High Table Ltd v Horst & Ors [1997] EWCA Civ 2000 (01 July 1997)

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL

Royal Courts of Justice
1st July 1997

B e f o r e :

LORD JUSTICE EVANS
LORD JUSTICE PETER GIBSON
LORD JUSTICE HOBHOUSE

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HIGH TABLE LIMITED
Appellant
-v-
(1) MRS C. HORST
(2) MISS J. JOWETT
and
(3) MRS. A. BURLEY
Respondents

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(Transcript of the Handed Down Judgment of Smith Bernal Reporting Limited, 180 Fleet Street, London, EC4A 2HD. Telephone No:
0171-831 3183. Shorthand Writers to the Court.)
MR. A. UNDERWOOD (instructed by Messrs Manches & Co., London, WC2) appeared on behalf of the Appellant.
MR. D. O’DEMPSEY (instructed by Messrs Michael & Co., London, E1) appeared on behalf of the Respondents.

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HTML VERSION OF JUDGMENT
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Crown Copyright ©

Peter Gibson L.J.: This is an appeal by High Table Ltd. (“the Employers”) from the order of the Employment Appeal Tribunal on 23 April 1996 whereby it allowed an appeal by the Respondents, Mrs. Horst, Ms. Jowett and Mrs. Burley (“the Employees”), from the decision of an Industrial Tribunal sitting in London (South). By that decision the Industrial Tribunal held that the Employees had been dismissed for redundancy and that it was in the circumstances of the case reasonable for the Employers to treat that reason as sufficient for the dismissals. Leave to appeal was refused by the Employment Appeal Tribunal but was allowed by Waite L.J.

It is convenient at the outset to refer to the relevant statutory provisions. By s.54 Employment Protection (Consolidation) Act 1978 qualifying employees (which the Employees were) have the right not to be unfairly dismissed. S.57(1) provides that in determining whether the dismissal of an employee was fair or unfair, the burden is placed on the employer to show what was the reason or principal reason for the dismissal and that (so far as material) it was a reason falling within subs.(2). By s.57(2)(c) that the employee was redundant is such a reason. Subs.(3) provides that (subject to certain sections not material to this appeal) the determination of the question whether the dismissal was fair or unfair, having regard to the reason shown by the employer, is to depend on whether the employer can satisfy the Industrial Tribunal that in the circumstances (having regard to equity and the substantial merits of the case) he acted reasonably in treating it as a sufficient reason for dismissing the employee. S.81(2) is in this form: “For the purposes of this Act an employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is attributable wholly or mainly to –

(a) the fact that his employer has ceased, or intends to cease, to carry on the business for the purposes of which the employee was employed by him, or has ceased, or intends to cease, to carry on that business in the place where the employee was so employed, or

(b) the fact that the requirements of that business for employees to carry out work of a particular kind, or for employees to carry out work of a particular kind in the place where he was so employed, have ceased or diminished or are expected to cease or diminish …”

In the definition section, s.153(1), whilst there is no definition of the verb “employ”, there are definitions of “employee”, “employer” and “employment” which refer directly or indirectly to the contract of employment between the employer and the employee. Finally, I should refer to para.10(3) of Sch.1 to the Industrial Tribunals (Constitution and Rules of Procedure) Regulations 1993, which requires the Industrial Tribunal to give reasons for its decision. Those reasons may be given in summary or (in specified circumstances) extended form. The Industrial Tribunal in this case gave reasons in extended form.

I now turn to the facts. The Employers’ business is that of providing catering services for companies and firms in the City of London and elsewhere. The Employees were employed as waitresses, Mrs. Burley from 5 January 1981, Ms. Jowett from 13 April 1982 and Mrs. Horst from 12 July 1988. All worked as “silver service waitresses” (denoting a particular level of service provided by the Employers) to Hill Samuel in the City until dismissed on 28 February 1993 pursuant to redundancy notices served on them on 29 January 1993. The hours they worked were from 10am to 4pm on weekdays. Mrs. Horst’s terms of employment specifically stated that the staff handbook of the Employers formed part of the terms of employment and this contained the following mobility clause:

“Your normal place of work is as stated in your letter of appointment which acts as part of your terms and conditions. However, given the nature of our business, it is sometimes necessary to transfer staff on a temporary or permanent basis to another location. Whenever possible this will be within reasonable daily travelling distance of your existing place of work.”

