Appeal No. EAT/0336/02/RN

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 10 September 2003

Before
HER HONOUR JUDGE WAKEFIELD
MR T HAYWOOD
MR D NORMAN

(1) MR F O’GRADY
(2) MR S WALTERS	APPELLANTS

(1) MTL COMMERCIALS LTD
(2) PILGRIM SECURITY SERVICES (NORTH) LTD	RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised
________________________________________________________________________________

	APPEARANCES

For the Appellant	MR P EDWARDS
(of Counsel)
Instructed By:
Messrs Rowley Ashworth
Solicitors
Kennedy Tower
St Chads
Queensway
Birmingham B4 6JG	

For the First Respondent

For the Second Respondent	

MR M SALE
(Solicitor)
Messrs DLA Solicitors
India Buildings
Water Street
Liverpool L2 0NH

NO APPEARANCE OR
REPRESENTATION
BY OR ON BEHALF OF
THE RESPONDENT

HER HONOUR JUDGE WAKEFIELD:

1.	This is an appeal by Mr Frank O’Grady and Mr Steven Walters against a decision dated 4 February 2002 of an Employment Tribunal sitting at Liverpool on 28 November 2001 by which it determined the compensation to be awarded for unfair dismissal.  An earlier decision of the same Tribunal, following an earlier hearing, had determined that there had been no transfer of undertaking between the first and second respondents and it followed that the appellants had been unfairly dismissed by the first respondent.

2.	Although the appellants have been represented before us by the same Counsel, and many of the criticisms of the decision are common to both, it is important for us to consider their cases individually.  

3.	So far as Mr O’Grady is concerned, the decision is criticised, primarily, in that there is no award for loss of earnings after 18 June 2000 and no explanation from the Tribunal as to this.  Mr O’Grady did not obtain alternative employment until March 2001 and it was Mr Walters who was re-employed from 16 June 2000.  If that date was regarded by the Employment Tribunal as significant also for Mr O’Grady, it is argued that the decision should have set out the reasons.  Secondly, the base figure for calculating loss of earnings is said to be wrong in that there is no explanation for choosing the median point in the range of potential earnings cited by the Employment Tribunal and no consideration of the issue of protected pay as to which there had been evidence before the Tribunal.  Thirdly, the finding that Mr O’Grady was, after proper consultation, only 30% likely to have taken an alternative job with the respondent as a security guard, is said to be contrary to the evidence.

4.	For Mr Walters, it is argued that, firstly, the Employment Tribunal was wrong without explanation or apparent reason not to have awarded him any compensation for loss of statutory rights nor any for expenses in seeking alternative employment.  Secondly, the same argument is put forward for Mr Walters as it was for Mr O’Grady as to the correct base figure for calculation for loss of earnings.  Thirdly, it is argued that, having found that Mr Walters was “distinctly more willing to consider other work, such as bus driving and the prison services”, the Tribunal was wrong to find there was only a 40% chance that, after proper consultation, he would have accepted a job with the respondent as a security guard.

5.	Both appellants also criticised the decision generally in that insufficient reasons are given for such findings as there are.

6.	On behalf of the respondent, MTL Commercial Limited, it is accepted that so far as Mr O’Grady is concerned, some explanation is required from the Employment Tribunal as to the cut-off date for loss of earnings being 18 June 2000.  Alternatively, if this was an error, it is argued that the correct date could be determined, in either case, by a reference back to the same Tribunal, presumably by way of application for review, although now very considerably out of time.

7.	So far as Mr Walters is concerned, the respondents accept that in absence of any reason in the decision itself, there is no apparent explanation for the failure to give compensation for the loss of statutory rights.

8.	As regards the remainder of the findings, it is argued by the respondent that the Tribunal asked the right questions and reached conclusions open to them on the evidence.  The decision itself is brief, albeit that both appellants had given evidence, as had Mr Woollam on behalf of the respondent.  There were other documents before the Tribunal including at least one further witness statement from a Mr Taylor.

9.	Leading up to their calculation of compensation, the Employment Tribunal said at their paragraph 4 the following:-

“What would either applicant’s chance have been of retaining employment?  Here is how we answered:-

(a) In February 2000, the 2 applicants were the only members of the respondents’ OSU who did not go to work for Cargill, the firm that started doing much of the work on the docks previously done by the respondents.  The respondents no longer needed an OSU.  The question was therefore not whether either applicant might have retained his job in the OSU, there was no chance of that.  The respondents no longer did enough covert work to justify the employment of specialists to do it.

(b) The question was whether either applicant might have been re-deployed to other work; in practical terms this meant as a security guard.  Although they were unwilling to accept it at the time of their termination, that reluctance operated in the absence of proper consultation.  One of the effects of consultation might have been to defeat their reluctance by making re-deployment appear a more attractive alternative than dismissal, persuading them that it would be sensible to take what was on offer.

(c) Consultation might have resulted in either applicant being retained by the respondents in the less well-paid job of security guard.  But the chances would not in either case have been very high.  Neither was happy about stepping down to that position.  Mr O’Grady was more reluctant than Mr Walters.  When unemployed he only looked for work of covert surveillance or private investigation.  He said he was not interested in being a security guard because of the wage.  Mr Walters was distinctly more willing to consider other work than covert work, such as bus driving and the prison service.  We thought that Mr O’Grady would have had a 30% chance of being saved by reasonable consultation, and Mr Walters a 40% chance.  Each could only have been retained as a security guard, at the salary of that rank.  The salary range was £!0500 to £14500.  What would they have been paid?  The fairest figure was the one half way up the range, £12500.”

10.	The Tribunal then continue at paragraph 5 to award Mr O’Grady a total of £1854, having calculated loss of earnings to 18 June 2000 and reduced the total loss of earnings by 70%.  To Mr Walters they gave a total of £1632 with no amount for loss of statutory rights or expenses and having reduced the loss of earnings award by 60%.

11.	Paragraph 6 of the decision, which neither Counsel nor we can understand, reads as follows:-

“Each applicant is further entitled to compensation for reduced earnings from 19 June 2000 until the date when their earnings rose to £1300 that loss is at the rate of £500 a year, £9.62 a week.  We do not know what that date was.  If the parties cannot agree the correct figure, they may come to us for a further order.”

12.	For the purposes of this appeal, each appellant has provided a witness statement as to what he and others said at the Employment Tribunal hearings.  Mr Woollam has also made a statement of his recollection of the evidence at the hearings both on 3 October 2000 and 28 November 2000.  We also have the Chairman’s notes as to some of the relevant evidence and these notes are not in all respects in accordance with the new witness statements, nor are the notes and the Chairman’s comments thereon wholly internally consistent.  The Chairman has also, inappropriately in our view, included a comment in his own notes reflecting his view of Mr O’Grady, this being the following:-

“The note might make the contradictions and back-tracking starker than they sounded, for the intervening questions were not recorded.  Each sentence was the response to a question.  But contradiction and back-tracking there certainly was - I was at pains to record them.  The applicant was wavering between wanting to be honest and wanting to give evidence that advanced his case at the moment.”

13.	In all the circumstances we consider that this decision is fundamentally flawed and that the matter must be remitted to the Employment Tribunal.  We sought the views of both parties as to the constitution of the Employment Tribunal were we to take this course and there were differing views.  The respondent wished for the Employment Tribunal to be constituted as before whilst the appellants wanted a wholly new panel.  We consider the latter option to be the correct one since there must be a complete rehearing of evidence.

14.	The appeal is therefore allowed.  The issue of the proper compensation for unfair dismissal is remitted to a newly constituted Tribunal in Liverpool.