THE INDUSTRIAL TRIBUNALS

CASE REF:	162/08

CLAIMANT:			Wesley Boyd

RESPONDENT:		Rosbotham Demolition Limited

DECISION
The unanimous decision of the tribunal is that the claimant was unfairly dismissed but that his conduct contributed 100% to that dismissal and therefore no compensation is awarded.

Constitution of Tribunal:

Chairman:		Mrs Ó Murray
Members:		Mr E Miller
			Mr I O’Hea

Appearances:
The claimant was represented by Mr D O’Neill, Barrister-at-Law, instructed by Gillen & Company, Solicitors.
The respondent was represented by Mr J Dowey, Barrister-at-Law, instructed by Thomas T Montague, Solicitors.

1.	The claimant’s claim was that he was unfairly dismissed for misconduct and that that dismissal was automatically unfair for failure to follow the statutory dismissal procedures.  The respondent admitted failure to follow the statutory dismissal procedures but claimed that the dismissal was otherwise fair, that the claimant contributed 100% to his dismissal and further contended that a Polkey deduction was applicable in this case as dismissal would have followed anyway even if procedures had been followed.  

Issues

2.	The issues for the tribunal were as follows:

(i)	As the respondent admitted that the claimant was unfairly dismissed by virtue of non-compliance with the dismissal procedures, the main issue for the tribunal was whether the circumstances were such that a finding of contributory fault was merited.  If such a finding was merited the next issue for the tribunal was the amount of any deduction.

(ii)	whether a deduction on the grounds of Polkey was applicable.

(iii)	The amount of any compensation payable.

Sources of Evidence

3.	The tribunal heard evidence from the claimant; from Jim Rosbotham, a Director in the respondent company, Philip Rosbotham, a Director in the respondent company, Eamon Donnelly, the Office Manager, Woods Rosbotham, the founder of the company and Co-Director with his two sons, Jim and Philip.  The tribunal also had agreed bundle of documentation.

