Appeal No. EAT/1038/02 & EAT/1039/02 & EAT/1040/02 TC

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 22 January 2003

Before
THE HONOURABLE MR JUSTICE RIMER
MR D BLEIMAN
MISS D WHITTINGHAM

(1) MR R DAVIS	APPELLANTS
(2) MR A KAKOULLI
(3) MR T RODRIGUES

THE SAVOY	RESPONDENT

Transcript of Proceedings

JUDGMENT

PRELIMINARY HEARING

Revised

	APPEARANCES

For the Appellants	MR KAKOULLI
(the First Appellant in Person)	

THE HONOURABLE MR JUSTICE RIMER

1	The matters before us are the Preliminary Hearings of three appeals against the decisions of the Employment Tribunal (Chairman Mrs S Pontac) sitting at London (Central) on 13 and 14 June 2002.  The Tribunal’s extended reasons were promulgated on 15 August 2002.

2	The appellants are former employees of The Savoy, which is the respondent to the appeals.  In November 2001 each appellant issued a separate application to the Employment Tribunal complaining of unfair dismissal by The Savoy and seeking re-engagement.  Their complaints to the Employment Tribunal were all heard together.

3	Mr Andreas Kakoulli asserted in his application that he had been employed by The Savoy as a banqueting wine waiter from September 1989 until his dismissal on 9 August 2001.  His explanation of his case, as he set it out in his application, was shortly as follows.  He was rostered to start work in the afternoon of 12 July 2001 at a banqueting function which finished at about 12.50 a.m. on 13 July.  On his way out of The Savoy, he filled in his timesheet.  He says he filled in 4.30 p.m. as the start time but was unsure of it, was told by colleagues that it was 4.00 p.m. and he corrected the timesheet accordingly.  He says in his application that on 18 July he was instructed by a letter from Mr Gates, the human resources director, to attend a disciplinary hearing on 25 July for irregular time keeping at that event.  He did so and on 1 August he received a letter requesting him to attend a formal disciplinary hearing on 8 August.  Following this, he was told he had been dismissed for gross misconduct for fraudulently attempting to record hours inaccurately.  His appeal against dismissal was refused.  He claimed that his dismissal was unfair and he asserted that under the applicable disciplinary procedure authority to dismiss normally lay with the personnel manager, Ms Aarons, in consultation with the head of department, with a right of appeal to the general manager; whereas the dismissal was by Ms Aarons with Mr Sandiford, with his appeal lying to Mr Benjamin, the director of banqueting.  Mr Kakoulli complained that The Savoy did not adequately investigate the matter, unreasonably refused to accept his explanation for what he said was a mistake, had no reasonable grounds for believing he had deliberately attempted to record an earlier time, unreasonably failed to acknowledge that the mistake was not deliberate and said that the timesheet would have been corrected by the operations manager anyway and so would not have led to the receipt of payment for a time he had not worked.  He asserted that the sanction of dismissal was unnecessarily harsh and that he had had no previous warnings for misconduct.

4	Mr Robert Davis was also a banqueting wine waiter, who asserted he had been employed by The Savoy from October 1999 until he was dismissed on the same day – 9 August 2001.  He too complained of unfair dismissal and sought an order for re-engagement.  He was dismissed in circumstances virtually identical to those relating to Mr Kakoulli and he made virtually identical points in support of his claim that the dismissal was unfair.

5	Mr Thomas Rodriguez was also a banqueting wine waiter who had been employed from about 1978 until his dismissal on 12 September 2001.  He too was dismissed in essentially identical circumstances, save that his disciplinary hearing was held on 10 September 2001.  He relied on grounds virtually identical to those relied on by the two other applicants.

6	The Savoy’s case in response to the three claims was that it had a reasonable belief, following reasonable investigation, that each applicant had attempted deliberately to falsify his hours, and in consequence his pay, by inaccurately recording his time on the roster sheet.  It also submitted that each had anyway wholly contributed to his dismissal.

