Appeal No. EAT/0770/02/SM

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 17 June 2003

Before
MR RECORDER LUBA QC
MR S M SPRINGER MBE
MR P A L PARKER CBE

MR A K ISAAC	APPELLANT

CENGLADE LTD	RESPONDENT

Transcript of Proceedings

JUDGMENT

Revised

	APPEARANCES

For the Appellant	MR D MASSARELLA
(of Counsel)
Instructed By:
Messrs Nelsons
Solicitors
Pennine House
8 Stamford Street
Nottingham
Notts NG1 7BQ	
For the Respondent	MISS A WHYTE
(of Counsel)
Instructed By:
Messrs Silverbeck Rymar
Solicitors
Heywoods Buildings
5 Brunswick Street
Liverpool L2 0UU	

MR RECORDER LUBA QC:

1	This is an appeal from a decision of the Employment Tribunal at Liverpool, which on 25 April 2002 heard a complaint of Mr Isaac that he had been unfairly dismissed by his employers, Cenglade Ltd.  

2	The Tribunal pronounced its decision at the conclusion of the hearing on 25 April 2002 in summary form and on 15 May 2002 extended reasons were provided to the parties.  The Employment Tribunal found unanimously that firstly, the Applicant had been unfairly dismissed and secondly, that there should be no order for his reinstatement, re-engagement or any compensation.

3	The Appellant, Mr Isaac, does not, of course, challenge the finding of unfair dismissal.  Rather he challenges the finding that there should be a 100 per cent reduction in any compensation otherwise to be awarded to him in respect of that unfair dismissal.

The Background Facts

4	Mr Isaac was employed by Cenglade Ltd as a fabricator/welder from either 1994 or 1995.  In June 2001 he had been given a final written warning, as a consequence of alleged dishonest or fraudulent activity on his part.  

5	On 20 or 21 November 2001 (the dates are expressed differently in different parts of the papers before us) the employers, not being satisfied as to his standard of work, gave him a letter in effect transferring him to other duties at lower wages.  Later that same day an administrative employee, Miss Stephenson, saw what she thought to be an incident of Mr Isaac deliberately ramming his forklift truck into another Company vehicle.  This was reported by her to a Mr McCabe, Mr Isaac’s supervisor.  When challenged about it by Mr McCabe, Mr Isaac seemingly initially denied any collision but on being told that the incident had been witnessed, claimed that any collision had been accidental.  Mr Isaac was then called to meet Mr Stephenson, the employer’s Managing Director.  This was on the same day.  At that meeting he was dismissed summarily.  He was then given, or sent, a letter of dismissal which was in the following terms:

“We confirm your dismissal from our employment for repeated misconduct in the form of wilful damage to company property and dishonesty.  The circumstances are as follows.
At approximately 11:30 am, Tuesday 20 November 2001, you were observed driving a forklift truck in the yard at Akenside Street.  A pick up truck parked in the yard appeared to obstruct your manoeuvres and you slammed the rear of the forklift truck against it to remove it bodily from your path.  Your behaviour was brought to my attention but when asked about it you completely denied that the incident had taken place.  When cautioned that there was a reliable witness to your actions you then changed your story admitting guilt, but tried to minimise the seriousness of your actions.
You are an experienced forklift truck operator and have been trained to use the equipment correctly.  Your action was deliberate and taken with total disregard for any damage that may be caused to the company’s property or the safety of anyone in the vicinity.
You are fully aware that a final written warning for gross misconduct was issued to you in June this year.
In light of this further misconduct the company can no longer regard you as a truthful and trustworthy employee.  Under these circumstances you left us no alternative other than to dismiss you.”

That letter appears over the signature of Mr McCabe, Foreman, who as we have indicated already is the supervisor, or was the supervisor, of Mr Isaac.

6	It must be noted at this point that the yard at Akenside Street, where the incident took place, is covered by a closed-circuit television camera system operated by the employers.  No steps appear to have been taken by the employers to retrieve and view the tape for the date in question, either on or immediately after the occurrence of the incident.  Furthermore, no request was made by Mr Isaac at or about that time, or shortly thereafter, to view the tape or to have it retained for safekeeping and viewing later.
7	As indicated, Mr Isaac complained to an Employment Tribunal that his dismissal had been unfair.  His accompanying statement, that is, accompanying his application to the Employment Tribunal, sets out something of the history of matters in his employment with these employers and asserts, in broad terms, that the employer’s conduct was intended to drive him out of his employment.  He adds:  “The letter dismissing me is also a sham, because I have not damaged deliberately any of my employer’s property ... it is therefore inconceivable that I would deliberately do something to cause my employer to summarily dismiss me.”  