The Employers accept that this term is to be treated as also included in the contracts of employment of Mrs. Burley and Ms. Jowett, even though no reference is made to the staff handbook in their letters of appointment. In Mrs. Burley’s letter of appointment, she was appointed as a waitress to a City company other than Hill Samuel, but she ceased to work there after a year and worked at Hill Samuel for more than 4 years until dismissed. Ms. Jowett by her letter of appointment was appointed as a “floating waitress” whose duties were to relieve and assist the Employer’s permanent waitresses and no normal place of work was specified. But she worked at Hill Samuel for over 4 years until her dismissal. Only Mrs. Horst’s letter of appointment specified that she was appointed as a waitress to Hill Samuel, and she worked there until her dismissal. The staff handbook also contained detailed provisions governing the advertisement of job vacancies and redundancy, but there is no complaint in the present case that there was a failure to observe the stated redundancy procedures.

In 1992 Hill Samuel made a number of its own staff redundant and this reduced its requirement for the services of the Employers. In consequence the Employers had to reduce their services and the staff providing the services. But the Employees were not then affected. Shortly before Christmas 1992 Hill Samuel told the Employers that there would have to be even more cuts in the catering budget. This necessitated a substantial reappraisal by the Employers of their services to Hill Samuel with inevitable reductions in the Employers’ staff. The Employers put several options to Hill Samuel, but it was not until 24 January that the Employers knew what action they had to take. The plan chosen by Hill Samuel necessitated the creation of a new composite post of Head Waitress, with hours of work from 10am to 6pm; thus the new job was of 40 hours a week whereas the Employees had been working a 30-hour week. The Employers put on notice boards lists of vacancies at the places where they supplied services. On 29 January 1993 Mr. Begg, the Employers’ catering manager at Hill Samuel, and Mr. Wright, a director of the Employers, interviewed all the staff there and explained which of them would be made redundant. The evidence before the Industrial Tribunal showed that there were two other waitresses working at Hill Samuel. One who had only been there for 3 years already worked a 40-hour week and her job did not change. The other who had longer service than any of the Employees was prepared to work from 10am to 6pm. Also on 29 January 1993 the Employers’ personnel and training manager, Miss Bish, wrote to each of the Employees, confirming the points made at the meeting with Mr. Begg and saying:

“Unfortunately due to staff restructuring and costs savings within Hill Samuel … your position as Waitress … will become redundant with effect from 28th February 1993.

This letter acts as formal notice of that fact.”

Each was told of the redundancy payment she would receive. The letter continued:

“Obviously we will do all we can to find a suitable alternative position within High Table and if this is successful then the redundancy will not stand.”

None of the Employees applied for the new composite post although Mr. Begg told them that they could apply for it. Neither Mrs. Burley nor Ms. Jowett applied for any of the advertised posts elsewhere with the Employers. Mrs. Horst applied for two of the advertised posts but was not successful.

The Employees applied to the Industrial Tribunal, each complaining of “Unfair dismissal/unfair selection for redundancy”, for which compensation was sought. Each gave Hill Samuel as the place of her employment. The grounds for the application were stated by each to be as follows:

“On 29/1/93 I received a letter from my employer telling me that “due to staff restructuring and cost savings within Hill Samuel Ltd.” I was to be made redundant. I believe I was unfairly selected for redundancy. I worked for High Table Ltd., not Hill Samuel. High Table have contracts with numerous other City firms, and could easily have redeployed me. There were vacancies advertised at the time with some of the other contractors. No effort was made to redeploy me, and staff with a shorter record of service than myself were allowed to stay on.”

The Employers in their Notices of Appearance asserted that the Employees were dismissed for redundancy, that the dismissals were fair and that every effort was made to offer them subsisting vacancies elsewhere.

At the one-day hearing of the 3 applications together before the Industrial Tribunal, the Employees were represented by someone from the Brixton Advice Centre. Oral evidence was given for the Employers by Mr. Begg and Mr. Wright. Each of the Employees also gave evidence. Mr. Begg was briefly cross-examined on the mobility clause but only, it appears from the Chairman’s notes of evidence, in the context of redeployment. Mr. Wright was examined on the mobility clause, but he was not cross-examined on it. Both Mr. Begg and Mr. Wright said that they had no experience of the clause being invoked to require an employee to move to another location.