7	The applicants were represented before the Employment Tribunal by Counsel, Miss E Misra, and The Savoy was represented by Mr Crossley, its solicitor.  In its extended reasons the Tribunal recorded that it was agreed that the reason for dismissal in each case was gross misconduct, in that in each case The Savoy believed the applicants had falsified their working time in order to increase their pay.  The Tribunal identified the issues before it as being: 

(1)	whether The Savoy had reasonable grounds for believing the applicants had committed the misconduct for which they were dismissed;
(2)	whether, at the time it formed that belief, The Savoy believed it had carried out a reasonable investigation into the matter; and
(3)	whether dismissal was within the band of reasonable responses available to The Savoy.

8	The Tribunal found as a fact that the applicants were paid for time worked at the rate of £6.00 an hour.  They found that, in February 2000, The Savoy had emphasised at a meeting with the hourly-paid staff the importance of its signing procedure; that is, the signing by the staff of the times they start and finish a particular shift.  It also attached to the staff payslips an explanation of the signing procedure.  They found that Mr Kakoulli and Mr Davis were at that meeting and understood the signing procedure.  They appear to have accepted that, as he told them, Mr Rodriguez was not at that meeting and they recorded that he had given different accounts of whether he had or had not received the written explanation of the signing procedure.  The Tribunal found, however, that it was probable that he had received it and found that he anyway knew what the signing procedure was.

9	The Tribunal found that, at the end of the banqueting event held on 12 July 2001, each of the applicants (and also a Mr Balkandali, who was also dismissed) signed themselves in at 4.00 p.m., although they had been rostered for, and had begun work at, 4.30 p.m. They found that the following day Mr Sandiford, the banqueting operations manager, saw the signing in form and regarded the discrepancy in the signing in times as so plain that he checked it with the head waiter and found that the applicants had started work at 4.30 p.m.  He sought advice from Tim Gates, director of human resources, who advised an investigation and authorised Mr Sandiford to carry it out and, if necessary, institute formal disciplinary hearings.

10	The Tribunal referred to The Savoy’s disciplinary procedure, which stated that it “will generally follow the ACAS Code of Practice.”  It also provided that authority to dismiss “normally lies” with the personnel manager in consultation with the head of department.  The personnel manager was Ms Aarons and the head of department was Mr Benjamin.  The procedure provided for an appeal to the general manager, who was Mr Shepherd.

11	The Tribunal explained that Mr Gates called each of the applicants to a disciplinary hearing with himself and Mr Sandiford on 25 July.  Each was told that, as it could result in disciplinary action, he could be accompanied by a colleague or a trade union representative.  The meetings were duly held and none of the applicants chose to be accompanied.

12	Mr Kakoulli told the hearing (that is, the hearing on 25 July) that in the rush to get the night bus he mistakenly wrote 4.00 p.m. and that the others copied him.  The Tribunal recorded that he confirmed his familiarity with the signing procedure, acknowledging the need to sign accurately.  Mr Davis told the hearing that what happened was “basic human error.”  He too confirmed familiarity with the procedure and said that an element of honesty was required.  Mr Davis originally wrote 4.30 p.m. as the start time but changed it to 4.00 p.m. when he saw others had put down 4.00 p.m.  Mr Rodriguez told the hearing that he had not filled in the start time because someone had already done it for him, although he did not know who.  He did not correct it.  He said he had made a mistake.

13	The Tribunal found that, following this initial hearing, Mr Gates and Mr Sandiford considered that further action and investigation were warranted.  Mr Gates wrote to each applicant and told him that a formal disciplinary hearing would be held.  Each was told that he could be accompanied and that “any breach of time-recording procedures is gross misconduct.”

