Appeal No. EAT/162/00

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 16 March 2001

Before
MR RECORDER BURKE QC
MR W MORRIS
MR J C SHRIGLEY

LONDON BOROUGH OF CAMDEN	APPELLANTS

MRS PAMELA COLEY	RESPONDENT

Transcript of Proceedings

JUDGMENT

Revised

	APPEARANCES

For the Appellants	MISS ADRIENNE MORGAN
(of Counsel)
Instructed by:
Borough Solicitor
London Borough of Camden
Town Hall
Judd Street
London WC1H 9LP	
For the Respondent	MR CHARLES CIUMEI
(of Counsel)
Instructed by:
UNISON
Legal Services Dept
1 Mabledon Place
London WC1H 9AJ	

MR RECORDER BURKE QC

1	This is an appeal by the London Borough of Camden against the decision of the Employment Tribunal sitting at London North, chaired by Mrs Prevezer and promulgated on 16 December 1999 with Extended Reasons.   

2	The Tribunal found that the Appellants had unfairly dismissed Mrs Coley, the employee, and awarded her compensation of £8,987.60 consisting of a basic award and three months’ compensation for loss of earnings during the notice period, which she did not serve, her dismissal having been a summary dismissal.

3	Mrs Coley was, before her dismissal, a long standing employee of the employers.  She had been employed from 1969 until her dismissal on the grounds of misconduct on 1 May 1998, a total of some twenty nine years.  She worked in various child care roles; for several years, in the 1970s, she managed a children’s home at Shoot-Up Hill.  That home closed in 1980, and she moved on to other roles within Camden’s child care organisation.  There was no suggestion of any complaint against her, save on one occasion, when the mother of a school friend of a child resident at the home wrote a note pointing out that the resident had bruises.  

4	In late 1996 or early 1997, two former residents of the Shoot-Up Hill children’s home complained that they had been physically ill-treated by Mrs Coley at that home.  These were complaints, therefore, that were raised at least sixteen years, and probably considerably more, after the event; but of course the employers were bound to take the complaint seriously.  The Police and the NSPCC became involved, and the employers put in train their own investigation which was carried out by a Mr Liddicott as a result of which Mrs Coley was suspended in May 1997, and was made the subject of disciplinary proceedings which took place in February and April of 1998.  The decision maker in those proceedings, a Ms Brazil, was satisfied that Mrs Coley had been guilty of the misconduct alleged.  As a result, Mrs Coley was dismissed for gross misconduct, summarily, on 1 May; her subsequent appeal was rejected.

5	Mrs Coley brought proceedings in the Employment Tribunal claiming that she had been unfairly dismissed.  It should be noted that she did not make any claim for breach of contract, whether in respect of the notice period of which the summary dismissal had deprived her, or otherwise.  In paragraphs 33 - 36 of its Decision, the Tribunal directed themselves at some length on the relevant principles of law; and in particular, as was appropriate where the reason for dismissal was misconduct, they set out the principles established in the case British Homes Stores v Burchell [1978] IRLR 379, reminding themselves to consider whether the employers reasonably believed that Mrs Coley had been guilty of misconduct, whether they reached that belief as a result of a reasonable investigation and whether the dismissal was a reasonable response in the circumstances.  No criticism has been made in this appeal of the Tribunal’s self direction as to the applicable law, as set out in those paragraphs of its Decision.  

6	Having set out the factual history at some length, the Tribunal found that the investigation carried out by the employers was “procedurally flawed” by which they meant, of course, that the investigation fell short of what was reasonable; and they went on to find, in paragraph 38 of the Decision, that Ms Brazil did not, as a result of the flawed investigation, have sufficient information before her to enable her reasonably to conclude that the facts on which she relied were established.  For reasons to which we shall come, it is not necessary for us to set out in detail the shortcomings in the investigation which the Tribunal identified; but it is right to mention that the Tribunal found, as facts:

1) Ms Brazil had only available to her the evidence of the social worker, Ms Ward, to whom the original complaints had been made, and of her team manager.  

2) There were no contemporaneous notes of any interviews with the complainants, of which were are told by Ms Morgan, on behalf of the employers today, there were many.

3)  The employers had not investigated with the other staff who had been working at the home at the relevant time, because the investigator, Mr Liddicott, thought that this was inappropriate, as a result of the involvement of the Police and CPS.

4)  Ms Brazil did not request any of the evidence gathered by the police, or the NSPCC, in the course of their investigations.

