimant's culpability and thereafter failed to collect and discounted evidence which did not support that view. The claimant was not provided with a fair and proper opportunity to present his case at the disciplinary hearing. Whilst Mr O'Keefe's belief in the claimant's culpability might have been genuine, the Tribunal did not consider that belief to be reasonable, based as it was on no supporting evidence and flying in the face of the evidence available to Mr O'Keefe. The disciplinary and appeal process was fundamentally flawed in that Mr O'Keefe drew no distinction between his role as investigator and his role as the person conducting a disciplinary hearing and imposing a disciplinary sanction. The decision making process was further flawed in that Mr O'Keefe involved other parties without the claimant's knowledge and it remained unclear as to who had been consulted in the ultimate decision to dismiss. As to the appeal, Mr Rogers made his decision on a different basis to that of the claimant and his conclusions were at odds with the evidence available to him."

  14. Having discussed with the parties at the outset what the scope of the hearing would involve, it was plain that it was to consider contribution and Polkey. Sometimes those matters which are essentially remedy matters are dealt with at a separate remedy hearing, but in this case the parties had their eyes wide open to the very sensible process of identifying contribution and Polkey at the first hearing. A remedy hearing which was set up has now been adjourned pending this appeal. Thus the Tribunal decided both those remedy issues in the following way:
  15. "24. Although the claimant made a pragmatic acknowledgement at the appeal hearing that he could have handled the situation better, the Tribunal did not consider this concession to be sufficient to form the basis of a finding of contributory fault. The Tribunal remained satisfied that the claimant's actions, as viewed on the CCTV footage, fell within the respondent's policy and, as found above, the reason for dismissal was based upon a finding a fault without evidential basis. The Tribunal accepted the claimant's description of events around the corner as being, in essence, self defence and did not find the claimant culpable to any extent. Accordingly the Tribunal found that the claimant had not contributed to his dismissal.
    25. With regard to the 'polkey principles', the investigatory and disciplinary process was so flawed that it could not be said that the claimant's dismissal was inevitable or likely to any extent, had a fair and reasonable process and procedure been applied. The Tribunal was satisfied, therefore, that the 'polkey' principles had no application to the claimant's dismissal."

  16. Because this case involved a claim for wrongful dismissal, the Tribunal was obliged to make a decision on whether the conduct of the Claimant was gross misconduct so as to warrant a summary dismissal, as to which the Tribunal said this:
  17. "26. The Tribunal found that the claimant had not committed the act of gross misconduct alleged and the respondent was not entitled under the claimant's contractual terms to dismiss him without notice of termination of employment. Accordingly the claimant's claim of breach of contract, amounting to one week's pay, was well founded."

  18. It is not in any way criticised for its separate approach to, on the one hand, wrongful dismissal and contribution, and on the other, reasonableness under section 98(4) of the Employment Rights Act 1996 in accordance with the judgment of the Court of Appeal in London Ambulance Service v Small [2009] IRLR 563.
  19. The submissions and our conclusions

  20. Since there is only one argument in this case we can deal with it at the same time as we deal with the respective arguments. Anterior to any discussion of the principal argument has to be a submission made in the written argument of Mr Campion that a new point is being raised. As is clear from Kumchyk it would be exceptional for the EAT to hear a new case. The House of Lords upheld my approach to this issue which I set out in Leicester County Council v Unison [2006] IRLR 810 CA when the House of Lords decided CELTEC Ltd v Astley [2006] ICR 992. Generally a new point will not be allowed to be advanced on appeal if it was not advanced below, but exceptionally a hard-edged question of law may be, but a case which requires further investigation by an Employment Tribunal would be most unlikely.
  21. The issue to which this is directed is the contention that the Polkey principle should be applied in this case so as to reduce the Claimant's compensation, as Mr Bryden puts it, significantly below 50%. The argument is based upon what the Claimant admitted in his written evidence to the Employment Tribunal - broadly speaking that he would have handled matters differently today - and the Tribunal noted that that was a pragmatic acknowledgment that he could have handled the situation better. The notes created by the Respondent's advocate, Ms West, have been produced to us and it has to be said that there is not a word about Polkey. She is an HR Manager, she may not know precisely the legal citation but she knows the law. Assuming she addressed the Tribunal in the terms of her aide memoire, all that is said it this:
  22. "In the event that this does not happen I request that the Tribunal make a reduction to any award due to the Claimant's actions. The Claimant has never denied having punched Mr Whittaker. The Respondent requests a 100% reduction or alternatively any other reduction fitting."