14	Mr Kakoulli’s and Mr Davis’ disciplinary hearings were held on 8 August and were conducted by Ms Aarons (the personnel manager) and Mr Sandiford.  Mr Rodriguez’s hearing was held rather later, on 10 September, because he was away on holiday in August and that hearing was conducted by Mr Sandiford and Mr Gates.  Mr Sandiford’s evidence to the Tribunal was that his main concern at these hearings was to ascertain whether what had happened was a genuine mistake or whether it had been done deliberately.

15	Mr Kakoulli’s explanation at that hearing in August was that he had made a mistake and that it was probable that he had signed all the applicants in, the other applicants being around him at the time he did so.  He confirmed that in the evidence he gave to the Tribunal.  Mr Davis said at his hearing in August that “I had in my mind it was 4.30 p.m. but everyone had done 4.00 p.m.”  The Tribunal recorded that he asked Mr Kakoulli “in a casual way” and then changed his time to 4.00 p.m.

16	Following the hearings in August, Mr Sandiford and Ms Aarons considered the information they had obtained down to that point.  They concluded that Mr Kakoulli had not made a simple mistake but had deliberately breached signing procedure and so was guilty of gross misconduct.  They concluded he had broken a long-standing rule which had been reinforced in February 2000 and that it involved a clear breach of trust that could not be tolerated.  They concluded that he must be summarily dismissed.

17	They then turned to Mr Davis’ case, concluded that he too knew the start time was 4.30 p.m. and changed it to 4.00 p.m. so as not to differ from the others.  They similarly believed it was not a genuine mistake, but on the contrary was a deliberate breach of the signing procedure.  They decided that he too must be summarily dismissed.

18	Mr Sandiford and Ms Aarons then held meetings with Mr Kakoulli and Mr Davis on 9 August, relayed their decisions and told them of their right of appeal to Mr Benjamin, the director of food and beverage operations.  We comment that, as we have earlier noted, under the applicable disciplinary procedure the right of appeal lay to the general manager, Mr Shepherd.

19	At Mr Rodriguez’s disciplinary hearing in September, conducted by Mr Sandiford and Mr Gates, Mr Rodriguez said he did not write in his start time and did not know who did.  He said his colleagues were all there when he signed out but he did not hear Mr Davis query the start time.

20	Mr Sandiford and Mr Gates then considered his case, taking account of his long service with The Savoy.  They then called him back in, told him they had taken into account Mr Kakoulli’s admission that he had written the times in when all four were there and Mr Davis’ query about the time in his colleagues’ presence.  Mr Gates told Mr Rodriguez that it was a reasonable assumption that they had all heard this and that it was enough to make him, Mr Rodriguez, stop and consider.  They then summarily dismissed Mr Rodriguez as well and explained his right of appeal.

21	Each applicant appealed, and Mr Benjamin heard the appeals of Mr Kakoulli and Mr Davis on 21 August and that of Mr Rodriguez on 26 September.  Mr Benjamin explained to the Tribunal that the purpose of the appeal was to hear the applicants’ version of events and to review all the investigative material.  Mr Kakoulli was accompanied and his case was that signing in was not as important as signing out, as starting times are monitored by the head waiter and he asserted that he did not misstate the time deliberately.  Mr Davis was unaccompanied and said he made a mistake.  He could not explain why his realisation of the true position was not triggered by his first having written in 4.30 p.m.  His response was apparently that the others said 4.00 p.m. and that it was as simple as that.

22	Following the appeals, Mr Benjamin made further enquiries and considered the evidence.  He satisfied himself that Mr Kakoulli and Mr Davis had attended the February 2000 meeting and had received the notice about the signing procedure.  He checked the applicants’ disciplinary procedure and concluded that, given the use of the word “normally” in it, there was no breach of it if Ms Aarons had taken the decision to dismiss with Mr Sandiford, rather than with himself.  Mr Benjamin reviewed the evidence and concluded that both Mr Kakoulli and Mr Davis knew the correct starting time and had deliberately entered the earlier one.  The Tribunal recorded that Mr Benjamin said in evidence that he could not afford to take the risk because wine waiters handle money. 