8	The employers, for their part, put in an Answer to Mr Isaac’s complaint, in the following terms.  First, in answer to the question “What was the reason for dismissal”, the employers responded “Repeated misconduct”.  Their response is accompanied by a rider which again touches on something of the recent history of dealings between the employer and employee and concludes with the following paragraph:

“The Applicant’s conduct in relation to the incident and his conduct at the disciplinary hearing were both considered together with the final written warning itself.  Given the seriousness of the Applicant’s actions it was decided that summary dismissal was the appropriate sanction.”

9	Before the Employment Tribunal both parties were represented by solicitors.  Mr Isaac gave evidence, as did Mr Stephenson for the employers, Miss Stephenson and Mr McCabe, all of whom have already been referred to in this judgment.

10	The Tribunal appear to have conducted the hearing in two parts.  First, they considered the liability question, ie the question whether or not Mr Isaac had been unfairly dismissed.  Secondly, and separately, having announced their decision on the first part, they then went on to the second part of the hearing which has been described as the “fault” part, ie the part in which they considered what contribution, if any, Mr Isaac had made to his own dismissal.

11	The Tribunal’s findings, as elaborated in the extended reasons, were (in summary) that firstly, the dismissal was by reason of conduct, a potentially fair reason for dismissal, but that secondly, the procedure in relation to the dismissal had been unfair.  The unfairness is summarised by the Employment Tribunal at paragraph 13 of their extended reasons, as being twofold.  First, Mr Isaac was not told that the meeting with the Managing Director was to be a disciplinary hearing and second, Mr Isaac did not have put to him all of the evidence available to the Company in relation to the allegation.  That latter point can only be understood as a cross reference by the Employment Tribunal to their earlier reference, at paragraph 9, to the fact that Mr Isaac had asked the Managing Director, Mr Stephenson, to “show him the damage”.

12	It appears, therefore, that the Tribunal found, at least in part, that the dismissal was unfair, because the employer did not provide an opportunity for Mr Isaac to deal with all the evidence against him, including the evidence as to the extent of the damage.  Having found on that basis that the dismissal was unfair, the extended reasons of the Tribunal then touch on the fault limb of their deliberations on 25 April.  This is dealt with in five short paragraphs which we reproduce in full, as follows:

“14	We then went on to consider whether Mr Isaac had contributed to his dismissal.
15	We heard evidence from Miss Stephenson, which we accepted, to the effect that the collision she had witnessed had been a substantial one.  There was no way that Mr Isaac could have been unaware that it had occurred.
16	We also accepted the evidence from Mr McCabe that Mr Isaac had simply denied that any collision had taken place when this matter was first put to him but had then changed his story.
17	We also, of course, bore in mind the evidence given by Mr Isaac himself.
18	On balance, we accepted that Mr Isaac had, indeed, deliberately rammed the vehicle in question.  In those circumstances we considered that it was just and equitable that any award of compensation should be reduced to nil.”

Those then were the Tribunal’s relevant findings.

13	We turn next to the grounds of appeal.  Mr Isaac’s grounds of appeal make two discrete complaints.  We can best express them in summary form.  Both relate to the fault limb of the Tribunal’s findings.  

14	First, a complaint is made in relation to the closed-circuit television.  Mr Isaac made an application for disclosure of the CCTV tapes.  That was done at the outset of the hearing.  The complaint is that the Employment Tribunal did not rule on it.  They failed, it is said, to make an order for the disclosure of those tapes and that failure may have resulted in Mr Isaac being deprived of evidence, or material, which may have supported his case in relation to the incident in question.

15	The second aspect of the grounds of appeal we can summarise as a “reasons challenge”.  Mr Isaac contends that the reasons given by the Tribunal, in the paragraphs which we have just extracted, are too summarily expressed for Mr Isaac to see why he was held to be 100 per cent at fault and why his case, on the fault aspect, had been rejected by the Employment Tribunal. 

