Appeal No. UKEAT/0858/04/MAA

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 21 March 2005

Before
HIS HONOUR JUDGE BURKE Q.C.
MRS A GALLICO
MR H SINGH

Ms B ROGERS	APPELLANT

SLIMMA PLC	RESPONDENT

Transcript of Proceedings

JUDGMENT

Revised (1 July 2005)

	APPEARANCES

For the Appellant	MR J ODUNTAN
(Representative)	
For the Respondent	MS M WHEELER
(Of Counsel)
Instructed by:
Messrs Pinsent Masons
3 Colmore Circus
Birmingham
B4 6BH	

SUMMARY

ET’s decision as to selection for redundancy confused and logically indefensible.

HIS HONOUR JUDGE BURKE QC

The issues in this appeal
1.	Ms Rogers was employed by Slimma Plc (whom we shall call “Slimma”) as production manager of the Frank Usher Group, a division of Slimma which produces and supplies ladies garments.  Her employment was terminated with effect from 14 October 2003.  She claimed that she had been dismissed by reason of pregnancy or childbirth.  She had had maternity leave towards the end of 2002 and gave birth to a child early in 2003; and she claimed that her dismissal was automatically unfair pursuant to section 99 of the Employment Rights Act 1996 (“The Act”).  Alternatively, she claimed that her dismissal was unfair on the merits, in the light of section 98(4) of the Act.  She also claimed that, by reason of her pregnancy or childbirth, she had in the course of her employment been subjected by Slimma to detriment in breach of section 47(c) of the Act.

2.	Her claims were heard by the Employment Tribunal, sitting at London Central and chaired by Ms Leslie.  In a decision sent to the parties on 2 July 2004, the Tribunal rejected Ms Rogers’ claims that she had been unfairly dismissed, both on the basis of automatic dismissal and on the merits but found in her favour in one respect, namely that she had been subjected to detriment contrary to section 47(c) of the Act.  That finding was, however, provisional upon an unresolved issue as to whether the complaint under that section had been brought in time, which issue, together with any issue of remedy, the Tribunal adjourned to a subsequent hearing.

3.	Ms Rogers now appeals against the Tribunal’s decision that she was fairly dismissed.

4.	The Tribunal’s decision as to automatically unfair dismissal is not challenged.  The appeal is directed against the Tribunal’s decision on the merits that the dismissal was fair.  We should mention that there is a second appeal against the Tribunal’s decision at the subsequent hearing that Ms Rogers should pay a sum in the region of £1250 towards Slimma’s costs of the proceedings.  That appeal has been stayed pending the outcome of this appeal.

5.	The facts, which we take from the findings made by the Tribunal, can, for present purposes, be briefly stated.

6.	The Frank Usher Group had had financial problems for some time.  Over the period 2002 to 2004 sales fell by 32%.  In the years 2000 to 2004 there were four separate redundancy exercises in the Group.  Ms Rogers joined, as she knew it to be, an ailing employer.  She was a relatively senior employee.  It was not in dispute that her starting salary was £35,000 per annum; and she had a company car.

7.	The Tribunal had to examine and make findings upon numerous events in the history of the relationship between Ms Rogers and the Group’s senior director, who was Ms Rogers’ line manager, Mr Lee, and his personal assistant, Mrs Tipperman from August 2002, when Mrs Tipperman first appreciated that Ms Rogers’ was pregnant, through to October 2003, when Ms Rogers was dismissed.

8.	We do not need to go into the details of that history, which were relevant principally to Ms Rogers’ claim that she had been dismissed because of her pregnancy and that that dismissal was the culmination of a campaign directed against her by Mr Lee, in particular.  It is clear from the Tribunal’s findings that they rejected Ms Rogers’ assertion that she had been the victim of such a campaign; but they found that there was a number of occasions on which Mr Lee had shouted and sworn at her.

9.	By August 2003, as the Tribunal found, Ms Rogers had complained to Mrs Tipperman that Mr Lee was always critical of her and wanted to get rid of her; but Mrs Tipperman’s response was that Mr Lee behaved like that to everyone.  There was an incident in mid-September when Mr Lee was angry with Ms Rogers about an error made by a junior in Ms Rogers’ team and said to her that heads would roll as a result.

10.	During September and early October 2003, Mr Lee discussed reducing overheads in the light of the sales figures, which continued to decline, with Slimma’s Chief Executive, Mr Thwaite.  It was decided that the post of production manager was dispensable but that none of the other posts in the production department was dispensable.