23	Mr Benjamin wrote to Mr Kakoulli and Mr Davis setting out his reasons for upholding the dismissal decision.  He had discovered from an investigation of the swipe card records that, in the case of Mr Kakoulli, this was not an isolated such occurrence.  As for Mr Davis, he told him that he had concluded that Ms Aarons was entitled to conclude that he had made a deliberate attempt to defraud on 12 July, in particular because he had initially signed in correctly.  Mr Benjamin decided that Mr Kakoulli and Mr Davis should be given a further right of appeal to the general manager, Mr Shepherd, to whom a right of appeal lay under the disciplinary procedure to which the Tribunal had referred.  

24	As for Mr Rodriguez, Mr Benjamin reviewed all the evidence, including the discrepancies between what Mr Rodriguez had said at the disciplinary and appeal hearings, and concluded that he had not made a genuine mistake.  He upheld that dismissal too and set out his reasons in a letter to Mr Rodriguez.

25	Each of the three applicants then appealed to Mr Shepherd.  None was accompanied.  Each of Mr Kakoulli and Mr Davis said he had simply made a mistake.  Mr Shepherd then made further enquiries and concluded that he should uphold the dismissals.  He said in evidence to the Tribunal that an intentional breach of the signing procedure alters the amount payable to the applicants.  The issue was one of trust and The Savoy had lost trust in the applicants.  

26	Mr Shepherd heard Mr Rodriguez’s appeal on 24 October.  Mr Rodriguez said he did not see that 4.00 p.m. had been written in as his starting time.  Mr Shepherd made further enquiries and upheld that dismissal too.
27	The Tribunal recorded that they had applied section 98 (4) of the Employment Rights Act 1996 and the principles set out in British Home Stores v Burchell [1978] IRLR 379.  They recorded that the applicants’ case was that the 4.00 p.m. entries were one-off honest mistakes and that dismissal was not within the band of reasonable responses, and that a final warning would have been sufficient in each case.  They recorded that the applicants submitted that, under the applicable disciplinary procedure, the disciplinary hearing should have been conducted not by Ms Aarons and Mr Sandiford but by Ms Aarons and Mr Benjamin, the head of department.  The Savoy’s case was that it had reasonable grounds to believe that the applicants had committed misconduct.  The applicants’ accounts had changed during the disciplinary hearings, and the change to the start time made by Mr Davis showed that the time was discussed.  The investigation had been reasonable and had revolved around the issue of intent, not merely around signing procedure.  They submitted that dismissal was a reasonable sanction because the misconduct involved a breach of trust even though it did not involve a lot of money.

28	The Tribunal concluded that The Savoy had reasonable grounds to believe the applicants had committed misconduct.  The question The Savoy had been faced with was whether the applicants had committed a deliberate breach of the signing procedure.  The Tribunal concluded that The Savoy’s investigations had been thorough and fair.  It found that the disciplinary hearings did not breach the applicants’ disciplinary procedure because it was not an absolute requirement under it that it had to be conducted by Ms Aarons and Mr Benjamin.  In any event, each applicant had been given a second appeal to Mr Shepherd in case there should have been any unfairness in the formal hearings.

29	The Tribunal found that each of the persons conducting the hearings asked himself or herself the right question and that there was no evidence that any had made his or her mind up before hearing from the applicants.  

30	The Tribunal gave their reasons as to why they were satisfied that dismissal was within the band of reasonable responses open to The Savoy.  They had regard to the fact that each applicant had a good employment record and that both Mr Kakoulli and Mr Rodriguez had given long service to The Savoy.  They had regard to the fact that only an extra £3.00 would have been paid to each applicant had the incorrect starting time not been discovered.  They also had regard to the fact that the notice sent to each hourly-paid employee in February 2000 made it clear that breach of the signing procedure was misconduct and would result in dismissal.  The applicants knew that The Savoy regarded such breaches as fraud.  The result was that the Tribunal concluded that The Savoy was entitled to dismiss each applicant for misconduct and they dismissed the applicants’ claims that they had been unfairly dismissed.