The Industrial Tribunal in its decision set out the facts and expressed its conclusion in this way (I quote from the decision relating to Mrs. Horst):

“We preferred the evidence of the [Employers’] witnesses to that given by the [Employees’] witnesses where there was any conflict between them, and we have concluded that the [Employers] have clearly shown that [Mrs. Horst] was dismissed for redundancy. We are satisfied that, in the circumstances, the [Employers] could not have consulted their staff earlier than the end of January (although the [Employers’] manager, Mr. Begg told us that he had given his staff some earlier warning of the likelihood of redundancies) and that, in all the circumstances, the [Employers] adopted a reasonable procedure and a reasonable method for selection. Whilst there was no consultation before the [Employers] chose those who were to be made redundant, the lack arose from the [Employers’] peculiar difficulties and their employees had an entire month after they had been told of their redundancy whilst they worked out their notice, in which to make any suggestions or enquiries that they desired. Even if it was thought that [Mrs. Horst’s] dismissal was unfair for procedural reasons we would have no hesitation in holding that any consultation which the [Employers] could have undertaken would have made no difference to the result, namely the dismissal of Mrs. Horst.”

The Employees appealed. By then they had a solicitor acting for them. In their original notices of appeal they expressly accepted that they had been dismissed by reason of redundancy. They limited their grounds of appeal to a complaint that the Industrial Tribunal erred when considering whether the dismissals were unfair. After an ex parte preliminary hearing on 23 May 1994 the Employment Appeal Tribunal (Judge Smith Q.C. presiding) allowed the Employees to take their appeal to a full hearing. In the Judge’s judgment he said that the Employees should consider whether they wished to amend the notice of appeal to raise other grounds of appeal. He referred to a point raised by the Employees’ solicitor that the Industrial Tribunal should have found no redundancy situation because of the mobility clause, and gave leave to amend the notice of appeal. The Employees consequently amended the notice of appeal, alleging for the first time that there was no redundancy situation at all and also claiming that the dismissals were unfair on further grounds.

At the full hearing of the appeal Mr. O’Dempsey appeared for the Employees and Mr. Underwood for the Employers. In the judgment of the Employment Appeal Tribunal, Butterfield J. first considered the question whether there was a redundancy situation. He referred to Mr. O’Dempsey’s argument that the words of s.81(2) “in the place where he was so employed” meant the place where, under the employee’s contract of employment, he could be required to work and to the rival argument of Mr. Underwood that those words imposed a factual inquiry as to where the employee in fact worked. The judge said:

“Those competing contentions raise interesting and important issues. For their proper determination there must be an evidential and factual matrix into which they can be put. Regrettably, no such factual matrix exists here.

The extent to which the issue of redundancy was canvassed before the Industrial Tribunal in this case is not clear. The notes of evidence disclose no reference to the total size of the Respondents’ workforce and even the position of the workforce at Hill Samuel is opaque. There are only oblique references to whether other employees at different client sites were being made redundant at the material time. There was certainly no consideration of this issue in the Tribunal’s extended reasons. However, it is in our judgment apparent that there was no express or implied acceptance of redundancy by any of the Appellants. Indeed, there are indications to the contrary, in particular, in the original application of Mrs Horst and in cross-examination about the mobility clause to which I have referred.

In those circumstances, the Tribunal had facts before it which raised the question as to whether there was any redundancy at all. That is a question of mixed law and fact which it is for the Tribunal to consider in the first instance. We are satisfied that in reality the Tribunal did not consider that matter. On that ground therefore, the appeal is allowed and the matter will be remitted to an Industrial Tribunal for re-hearing.”

The judge then considered the question posed by s.57(3). Among the points taken by Mr. O’Dempsey had been submissions that the Industrial Tribunal erred in taking into account the procedural steps taken by the Employers after notification of dismissal, that the efforts made by the Employers to redeploy the Employees were insufficient to entitle the Industrial Tribunal to conclude that the Employers acted reasonably and that the finding that the method of selecting those to be made redundant was reasonable was not supported by evidence. The judge said:

“It may be that the Tribunal correctly asked all the right questions and reached answers which it was entitled to do on the evidence adduced. We remind ourselves that the Tribunal’s reasons are given in particular so that the losing party may understand why he or she has lost and we must not construe the reasons with the rigour of a parliamentary draughtsman, but we are all unanimously left at the end of this appeal with a feeling of uneasiness. We do not seek to encourage prolixity in the giving of extended reasons, but it must in our judgment, be apparent from those reasons that the correct test has been applied and proper consideration given to the appropriate evidence.