5)  Ms Brazil assumed that, because the matter had been referred to the police and the CPS, there was substance in the allegations against Mrs Coley and that they were true.  

7	The Tribunal, having made these findings, summarised the effect of them in paragraph 38:

“38.  The facts that were therefore before Ms Brazil when she came to the decision to dismiss were not fully investigated as Ms Brazil also relied on the fact that the police were investigating and it had been referred to the CPS.  At no time was the Applicant able to interview the persons or confront any of the persons who were making these allegations in order to question what they were saying.  We find therefore this investigation and this dismissal was procedurally flawed and therefore we conclude that Ms Brazil did not have sufficient information before her to reasonably conclude that the facts on which she relied had occurred.”

Thus far in the Decision, it is clear that the Tribunal had concluded, on the basis of their findings of fact, as to the nature and extent of the investigations that the investigations were flawed and were not reasonable investigations, and as a result, Ms Brazil could not reasonably have concluded that Mrs Coley was guilty of the misconduct alleged against her.  In other words, the first two parts of the tripartite Burchell test had not been satisfied.  

8	The Tribunal then continued, in the last sentence of paragraph 38,
“In those circumstances we do think that the facts relied on was sufficient to justify a summary dismissal”.

It is agreed between the parties and self evident that that sentence should be read as if the word “not” appeared between the word “do” and the word “think”.  The Tribunal continued in paragraph 39:
“Applying Section 98(4) we are aware of the current climate relating to child abuse and the paramount need to protect children at all times.  However, bearing in mind the circumstances that pertained at that time (between 1973 and 1980) and the fact that this Applicant had worked satisfactorily from 1980 until she was suspended in 1997 with children for the Respondents without any complaint being made against her, we do not find that the employers acted reasonably in treating this as a sufficient reason for dismissing this employee summarily.  The dismissal was therefore unfair.”

9	It had been submitted to the Tribunal by Ms Morgan, on behalf of the employers, that even if they found that there had been an inadequate investigation, and that the dismissal was therefore unfair, there should, nonetheless be no award of compensation because on the evidence before the Tribunal, strengthened as it was by that of the police officer, Detective Chief Inspector Wheeler, who was in charge of the police investigations (which evidence had not been before Ms Brazil) it was clear that if there had been a satisfactory investigation, Mrs Coley would have been shown to have committed serious misconduct, and therefore would have been dismissed in any event.  Thus, no compensation would be payable.  To put this in the shorthand used by those who are familiar with the Employment Tribunal, Ms Morgan was putting forward a “Polkey” argument, an argument based on the decision of the House of Lords in Polkey v Dayton Services [1988] AC 344.  The Tribunal considered this argument under the head of “Compensation” in paragraph 40 - 42 of its Decision.  

10	In paragraph 40, they record the submission to which we have just referred; they then set out that they had heard evidence from the police officer and set out some, at least, of what the officer had said to them.  They go on in paragraph 41 to say that they knew that the Applicant had no support during the relevant time from social workers and that there had been no complaints at all about the regime by the children to anyone outside the home.  In paragraph 42 the Tribunal continue as follows:-

“42.  Bearing in mind therefore that these matters happened between 1973 and 1980 and that the Applicant had been employed by the Respondent for 29 years before her dismissal and that she had worked since 1980 for the Respondents without any concern about her behaviour towards children, we find that she should not have been summarily dismissed but should have been dismissed with notice.”

They then go on to calculate the compensation that follows.  

11	It is clear, when one reads the whole of the Decision, and both parties today have accepted, that the decision of the Tribunal as to unfairness was that the dismissal was procedurally unfair, namely unfair because of the inadequate investigation, but that the Tribunal was not deciding that the dismissal was substantively unfair.  If the Tribunal had decided otherwise, then it would not and could not, rationally, have gone on to assess compensation on the basis that it did, in paragraphs 40 - 42, and if it had done so, then it would have lent itself to appeal, potentially on the part of the employee.  

12	At the preliminary hearing of this appeal, the Employment Appeal Tribunal, presided over on that occasion by His Honour Judge Altman, refused to allow the employers to pursue the grounds of appeal under which they sought to argue that the Tribunal below had erred in concluding that there had not been a reasonable investigation.  It is for that reason that it is not necessary for us, in this judgment, to go though in great detail the reasoning of the Tribunal which led them to that conclusion, although we have outlined the principal features on which the Tribunal based themselves.  