31	Mr Kakoulli’s Notice of Appeal is dated 24 September 2002.  By way of grounds he asserted that the Chairman of the Employment Tribunal was biased and that the Tribunal did not take account of the provisions of the 1996 Act and had no material finding of fact to reach its decision, which was therefore perverse.  There appears to be no Notice of Appeal in the bundle from either of the other applicants but we presume that, as with other formal documents in the proceedings, they follow the same imprecise form as Mr Kakoulli’s Notice of Appeal.

32	The points made in Mr Kakoulli’s Notice of Appeal do not disclose any arguable point of law such as to justify allowing this appeal going to a full hearing.  The allegation of bias is unparticularised and so is a worthless assertion which is not capable of further investigation; although we add that in the course of the oral hearing this morning we have anyway been told that the allegation of bias is now withdrawn.  The suggestion that the decision was perverse is itself perverse.  The decision by the Employment Tribunal was a carefully and comprehensively reasoned decision, which provided cogent grounds for the conclusion at which the Tribunal ultimately arrived.

33	By a joint affidavit the applicants made further points by way of written submission to this Appeal Tribunal for consideration on this hearing.  They make the point that The Savoy had failed to follow its own disciplinary procedure.  That is a reference to the fact that the dismissal was not effected by Ms Aarons and Mr Benjamin but, in the case of Mr Kakoulli and Mr Davis, was effected by Ms Aarons and Mr Sandiford; and, in the case of Mr Rodriguez, by Mr Gates and Mr Sandiford.  But the Tribunal considered this point and concluded that the normal procedure was not an inflexible one and that The Savoy had adopted a fair procedure and of course that procedure included a final appeal to Mr Shepherd, to whom a final appeal lay under the disciplinary procedure applicable to the applicants.  We see no grounds for the conclusion that the Tribunal were in error in finding as they did that the disciplinary procedure in fact adopted involved no fatal departure from the procedure referred to in the written code.  The question is whether or not the procedure adopted by The Savoy was fair and the Tribunal were satisfied that it was.  We can identify no error of law in that conclusion.  On the contrary, it appears to us from the Tribunal’s findings that The Savoy conducted the whole matter with manifest conscientiousness and care.  We add that the applicants make the point, which we understand related to the one we have just discussed, that Mr Sandiford was not the head of his department.  But the Chairman has responded to that by saying that her notes record that that is how Mr Sandiford described himself in evidence and that he was not challenged on it.

34	The applicants in their affidavit then identify one or two points of evidence said to have been given to the Tribunal, but we do not regard them as in any manner undermining the integrity of the findings made by the Tribunal and no point of law appears to us to arise out of them. 

35	The applicants then say that the Tribunal lacked impartiality because “they believed whatever the respondent’s witnesses said; even they were contradicting each other.”  We do not regard that assertion as making out any sort of arguable case of bias.  It was the Tribunal’s job to make findings of fact and they did so.  There is no warrant for any suggestion that they embarked upon that exercise other than fairly and impartially and we have already indicated that the allegation of bias is anyway now withdrawn.

36	The applicants then say that the Tribunal did not direct themselves to the band of reasonable responses test and they complain that the existence of a clear rule does not relieve the Tribunal from the need to apply the overall test of fairness.  They assert that dismissal for breach of a clear rule is not automatically fair.

37	These points appear to us to involve a misunderstanding and a distortion of the Tribunal’s reasoning.  Paragraph 47 of the extended reasons shows that the Tribunal gave careful consideration to the question of whether the dismissal was within the band of reasonable responses open to The Savoy and they concluded that it was.  We regard that as an unimpeachable finding.  We cannot accept the proposition that summary dismissal was not within the band of reasonable responses to what the Tribunal found The Savoy to have believed was the perpetration on it of deliberate dishonesty.  Further, the appellants are, in our view, in error in characterising their dismissal as being simply for “breach of a clear rule.”  They were dismissed because The Savoy was satisfied that they had been deliberately dishonest.  We cannot see that the Tribunal misdirected themselves in any manner in the application of the applicable principles.

