Appeal No.UKEAT/0285/04/TM

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 14 October 2004

Before
HIS HONOUR JUDGE PROPHET
MR R LYONS
MR P A L PARKER CBE

MRS E SPENCE	APPELLANT

MANCHESTER UNITED PLC	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR PAUL DRAYCOTT
(of Counsel)
Instructed by:
Trafford Law Centre
4th Floor John Derby House
88-92 Talbot Road
Old Trafford
Manchester
M16 0GS	
For the Respondent	MR MARTYN BARKLEM
(of Counsel)
Instructed by:
Messrs Beachcroft Wansbroughs Solicitors
St Ann's House
St Ann Street
Manchester
M2 7LP	

SUMMARY

Unfair Dismissal

Contract of Employment

Employment Tribunal failed to consider ACAS Code of Practice.  Appeal allowed and remitted to a differently constituted Employment Tribunal.

HIS HONOUR JUDGE PROPHET

1.	This is the full hearing of an appeal by Mrs Spence in respect of a decision unanimously reached by an Employment Tribunal sitting at Liverpool on 4 and 5 December 2003 with Miss Grundy as the Chairman and Ms Price and Mrs Jockins as the lay members, that Mrs Spence was not unfairly dismissed from her employment and also that her complaint of a wrongful dismissal was unsuccessful.

2.	The Employment Tribunal further determined (although not essential for the purposes of the Decision which they reached) that if Mrs Spence had been unfairly dismissed she had made a contribution of one hundred percent to that dismissal.  The decision was a reserved decision and it was promulgated with summary reasons on 22 December 2003 following a Chambers meeting on 16 December 2003.  Subsequently Extended Reasons were provided, these being promulgated on 17 February 2004.  

3.	At the hearing both sides were represented by solicitors, Mrs Miles for Mrs Spence and Mrs Hely for the Respondent employer Manchester United Plc.  The representatives at the hearing before us today are Mr Draycott of Counsel on behalf of the Appellant and Mr Barklem of Counsel on behalf of the Respondent.  

4.	The nature of the case itself was relatively straightforward.  The employer accepted that they had dismissed Mrs Spence and they maintained that the reason for her dismissal was her conduct.  That reason for dismissal was readily accepted by the Employment Tribunal and accordingly the essential issue for the Employment Tribunal to decide in respect of unfair dismissal was whether that dismissal was fair.  That was an issue which they were required to determine by reference of section 98 (4) of the Employment Rights Act 1996.
5.	It would perhaps have been helpful if the Employment Tribunal under the heading “the issues” in paragraph six of the Extended Reasons had indicated that that was one of the important issues for it to determine.  It is usual for an Employment Tribunal to set out the issues not by reference to the subsequent submissions of the parties but as to what everyone understands are the issues before the hearing begins.  The importance of that comment arises partly because of the subsequent finding by the Employment Tribunal that there was a one hundred percent contribution, if they had decided that the dismissal was unfair. (see para 18 below)

6.	In order for Mrs Spence to succeed in her appeal to this Tribunal we need to be satisfied that there was some error of law by the Employment Tribunal which materially affected their approach to their conclusions that she was dismissed fairly and not wrongfully dismissed.  In that respect it has to be appreciated, as Mr Barklem rightly reminds us, that in respect of unfair dismissal it is no part of the duty of the Employment Tribunal to decide if the Tribunal itself would have considered it appropriate to dismiss Mrs Spence.  They are required to determine whether dismissal fell within a band of reasonable options open to a reasonable employer.

7.	And so we turn our attention now to the nature of the misconduct which led to the dismissal.  It was for the making and receiving of personal calls on the telephone at work.  In that respect it has to be borne in mind that the nature of her employment involved her principally working on the telephone.  An investigation indicated that there had been excessive personal calls.  That was followed by an investigatory hearing and a disciplinary hearing and she was duly dismissed for gross misconduct.  She appealed internally but that was unsuccessful.

8.	There can be little doubt that usually one would not expect an Employment Tribunal, properly utilizing the employment relations experience no doubt particularly of its lay members, to regard it as fair for any employer instantly to dismiss an employee with an unblemished record over some ten years (as with the case with Mrs Spence) for misconduct of this nature without having gone through a proper formal warning process.  The possibility clearly arose for the Employment Tribunal to consider whether, for the employer to move in the circumstances to the grave sanction of instant dismissal for gross misconduct might be regarded as excessive and outside the range of reasonable options referred to above.

9.	In our experience it is often over looked by Employment Tribunals today that there is a matter which used to play a more important part in unfair dismissal cases, i.e. that there is a statutory requirement that the Employment Tribunal should in an appropriate case have regard to the ACAS Code of Practice on disciplinary matters.  This forms one of the principal parts of Mr Draycott’s submissions to us today.  It is provided in section 207 of the Trade Union and Labour Relations Act 1992 that an Employment Tribunal should have regard to any provision in a Code of Practice which appears to be relevant to any question which arises in the proceedings.