13	At the preliminary hearing, however, this Appeal Tribunal pointed out that there might, arguably, be an interrelationship between that conclusion and other potentially more vulnerable areas of the Tribunal’s Decision which interrelationship could be the subject of argument when this Appeal Tribunal came to consider the two grounds of appeal on which the employers were allowed to proceed.  

14	Those two grounds have been developed before us today by Ms Morgan, on behalf of the employers, and responded to by Mr Ciumei, on behalf of Mrs Coley.  We are grateful to both of them for their submissions.  

15	The first ground arises in this way: it is of course trite law that the fact that a dismissal is wrongful, i.e. in breach of contract, does not render it unfair, and the fact that it is unfair does not, of itself, render it unlawful, i.e. in breach of contract.  Unfairness is neither necessary nor sufficient for a breach of contract claim; and a breach of contract is neither necessary nor sufficient to establish unfair dismissal.  This had been clear ever since, if not before, the Decision of the Employment Tribunal in Tregasnowan v Robert Knee & Co [1975] ICR 405, and is confirmed, in the more recent case cited to us today, BSC Sports and Social Club v Morgan [1987] IRLR 391, another decision of this Appeal Tribunal.  The latter authority suggests that a failure to give notice on dismissal may be evidence of unreasonableness; that may or not be controversial; there is no need, in our judgment, for us to consider that controversy for the purposes of this appeal.  The Tribunal in an unfair dismissal claim has to decide, according to established principles, whether the dismissal was fair or unfair and it will, or at least may, be an error of law for a Tribunal to decide that a dismissal is unfair simply because the Tribunal believes that the dismissal should not have been a summary dismissal, but should have been one on notice.  

16	This is important because in the last sentence of paragraph 38, which we have recited before, but which it is necessary now to repeat, the Tribunal said:
“In those circumstances we do think that the facts relied on was sufficient to justify a summary dismissal”.

And in the last but one sentence of paragraph 39, the Tribunal say, and again, we have set this out before, but we repeat:
“we do not find that the employers acted reasonably in treating this as a sufficient reason for dismissing this employee summarily”

Ms Morgan submits that the Tribunal’s use of the word “summary” in paragraph 38 and “summarily” in paragraph 39, in important sentences in their reasoning, demonstrates that they were deciding that the dismissal was unfair only on the basis that the dismissal was without notice, and was summary, and not on the basis of fairness and reasonableness, as required by section 98(4) of the Employment Rights Act 1996.  Fairness, says Ms Morgan, has been wrongly confused with lawfulness.  

17	This error is further demonstrated, and indeed is convincingly demonstrated, according to Ms Morgan’s submissions, by the way in which the Tribunal expressed themselves in paragraph 42 when they say, and again we repeat our quotation:
“ we find that she should not have been summarily dismissed but should have been dismissed with notice.”

This, it is argued, makes it clear that the Tribunal were, from the outset, determined to find that Mrs Coley should succeed because she ought not to have been dismissed summarily, or if they were not determined so to find from the outset, they at least so decided, and thus, says Ms Morgan, the Tribunal erred in law.  

18	Mr Ciumei responds to that submission in this way:  he starts from the position that the Tribunal’s finding that the employer’s investigation was flawed is not now open to attack.  The Tribunal, he submits, were clearly on the unfairness track, rather than on the unlawfulness track, throughout their consideration of this case.  This is shown by their correct direction to themselves of the law, in the passages which we have already identified, by their correct reference to and application of the principles in British Home Stores v Burchell and by their consideration in paragraph 39 of the question whether the employers acted reasonably in treating the misconduct as a sufficient reason for dismissal.  If it were not for the use of the word “summarily” in paragraph 39 and “summary” in paragraph 38 says Mr Ciumei, the Tribunal’s approach could not be the subject of criticism at all.  

19	On the basis of that submission this Appeal Tribunal has to ask, and Mr Ciumei rightly sought to answer before the question was asked, why do those words appear?  Ms Morgan submits that they have an important effect in, as we have said, an important part of the judgment.  Mr Ciumei’s response is that the words are merely descriptive of what in fact happened.  The dismissal was a summary dismissal, and the Tribunal should be taken, in using the words that it did, simply to be describing what actually occurred, without meaning, thereby, to indicate that they were straying into breach of contract territory, or straying outside reasonableness and fairness territory in considering whether the dismissal was, or was not fair.  