38	The appellants then assert that the Tribunal:

“simply substituted its own views for those of the employer and decided that dismissal was fair for a rectifiable and one-off isolated incident, rather than making a wider inquiry to determine whether a reasonable employer could have decided to dismiss on those facts.”

39	The Tribunal did not substitute their own views and we see no basis for the assertion that they did.  We consider it clear that the Tribunal had proper regard to section 98 (4) of the 1996 Act and to the tripartite approach required by the decision in British Home Stores Ltd v Burchell [1978] IRLR 379, at 380, and that they satisfied themselves that The Savoy had acted reasonably in concluding that dismissal was the course it could and should adopt.

40	The appellants also submitted a written skeleton argument in support of their appeal.  They repeated in it the point that The Savoy did not follow its own disciplinary procedure, a point we have already dealt with.  Certain of the other points they make in that argument are either obviously irrelevant or else seek to reopen the facts of the case, but do not raise any arguments of law which justify a full hearing of the appeal.  We make that point because of course we can only review the Employment Tribunal’s decision if it suffered from an error of law.

41	There is a criticism in the skeleton argument that the Tribunal did not apply the overall test of fairness.  The appellants assert that this was an isolated case which was not serious enough to amount to gross misconduct and they criticise the Tribunal for not considering whether it was right for people with long service to be dismissed “in respect of one mistake of this nature.”
42	That submission ignores the fact that the Tribunal found that The Savoy was satisfied that this one so-called mistake amounted to the perpetration of a deliberate fraud on it, which caused it to lose trust in the applicants.  The Tribunal found that The Savoy was entitled to conclude that the dismissal was a reasonable response to such conduct and we see no basis on which it can be contended that that conclusion was not one to which the Tribunal were entitled to come.

43	At the hearing before us this morning, Mr Kakoulli was the spokesman on behalf of all three appellants.  He essentially repeated the points which had earlier been set out in the written submissions we have referred to, but he supplemented them by saying that the reasons the Tribunal gave for their decision were inadequate and that the appellants were entitled to know why they had lost, a reference to the well-known principles identified in Meek v City of Birmingham City District Council [1987] IRLR 250.  Of course the appellants are entitled to know why they have lost, but in our view the Tribunal’s very full and careful reasons in this case were just as full as they needed to be; indeed, they were perhaps more so and they left the appellants in no doubt at all as to the reasons for the decision.

44	Mr Kakoulli made the point that in any event this was not a case in which the writing in of the earlier time could have resulted in any loss to The Savoy because he said the start times for any shift are always entered on The Savoy computer and it is by reference to that that the payments are made, not by reference to the starting time written in by the employees.  That point was also made to the Tribunal and is dealt with in paragraph 9 of their extended reasons.  The Tribunal there referred to Mr Sandiford’s evidence to the effect that, although he would know from the booking sheet what time hourly-paid employees were due to start, he did not put their actual starting times into the spreadsheet until he got the signing form, and they were paid for their time according to the information on the form.  The Tribunal accepted Mr Sandiford’s evidence on that and so made a finding that the information in the computer, by reference to which the appellants were paid, derived from the signing in times they wrote down.  The appellants may or may not agree with that conclusion, and indeed from Mr Kakoulli’s submission we infer that they do not; but it was a finding of fact which the Tribunal made and we see no basis on which we can regard it as a finding which was unsupported by any evidence or which justifies this appeal going through to a full hearing.

45	Overall, we have come to the conclusion that the appellants have not identified any error of law on the part of the Tribunal.  In those circumstances we conclude that there is no substance in these appeals and that we therefore have no alternative but to dismiss them and we do so.