Appeal No. UKEATS/0065/05/RN

EMPLOYMENT APPEAL TRIBUNAL
52 MELVILLE STREET, EDINBURGH, EH3 7HF

	At the Tribunal
On 6 April 2006 

Before
THE HONOURABLE LADY SMITH
MR P HUNTER
MR P PAGLIARI

CHRIS PROJECT	APPELLANT

MRS LARA HUTT	RESPONDENT

Transcript of Proceedings

JUDGMENT

APPEARANCES

For the Appellant	Mr F Dawson, Welfare Rights Officer	
For the Respondent	Mrs L Hutt, the Respondent in person	

SUMMARY

The claimant was dismissed.  In her application to the Employment Tribunal, she alleged both that she had been made redundant and was entitled to a redundancy payment and that she had been unfairly dismissed and/or selected for redundancy.  She also claimed unpaid wages.  The respondent’s response included a statement that the claimant had been dismissed for gross industrial misconduct some of which was criminal.  The Employment Tribunal refused an application for a second adjournment to allow further steps to be taken in connection with the reporting of the case to the police.  Prior to the hearing of any evidence, the Chairman told the respondent’s representative that he may be in some difficulties in his case in the light of what was contained in the productions, prior to having heard any evidence.  The Employment Tribunal found the claimant entitled to compensation in respect of past and future loss of earnings.  The Employment Appeal Tribunal remitted the case to a freshly constituted tribunal in respect that they were satisfied that the Chairman’s comments were such as to give the impression that there was a real possibility of pre-judgment.

THE HONOURABLE LADY SMITH

Preliminaries
1.	This case concerns a claim by the claimant that she was unfairly dismissed by the respondent from her employment as an information worker.

2.	This judgment represents the views of all three members.  We will refer to parties as claimant and respondent.

Introduction
3.	This is an appeal by the respondent in those proceedings against a decision of an Employment Tribunal sitting at Glasgow, chairman Mr R A MacKenzie, registered with extended reasons on 10 June 2005.  The claimant was represented there by Mr G Booth, consultant but represented herself before us, and the respondent was represented there and before us by Mr F Dawson, Welfare Rights Officer.

4.	The claimant claimed compensation for unfair dismissal.  The respondent’s case in its Notice of Appearance was that the claimant was dismissed for gross industrial misconduct, some of which was criminal.  There is a reference to discrepancies in funds administered by the claimant and that consideration was being given to reporting the matter to the police.  However, in circumstances which we explain more fully below, the respondent departed from that position in the course of the hearing on evidence before the tribunal and conceded that the claimant had been unfairly dismissed.
5.	Compensation was fixed in the sum of £4,933.84.

The Issues before the Tribunal
6.	The tribunal determined two issues, firstly whether or not the respondent’s application for an adjournment should be allowed and secondly whether the claimant should received compensation and if so, in what sum.

The Employment Tribunal Hearing
7.	We should refer firstly to a matter which is not evident from the tribunal’s reasons but was raised as the principal ground of appeal on behalf of the respondent.  Both in the Notice of Appeal and before us, it was stated that, at the start of the hearing, the Chairman said to the respondent’s representative:
“You have an uphill struggle here.”

8.	The Notice of Appeal was sent to the Chairman for his comments and he replied in a document headed ‘Answers’ dated 4 October 2005.  He advises, in that document that at the outset, prior to the motion to adjourn and prior to any evidence being led, he “may have made” an observation to the respondent’s representative that it:
“may be in some difficulties in maintaining that the claimant was dismissed by reason of her conduct as it appeared from the productions  lodged by the Appellants that there was no indication that the reason for the Respondent’s dismissal was her conduct.”