20	Mr Ciumei referred us to the decision of the Court of Appeal in Jones v Mid Glamorgan County Council [1997] ICR 815 in which, in a wholly different factual context, but addressing the approach of an appellate tribunal to the way in which it should construe an Employment Tribunal’s decisions (and we interpose that both parties have agreed that some construction of the decision is necessary for the purposes of this case) the Court of Appeal, in the course of the judgment of Lord Justice Waite, with whom Lord Justice Kennedy and Mr Justice McCullough agreed said this:

“The guiding principles when it comes to construing the reasons of an Industrial Tribunal at an appellate level, must be that if the Tribunal had directed itself correctly in law, and reached a conclusion which is open to it on the evidence, the use in other passages of its reasons of language inappropriate to the direction that has properly given itself should not be allowed to vitiate the conclusion unless the relevant words admitted no explanation save error of law.”

21	In our judgment, it is plain that paragraph 38, 39 and 42 are not expressed with the lucidity that the parties were perhaps expecting from the Tribunal.  However, we unanimously prefer the submissions of Mr Ciumei on this issue.  We conclude that the words “summary” and “summarily” in paragraphs 38 and 39 were, indeed, used purely descriptively and do not denote the Tribunal as straying out of the correct territory and into the error of regarding the fairness issue as determined by the presence or absence of notice or by the lawfulness or unlawfulness of the dismissal.  We are fortified in this view by the passage in Jones v Mid Glamorgan County Council to which we have just referred.  

22	The Tribunal, as we have already explained, did direct itself correctly in law; and it is not now challenged that on the issue as to whether there was a reasonable investigation, it reached a conclusion which was open to it on the evidence.  Although the words “summary” and “summarily”, on which this issue focuses, appear in the passages of the Decision primarily under consideration, rather than in other passages, nonetheless it seems to us that the guidance of the Court of Appeal is important.  Inappropriate language should not be allowed to vitiate the conclusion, unless the relevant words admit of no explanation, save error of law.  In this case, in our judgment, there is an alternative explanation, namely that which is argued for by Mr Ciumei, and which we regard as correct.  

23	As to paragraph 42 on which Ms Morgan, for understandable reasons, laid considerable emphasis, and indeed, described as the paragraph that “gave the game away”, it is clear to us that that paragraph arises from the Polkey submission.  

24	The Tribunal having in paragraph 40 and 41 set out the state of the evidence before them, as opposed to the evidence before the employer, then went on to find in a paragraph which, it has to be said, is more elliptical than illuminating, that on the evidence before them Mrs Coley did commit at least some of the conduct alleged against her and that, if there had been a proper investigation, she would have been dismissed on the basis of that conduct.  But they went on to conclude that such a dismissal would not have been a summary dismissal but would have been a dismissal with notice.  It is for that reason that they draw, in paragraph 42, the distinction between a summary dismissal and a dismissal with notice; and that distinction made for that reason, in our judgment, does not bear on, or strengthen the Appellant’s case as to what the Tribunal meant in paragraphs 38 and 39.  It would have been easier perhaps to have reached such a conclusion if the Tribunal had, in paragraph 42, twice used the word “would” as opposed to the word “should”, but we regard the meaning as reasonably plain, and are not diverted from our view as to that meaning by the fact that the words used have been chosen in the form which appears in the Decision.  

25	In our judgment, therefore, the Tribunal did not err in law in using the words complained of in paragraph 38 or paragraph 39.  The Tribunal, it seems almost certain, if not absolutely certain, would, even if this had been a dismissal on notice, still have come to the conclusion, on the facts that it found, that the investigation was not a reasonable investigation and that, because of that unreasonable investigation, the dismissal was procedurally unfair.  

26	Ms Morgan’s second ground of attack upon the Tribunal’s Decision is put in two ways.  Firstly it is submitted that the Tribunal substituted its own view of the conduct complained of, and made its own assessment of that conduct, instead of considering what the employers’ belief was as to that conduct.  

27	Secondly, it is submitted, that the Tribunal made its assessment under section 98(4) by considering whether the employers had acted reasonably, and not by considering whether the employers’ response fell into the band of reasonable responses which an employer could reasonably adopt.  As it is unnecessary to state, perhaps, in Foley v The Post Office [2000] ICR 1253, the Court of Appeal restored the range of reasonable responses test to the position it had held, as a guide to the Tribunal’s approach to the task set it by 98(4) of the Employment Rights Act 1996, which position had been put in doubt by the decision of the Employment Appeal Tribunal in Haddon v Van Den Bergh [1999] ICR 1150.  This case was heard by the Tribunal after the decision in Haddon was available, and before Haddon was corrected by Foley.  