16	We shall deal with each of those two strands of the Notice of Appeal in turn.

17	First, ground 1, the closed-circuit television.  No mention whatever is made in the Employment Tribunal’s extended reasons of the existence of the CCTV point, nor of any application to adduce the CCTV tapes in evidence.  However, as a result of a direction made by this Employment Appeal Tribunal at a preliminary hearing, the Appellant, the Appellant’s solicitor and the Respondent’s solicitor, have been invited to prepare statements as to what occurred in respect of the CCTV issue at the hearing on 25 April 2002.  The statements of the Appellant and the statement of the Respondent’s solicitor, together with what can only be described as “a questionnaire response” from the Appellant’s previous solicitor, have been forwarded to the chairperson of the Employment Tribunal for comment and we have received his comments.  

18	From all of that material it has sadly not been possible to deduce a uniformly agreed and comprehensive account of precisely what occurred, but from the material before us we find that the following features emerge.

19	Firstly, some days prior to the hearing, that is in early April 2002, the issue of the potential relevance of the closed-circuit television was raised by Mr Isaac or his representatives for the first time.

20	Second, in his Witness Statement prepared for the Employment Tribunal, which was seen for the first time by the Respondent’s representatives on the very day of the hearing, a manuscript note has been added which contains the following:

“And also the yard is covered by CCTV cameras.  I would like these to be produced as evidence of my innocence.”

21	Thirdly, that outside the Tribunal hearing room, and immediately prior to the hearing, a first request for disclosure was made by Mr Isaac’s representative to the employer’s representative.

22	Fourthly, before that could be dealt with, the parties were called into the Tribunal room and the hearing began.  

23	Fifthly, the representative of Mr Isaac made an application to the Tribunal Chairman for the disclosure of the CCTV footage.

24	Sixthly, the Chairman directed that the issue of the closed-circuit television tapes would be explored with the witnesses in giving their evidence.  What then of that evidence and the exploration of the CCTV issue?  

25	Certainly Mr Stephenson, the Managing Director of the employers, was cross-examined about the closed-circuit television.  The crucial issue, of course, is what evidence did he give in relation to that matter.  The Appellant, in the Witness Statement he has prepared for this hearing, at paragraph 8, records the relevant exchange as follows:

“8	My solicitor then asked Mr Stevenson (sic) whether these tapes were available.  Mr Stevenson (sic) said they may be but he could not guarantee the quality and that they might have been taped over.”

26	For her part, the representative who appeared at the Tribunal hearing for the Company, a Miss Worthington, deals with the matter in her Witness Statement, at paragraph 12, in the following terms:

“After that Mr Phillips [we interpose, that is the representative for Mr Isaac] asked Mr Stephenson further questions about the footage.  He said in reply that the camera was a roving one and that he would not be able to answer whether it had covered the incident in question as he did not look at it at the time, it might have done and it might not have done.  He also said that he did not even know if the tapes would be good enough quality to view, that they were mainly used as a deterrent and that he generally taped over them without looking at them.”

27	In the circumstances, therefore, there is some degree of consistency between those two recollections of the evidence of Mr Stephenson given in cross-examination.  Sadly, neither party has invited the Employment Appeal Tribunal to direct that the Chairman provide the notes of evidence given by the witnesses, or more specifically the notes of the evidence given in cross-examination by Mr Stephenson.  There is, however, one further passage in the Witness Statement of Miss Worthington which may give limited assistance in this regard.  At her paragraph 14, she provides what she candidly describes as a précis, rather than direct note, of earlier parts of the cross-examination of Mr Stephenson.  She says this:

“Mr Phillips had asked a number of questions.  It had become clear that the tapes might have been available on 20 November 2001, might have covered the event in question and might have been of a quality that allowed them to be viewed, but they were no longer available.”

28	It is certainly common ground that at that point, or at some point in the cross-examination of Mr Stephenson, the Chairman had intervened to make a number of observations or ask questions about the CCTV footage, but the result of that exchange appears from paragraph 15 of Miss Worthington’s statement which concludes with the sentence, “The Chairman said that the position in relation to the CCTV footage now seemed reasonably clear”.  