9.	He adds that he:
“does not have any recollection of saying to the Appellant’s agent ‘you have an uphill struggle here’.  It is not an expression the Chairman uses or would choose to use.  Other than as stated in the foregoing paragraph the Chairman would have given no indication as to the Appellants’ prospects of success.”
10.	As is evident from the tribunal’s reasons, the request for an adjournment was refused.  The circumstances were that this was the second such request.  The first had been made, and granted, some six months earlier to enable the respondent to report its concerns to the police.  That had happened but the respondent required to provide audited accounts before matters could be investigated.  The police had advised that there were no ongoing investigations.  The tribunal took the view that the respondent had had ample time and it was not at all clear that the police would take matters any further even if the further information was provided to them.  The hearing proceeded.

11.	After the refusal of the adjournment sought, the respondent proceeded to lead evidence from Mr Hackett, who had been Chairman of the Project at the relevant time.  After he had been giving evidence for about 35 minutes, a point was reached where he was being questioned about accounts that had been lodged.  The respondent’s agent asked for a short adjournment which was extended over the lunch break.  We were advised by Mr Dawson that he sought the adjournment because the Chairman had taken over the questioning and the witness was confused and distressed.  At 2pm, it was intimated that it was conceded that the claimant had been unfairly dismissed and that parties had not been able to achieve a negotiated settlement.  We were advised that the reason the concession was made was that Mr Dawson considered that the respondent’s case was ‘dead in the water’ given the comment made by the Chairman at the start of the proceedings.

12.	The tribunal determined compensation.  The claimant had been working 17½ hours per week and earning £115 net.  She was dismissed on 23 April 2004.  The tribunal found that she managed to obtain employment on 5 September 2004 for 22½ hours per week and that on occasions, she required to work evenings which she found unsuitable due to family commitments.  She earned £103.85 on average in that job.  She turned down an offer of a better paid post as duty manager as she did not want to work the hours involved.

13.	The tribunal found that the claimant resigned from that job on 23 March 2005 ‘due to her inability to manage her family commitments’.  On 9 May 2005, she began work on a self employed basis selling from a mobile snack bar.  The tribunal found that it would have been reasonable for the claimant to carry on in the job that she had until she found other suitable employment.  They took the view that it was uncertain when, in her self employed capacity, she would earn the equivalent of her pre-dismissal earnings but calculated compensation on the basis that she should be in such a position by September 2005.

14.	The tribunal awarded compensation on the basis of compensating the claimant for her lost earnings between the date of dismissal and the start of her new job in September 2004, in full and thereafter awarding her compensation in respect of the shortfall as between her previous rate of earnings and her earnings in that job from September 2004 until September 2005.

The Appeal
15.	Mr Dawson stated that the Chairman said to him:  “You will have an uphill struggle.”  The respondent did not recall there having been any such comment and thought that she would have remembered it if there had been as it would have been favourable to her.

16.	Mr Dawson advised that he took it to mean that the tribunal had prejudged the question of whether or not there was a defence to the claim.  It should have acted impartially and not prejudged the case.  The concession that the claimant had been unfairly dismissed had been made because of that prejudgment and he sought to be allowed to withdraw it.  We saw no reason for not accepting that the concession was made because of his belief that the tribunal had prejudged the case.  He referred, in support of his submission, to the case of Ellis v Ministry of Defence [1985] ICR 257.

17.	Separately, he sought to submit that the adjournment should have been allowed, that the tribunal had failed to regard the claimant as having failed to take reasonable steps to mitigate her loss and that they had awarded future loss of earnings without there being any evidence to support that claim.  It was, though, evident that his primary ground of appeal related to the Chairman’s comment.

18.	Mrs Hutt submitted that the issue of prejudgment became academic once the concession of unfair dismissal was made, that there was no good reason for granting a further postponement in the case, and that the tribunal’s assessment was properly arrived at and not perverse.

Discussion and Conclusions
19.	It is fundamental that justice must not only be done before an Employment Tribunal but must be seen to be done.  There must be no bias on the part of the tribunal and they must give no impression of bias.  The test is an objective one and is that of whether the fair minded and informed observer present at the hearing, not being a party or associated with a party, having considered the facts, would consider that there was a real possibility that the tribunal was biased (Porter v Magill [2002] 2AC 357; Jiminez v London Borough of Southwark [2003] IRLR 477).  To give the impression that the case has been prejudged is to give the impression of bias (Ellis v Ministry of Defence).  Such an impression can be given by the appearance of a closed mind against a party on a matter which the tribunal has to decide before that party has presented evidence and submissions regarding it.

