Appeal No. EAT/914/92

	EMPLOYMENT APPEAL TRIBUNAL
	58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

		At the Tribunal
		On 21st July 1993
	Judgment delivered on 1st October 1993

	Before

	HIS HONOUR JUDGE J HULL QC

	MR D G DAVIES

	MR J H GALBRAITH CB

ROYAL LIFE ESTATES (SOUTH) LTD	APPELLANTS
t/a FOX & SONS

MR D J CAMPBELL	RESPONDENT

	Transcript of Proceedings

	JUDGMENT

Revised

	APPEARANCES

For the Appellants	Mr J Latham
Consultant
The Care Asst. Group Ltd
Wheatfield Way
Hinckley Fields
Hinckley
Leicestershire
LE10 1YG

For the Respondent	Mr D Lochrane
(of Counsel)
Messrs Harold Walker & Co
Lansdowne House
Christchurch Road
Bournemouth
BH1 3JT

HIS HONOUR JUDGE HULL QC      In this case Royal Life Estates (South) Ltd, trading as Fox & Sons (the employers) appeal against the decision of the Industrial Tribunal sitting at Southampton on 4th November 1992 which held that the employers had unfairly dismissed Mr Campbell, one of their branch managers.

	As the Tribunal observed, there was no dispute about the primary facts in the case.  Mr Campbell had been employed by the employers from August 1982 until 5th May 1992.  The employers are well-known estate agents with some 60 branches across the south of England.  Mr Campbell was employed at first as a senior negotiator; then he was appointed an acting manager and finally he became branch manager at Christchurch.  His dismissal arose from a criminal offence which he committed on 28th April 1992.  Mr Campbell was a homosexual; this was known to his colleagues, but he had evidently done nothing to cause them any offence.  On 28th April 1992 he was on his way home having finished his day's work.  He went to a public lavatory, leaving the employers' car nearby, and was there involved in an incident which resulted in him and a number of other men being arrested and charged with gross indecency.  While still at the police station, he telephoned Mr McKellar, his area director to whom he was responsible, to tell him what had happened.  He was released the same night and on the next day he had an informal meeting with Mr McKellar.

	At the meeting on 29th April Mr Campbell told Mr McKellar what had happened, evidently in detail, and indicated that he was not going to deny the accusations and would be pleading guilty.  He was in a distressed state.

	On 30th April a further meeting took place between Mr Campbell, Mr McKellar and Mrs Gibbs from the employers' personnel department.  There was reference at the meeting to the potential consequences of the incident to the employers, in particular with regard to adverse publicity damaging the company's image and creating difficulties for the company in a highly competitive market place.  There was reference made to another firm of estate agents where there had been an incident involving one its negotiators which had resulted in substantial publicity.  The question of resignation was raised and Mr Campbell was given the opportunity to think about this and come back the following day.

	On 1st May Mr Campbell told Mr McKellar that he was not going to resign and Mr McKellar said that it would be necessary to have a disciplinary meeting.

	On 5th May the disciplinary meeting took place; in addition to Mr Campbell, Mr McKellar and Mrs Gibbs, a Mr Wiseman, one of Mr Campbell's colleagues at Christchurch, was also present.  Mr Wiseman made it clear that, for his part, he was not troubled about the fact that Mr Campbell was homosexual; and he told the others that a lady who worked with them both at Christchurch was not concerned about what had happened.  Mr McKellar looked at the situation from the company's point of view, which concerned the issue of adverse publicity.

	At the end of the meeting, Mr McKellar considered the position and took the decision to dismiss the Applicant.  In his letter of 6th May 1992, which is copied at p.20 of our papers, he said among other things:

	"You described the incident which had occurred on your way back from an appointment at the end of the day; and as a result of that incident taking place you were arrested and then released on bail.  The police are prosecuting you, a court case has been set for 8th June and you confirmed that you intend to plead guilty to gross indecency in a public place between two men.

	 You accepted that an incident such as this could have wide repercussions for both you personally and the Company.  We agreed that there would be press coverage, due to the fact that this type of incident is "newsworthy" in the provinces.  We also considered the effect your actions would have on current staff as well as the business in terms of current and potential vendors.  Whatever one's views on an offence of this nature, it is still a criminal offence and one which could bring the Company's name into disrepute.

	 In the light of our discussion and after giving this matter careful consideration, I advised you when the meeting resumed yesterday afternoon that you had put the Company in an untenable position giving us no alternative but to summarily dismiss you on the grounds of serious misconduct.  ..."