  23. Mr Bryden accepts that that is in terms a reference to contribution. It is only arguably in relation to Polkey. Nor is there any reference in it to what is now relied upon for the foundation of the Polkey claim, which is the admission by the Claimant that he might have handled things differently. There is no finding by the Tribunal upon that. True it is that the evidence was before the Tribunal in the form of the written statement but it goes no further than that, and it was for the employer here to say why it is that it would have dismissed the Claimant at the time or shortly thereafter had it followed a fair procedure and had it paid attention to what the Claimant now admits.
  24. We accept the argument in Mr Campion's written submission that this is indeed a new point and we will not allow it to be raised. It will require further examination by the Tribunal. If it had been put to the Tribunal that the source of the Polkey argument was in the Claimant's evidence, it would have been bound to make a finding about that.
  25. This was not a matter which could have been flagged up at the sift before HHJ Serota QC, because it only emerges once the appeal is sent to a hearing. However, in fairness to the submissions which have been made in writing and most capably in oral presentations by Mr Bryden, we will deal with this matter as one which is properly before us, lest we be wrong in the application of the CELTEC v Astley principle.
  26. In Software 2000 Ltd v Andrews [2007] IRLR 568 Elias J (President) as he then was, set out guidance described as principles which ought to be applied. Relied upon by Mr Bryden are the following:
  27. "54. …
    (1) In assessing compensation the task of the Tribunal is to assess the loss flowing from the dismissal, using its common sense, experience and sense of justice. In the normal case that requires it to assess for how long the employee would have been employed but for the dismissal.
    (2) If the employer seeks to contend that the employee would or might have ceased to be employed in any event had fair procedures been followed, or alternatively would not have continued in employment indefinitely, it is for him to adduce any relevant evidence on which he wishes to rely. However, the Tribunal must have regard to all the evidence when making that assessment, including any evidence from the employee himself. (He might, for example, have given evidence that he had intended to retire in the near future)."

  28. That case itself drew upon Gover v Property Care Ltd [2006] ICR 1073. There the Court of Appeal upheld a judgment I gave where I had set out the various circumstances in which a Polkey reduction is apt. The point in this case is that the Tribunal should have made a Polkey reduction because of the premise that this is a procedurally unfair dismissal. We reject the premise.
  29. In a number of judgments the Court of Appeal and the Inner House of the Court of Session have given different views about whether it is appropriate to use the distinction between substantive and procedural unfairness. However, the amended statute itself makes that distinction now, and we consider it is apt. Polkey applies where there has been a finding of unfair dismissal so as to reduce the compensation on the ground that the dismissal would have occurred in any event. In this case, we are not dealing with events which occur extrinsic to the disciplinary process; for example, that the Claimant was looking for a job or that the office would have closed down, circumstances I envisaged in my judgment in Gover. This is a case where it is said that, had a proper procedure been carried out, the dismissal of the Claimant would have occurred about this time or within two months, because it would have been carried out fairly.
  30. With respect we cannot see this as simply a procedural failure. As Mr Campion puts it in his argument, the unfairness in this case was at the heart of the decision making, and that therefore makes it inapt to describe this as a procedural or merely procedural defect. One has only to look at the findings of fact which precede the passage we have cited at paragraph 22 to show just how wrongly this company behaved in dealing with the issue which it had. So Polkey does not arise. As it happens, the Tribunal made that decision, for it said that the dismissal was not inevitable or to any extent likely.
  31. Criticism has been made that the passage we have cited is all there is about Polkey. There is slightly more than that because there is the direction at the beginning when it set out the list of issues, but we accept that the Tribunal was entitled to be succinct about this in the light of the submission which had been made to it. Being generous to the HR Manager, if she was indeed campaigning for a deduction on the grounds of contributory fault and a reduction on the ground of Polkey, she could have spelt that out. Thus the Tribunal cannot be faulted for its rather short finding on the Polkey principles.
  32. It must also be borne in mind that there is no criticism of the Tribunal's finding of unfair dismissal and of wrongful dismissal and of lack of contribution. In other words, the finding on gross misconduct that the Claimant did not commit the act of misconduct put against him is a very powerful finding. There is illogicality in suggesting that, once that finding has been made, there could be a fair procedure to dismiss him for it. It is not necessary for this appeal to decide that philosophical concept, for there are sufficient findings here.
  33. In our judgment the Tribunal properly set out the reasons why it could not be said the Respondent would fairly have dismissed the Claimant in any event within a month or two, and insofar as Polkey arose in this case and the finding is made upon it, it is fully supported by the evidence.
  34. We reject the contention that an employer can reach into the reasons of the Claimant when they have been formerly argued before the Tribunal as being the grounds for the Polkey reduction. There is no evidence by the employer here of how it would have behaved once the scales fell from its eyes and it conducted a fair hearing.
  35. So in those circumstances we have not felt it necessary to call upon Mr Campion to develop further the written argument which he has placed before us. The appeal is dismissed.

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