The decision of this Industrial Tribunal failed to achieve either of those ends on the issue of unfairness. It may be that it was entitled to reach the conclusions that it did. We simply do not know. On this ground, therefore, we allow this appeal and further direct that the applications be remitted to the Industrial Tribunal for re-hearing”.

Before us two main issues have emerged. The first is whether s.81(2) imposes a contractual test, as contended for by Mr. O’Dempsey, or a primarily factual test, as contended for by Mr. Underwood, to determine “the place where the employee was so employed”. The second is whether the reasons given by the Industrial Tribunal were adequate.

I would make the following preliminary observations on the first issue.

(1) The issue is one of law, turning on the true construction of the statutory language.

(2) The Employment Appeal Tribunal should in any event have determined that issue; even if there were matters to be remitted to the Industrial Tribunal the Employment Appeal Tribunal should have given the requisite guidance to the Industrial Tribunal on the issue.

(3) If Mr. O’Dempsey’s construction is correct, further facts would have to be found by the Industrial Tribunal.

(4) The Industrial Tribunal cannot be criticised for failing to find those facts when in my judgment it is plain that the Employees did not contend before it that no redundancy situation existed. That contention only emerged at the preliminary hearing before the Employment Appeal Tribunal.

(5) The Employment Appeal Tribunal should not have given leave to amend to raise the point at that late stage as it should have been obvious that it would necessitate the finding of further facts.

(6) If Mr. Underwood’s contention is correct, no further facts needed to be found by the Industrial Tribunal to reach a determination on the point, as Mr. O’Dempsey accepts.

Mr. O’Dempsey pointed out that in s.81(2) the word “employed”, not “worked”, was used and he submitted that it connotes “employed under the contract of employment”. He said that in the context of the subsection and having regard to the definitions of “employee” and “employer” the question, what is the place where the employee was so employed, i.e. by the employer, must be determined by reference to the contract of employment; if the contract contains a mobility clause, allowing the employer to require the employee to work elsewhere, “the place where the employee was so employed” extends to every place where the employee may be required to work. He sought to rely on the decision of this court in Mumford v Boulton and Paul (Steel Construction) Ltd. (1971) 6 ITR 76 as supporting the contractual test. In that case a steel constructor worked for many years for his employer in and around London. When his employer required him to go to a site 77 miles from London, the employee refused. His employer dismissed him, claiming that he was in breach of contract in refusing. It was held that because he had been employed on terms that only required him to work in and around London, he had not repudiated his contract but was dismissed for redundancy. But the reasoning of this court which relied on the terms of the contract went only to the question whether the employee was bound to obey the requirement to work out of the London area. None of it was directed to the question, what was the place where the employee was employed by the employee, and it is important to have in mind that under s.9(2)(b) of the Redundancy Payments Act 1965 “an employee who has been dismissed by his employer shall, unless the contrary is proved, be presumed to have been so dismissed by reason of redundancy”. The contrary was not proved. That decision does not assist Mr. O’Dempsey.

I would add that O’Brien v Associated Fire Alarms Ltd. [1968] 1 W.L.R. 1916 was decided by this court in a similar way. Again the question was whether employees (of a contract electricity firm) who had been employed for some years in jobs within commuting distance of their homes and who refused the employer’s requirement to work further afield were in breach of contract justifying dismissal. Again it was in that context that the terms of contract were considered. This court implied a term that the employees’ area of work was within commuting distance of their homes and concluded that the employees were not in breach of contract and so the presumption under s.9(2)(b) applied. Salmon L.J. (at p.1924) specifically referred to, but found it unnecessary to decide, “the rather difficult point as to whether the words …, “the place where the employee was so employed”, refer to the place where the employee actually worked or to the place where, under his contract of employment, the employee could be required to work”.

A similar issue arose in Stevenson v Tees-side Bridge and Engineering Ltd. [1971] 1 All E.R. 296. A steel erector had in the course of his employment travelled from place to place round the country, but when he refused to travel to work at 3 sites offered to him because he thought the opportunity of earning overtime was not good, he was dismissed. It was held by the Industrial Tribunal and the Divisional Court (Lord Parker C.J., Ashworth and Browne JJ.) that it was an implied term of the contract of employment that he should go where his employer required him to go, and that his refusal was a breach of contract. Accordingly he was not entitled to a redundancy payment.