Findings of Fact

4.	The respondent company is a family-run business whose trade involves demolishing buildings and disposing of the rubble caused by demolition. At the relevant time for these proceedings, the respondent company employed approximately 15 people comprising mainly Rosbotham family members and people recommended by family.  In October 2007 there were approximately seven lorry drivers.
5.	The nature of the respondent’s business was such that lorry drivers worked largely unsupervised.  The claimant’s job involved ferrying loads from demolition sites to the depot and scrap metal merchants.  The company managers would call into sites but could not be on site all the time keeping an eye on what was going on.  It was therefore very important for the company that they could trust their drivers and indeed the digger drivers who worked so closely with the lorry drivers by loading rubble and scrap onto the lorries at the sites and at the depot.  
6.	Any scrap metal recovered by the company from demolition sites is sold by the company to scrap metal companies.  The sums earned by the company through the sale of scrap metal constitute an important source of income for the company, contributing to its ability to pay the workforce.
7.	The main scrap company that the respondent uses is called Clearway and it is situated in Belfast.  The respondent has an account with Clearway that means when loads of scrap metal are brought to Clearway they are weighed and a sum is credited to the respondent’s account.  Occasionally Rosbotham scrap metal is brought to another company called TMET but this only happens when the demolition site is closer to the TMET site in Moy than to Clearway.  If scrap metal is brought on the company’s behalf to TMET, an account is set up and payment is made into the respondent company’s account rather than in cash.  The company never uses TMET in Mallusk.
8.	The claimant was employed as a lorry driver.  The claimant was employed from 30 October 2004 until 19 October 2007 when he was summarily dismissed by Woods Rosbotham for theft.  The effective date of termination is therefore 19 October 2007.
9.	It was common practice for lorry drivers and digger drivers to pick up small pieces of scrap metal, such as copper piping or lead, which might have fallen off loads or be lying around demolition sites.  These small pieces of scrap metal would be gathered up in the driver’s cab over the course of one to eight weeks, until enough was gathered to fill a bag.  A bag could be as big as a coal bag and could weigh up to one hundredweight.  A bag of copper scraps would be worth about £50.  The driver would then put the scraps in his car and would sell that small amount of scrap metal on his own time to whichever company he wanted and he could keep the proceeds.  It was well-known to the respondent company’s directors that this went on and it was regarded as a ‘perk’ of the job.  
10.	On an unspecified date a few months before October 2007 the claimant told Eamon Donnelly, the Office Manager, that he had not been treated well by the other employees because he was not getting his fair share of the proceeds of the scrap metal.  Eamon Donnelly assumed that this related to the collection of small bags of scrap metal which was permitted by the company, and told the claimant that it was nothing to do with him.  
11.	On Monday 15 October 2007 the claimant told Jim Rosbotham that Jim’s son and another employee, Mr G, was stealing scrap from the depot.  Jim’s son was employed as a digger driver at the depot.  
12.	That same day, Jim Rosbotham passed that information to his brother and Co-Director, Philip Rosbotham, for Philip and his father, Woods, to handle the matter because Jim’s son was involved.  Philip Rosbotham asked TMET for evidence of who was involved in selling scrap metal to them.  TMET produced dockets and photographs of individuals with lorries on the weighbridge which showed that two people were involved in selling scrap from Rosbotham lorries, namely Mr D and  Mr G.  The son of Jim Rosbotham was also implicated.  These individuals, two of whom were identified from the photos relevant to the dockets, used a variety of names and received cash or cheques personally. The three were accused of having five to six thousand pounds’ worth of scrap in different lorries on several dates from the site.
13.	On Wednesday 17 October 2007, the three individuals were sacked having been confronted with the evidence and having admitted theft.  All three individuals have since repaid the sums in question to the company.  
14.	On Friday 19 October 2007, Eamon Donnelly, the office manager, collected more photographs and documents provided by TMET which showed the claimant bringing a lorry-load of large pieces of steel to TMET on the 18 September 2007 and showed him receiving payment of £206 in cash.  The load filled the lorry to one-third of its capacity and weighed just under three tonnes.  This information was given to Philip Rosbotham on 19 October 2007.
15.	On 19 October 2007 the claimant was confronted with the photograph and docket by Woods Rosbotham accompanied by Philip Rosbotham.  The claimant confirmed it was him in the photograph but said that he did not steal anything and that he was not doing anything that anyone else was not doing. Woods Rosbotham called him a thief and sacked him. The claimant was asked to leave his keys and go home so he got into his car and drove away.
16.	The load in question comprised large pieces of steel including baths, radiators grilles and sheets.  The claimant confirmed in evidence that scrap steel such as this should have gone to Clearways or the respondent’s yard rather than to TMET.
17.	On Monday 22 October 2007 the claimant called into the company premises to ask about timesheets.  He said to Mr Donnelly that he had not been interviewed properly so that he would be applying for unfair dismissal.
18.	The company had absolutely no written procedures nor was there a written contract between the company and any employees.  Woods Rosbotham had never sacked anyone in his long career before he sacked the four men who were sacked in October 2007.  At no stage did the respondent write to the claimant to explain why he had been dismissed.
19.	The claimant at hearing claimed that he was instructed by Mr J, the digger driver on the demolition site in Antrim, to take the three tonnes of scrap steel from the demolition site to TMET in Mallusk.  The claimant further testified that the cash which he received was to be split between the claimant, Mr J and Mr A.  However, the claimant testified that when he returned to the site with the £206 cash he decided to give Mr H, driver of the low-loader who had just arrived, £26, meaning that the other three received £60 each.  All three men denied that they were involved in such a transaction when questioned by the respondent after the sacking of the claimant.  The respondent had no photographic or documentary evidence against these three men and therefore did not discipline them.    The digger driver had only been employed one year with the respondent whereas the claimant had been with the respondent for over three years.
20.	The sacking of four men in such a short period of time caused serious manpower difficulties for the respondent and had a detrimental effect on the operation of its business.
The Law
21.	The right not be unfairly dismissed is outlined at Article 126 of the Employment Rights (Northern Ireland) Order 1996 (“the ERO”).  Misconduct falls under one of the potentially fair reasons for dismissal set out at Article 130.  Under Article 130A an employee is regarded as automatically unfairly dismissed if the statutory dismissal and disciplinary procedures, outlined below, have not been followed due to the employer’s failure.
22.	Under the Employment (Northern Ireland) Order 2003, and the Employment (Northern Ireland) Order 2003 (Dispute Resolution) Regulations (Northern Ireland) 2004, an employer must follow a minimum procedure when disciplining or dismissing an employee.  In a case where summary dismissal is warranted, that is in a case of gross misconduct, the modified procedure applies.  The modified procedure requires that, having summarily dismissed the employee, the employer must write to the employee to set out the reasons for dismissal and must advise the employee of his right to appeal.  If the right to appeal is exercised there must be a meeting and the outcome of that appeal must be communicated to the employee.  If the employer fails to follow the statutory procedure, the tribunal must make a finding of unfair dismissal and award a minimum of four weeks’ pay if the basic award transpires to be lower than that figure.  The tribunal must also increase any award which it makes to the employee by 10%, and if it considers it just and equitable in the circumstances, by a larger percentage up to a maximum of 50%.  The percentage increase must be made unless there are exceptional circumstances which would make the increase of 10% minimum unjust or inequitable (Article 17).
23.	Under Article 146 of ERO, the tribunal must make an award of four weeks’ pay for procedural unfairness unless the tribunal considers that such an award would result in injustice to the employer.  
24.	Under Article 156(2) of ERO, the tribunal has the power to reduce the basic award to any extent for contributory fault on the part of the claimant, ie conduct of the claimant before the dismissal.  The compensatory award can be reduced to any extent for the same reason under Article 157(6).
25.	If the tribunal is minded to reduce the award for contributory fault, both the basic award and the compensatory award must be reduced by the same percentage (McFall  v  Curran [1981] NICA IRLR 455).  As regards contributory fault the question for the tribunal is whether the claimant’s conduct contributed to his dismissal.  
26.	The case of Polkey v Dayton Services LTD 1987 3 All ER 974 HL makes it clear that, if a dismissal is procedurally defective, then that dismissal is unfair but the tribunal has a discretion to reduce any compensatory award by any percentage up to 100% if following the procedures correctly would have made no difference to the outcome.
27.	The EAT in Alexander  v  Bridgen [2006] IRLR 422 summarised the interplay between the statutory procedures and fair or unfair dismissal as follows:

(1)	if the statutory procedures were followed and there was a breach of other procedures but the individual would have been sacked anyway, that is the chance of dismissal was more than 50%, the dismissal is fair;

(2)	if the statutory procedures were followed but there was a breach of other procedures and if the chance of dismissal was below 50% the dismissal is unfair, but a Polkey deduction can be made;

(3)	if no statutory procedures were followed there is automatic unfair dismissal and four weeks pay is the minimum which must be paid and can be increased by 10 to 50% unless the award of four weeks pay would result in injustice to the employer.  

28.	The case of Ingram v Bristol Street Parts 2007 UKEAT/0601/06 confirms that there is no need for the tribunal to set out compensation in detail and determine the percentage uplift, if there is a 100% reduction for contributory fault.  The blameworthy conduct of Ms Ingram was the sole factor in her dismissal and it was therefore justified that she received no compensation at all.  In the Ingram case the respondent had not in fact breached the basic statutory procedure therefore there was no automatic unfair dismissal.  Mr Justice Elias, however, commented that there nothing to stop a full 100% reduction of compensation even where there was a breach of procedure.  In that case the basic award had already been extinguished by the payment of statutory redundancy.

Conclusions

29.	In general the tribunal found the claimant to be an unsatisfactory witness.  He was vague and unconvincing in his evidence in several key respects.  For example, in evidence he denied that the photograph showed him on 18 September 2007 but related to an earlier incident despite the fact that this denial was never raised before his evidence-in-chief.  He also testified that in the photograph he was carrying a piece of lead when in fact the clearer copy of the photograph showed that he was carrying nothing.  Additionally, the claimant stated in his examination-in-chief that the respondent’s motive for sacking him was that Jim Rosbotham was annoyed at him having reported his son for theft.  This was never put to the respondent’s witnesses nor was it raised before the claimant gave his evidence-in-chief.  The tribunal is therefore, not persuaded that this was the reason behind the sacking.  The claimant in evidence at tribunal alleged for the first time that he had been “set up” but retracted this allegation when he was asked to provide more details by the panel.

30.	Leaving aside the issue of the non-compliance with the minimum statutory dismissal procedures, the tribunal finds as follows in relation to the dismissal process.  

31.	The tribunal finds that the respondent had reasonable grounds for suspecting that the claimant was guilty of theft, having gathered information in their investigation and having put that to the claimant who confirmed that he was the person in the photograph to whom the docket related.  The tribunal also finds that theft of this nature constituted gross misconduct and warranted summary dismissal.  The tribunal does not accept the claimant’s contention that the fact that the company allowed workers to gather small pieces of metal to cash in on their own behalf meant that he had carte blanche to take a lorry-load of three tonnes of large pieces of steel from a site using a company vehicle, to a company which had no dealings with the respondent, and cash that load in on his own behalf.  This showed to the tribunal that this was an underhand transaction in which the claimant was involved.  The tribunal accepts that the claimant knew what he was doing was wrong and, the contention that other individuals might have been involved in the particular transaction in question here does not take away from the gross misconduct committed by the claimant.  

32.	The tribunal believes that the claimant unwittingly precipitated the investigation that ultimately showed him to have been involved in theft, by reporting the other three men.  It was clear from this act that the claimant knew that taking lorry-loads of scrap to TMET for personal gain was wrong.  The tribunal does not accept the distinction that the claimant sought to make between the acts of those men and his act in bringing scrap steel to TMET. 

33.	The tribunal finds that there is a big difference between, on the one hand, the company ‘perk’ whereby small bits of metal were gathered up, and on the other hand, the loading of a company lorry with large pieces of metal.  The claimant in cross-examination, conceded that he knew that such a load of large pieces of steel ought to have gone to Clearways or the respondent’s yard and that it should not have gone to TMET but that he was only obeying the orders of a superior.