11.	The Tribunal found that the requirements of the Group for a production manager had ceased, that there was a genuine redundancy situation and that the dismissal of Ms Rogers was wholly or mainly attributable to that redundancy situation; see paragraphs 18, 20 and 21 of their decision.  These conclusions were plainly open to the Tribunal on the evidence and have not been the subject of criticism in this appeal.

12.	What is, however, the subject of criticism, made with charm and appropriate force by Mr Oduntan, who is Ms Rogers’ husband and who has no legal experience but has plainly worked very hard in the preparation of this case and has learned a great deal of employment law as a result, is the Tribunal’s conclusion that the dismissal of Ms Rogers for redundancy was fair.

13.	At paragraph 16.25 of their decision, that being towards the end of paragraph 16 in which the Tribunal set out their findings of fact, the Tribunal said this:-

“On 3 October 2003 Mr Lee had a meeting with Mrs Tipperman to discuss the roles of the production team and to consider the question of redundancy.  The Applicant’s skills were not inter-changeable with the rest of the team and concluded that she was in a pool of one.  The Tribunal was far from satisfied that such an exercise took place.  Given the Applicant’s long experience in the fashion industry and the fact that she supervised and covered for members of the team when they were absent, the Tribunal accepted her skills were inter-changeable with Terry Barwick and Jill Gimbird (the Applicant accepted her skills were not inter-changeable with the other two members of the team i.e Janet White and Wendy Golding).  Mr Lee also conceded the Applicant’s skills were inter-changeable with the two junior assistants but the Tribunal accepted their positions would not have been suitable alternative employment for the Applicant.  In the circumstances, the Tribunal finds the pool should have comprised the Applicant, Terry Barwick and Jill Gimbird.  However, on the basis of last in first out (LIFO), which the Tribunal accepted Mr Lee also used as a criterion, the Applicant would have been selected for redundancy in any event.”

14.	The Tribunal went on to find that, on 7 October 2003, Mrs Tipperman told Ms Rogers that she was to be made redundant or rather that her post was to be made redundant.  This was the first that Ms Rogers knew about it, so far as one can tell from the decision.  The Tribunal found that, according to Mrs Tipperman, she asked Ms Rogers if she could undertake the jobs of any of the other members of the production team and Ms Rogers replied that she was not qualified to do so.  Mrs Tipperman offered Ms Rogers the opportunity to go home for a week to think about her position, which offer Ms Rogers accepted.

15.	The Tribunal found, in paragraph 16.27, that on the following day Mrs Tipperman wrote to Ms Rogers asking her to come back with any input by 14 October 2003.  That is a reference to a letter dated 8 October in which the Frank Usher Group said:-

“Having looked at the alternatives and made the necessary selection assessments, regrettably, we cannot offer you an alternative position within the company.  However, please let us have your input as to whether you feel there are any positions within the Group that you feel are within your capabilities.  Please contact Rita Tipperman by 14 October in respect of this possibility.”

Miss Wheeler tells us, and this appears to be common ground, that, in that paragraph from that letter, the word “company” refers to the Frank Usher Group and the word “Group” refers to Slimma, i.e., the whole plc which was the employer.

16.	The Tribunal went on to say that, at this point, that is on 8 October, Mr Oduntan became involved (although they do not say how).  Ms Rogers did not return to see Mrs Tipperman, as she had been asked to do; and, as a result, she was dismissed by a letter of 15 October; see paragraph 16.28.

17.	Mr Oduntan tells us that Ms Rogers had, on 14 October, the day by which she had been asked to go back to provide input to the Group in response to the letter of 8 October, attempted to speak to Mrs Tipperman by telephone; but Mrs Tipperman was unavailable.  He so asserted in a letter which he wrote to the Frank Usher Group on the same day.

18.	The Tribunal’s decision is silent as to whether they accepted or rejected the account that there had been an attempt to contact Mrs Tipperman by telephone on 14 October.  The Tribunal found that Ms Rogers did not return to see Mrs Tipperman; but that, of course, does not rule out the possibility of the telephone conversation having taken place.