28	In support of these arguments Ms Morgan has taken us first to paragraph 11 of the decision where the Tribunal said 
“11   I am not going to outline the details of the alleged abuse in this decision except to say that it consisted of physical abuse consistent with Mrs Coley running a very strict disciplinary regime at the home in her efforts to control the children.”

Ms Morgan submits that the failure of the Tribunal in this passage to set out the essential details of the conduct complained of; and more significantly, their including within the outline the comment that the allegations had occurred in the context of Mrs Coley’s running a strict disciplinary regime in her efforts to control the children (as to which there was no finding and no evidence before the employer) shows, says Ms Morgan, that the Tribunal were imposing their own views of what had happened.  

29	Ms Morgan goes next to paragraph 23, where the Tribunal set out in detail what they had heard about the allegations which the employers were making and the allegations as described to the Tribunal by the Detective Chief Inspector.  Here too, says Ms Morgan, the Tribunal were asserting their own views as to Mrs Coley’s conduct, as is disclosed, for example, by the Tribunal’s comment that Ms Coley did not have the support of the social workers and other workers.  

30	Thus, it is submitted, the Tribunal were considering not what conduct was in the minds of the employers, but what the conduct actually was.  That, it is said, is demonstrated by paragraph 40 to which we have already referred.  Furthermore, in support of the second branch of the submission, Ms Morgan says that nowhere in the Decision does the Tribunal refer in terms to the range of reasonable responses test.  

31	We are not persuaded by these submissions.  In paragraph 11, in our judgment, the Tribunal were simply summarising the nature of the conduct complained of, in very general terms, without going into any details, perhaps intending at least at that part of the writing of their Decision to seek to avoid causing discomfort by embarking on further particulars.  We do not see, in that paragraph, anything which indicates that the Tribunal were departing from the task which the law required of them.  The comment that the Tribunal make about Mrs Coley acting as she did, in her efforts to control the children, is not, in our judgment, evidence that the Tribunal was asserting its own view in any relevant way.  They had been so told, it appears from their subsequent description of the evidence of the police officer, and in any event it is something which appears to us to be entirely consonant with common sense.

32	So far as paragraph 23 is concerned, here the Tribunal were simply reciting what they thought the allegations were, and were not making any findings of their own as to what they thought had happened.  It does not appear that there was any real dispute that the Applicant did not have the support of social workers and other workers; and indeed, the investigation had itself received no support from the social workers who seemed to have refused to assist it, so there was no evidence from them in front of the employers.  In that paragraph, although Ms Morgan suggests that the Tribunal were watering down the allegations, it is important to note that the Tribunal described, in graphic terms, what they had been told by the Chief Inspector as to the consequences for some of the children who were at the home at the relevant time.  

33	As to paragraph 40, that is not the Tribunal giving their own view of what the allegations were before the employers.  There the Tribunal were describing what the evidence was before the Tribunal for the purposes of responding to Ms Morgan’s Polkey submission.  

34	It has to be borne in mind that the unfairness in this case was unfairness by reason of the flawed investigation.  Even if the Tribunal did understate the allegations, which we do not accept, it would have made no difference, in our judgment, had they not done so to the basis on which they found that the dismissal was unfair.  Indeed, the more serious the allegations, as a matter of plain common sense and reality the greater was the need for a reasonable investigation, and the greater the depth required of the investigation to satisfy the demands of reasonableness.  

35	As to the reasonable range of responses test, looking at this Decision as a whole, looking in particular at the directions which the Tribunal gave to themselves on the law at paragraphs 35 and 36, and looking at the language used in paragraph 38 and 39, we conclude that the Tribunal did not apply the wrong test, but asked themselves whether the employers had responded reasonably to the circumstances before them, but again, even if the Tribunal had applied the wrong test, it would, in our judgment, have made no differences in the circumstances of this case, because this was not a case in which they reached the conclusion that the dismissal was substantively unfair.  They reached the unchallengeable conclusion on the facts that the investigation was unreasonable, and whichever test they had applied, the test of general reasonableness or a test of the range of reasonable responses, it seems to us that it was inevitable on the facts of this case and on its findings that they would have concluded, as they did, that the Decision was procedurally unfair.  

Accordingly, in our view the second ground on which this appeal is put, under both its heads, should be rejected, and the appeal must therefore be dismissed.