29	The Tribunal does not appear, from their extended reasons, to have taken any account of CCTV or its availability in their review of the fairness of the dismissal.  No complaint is made by either of the parties as to that.  Mr Massarella, on behalf of Mr Isaac, takes an altogether different point.  He says, in summary form (a summary, we hope, that does not do him injustice) that the Employment Tribunal here erred, because it went on to the fault aspect of the hearing before dealing with the extant application for disclosure of the CCTV tapes.  In paragraph 12 of his Skeleton Argument, he puts it as highly as that the Employment Tribunal “refused to consider the question of the contents of the CCTV tapes at the liability stage”, but his case is probably best summarised at paragraph 13, as being a complaint that the Employment Tribunal simply did not return to the outstanding application for disclosure.  The error of law is said to be that the failure to return to the application for disclosure and to allow it, potentially rendered an unfairness to Mr Isaac in that it possibly deprived him of an opportunity to rely on the content of the CCTV which may have contained material assisting him.

30	For the employer’s part, Miss Whyte, who appears before us today, says that this is all entirely speculative.  It is not clear that at the time the application for disclosure was made that the tapes existed or, if they did, what they contained and, in any event, this application had been made at a very late stage.

31	We consider that, on the best material available to us as to what occurred, the evidence given in cross-examination of Mr Stephenson must have satisfied the Employment Tribunal that the question of CCTV had fallen away.  That must have been on the basis that the position was “clear”, ie that any such tapes were no longer available.  Only the Chairman’s note of the cross-examination would show whether this was, in fact, accurately the position but, as we have indicated already, we do not have those notes.

32	There is no suggestion that the representative of Mr Isaac applied again to the Employment Tribunal before it proceeded with the fault stage hearing for the disclosure of the tapes.  Indeed, at question 14 of the question and answer exchange with the representative who appeared for Mr Isaac, the representative is asked directly, presumably by those now presently instructed for the Appellant, “When the Tribunal reconvened, please confirm whether or not either you or Mr Isaac raised the question of CCTV video evidence again?  Then the answer is given, “We cannot recall this aspect”.  

33	The fact that the issue of the CCTV is not mentioned at all in the reserved decision also suggests to our mind that this was not a live issue before the Tribunal, after the conclusion of Mr Stephenson’s cross-examination.

34	Mr Massarella however, indicates that there is a contra indication.  He says that Miss Stephenson was asked during the fault hearing stage if she had been the keeper of the tapes.  He attaches some significance to that matter which appears in the Witness Statement of Miss Worthington.  We do not attach much significance to this unexplained question and answer.  Certainly it does not throw doubt on our view as what is most likely to have occurred.  

35	The relevant exchange is dealt with in Miss Worthington’s Witness Statement at paragraph 19 and the relevant passage relating to Miss Stephenson’s evidence is “To the best of my recollection she was then asked again to confirm the evidence the Respondent had already given in relation to how long the tapes were kept” and we have emphasised the words “had already given” 

36	In sum we find that no fault on the part of the Tribunal, in relation to either its conduct on 25 April 2002 or in its reasoning, has been made out on this point.  On the material available to us, it is impossible to say that the Tribunal ought to have conducted itself differently in respect of the CCTV disclosure issue.  

37	We accordingly dismiss the first ground of appeal.

38	The second ground.  This ground was originally ground 3 in the Notice of Appeal, but it is the second substantive ground argued before us, ground 2 in the formal notice having been abandoned.  This second ground is, in essence, that the Employment Tribunal fell short in meeting its duty to provide proper reasons for its decision in relation to the fault limb, in particular in relation to both the contribution, if any, Mr Isaac had made to his dismissal and the extent of that contribution.  We have already set out the relevant passages in the extended reasons.

39	Mr Massarella deploys in support of his helpful Skeleton Argument, and his able oral submissions, the well known cases of Meek and Tran.  Those cases are, of course, the familiar decisions, Meek v City of Birmingham District Council [1987] IRLR 250 and Tran v Greenwich Vietnam Community [2002] IRLR 735.  Taken together they give a helpful modern indication of what is required of Employment Tribunals in relation to the adequacy of reasoning.  His Skeleton gives examples of what are alleged to be deficiencies or inadequacies in the Employment Tribunal’s reasoning in this case in relation to the question of contribution to the dismissal.