19.	Having found the facts, the Tribunal then found, as we have said, that the dismissal was wholly or mainly attributable to a genuine redundancy situation and, in paragraph 22, continued as follows:-

“22.	The Tribunal was not satisfied the Respondent applied its mind to the pool. If the pool was constructed on the basis of skill and expertise, the Tribunal considered Terry Barwick and Gill Gimbird should have been in the pool as well.  However, the Tribunal accepted Mr Lee also used LIFO as a criterion.  On the basis of LIFO, the Applicant would have been selected for redundancy in any event.  The Tribunal accepted the use of LIFO in the context of this case was fair and objective.

23.	The Tribunal was satisfied the Applicant was properly consulted about her possible redundancy, as far as it was possible to do so.

24.	Accordingly, the Applicant’s claim for ordinary unfair dismissal fails and is dismissed.”

20.	The Notice of Appeal submitted on Ms Rogers’ behalf by Mr Oduntan, contains four grounds, of which the last has been withdrawn.  The first three grounds go to those three aspects of fairness which routinely arise in redundancy dismissals, namely selection, consideration of alternative employment and consultation.  This is not one of those cases in which one or more of those issues was not raised before the Tribunal.  Authorities such as Langston v Cranfield University [1998] IRLR 172 (to which we were referred), in which the Employment Appeal Tribunal held that a Tribunal is bound in considering the fairness of a redundancy dismissal to consider those three issues, whether specifically raised by the employee or not, are not in point in this appeal.

21.	We acknowledge that the main part of the evidence before the Tribunal was directed to Ms Rogers’ case that there had been against her the campaign which we have described and that she had been dismissed for an inadmissible reason.  That case involved the examination by the Tribunal of a substantial history; but Miss Wheeler, on behalf of the Respondents, fairly accepts that the Tribunal were obliged to consider the alternative albeit subsidiary case that, if the dismissal was for redundancy, that dismissal was unfair and to examine in so doing the three issues of selection, alternative employment and consultation.

22.	Mr Oduntan’s first point in relation to selection is that the Tribunal failed, in considering the fairness of the selection of Ms Rogers for redundancy, to take into account the effect of their finding that at about the same time as that at which Mr Lee was discussing with Mr Thwaite the continuing decline in sales and what was to be done about it and, about two or three weeks before she was told that her job was redundant, Mr Lee said to Ms Rogers, in the context of his anger over a mistake in her team, “heads will roll”.  Mr Oduntan submits that that comment must have prejudiced the selection process.

23.	There are, in our judgment, three responses to this point.  The first is that Mr Lee did not say that Ms Rogers’ head would roll but that “heads” in the plural would roll: yet in the production department, which had been responsible for the error which had caused Mr Lee to become angry and to use the words the Tribunal found him to have used, Ms Rogers alone was made redundant.  There would not in logic seem, from the remark alone, necessarily to have been a direct connection between the remark and the redundancy.

24.	Secondly, the Tribunal found as a fact that there was a genuine redundancy and that Ms Rogers was dismissed by reason of that redundancy and, by implication, not by reason of whatever antagonism Mr Lee felt in relation to Ms Rogers.

25.	Thirdly, and most significantly, the Tribunal, at paragraph 21.2 of their decision, expressly said that they accepted that the redundancy of Ms Rogers was genuine and did not come about “because Mr Lee wanted her head to roll”.  Thus, the Tribunal found as fact that the remark which is the subject matter of Mr Oduntan’s submission was not causative of the redundancy or, at least, substantially causative of the redundancy; and, Mr Oduntan’s point, in our judgment, must therefore fail.  Mr Lee’s remark about heads rolling must be regarded as having had no or no significant influence upon Ms Rogers’ dismissal.

26.	However, it does not by any means follow that Mr Oduntan’s attack on the process by which Ms Rogers was made redundant must fail as a result. It is next necessary to consider Mr Oduntan’s criticisms of the Tribunal’s conclusion that the selection process was fair.

27.	We have already set out paragraph 16.25 of the Tribunal’s decision.  In that paragraph the Tribunal, in our judgment, clearly rejected the evidence of Slimma that Mr Lee and Mrs Tipperman had considered the question of redundancy and concluded that Ms Rogers’ skills were not interchangeable and that she was, therefore, in a pool of one.  The Tribunal said that they were far from satisfied that such an exercise had taken place.  They were thus finding as a fact, that there had been no such selection exercise at all.  