Mr. O’Dempsey can rely on two decisions of the National Industrial Relations Court, each time presided over by Sir John Donaldson. In the first case, Sutcliffe v Hawker Siddeley Aviation Ltd. [1973] I.R.L.R. 304, an aircraft electrician, whose contract of employment provided that he could be moved to any station in the U.K., refused to move from one station, where his work had come to an end, to another station. He resigned but applied for a redundancy payment. Sir John Donaldson, in holding that there was no redundancy situation, said (at p.306):

“The words “where he was so employed”…. do not mean “where he in fact worked”. They mean “where under his contract of employment he could be required to work”.”

He referred to Stevenson “if it were necessary to rely on authority to support our decision.” But, with respect, Stevenson is authority for the proposition that to dismiss a man whose work requires him to travel but refuses to travel is to dismiss him for repudiating his contract, and whilst Lord Parker C.J. did refer to the statutory words in dealing with what term should be implied, it is clear that he was considering the extent of the place of employment in the light of what had happened in the course of the employee’s employment. It may be that the Sutcliffe decision could be supported on either the contractual or the factual test, as the employee in the course of his employment had been posted to a number of stations.

In the second case, United Atomic Energy Authority v Claydon [1974] I.R.L.R. 6, the employee had worked at one of the Authority’s establishments under a contract which provided that he could be transferred to any of the Authority’s establishments or overseas. When the authority decided to transfer all work of the kind performed by the employee to another establishment, the employee was told that a job would be available if he wished to transfer. He did not so wish and was dismissed. The Industrial Tribunal awarded him a redundancy payment, pointing out that he had never been required to transfer, but the Authority’s appeal was allowed. Sir John Donaldson reviewed the authorities and applied his own construction in the Sutcliffe case of the statutory wording. He held that because of the mobility clause and because no redundancy situation throughout the Authority’s establishments had been shown, no redundancy payment was due. It is unfortunate that the employee was a litigant in person. The decision has attracted severe criticism (see Harvey on Industrial Relations E 672). But it has been followed by the Employment Appeal Tribunal (see Rank Xerox v Churchill [1988] I.R.L.R. 280).

Mr. Underwood submitted that what he called a “plain words” construction of the statute was appropriate, the words “the place where he was so employed” clearly referring to the place where the employee actually worked and not where in theory the employer could require the employee to work. He relied in particular on the decision of the Employment Appeal Tribunal in Bass Leisure Ltd. v Thomas [1994] I.R.L.R. 104. In that case the employee was based at Coventry, but in the contract of employment the employer reserved the right to relocate the employee. When the employer closed its Coventry depot, the employee was expected to operate from a different location 20 miles away. After an unsuccessful trial, she left her employment and claimed a redundancy payment. The Employment Appeal Tribunal upheld the Industrial Tribunal’s finding that she was entitled to that payment. Judge John Hicks Q.C. in a judgment, which I have found most helpful, considered the language of s.81(2) and said (at p.110):

“We begin with the obvious but nevertheless important point that the question “Where is X employed?” is on the face of it a factual question. Indeed, where there is no contractual term – express or implied – requiring mobility, we do not see how it can be answered other than factually; that is to say as being equivalent to “Where does X work?”

It is arguable that that is all that needs to be said, but for ourselves we should not be disposed to maintain that contractual provisions are irrelevant, or that “Where does X work?” is always an adequate paraphrase. The use of the words “so employed”, relating back to the phrase “employed by [the employer]”, directs attention to the relationship between the parties, and the definite article in “the place” suggests a certain fixity which tends against equating the place of employment with, for instance, each location of a peripatetic “place of work” successively. Without needing to consider or decide whether the parties could arbitrarily define the “place where the employee is employed” in terms outside the limits of the objective realities, we see no reason why there cannot be valid and effective contractual terms, express or implied, evidencing or defining the place of employment and its extent within those limits, so that (for example) the place where a steel erector is employed could be the area within which he can be required to attend at construction sites to perform his duties. That is supported by the fact that the preposition before the expression to be construed is “in” not “at”.

A construction which looks beyond those bounds and treats the “place where the employee is employed” as including any place where he or she can contractually be required to work, whatever the nature of the term under which that requirement is imposed, whatever the limits to be observed, and whatever the conditions to be complied with before the power to impose it can be exercised, seems to us to raise substantial difficulties.”