20.	Since the claimant does not accept that the Chairman used the words which Mr Dawson alleges, we proceed on the basis of what we are advised by the Chairman in his Answers, which we have set out above.  We consider it appropriate, in the circumstances, to treat the Chairman’s acceptance that he ‘might have said’ words to the effect set out by him as indicating that that is what happened.  The objective observer would have seen that it was an exchange between the Chairman of the tribunal and a lay representative.  Mr Dawson, that lay representative, appeared before us; he was anxious, not confident and it was easy to envisage that he would have been vulnerable to pressure.  We see no reason to think that he would have given any different an impression to the objective observer.  It was an exchange that took place before any evidence had been led in the case, or submissions made.  It was specifically directed to an issue that was before the tribunal for determination, given the terms of the respondent’s response to the claimant’s application.  It was indicative of there having been a prior consideration of the productions and a view having been reached on them before they were referred to in evidence.  It was clearly indicative of that view being that those productions did not support the respondent’s defence to the claim and, furthermore, that being so, that the view had been taken that the respondent must be in difficulty with its defence.  The Chairman did not say that he was expressing only a preliminary or provisional view or that the tribunal remained open to persuasion on the matter.

21.	In these circumstances, whatever was intended by the Chairman, we are satisfied that the objective observer would have considered that the making of the comments that were made at the time and in the circumstances that they were made meant that there was a real possibility that the tribunal had a closed mind to the effect that there was no merit in the respondent’s defence.  Further, we consider that such an observer would have considered that the Chairman’s statement was at risk of putting undue pressure on the respondent’s representative to refrain from advancing the respondent’s misconduct defence.

22.	There are, of course, occasions when a judge or tribunal can quite properly explore difficulties that have become apparent from the evidence in a case, prior to the point at which all evidence has been led and submissions made, whether with a view to encouraging parties to consider settlement or narrowing the issues between them, or otherwise.  There must, though, be few occasions when that can properly be done at a point prior to the leading of any evidence in the case since, at that stage, there is, by definition, no evidence before the court or tribunal on which it can comment.  Moreover, if minded to make such a comment, it is plain that the risk of giving an impression of prejudgment will arise if it is not made clear to the parties that any views expressed are but provisional, that the tribunal’s mind is not yet made up and that it remains open to persuasion.

23.	We turn then to consider whether, in the circumstances of this case, our intervention is justified.  In our view, it is.  Not only has there been an appearance of bias but its effect was such as to cause the respondent’s representative to make a concession regarding unfair dismissal.  The appeal will, accordingly, be allowed.

24.	In these circumstances, we do not require to reach a decision in respect of the respondent’s second, third and fourth grounds of appeal.  Had we had to do so, we would not have been inclined to allow the appeal in respect of either the second or third ground.  The question of whether or not to adjourn was within the tribunal’s discretion and no grounds were advanced on which we could have interfered with it.  The matter of mitigation of loss was addressed by the tribunal, they made a decision in respect of it which they were entitled to reach on the evidence before them and, again, no grounds were advanced which would have allowed us to interfere with their assessment of what was reasonable in the circumstances.  We may have been minded to allow the appeal in respect of the fourth ground of appeal as the tribunal do not appear to have had any evidence before them which entitled them to assume that the claimant would not, through her self employed earnings, eliminate her £11.15 per week shortfall prior to September 2005 but we observe that the effect that success on that ground would have had would have been  de minimis in the context of the overall value of the award.

Disposal
25.	In the event, we will, firstly, allow the respondent to withdraw the concession made regarding unfair dismissal, allow the appeal and remit the case to a freshly constituted tribunal for a re-hearing.