28.	The Tribunal then concluded on the facts that Ms Rogers’ skills were interchangeable with two other employees in the production team, Mr Barwick and Miss Gimbird and that there was, therefore, a pool of three employees from which a redundant employee should have been chosen; see, in particular, the words “in the circumstances the Tribunal finds the pool should have comprised the Applicant, Terry Barwick and Gill Gimbird.”  And at paragraph 22, the Tribunal again said that they considered that Terry Barwick and Gill Gimbird should have been in the pool as well as Ms Rogers.  The Tribunal was, therefore, finding that the selection exercise should have involved selecting one from that pool of three but that there had been no such selection exercise and, thus, no selection exercise at all.

29.	However, the Tribunal then went on to say, at the end of paragraph 16.25, that Ms Rogers would have been selected for redundancy in any event on the basis of LIFO, which the Tribunal accepted Mr Lee also used as a criterion.

30.	The Tribunal did not find that LIFO was the sole criterion.  There is a dispute as to whether there was evidence from Slimma that LIFO was a matter which they considered at all, which dispute we do not propose to enter upon; but there is no suggestion of any evidence from anybody that LIFO was the sole selection criterion operated by Slimma.  If there was any such evidence, there was certainly no finding to that effect.  Nor is there any finding that LIFO was a dominant criterion which would always prevail over the other two criteria of which the Tribunal did speak in paragraph 22, namely, skill and expertise, whatever the differentials between one employee and the others in terms of those criteria and whatever the difference in length of service.  On the Tribunal’s findings, there were at least three criteria, skill, expertise and length of service, which could or should have been taken into account in the selection process.  But none of them was because there was, on the Tribunal’s findings, no selection process at all.

31.	Thus, in our judgment, the Tribunal was bound in the light of their own findings to consider fairness on the basis that the employers should have selected one employee from the pool of three, considering LIFO as one of the three relevant criteria but clearly they did not in fact do so.

32.	It would, of course, have been open to the Tribunal to consider whether, if the exercise of selection from the pool of three had been carried out on the basis of the criteria, the result would have been the same, i.e. Ms Rogers would have been selected.  But the Tribunal could not decide, as they did, that the result would have been the same purely on the application of LIFO unless the criteria for selection were such that, whatever the result of the comparison of the three employees in the pool, LIFO must inevitably have dictated the result; and, as we have said, there is no finding to that effect.

33.	Thus it seems to us to be manifest that the error in relation to selection, which the Tribunal found in paragraph 16.25 and paragraph 22 to have occurred, could not be cured by the application of LIFO because LIFO was not and the Tribunal did not regard it as being the sole criterion.  We point again to the use of the word “also” in the vital sentence at the end of paragraph 16.25, used in precisely the same way again in paragraph 22.

34.	Miss Wheeler submitted that the Tribunal, in referring to a pool of three in paragraph 16.25, were speaking not of a pool for selection for redundancy but of a pool of employees whose positions needed to be considered as part of the search for alternative employment for Ms Rogers.  She accepted that the language of paragraph 16.25 is confusing and, perhaps, muddled; but she points out, firstly, that at paragraph 16.25 the Tribunal expressly referred to alternative employment in considering the position of the two assistants, junior to Terry Barwick and Gill Gimbird, secondly, that in paragraph 10.1 of their decision the Tribunal directed themselves that they had to apply their minds to the question of the pool for selection, but referred to the case of Thomas & Betts Manufacturing Ltd v Harding [1980] IRLR 255, which is not a case about selection but a case about alternative employment and, thirdly, that the job of production manager was redundant as the Tribunal found.  This put Ms Rogers in the frame for redundancy and, in reality, the issue was not at all about selection but about alternative employment.

35.	We agree with Miss Wheeler that paragraphs 16.25 and 22, taken together, are to a degree, muddled, although paragraph 22 tends to illuminate paragraph 16.25 and persuades us that the way we have interpreted paragraph 16.25 is correct; but it is, in any event, clear to us from the words used by the Tribunal that the Tribunal were rejecting the evidence given on behalf of the employers as to how Ms Rogers came to be selected and were finding on the facts that she should have been considered for selection in a pool of three.  In the last sentence, where they refer to LIFO, the Tribunal speak of Ms Rogers being selected for redundancy in any event.  In paragraph 10.1 they direct themselves to consider issues of selection.  Both paragraph 16.25 and paragraph 22 are largely, if not wholly, devoted to setting out the Tribunal’s thoughts about selection.  We cannot accept Miss Wheeler’s submissions, ably as they were put, that the discussion about the pool of three is a discussion not about selection but about alternative employment.