And a little later on p.110:

“We appreciate that if a distinction such as we have recognised is drawn between different types of contractual provision there will be debateable borderline cases, but that simply reflects the infinite variety of factual situations and contractual terms, and the difficulty of applying to them a statutory test which requires the identification of a unique “place where the employee was …. employed”.

It seems clear to us that the references to “the place where [the employee] was … employed” in s.81(2)(a) and (b) require that the location and extent of that “place” be ascertainable whether or not the employee is in fact to be required to move, and therefore before any such requirement is made (if it is) and without knowledge of the terms of any such requirement, or of the employee’s response, or of whether any conditions upon the making of such a requirement have been complied with”.

The Judge carefully reviewed the authorities, finding particular assistance in the decision of the Divisional Court (Lord Parker C.J., Diplock L. J. and Ashworth J.) in McCulloch v Moore [1968] 1 Q.B. 360. There the existence of a mobility clause had been held not to prevent an employee, who had worked for his employer in Sussex and whose work there had come to an end but who declined the employer’s offer of employment elsewhere, from being entitled to a redundancy payment. The Judge chose not to follow Sutcliffe and Claydon and concluded (at pp.112,3) that the place where the employee was employed for the purposes of s.81(2) “is to be established by a factual inquiry, taking into account the employee’s fixed or changing place or places of work and any contractual terms which go to evidence or define the place of employment and its extent, but not those (if any) which make provision for the employee to be transferred to another.”

I am in broad agreement with this interpretation of the statutory language. The question it poses – where was the employee employed by the employer for the purposes of the business? – is one to be answered primarily by a consideration of the factual circumstances which obtained until the dismissal. If an employee has worked in only one location under his contract of employment for the purposes of the employer’s business, it defies common sense to widen the extent of the place where he was so employed, merely because of the existence of a mobility clause. Of course the refusal by the employee to obey a lawful requirement under the contract of employment for the employee to move may constitute a valid reason for dismissal, but the issues of dismissal, redundancy and reasonableness in the actions of an employer should be kept distinct. It would be unfortunate if the law were to encourage the inclusion of mobility clauses in contracts of employment to defeat genuine redundancy claims. Parliament has recognised the importance of the employee’s right to a redundancy payment. If the work of the employee for his employer has involved a change of location, as would be the case where the nature of the work required the employee to go from place to place, then the contract of employment may be helpful to determine the extent of the place where the employee was employed. But it cannot be right to let the contract be the sole determinant, regardless of where the employee actually worked for the employer. The question what was the place of employment is one that can safely be left to the good sense of the Industrial Tribunal.

In my judgment a remission on the first issue is not justified. It is plain that for all of the Employees the place where they were employed by the Employers was Hill Samuel and that there was a redundancy situation there which caused the Employees to be dismissed.

I turn to the second issue. The Employment Appeal Tribunal found that the reasons given by the Industrial Tribunal were inadequate, leaving all the members with a feeling of uneasiness. There can be no doubt but that the statutory duty to give reasons carries with it the obligation to give adequate reasons intelligibly. As was stated by Bingham L.J. in Meek v City of Birmingham District Council [1987] IRLR 250 at p.251:

“It has on a number of occasions been made plain that the decision of an Industrial Tribunal is not required to be an elaborate formalistic product of refined legal draftsmanship, but it must contain an outline of the story which has given rise to the complaint and a summary of the Tribunal’s basic factual conclusions and a statement of the reasons which led them to reach the conclusion which they did on those basic facts. The parties are entitled to be told why they have won or lost. There should be sufficient account of the facts and of the reasoning to enable the EAT or, on further appeal, this court to see whether any question of law arises; and it is highly desirable that the decision of an Industrial Tribunal should give guidance to both employers and trade unions as to practices which should or should not be adopted.”

However in considering whether the reasons given by an Industrial Tribunal comply with its statutory obligation, it is very important to keep in mind the issues which the Industrial Tribunal was dealing with. It has, of course, to reach conclusions on the issues which the statute raises, viz. in the present case, have the Employers established that the reason for the dismissals was redundancy and, if so, did they act reasonably in treating the redundancy as a sufficient reason for dismissing the Employees? But whilst it must consider all that is relevant it need only deal with the points which were seen to be in controversy relating to those issues, and then only with the principal important controversial points (compare what is required in planning decisions : Bolton Metropolitan District Council v Secretary of State for the Environment (1995) 71 P. & C.R. 309). The Employers claimed that the reason for dismissal was redundancy, and I have already expressed my view that that was not disputed by the Employees before the Industrial Tribunal. The dispute lay in whether the Employers acted reasonably in the circumstances in treating the redundancy as a sufficient reason for dismissing the Employees, a familiar question for the industrial jury which the Tribunal is.