	There is no suggestion that these various meetings, and in particular the meeting on 5th May, were conducted in a way which was unfair to Mr Campbell, or that they do not represent a patient and careful enquiry into the facts.  Notwithstanding this the Industrial Tribunal came to the conclusion that the decision to dismiss was unfair.  In the course of its Decision it said:
	"21.   It was Mr McKellar's evidence to us that in reaching his decision he had considered the risk of adverse publicity to the position of the company, the incident would be likely to have an adverse effect upon the business, the reaction of colleagues, the question of public perception and the level of trust required of someone in Mr Campbell's position.  Also he had regard to the fact that the town of Christchurch was conservative with a little `c'.  Mr McKellar did consider the possibility of alternative work for the applicant but there were no vacancies elsewhere and in any event the applicant would have had to be involved with the public throughout.

	22.   It was reasonable for Mr McKellar to consider the position and or reaction of Mr Campbell's colleagues in deciding how to deal with the situation but it was apparent to the Tribunal that he concluded that there were likely to be a significant number of colleagues who would be caused offence or be uncomfortable with Mr Campbell once the details of what had happened were made public knowledge.

	23.   The Tribunal does not consider it reasonable for this conclusion to have been drawn.  It was clear that those who had to work on a day to day basis with Mr Campbell would not be "made uncomfortable" by the situation and indeed his most immediate colleague was at the disciplinary meeting to support him.  Other employees would obviously have less to do with the applicant and whilst we accept that some might have been disturbed, equally others might be disturbed by the circumstances being used as a reason for dismissal.  In the view of the Tribunal Mc McKellar made an assumption which he was not entitled to do."

	In our view, the Industrial Tribunal totally went outside its proper function at this point.  It was for Mr McKellar and not for the Tribunal to decide whether a significant number of colleagues would be caused offence or be uncomfortable with Mr Campbell once the details of what had happened were made public knowledge.  The loyalty of Mr Campbell's immediate colleagues was well known to Mr McKellar but he must have been very familiar with the feelings of many other colleagues about whom the Tribunal knew nothing.

	The Tribunal continued:
	"24.   The Tribunal does not consider that there was any real chance of the company becoming associated with what had occurred other than through press publicity following the Court appearance. ..."

	Again, it appears to us that this was a matter for Mr McKellar to assess.  Press publicity is not the only sort of publicity: in commercial or professional circles gossip can be as  damaging.

	The Tribunal continued:
	"25.   Mr McKellar gave evidence about the issue of trust and potential risk in having Mr Campbell go out on his own to potential clients' houses in motor vehicles.  This issue generally figured quite significantly in his evidence to us but whilst it was touched on did not figure heavily in the course of the disciplinary hearing and matters put to Mr Campbell.

	 26.   In the Tribunal's view the matter which was uppermost in Mr McKellar's mind in making the decision which he did was the potential damage made to the company in respect of adverse publicity.  He was influenced in this by his own experience of press reports relating to incidents involving another firm of estate agents in Bournemouth and another incident involving a member of the staff of the Crown Prosecution Service."

	We do not think that the Tribunal was under any duty to consider which matters were "uppermost" in Mr McKellar's mind in making the difficult decision which he had to do.  The decision was a matter for Mr McKellar and not for the Tribunal.

	The Tribunal went on:
	"27.   Mr Campbell in his evidence acknowledged that publicity could be a problem but took the view that if there was adverse publicity then it would be shortlived.

	 28.   The Tribunal accepts that Mr McKellar's concern was entirely legitimate and he had to have regard to the potential commercial effect of the general public becoming aware of the situation which had arisen.

	 29.  In the events which happened, and of course after the dismissal there was but a short report in the Bournemouth Echo, none of the persons involved were identified by occupation and indeed the applicant's name was incorrectly spelt.  This was perhaps their good fortune and we think it reasonable for Mr McKellar to have expected that greater publicity might arise following the court appearance.

	 30.   This was not a situation, however, where the court disposal of the case was going to occur at some distant and unknown time.  Mr Campbell indicated from the outset that the case would be before the court on 8 June some 5 or 6 weeks, at the most, after the incident had occurred.  Therefore the company would be in a position after a short period of time of being able to assess the actual out-turn of the case in terms of adverse publicity.  No effort appears to have been made by the company to seriously consider whether or not the matter should be "put on hold" pending the court appearance.  There was the possibility of negotiating a suspension with or without pay, a temporary assignment elsewhere or some alternative disposal.  It has to be borne in mind of course at that time prior to 8 June in any event there was no reason to think that anybody associating with `FS' office, other than the immediate employees themselves, would be aware of what had happened.  It would have been reasonable for consideration being given to the applicant on a temporary basis from the office so as to reduce the likelihood of him being associated with the firm directly at the time of the court appearance.