10.	In our view the nature of the circumstances of this particular case cried out for the Tribunal to have made reference to the Code of Practice and its guidance on employment relations.  There are a number of reasons why we say this.  In the first place if the Employment Tribunal had looked at the current Code of Practice it would have been asking itself by reference to the guidance therein whether the nature of the misconduct in this case could properly fall within the heading of gross misconduct (see paragraph 7 of the Code of Practice).
Furthermore it would have been asking itself whether Mrs Spence had been given sufficient notice by the employer that the misuse of the telephone system could result in her instant dismissal on the basis of it being gross misconduct.

11.	They would also have been inquiring into whether the nature of the warnings which were alleged to have being given to her could properly be regarded as formal warnings which gave her sufficient indication that her job would be in jeopardy if she failed to take notice of them.  When we look at what the Employment Tribunal said about warnings it emerges that there had been some form of informal warning which Mrs Spence acknowledged but no warning at all within the disciplinary procedure.  The Code of Practice emphasises that if the infringement is regarded as more serious than a minor matter the worker should be given a formal written warning (see para 15 of the Code of Practice).  The Employment Tribunal fails to explain why in the absence of such a warning, it had to be fair for a reasonable employer to have summarily dismissed Mrs Spence for gross misconduct.

12.  In paragraph 72 of the written reasons the Employment Tribunal say that the employer took into account the applicant’s excellent record but they do not explain in any way how they reached that determination, bearing in mind that the employer imposed the highest level of discipline open to them, i.e. instant dismissal.  It is somewhat difficult to understand how given the nature of the misconduct and the particular circumstances the employer could be said to have given any proper regard to that record.

13.	We are therefore of the view that reference to the Code of Practice would have enabled the Employment Tribunal to have given more appropriate attention than it did to the above matters, and to have reflected such attention in their reasoning.  We have been referred by Mr Draycott to the case of Lock v Cardiff Railway Co Ltd [1998] IRLR 358 where Morison J. emphasises the need for Employment Tribunals to have regard to the Code of Practice and to have a copy, as he put it, “to hand” in all cases.  Mr Barklem tell us that his experience indicates that Employment Tribunals in recent times frequently do not make such references.  Perhaps this might be an opportunity to remind them of Morison J’s decision in that respect.  As Morison J. said (at page 360):

“the Code forms the basis on which the employers’ conduct should be judged.”

We are satisfied that the circumstances of this case are such that the Employment Tribunal misdirected itself in law by not having regard to the Code of Practice, and that consequentially the appeal be allowed on that basis and the case remitted for a rehearing in respect of both unfair dismissal and wrongful dismissal before a differently constituted Employment Tribunal 

14.	Mr Draycott has submitted further grounds of appeal to us but those can I think be dealt with fairly shortly at this stage having regard to the fact that the case is to be remitted.

15.	Mr Draycott says that some documentation was introduced during the course of the hearing which had not been disclosed prior to the hearing.  The question which arose of importance in this respect was whether the Employment Tribunal may have given attention to this documentation some of which was undoubtedly prepared after the dismissal of Mrs Spence, in deciding whether or not it was fair to dismiss her.  Mr Draycott submits that an Employment Tribunal should only have reference under the Birchell test to the matters which were before the employer at the time of dismissal.  That matter can be properly attended to by both sides at the rehearing.

16.	Another ground of appeal which we can also deal with fairly shortly is that a reading of the Employment Tribunal’s Extended Reasons may well suggest that they gave less then proper attention to arguments relating to mitigation, but once again that can be attended to at the resumed hearing.

17.	Mr Draycott has also made submissions in respect of waiver and in this respect also the Employment Tribunal’s reasons may well be unsatisfactory.  It was important for the Employment Tribunal to decide as a clear matter of fact whether Ms. Derbyshire (Mrs Spence’s line manager) indicated to her prior to the disciplinary hearing that she was not in danger of being sacked.  The particular point about that is that Mrs Spence would undoubtedly be entitled to regard Ms. Derbyshire as representing the employer so far as her employment was concerned and if such an assurance was given to her it would be a factor that the Employment Tribunal should have taken into account in deciding whether the dismissal was fair or unfair.  Again that matter can be properly addressed at the rehearing.

18.	That leaves us with the finding by the Employment Tribunal on contributory fault and although both Counsel here today were not present at the Employment Tribunal itself we understand that Mrs Spence’s solicitor was not called upon by the Employment Tribunal to make any submissions on that matter before they reached that finding.  The case law is quite clear that that is an unsatisfactory situation.  Incidentally that is why we mentioned the proper setting down of the issues at the beginning of this judgment.  If the Employment Tribunal intended if appropriate to make a finding on contributory conduct following the hearing, both sides should be aware at the outset that this was so.  That being the situation any finding on contributory fault will have to be arrived at, if necessary, at the new hearing.  

19.	We would just mention that Mr Draycott has asked to us to substitute our view that Mrs Spence was unfairly dismissed but that is not a course we can accept to be appropriate.  We agree with Mr Barklem that the only proper course is for the whole case to be reconsidered afresh by a differently constituted Employment Tribunal and that is what we order.