Three matters were identified by the Employment Appeal Tribunal as not having been adequately dealt with by the Industrial Tribunal.

The first related to the steps taken by the Employers, after notification of dismissal, to assist the Employees to obtain another job. Butterfield J. commented:

“Those events taking place after notification of dismissal may be relevant to the intention of the [Employers] at the time of the dismissal to dismiss. If the Tribunal took them into consideration for that effect, it may well be that the [Employees’] argument would be of less substance, but we simply do not know. The findings are wholly silent on the issue.”

The Employees’ argument, repeated before us, was that the actions of the Employers after notifying the Employees that they were being made redundant were irrelevant. I cannot accept that submission and indeed the comments of Butterfield J. indicate that the Employment Appeal Tribunal had lost sight of the issue before it. As Browne-Wilkinson J. said in Sillifant v Powell Duffryn Timber Ltd. [1983] I.R.L.R. 91 at p. 97 (in a passage expressly cited with approval by Lord Mackay L.C. in Polkey v A.E. Dayton Services Ltd. [1988] AC 344 at p. 357):

“The only test of the fairness of a dismissal is the reasonableness of the employer’s decision to dismiss judged at the time at which the dismissal takes effect.”

I do not understand, and Butterfield J. does not explain, why the intention of the Employers was a relevant issue. That they were intentionally dismissing the Employees for redundancy was not in dispute. Of course, best practice would have required the Employers to consult the Employees and to have sought to redeploy them before the notice of dismissal, but the Industrial Tribunal explained why that did not happen, and further pointed out that the dismissal did not take effect for a month, during which the Employees were free to make suggestions or enquiries. It further found that consultation would have made no difference, a finding which has not been challenged.

The second matter was the adequacy of the efforts made by the Employers to redeploy the Employees, Butterfield J. commenting: “This is a question of fact and degree upon which the reasons are largely silent.” The Industrial Tribunal heard and accepted the evidence of the Employers on this. Only Mrs. Horst sought to avail herself of the advertised opportunities elsewhere. In my judgment the Industrial Tribunal was entitled to conclude that the Employers acted reasonably, and I can see no justification for a remission on this ground.

The third matter was the finding that the Employers adopted a reasonable method for selection. The Employment Appeal Tribunal accepted that it might be that the selection was in reality self-selection but said:

“We do not know and the evidential basis for the finding that there was here a reasonable method for selection is tenuous at best.”

Having read all the notes of evidence, I am not able to agree. Sadly, the Employees were the obvious persons to be selected for redundancy. The plan adopted by Hill Samuel, whose requirements dictated how many staff working how many hours were needed, did not require waitresses working the hours which the Employees had done. Mrs. Burley had requested further information as to why she had been made redundant when another waitress, who had worked only 3 years, had not. Miss Bish by letter dated 8 February 1993 explained that the job of that waitress (working longer hours) was unaffected by the plan. The other waitress retained had been employed longer and was prepared to work a 40-hour week. Contrast the Employees who, although told that they could apply for the composite post, never did apply.

Accordingly, I do not think that the Employment Appeal Tribunal was justified in ordering a remission on this ground either.

In truth this case was a simple case before the Industrial Tribunal, which the ingenuity of those looking at it with hindsight has sought to make complicated. For my part, seeing as I do no proper basis for a remission, I would allow the appeal and restore the order of the Industrial Tribunal.

Hobhouse L.J.: I agree that these appeals should be allowed and the orders of the Industrial Tribunal restored for the reasons given by Peter Gibson L.J. with whose judgment I am in full agreement.

Evans L.J.: I likewise fully agree with the judgment of Peter Gibson L.J.

Orders: Appeal allowed; no order as to costs in relation to all three respondents save for legal aid taxation of the costs of the appeal in the cases of Miss Jowett and Mrs Horst; legal aid fund to bear the appellant’s costs; order to take effect eight weeks from now to give legal aid fund opportunity to apply; application for leave to appeal to the House of Lords refused.

 

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