40	Miss Whyte, in her equally able and helpful submissions, retorts that this was a simple and straightforward case and that the Employment Tribunal’s reasons, albeit summarily expressed, are sufficient to discharge the twin tasks of firstly, ensuring that the employee can see why he lost or won and secondly, enabling an appellate court to review the decision to detect any error of law.  Those are the respective contentions on this ground.

41	We are unanimously satisfied that in this particular case the Tribunal’s reasons were significantly short of what was required.  The Tribunal were concerned at this stage to determine two issues.  

42	Firstly, whether Mr Isaac’s acts caused or contributed to the dismissal and secondly, and discretely, if they had, what would be a just and equitable reduction, if any, in the compensation he was to be awarded?  By way of preliminary observation, we note that the Employment Tribunal do not, in this part of their judgment, refer to the statutory provisions in sections 122 to 123 of the Employment Rights Act 1996, giving them jurisdiction to make a deduction or reduction.  Nor do they indicate that they considered separately, as they should have done, the question of any reduction in the basic award and separately, the compensatory award.

43	On the issue of the acts causative or contributing to the dismissal, the Employment Tribunal’s Decision is completely silent as to what Mr Isaac’s case was or what his evidence was.  Sometimes such a deficiency is understandable and can be met by making reference to the written statement that the Applicant put before the Employment Tribunal.  But in this particular case it appears that Mr Isaac was not permitted to read his prepared written statement and, indeed, there was no indication at all that it was led in evidence.  No reference is made to it by the Employment Tribunal at all.  

44	In relation to Mr Isaac’s own evidence, if the Tribunal considered that they should not accept his account because he was not truthful, they did not say so.  If they considered he was acting on the day in question in vindictive response to the letter “demoting him”, they likewise do not say so.  As we have indicated, there is no account in their extended reasons of Mr Isaac’s case at all.  Indeed, there is an issue between the parties as to whether Mr Isaac was even recalled to give evidence at the fault stage.  We do not need to resolve that issue in the circumstances.  

45	Returning to the question of the Tribunal’s reasoning, the Employment Tribunal have, in our view, wholly failed to explain why they took the somewhat unusual course of depriving Mr Isaac of both 100 per cent of the basic award and 100 per cent of any compensatory award.  Miss Whyte says that the answer is plain.  This was a case of deliberate damage to Company property and, axiomatically, a 100 per cent reduction is appropriate.

46	On the facts of this case we reject that submission.  First, there is no finding by the Employment Tribunal at all as to the extent of any damage caused.  On Miss Whyte’s argument, even a minor scratch on an already scratched surface of a piece of employer’s machinery or vehicle would justify a 100 per cent reduction in both basic and compensatory award.  Such submission, in our view, goes too far.  

47	The next matter which the Tribunal should have addressed is the question of the extent to which the conduct in question was the sole, primary or significant contributor to the dismissal.  Here, on the facts, it is clear that the employers were not treating the incident in isolation in dismissing the Appellant.  We have already quoted from the letter of dismissal and from the response made to the Employment Tribunal.  The Employment Tribunal do not deal in their extended reasons at all with the fact that there was this broader background to the employer’s reasons for dismissing.  It follows that they do not address whether, in the circumstances, a 100 per cent contribution is appropriate, given that background.

48	For all these reasons, we regrettably find that the Employment Tribunal’s extended reasons in this case do not meet the required standard of giving adequate, proper and intelligible reasons for the Tribunal’s conclusion.  We are satisfied that the finding in relation to unfair dismissal can be sustained, but we find that the reasoning in relation to the fault limb is short of the required standard and, accordingly, the finding in relation to that part must be set aside.  

49	Our conclusion is, therefore, that we should remit to the Liverpool Employment Tribunal for a fresh consideration the determination of the contribution, if any, made by the Appellant to his dismissal and the extent to which, if at all, that should be reflected in a reduction of either his basic award or his compensatory award.

50	Finally, reverting to the CCTV point, we say nothing further as to that matter, save that if an application is to be made for disclosure of any CCTV tapes, it should (a) be made formally and (b) promptly.