	 31.   The Tribunal considers the failure to look at this possibility as being serious particularly having regard to the fact that Mr Campbell had worked for the company for some 9 years, there had never been a hint of a problem in this area before and his branch staff were supporting him.

	 32.  Mr Latham for the company argued that the company was in an untenable position as it was a serious risk to business as a result of what had occurred, adverse publicity was a real prospect and that this factor together with the issue of trust and the potential reaction from fellow employees meant that there really was no alternative to dismissal."

	It appears to us that both the Tribunal and the employers' advocate were, in these paragraphs, addressing their minds to matters which were irrelevant.  The question was not whether there were other courses, such as suspension, which might have been available to the company; nor, on the other hand, was it a question whether "there was really no alternative to dismissal".  The relevant question was put by Cumming-Bruce J. giving the judgment of this Tribunal in Vickers Ltd v. Smith [1977] IRLR 11: he said that the Industrial Tribunal had failed to appreciate that
	"...not only was it necessary [in order to treat the employer's decision as unfair] to arrive at the conclusion that the decision of the management was wrong, but that it was necessary to go a stage further, if they thought that the management's decision was wrong, and to ask themselves the question whether it was so wrong, that no sensible or reasonable management could have arrived at the decision at which the management arrived ..."
The test is not whether a reasonable employer would have considered a lesser penalty appropriate; it is whether dismissal is a sanction which a reasonable employer might reasonably impose.  The fact that other reasonable employers might be more lenient is not the point.

	The Tribunal continued:
	"33.   The Tribunal concluded that the reason for the dismissal was one relating to conduct.  It then went on to look at the consideration under Section 57(3) of the Employment Protection (Consolidation) Act 1978.

	 34.  The Tribunal concluded that upon proper consideration there was only one substantial reason for dismissal and that was adverse publicity harming the business.  The view of colleagues and difficulties arising therefrom was based upon an assumption and in the case of the Christchurch office clearly incorrect.  The issue of trust and so on whilst possibly of some significance was not one which was uppermost or received great consideration from Mr McKellar when investigating the matter in the course of the disciplinary proceedings.  He took the decision, the Tribunal concludes, in order to place as much distance between the company and Mr Campbell with a view to minimising the potential fall out from adverse publicity."

	Once more, we do not think that it was for the Industrial Tribunal to say whether Mr McKellar's assumptions were correct or incorrect, bearing in mind that he knew his own company and the Tribunal did not.  Nor do we think it appropriate for an Industrial Tribunal to observe that the issue of trust was "possibly of some significance", that was eminently a matters for the employers.

	The Tribunal went on:
     "35.   No account was taken by Mr McKellar of the fact that Mr Campbell had been entirely frank with him from the outset, of his length of service and age.  No mention was given to the support for Mr Campbell with the Christchurch office.  The Tribunal concludes in all the circumstances of the case the dismissal was unfair.  It was outside the range of reasonable responses of an employer.  It was based partly on supposition and was too hasty.  The supposition was the view of the generality of the staff.  The extent that issues of trust were relevant was not canvassed in any detail at all during the course of the disciplinary hearing and in relation to publicity, a legitimate concern, bearing in mind the length of time that the applicant had worked for the company and his hitherto blameless record, we believe that a reasonable employer would have awaited to see exactly what damage did occur knowing that this would be clear within a few weeks.  Within the resources of `FS' it should have been possible to have found some temporary employment for Mr Campbell and if that really was not possible then it would have been reasonable to have suspended him.  If the company felt that to suspend the applicant for some weeks on full pay was unreasonable it could have canvassed with him the possibility of a suspension without pay.  However this was never done."

	In these passages it appears to us that the Industrial Tribunal is repeating the erroneous approach which we have felt obliged to criticise.  We ask ourselves why Mr McKellar should not have taken his decision "in order to place as much distance between the company and Mr Campbell with a view to minimising the potential fall-out from adverse publicity".  It is not clear to us why the Tribunal found that Mr McKellar took no account of the meritorious side of Mr Campbell's case, such as his frankness, his long service and his age.  In the context of this Industrial Tribunal's approach, it seems to us that when they say "We believe that a reasonable employer would have awaited to see exactly what damage did occur knowing that this would be clear within a few weeks", the Tribunal was applying a wrong test; they were not considering whether dismissal was a course which no reasonable employer would have taken in the circumstances, but were, as the previous comments which we have quoted make clear, thinking of reasonable courses which "a" reasonable employer might well have followed.

	We are therefore satisfied that there are errors of law in the way in which this Industrial Tribunal approached its task. 	In those circumstances, the appeal must be allowed and the case remitted to a differently constituted Industrial Tribunal for a re-hearing.