36.	In any event, even if Miss Wheeler is right, whether the Tribunal were considering selection or alternative employment, the last sentence of paragraph 16.25 cannot stand up in the absence of a finding, that had there been a fair process, Ms Rogers would have been dismissed in any event by reason of LIFO for the reasons which we have already set out.

37.	Accordingly, in our judgment, the Tribunal’s approach to the selection issue was fatally flawed and their decision on that issue was central to their conclusion that the dismissal was fair.  For those reasons we have come to the conclusion that the Tribunal’s determination of the issue of fairness in terms of selection cannot stand and, thus, the decision that Ms Rogers was fairly dismissed cannot stand.  We should say that we were taken to a number of authorities by Mr Oduntan, for which we are grateful; but in the light of the reasons which we have set out for our conclusion that the Tribunal erred in law in their approach to this issue, it is not necessary for us to refer to those authorities any further.

38.	We need to say, before passing on to the issues of alternative employment and consultation, that we do not believe that we are in any position, contrary to what Mr Oduntan would like us to believe, to substitute our own view as to what the result of an analysis of an appropriate selection process would have been.  It appears to us to be essential that the issue of fairness, insofar as we have described it so far, should go back to the Tribunal and should be reconsidered.  Miss Wheeler has submitted that it should be reconsidered by the same Tribunal in the light of this judgment; but we do not think that that would produce justice between the parties; and we have no doubt that it is necessary for this case to go back to a differently constituted Tribunal.

39.	That Tribunal will inevitably have to consider all the facts which relate to the fairness of the dismissal.  That being so, we take the view that it would be wise for us not to enter into any final decision as to the rival arguments about alternative employment and consultation, which issues cannot be divorced from the issue of fairness and will be have to be re-looked at by the fresh Tribunal.

40.	However, it is necessary to say just a few words about those issues so far as alternative employment is concerned.

41.	We would say first of all, that there does not appear to be any finding in the Tribunal’s decision as to that issue.  If we are right that, in paragraph 16.25, the Tribunal were not dealing with alternative employment, at least, directly (and in any event, in that paragraph they were only setting out their findings of fact) then it is not possible to find elsewhere in the decision what the Tribunal really thought about the alternative employment issue.  Miss Wheeler says that one can infer from the whole of their decision what their view was; but there are no reasons given for any decision on that issue against Ms Rogers, or for that matter, in the other direction; and the position would appear to us, therefore, to be open and one which will have to be considered by the new Tribunal.

42.	We would, however, say this.  The employers rely on the letter, given to Mr Oduntan for his wife on 8 October, in which they invited Ms Rogers to put to them suggestions as to jobs which might be available for her in Slimma as a whole, as opposed to in the Frank Usher Group alone.  The Tribunal which hears this case will want, of course, to consider all relevant aspects of the issue of alternative employment.  One of those aspects will have to be whether reasonableness and fairness required consideration of positions outside the Frank Usher Group and in Slimma as a whole; and, it may also be necessary for them to consider the extent to which reasonableness and fairness were satisfied by the employers merely asking the employee to make suggestions as to whether there were any positions open which she felt she might be able to slot into.

43.	As to consultation, we have some reservations about the Tribunal’s decision on that issue too; in particular, we are concerned as to the lack of reasons which are given by the Tribunal for their conclusion that consultation was adequate and the sparseness of the findings of fact, as to what happened between 7 and 14 October, including the absence of any finding of fact as to the telephone call, which, it was alleged, Ms Rogers had made in order to find Mrs Tipperman on 14 October.  However, that matter too will be before the Tribunal to reconsider, because what we are remitting is the whole question as to whether the dismissal of Ms Rogers for redundancy was fair or unfair having regard to the terms of section 98(4) of the Act.

44.	We make it absolutely clear that we are not remitting any issue as to the other matters in the case.  Mr Oduntan accepts that the Tribunal has made its determination on the facts as to what was his principal case on behalf of Ms Rogers before the Tribunal, that the Tribunal have validly found that there was no campaign, that the dismissal was not one which was automatically unfair and, that there was a genuine dismissal for redundancy.  Those findings of the Tribunal are now fixed and no longer open to challenge.

45.	The appeal is, therefore, allowed to the extent which we have described.