34.	We also do not accept that the digger driver was in a position of authority to give orders to the claimant. If the claimant was acting under instruction, the tribunal cannot understand why he made the delivery in his unpaid lunch break.  It was such an unusual occurrence to go to TMET that the claimant should have challenged the digger driver if he was being given an order so much at odds with normal practice.  In addition, the claimant said that it was he who decided to give a cut to Mr H without reference to Mr J who was supposedly the person giving the claimant orders.  In summary, the tribunal does not accept that he was under instruction. On the claimant’s own evidence relating to his decision to give some of the money to one of the men, the tribunal finds that the claimant was not acting under the instruction from the digger driver, but was rather a prime mover in this transaction from which he personally profited.  The tribunal makes no finding as to the involvement or otherwise of others but finds that the issue of whether or not others were involved in this transaction does not detract from the claimant’s wrongdoing.  

35.	An investigation was carried out and there were reasonable grounds for believing that the claimant was guilty of theft.  However, no fair procedure was followed whether statutory or otherwise.

36.	The respondent had dismissed his own grandson and a person he had known for 30 years and this underlines to the tribunal that the Rosbothams had to trust their men because they could not supervise them because of the nature of the business.

37.	The tribunal accepts that what the claimant had done amounted to theft.  He could have been instantly dismissed if the respondent had followed the modified procedure as a bare minimum.  As it amounted to theft, it clearly amounted to gross misconduct and struck at the heart of the trust and confidence required, particularly with this business, where trust was particularly important because they largely could not supervise their workers.  There was enough evidence to give reasonable grounds for believing that the claimant had stolen scrap metal and this was grounds for summary dismissal.  

38.	As the tribunal has found that summary dismissal was warranted in this case the modified statutory dismissal procedure applies.  The statutory procedure allows for summary dismissal and the modified procedure requires that the right to appeal is given to the employee.  If the respondent had followed a procedure there is no evidence that the claimant would have appealed given that he made no indication to Eamon Donnelly on the 22 October 2007 that he regarded the dismissal as unfair for reasons other than the failure to follow a procedure. The tribunal does not, therefore, believe that any appeal, if exercised, would have changed the result.  

39.	The failure to follow any procedure whatsoever means that the respondent falls foul of the minimum statutory dismissal procedure and the tribunal must find unfair dismissal and must therefore award four weeks’ pay unless it finds that this would cause injustice to the employer.  The respondent clearly did not follow any procedure and was wholly to blame for that.  It is not acceptable for the respondent not to have procedures in place.  Indeed this is the very reason why the statutory minimum procedures were enacted, namely to ensure that employers and employees try to sort out their differences without recourse to proceedings.  

40.	The basic award would have amounted to four weeks’ pay at the statutory maximum of £330 per week.

41.	The basic award and compensatory award are extinguished by the finding of 100% contributory fault.  The tribunal believes that this also extinguishes any enhanced basic award for automatic unfair dismissal for failure to follow statutory procedures.  If the tribunal is wrong in this finding it finds that such an award of four weeks’ pay would result in injustice to the employer and no such award is therefore made. The tribunal has thought very carefully about the minimum award of four weeks’ pay.  Given that the tribunal has found that the claimant contributed 100% to his dismissal, the tribunal further finds that this is indeed an exceptional case where it would be unjust to this employer for the claimant to receive any compensation.  In making this finding the tribunal does not condone the employer for its failure to have procedures, but regards the respondent company as the victim of a brazen theft.  In making this finding the tribunal also has regard to the fact that this is a small family firm whose workers are largely comprised of family and friends and that the claimant knew that what he was doing was wrong.

42.	The tribunal does not need to look at the effect of Polkey on the compensatory award, if no such award has been made due to the 100% contributory fault.  The tribunal’s view is that this is a case where a 100% Polkey deduction would have been warranted.  A Polkey deduction is not relevant to the basic award.  

43.	In summary, therefore, the tribunal finds that the respondent unfairly dismissed the claimant due to the failure to follow the basic statutory dismissal procedures.  Aside from the automatic unfair dismissal finding for failure to follow procedures, the claimant was unfairly dismissed for failure to follow any procedure generally.  However, given that 100% contributory fault deduction has been found, Polkey need not come into play.  The 100% reduction for contributory fault extinguishes the basic and compensatory awards.  If the tribunal is wrong that it extinguishes the basic award of four weeks’ pay for failure to follow the statutory procedures, no such award is made as it would result in injustice to the employer in this case.

Chairman:

Date and place of hearing:	26 June 2008: and 30 July 2008, Belfast

Date decision recorded in register and issued to parties: