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	United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Luke v Stoke On Trent City Council [2006] UKEAT 0344_06_1512 (15 December 2006) URL: http://www.bailii.org/uk/cases/UKEAT/2006/0344_06_1512.html Cite as: [2007] IRLR 305, [2006] UKEAT 344_6_1512, [2006] UKEAT 0344_06_1512

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APPEARANCES

 

For the Appellant	MS CATHERINE O'DONNELL (of Counsel) Instructed by: Messrs Cowlishaw & Muntford Solicitors 90 High Street Uttoxeter ST14 7JD
For the Respondent	MS SOPHIE GARNER (of Counsel) Instructed by: Stoke on Trent City Council Office of the Council Manager Education HR Floor 2, Civic Centre Glebe Street Stoke on Trent ST4 1RJ


 


SUMMARY

Contract of Employment – Implied term

Unlawful Deduction from Wages – Ready, Willing and Able to Work

The employee had been off work following allegations that she was bullied by her manager. An independent investigator rejected her claims. The employers proposed her return to work in accordance with an action plan suggested by the investigator, on the basis that she accepted the investigator's conclusions. The employee refused to return on that basis. In order to avoid an impasse the employers proposed her temporary "redeployment" to duties outside the express scope of the contract. When she refused to perform such duties they declined to continue to pay her wages. The issue was whether the employers were entitled to require her to perform the duties in question.

Held that the Tribunal was entitled to find that there was an implied term of the contract which entitled the employers to require her to do different work on a temporary basis and in the exceptional circumstances of the case. Millbrook Furnishing Industries Ltd v McIntosh [1981] IRLR 309 and Courtaulds Northern Spinning Ltd. v Sibson [1988] ICR 451.


 


THE HONOURABLE MR JUSTICE UNDERHILL

1. This is an appeal against the decision of an Employment Tribunal sitting at Shrewsbury. The claim was heard over several days between April and July 2005, and the Tribunal's Judgment was promulgated on 2 August 2005. The situation giving rise to the claim and appeal can be summarised as follows:

(1) The Appellant, Mrs Luke, is a special needs teacher. She has since 1996 been employed by the Respondent (to which we will refer to as "the Council") under a contract – "the ACE contract" - to teach for 12¾ hours per week at what was originally known as the Queensberry Centre Pupil Referral Unit but is now known as the Assessing Continuing Education Pupil Referral Unit ("the ACE Centre"). The Centre is a unit for children between the ages of 11-16 with severe behavioural problems such that they cannot be accommodated in ordinary schools. Mrs. Luke taught English there. It is the only such unit run by the Council. Mrs. Luke has also since (at least) April 2003 had a separate contract with the Council – "the Merit contract" - to teach 10 hours per week at a separate unit called the Merit Pupil Referral Unit. The Merit Unit is for children with medical problems which prevent them attending an ordinary school: Mrs. Luke taught children of various ages in a range of subjects. The work done by her under the two contracts is thus different, albeit that both can be described as "special needs teaching".

(2) Unfortunately problems arose between Mrs. Luke and the Head Teacher at the ACE Centre, Mrs. Chambers. Mrs. Luke was off sick between October 2002 and April 2003 and alleged that she was the victim of bullying and harassment by Mrs. Chambers. The Council commissioned a report from an independent investigator, Mrs Chadwick, which dismissed all save one of Mrs Luke's 33 complaints and proposed an Action Plan, involving the use of a mediator, designed to assist her in returning to work at the ACE Centre.

(3) Mrs Luke indicated that while she was willing to take part in the Action Plan she was not prepared to accept the conclusions of Mrs Chadwick's report. The Council took the position – which the Tribunal held to be reasonable – that the Action Plan would not work on that basis, and it was not prepared to allow her back to work at the ACE Centre unless she accepted the report's conclusions: the principal decision-maker in this regard was Mr. Cartlidge. A meeting was called under the disciplinary procedure (relating not to Mrs Luke's failure to accept the report but to matters which had been deferred pending investigation of her grievance); but, in order to avoid having to go down the disciplinary route, the Council on 13 June 2003 formulated instead a proposal that (in the Tribunal's words):

"Mrs Luke's return to Ace should be deferred still further, possibly forever, but that she would be found equivalent hours doing similar work in other parts of the Authority. She would not suffer any detriment in terms of salary or status."

(4) Mrs. Luke indicated that she was agreeable in principle to this proposal, and Mr. Penny, the manager responsible, set about coming up with a firm plan. Before he could do so, however, Mrs. Luke changed her mind. Picking up the story at para 12.4 of the Tribunal's Judgment:

"In August 2003 Mrs Luke made it clear that she was not willing to agree to the proposals of 13^th June and that she was intent on a return to the Ace Centre. Mr Penny was in a difficult situation. It was his view and that of his line managers that a return to the Ace Centre was not possible without the implementation of the Action Plan, that the Action Plan could not be implemented without the acceptance of the report and as things stood, Mrs Luke did not accept the report. He therefore took the decision that he would not allow Mrs Luke to return to the Ace Centre and to use a word that he used, which may have been unfortunate, he indicated that she was to be redeployed."

(5) Various possibilities were explored over the following months. Not unreasonably, the Council was unhappy with a situation where Mrs. Luke was being paid under the ACE contract but was not doing any work at the Centre because she was not willing to return on what it believed – reasonably, as the Tribunal found – was the only basis which was likely to be workable. One proposal which was made was that Mrs. Luke should simply increase the hours worked under the Merit contract. However, all the alternatives proposed foundered on the rock of Mrs. Luke's insistence that she should return to the ACE Centre (but without accepting Mrs. Chadwick's conclusions). As the Tribunal found at para. 12.6 of its Judgment:

"We find that all of these approaches and offers of additional work were declined by Mrs. Luke. We fully accept what she says, that nothing hard and fast was ever offered to her, no specific dates of times or cases. We find that that is because she never allowed the discussions to get that far: she repeatedly put obstacles in her way, saying that she was entitled to return to Ace."

(6) Eventually, in the light of the impasse which had been reached, on 11 February 2004 the Council stopped payment of Mrs Luke's wages. She was not, however, dismissed and she remains formally employed under the ACE contract (so far as we are aware) to this day.

2. The present proceedings were commenced in August 2004. Various claims were made, but the present appeal is concerned only with her claim under Part II of the Employment Rights Act 1996 for unlawful deduction of wages from February 2004. As to that, her case was and is that she was at all times ready and willing to do the only work which she could contractually be obliged to do, namely work at the ACE Centre, and that accordingly her wages were "properly payable" within the meaning of s. 13 (3) of the Act.
3. The Tribunal dismissed Mrs. Luke's claim. It held that the Council had, in the circumstances which arose, been contractually entitled to require her to work elsewhere than at the ACE Centre; and that since she had made it clear that she was not prepared to do so no wages were payable. It stated its reasons at para. 14 of its Judgment, as follows:

"The respondents' counsel referred us to a case very much on the point - Courtaulds Northern Spinning Ltd –v- Simpson and the Transport & General Workers' Union [1988] IRLR 305. That case is authority for the proposition that it can be implied into a contract of employment that an employer can reasonably require an employee to work at a location other than that specified in the contract, so long as the employee is not suffering a detriment, so long as the place is within reasonable travelling distance from home. Now here we find that Mr Penny was dealing with a unique situation and one which neither party could really have envisaged. Effectively, both parties agree that Mrs Luke could not go back to Ace without the implementation of the Action Plan. We find that Mr Cartlidge was reasonable in saying that he would not allow the Action Plan, with its resource implications for the Authority and so on, to be implemented, if Mrs Luke was not accepting the report, in other words unless he could be sure that a line had been drawn under the previous grievances. Therefore Mr Penny's position was that Mrs Luke could not return to Ace; and in those circumstances we have no difficulty in importing into this contract a requirement that he could ask her to do something else on a temporary basis, until a long term solution to the problem could be found. As I have said, possible long term solutions that appeared to him were threefold. One is that an alternative which suited her and which could become permanent would emerge, the other is that a way forward on the report would emerge and she could eventually go back to Ace under the Action Plan. Thirdly, that she would leave service on agreed terms. But it was important to him that she was working in some kind of capacity in the meantime in order to justify the fact that the Local Authority, using public funds for paying her salary [sic]. So we feel that he was entitled to require her to work elsewhere and he gave her every opportunity to cooperate in that the requirement by speaking to the line managers concerned and agreeing the precise details. We find that Mrs Luke refused to undertake that work and that in those circumstances she was not performing the work under the contract and she was not entitled to the salary under the contract and accordingly, there has been no unlawful deduction for the purposes of section 13 of the Employment Rights Act 1996."

4. The determinative issue in the appeal is whether the Council was contractually entitled to require Mrs. Luke to work otherwise than at the ACE Centre. (We should say that the case was not argued before the Tribunal or before us on the basis that Mrs. Luke's refusal to accept Mrs. Chadwick's report undermined or impugned her expression of willingness to work at the Centre.) It is accordingly necessary that we should identify in more detail the written terms of the contract. The only contractual document appears to have been a standard-form "Written Statement of Particulars of Terms of Employment", i.e. the statutory statement of terms required by Part I of the 1996 Act: nothing in this case turns on the question whether the statement doubles up as the contract itself or is merely the best evidence of its terms, and we will refer to it simply as "the contract". It is headed "Queensberry Vocational Centre - Pupil Referral Unit". Para. 1 sets out certain key details (such as date of appointment and nature of post) and concludes with the words "You will serve at: The Pupil Referral Unit": the Tribunal found, and it is common ground, that that is a reference to the specific unit referred to in the heading, i.e. what is now the ACE Centre. On the face of it, therefore, the contract is plainly a contract to work at the ACE Centre and – subject to what we discuss below – nowhere else.
5. As appears from the passage from its Judgment set out in para. 3 above, the Tribunal based its conclusion that Mrs. Luke could be required to work elsewhere than at the ACE Centre, notwithstanding the express terms of the contract, on the decision of the Court of Appeal in Courtaulds Northern Spinning Ltd. v Sibson [1988] ICR 451. We need therefore to consider with some care what was decided in that case. We analyse it as follows:

(1) The employee was an HGV driver based (from the inception of his employment) at the employers' transport depot at Greengate, near Manchester. He resigned from the union, whose members at Greengate then refused to work with him. The employers sought to transfer him to another of its depots, Chadderton Mill, less than a mile away. He refused to move and was dismissed.

(2) The employee brought proceedings for unfair dismissal. The decisive issue was whether the employers were entitled to transfer him to Chadderton Mill. The Court of Appeal, differing from the Industrial Tribunal and the Employment Appeal Tribunal, held that they were. Slade LJ, delivering the leading judgment, treated the case as one in which the contract of employment was silent on an essential matter, namely what were "the place or places where [the employee] was expected to work" (see at p. 461A); and on that basis he held that it was necessary to imply "a term which the parties, if reasonable, would probably have agreed if they had directed their minds to the problem" (see at p. 460 D-E).

(3) In reaching that conclusion Slade LJ approved, and adopted the approach in, the decision of the Employment Appeal Tribunal in Jones v Associated Tunnelling Co. Ltd. [1981] IRLR 477. In that case Browne-Wilkinson P. had said this, at para. 14 (p. 480):

"The starting point must be that a contract of employment cannot simply be silent on the place of work: if there is no express term, there must be either some rule of law that in all contracts of employment the employer is (or alternatively is not) entitled to transfer the employee from his original place of work or some term regulating the matter must be implied into each contract. We know of no rule of law laying down the position in relation to all contracts of employment, nor do we think it either desirable or possible to lay down a single rule. It is impossible to conceive of any fixed rule which will be equally appropriate to the case of, say, an employee of a touring repertory theatre and the librarian of the British Museum. Therefore, the position must be regulated by the express or implied agreement of the parties in each case. In order to give the contract business efficacy, it is necessary to imply some term into each contract of employment."

(4) The term which Slade LJ was willing to imply in Courtaulds was that the employee could be required to work from any place within reasonable daily travelling distance of his home: a similar term had been applied in Jones. Accepting what Browne-Wilkinson P. had said in Jones about the appropriate implication depending on the nature of the employee's work, Slade LJ attached importance to the fact that the nature of the employee's work as an HGV driver meant that "he would spend by far the greatest part of his working hours on the road" (p. 461 H) and that Greengate was no more than the starting and finishing point for his shifts: he contrasted that with the position of, say, a shop assistant. (We are bound to say that we do not ourselves quite understand the nature of the distinction, given that both depot and shop represent the places which the employee has to get to and from at the beginning and end of the working day; but that question does not arise on this appeal.)

(5) Thus far the case is reasonably straightforward. What complicates the analysis is that Slade LJ had earlier in his judgment recited (and appeared to endorse) the Industrial Tribunal's finding that "for the purposes of the employee's contract of employment there was to be initially a fixed place of work, namely, at the employer's transport department at Greengate" (p. 458 D). That finding was apparently based on the wording appearing on the cover sheet of the employee's "terms and conditions of employment … where the factory/unit is defined as 'Courtaulds Ltd., Northern Textile Division, Transport Department, Greengate, Middleton Junction, near Manchester'" (p. 457 C). That being so, it seems rather odd that Slade LJ felt able to treat the contract as being "silent" on the question of the place of work. (In Jones, by contrast, the identification of the workplace in the contractual documents was much less explicit: see para. 6, at p. 477.) It appears however that he must have regarded the reference in the contractual documents as being, on its true construction, simply a statement of where "initially" (to use the Industrial Tribunal's term) the employee was to be based and as not constituting a definitive statement of the places where he could be expected to work.

(6) Thus it is certainly right to say that in Courtaulds the Court of Appeal was prepared to imply a term entitling the employer to transfer the employee's place of work to a different location within a reasonable travelling distance. What is more – and more importantly in the present context – it was prepared to do so notwithstanding that the contractual documents appeared to identify a specific place of work; and the case thus establishes that the fact that the contract may name a place of work does not necessarily mean that that is the only place at which the employee may be required to work. But if the Tribunal, in setting out in para. 14 of its Judgment the proposition for which it said that Courtaulds was authority, meant to say that it established that such a term could be implied in all circumstances, that is going too far. On the contrary, it is clear from Jones, as approved in Courtaulds, that there is no general rule.

(7) There is a further important point. In Jones and Courtaulds the issue essentially concerned the place - in the sense of the physical location - where the employee could be required to work. It is true that in Courtaulds by changing depots the employee would (presumably) have been changing not only his location but his administrative unit, so that he would be working under different managers and with different colleagues; but that aspect is not alluded to at all and appears to have been treated as insignificant – probably because (a point which Slade LJ emphasised, albeit for a different purpose) as an HGV driver his "place of work" was in truth no more than a base and will have had very little impact on the actual nature of his work.

6. On the basis of that analysis, we do not believe that Courtaulds provides the answer in the present case. If the issue before us were only concerned with location, it may very well be that the wording which we have quoted from the front page of the ACE contract should not be treated as definitively prescribing where Mrs. Luke could expect or be expected to work, so that if the ACE Centre moved premises she might have to move with it. But that is not the real issue here. The ACE Centre was not merely a location but a unique institution, whose work was not replicated at any other place where the Council employed teachers. That is indeed illustrated by the fact that Mrs. Luke's (different) work for the Council at the Merit Unit was the subject of a different contract. In our view the contract plainly does prescribe the ACE Centre as the unit in which she was entitled and obliged to work. What the Council are asserting is the right to require Mrs. Luke to work in a different unit. That is different from the situation considered in Courtaulds and Jones. In our view nothing in the reasoning of those cases supports the proposition that the Council had an implied right to require her to work at a different unit; and, subject to the point which we consider below, we do not see how such a right can properly be implied in circumstances where the contract quite explicitly identifies the ACE Centre as the unit in which she was to work. Although the Centre is an institution of an unusual character, it is broadly equivalent to a school. We cannot conceive that – in the absence of any express mobility clause – an education authority would have the right to direct a teacher who had been expressly engaged to work at school A to move on a permanent basis to school B, even if the work that he or she would be required to do at school B would be broadly similar and even if it were within easy travelling distance: however "suitable" the transfer, it would simply not be within the terms of the agreement.
7. However, that is not the end of the matter. We drew the attention of the parties to the decision of the Employment Appeal Tribunal in Millbrook Furnishing Industries Ltd v McIntosh [1981] IRLR 309, which was not cited to the Employment Tribunal. In that case the employees were sewing machinists employed in the employers' upholstery factory. Because of a downturn in work, the employers decided to transfer them to their bedding factory, which was very nearby. The work at the bedding factory would be less skilled but was essentially of the same character. The intention was that the transfer would be temporary only, and on terms which protected the employees' earnings. The employees refused to transfer and resigned and claimed (constructive) unfair dismissal. The Industrial Tribunal held that the employers had not been entitled to require the employees to transfer and that they had accordingly indeed been constructively dismissed. The Employment Appeal Tribunal upheld the decision. The passage in the judgment delivered by Browne-Wilkinson P. which is relevant for present purposes is at para. 12 (p. 311) and is as follows:

"The first question must be whether the requirement to transfer to the bedding department does constitute a breach of contract. We can accept that if an employer, under the stresses of the requirements of his business, directs an employee to transfer to other suitable work on a purely temporary basis and at no diminution in wages, that may, in the ordinary case, not constitute a breach of contract. But in saying that, we think it must be clear that the word 'temporary' means a period which is either defined as being a short fixed period, or which, as in the Aveling Barford [1977] IRLR 419 case, is in its nature one of limited duration. Similarly, when dealing with no diminution in wages, we think it is clear that it is on the employers to bring home to the employee, that the order to transfer is on the basis that there will be no diminution in wages. When one refers to this case, first of all, although the transfer was temporary, it was of unlimited and very uncertain duration, because it was to last until the work in the upholstery department picked up again. Secondly, as to the wages, although the Industrial Tribunal found that it was Mr Kroll's intention to make it clear that he was guaranteeing that their wages would not be decreased, the ladies certainly did not understand that. The statement that there would be no drop in money is ambiguous. It could either mean 'I forecast that with your skills you will make enough or at least as much money in the bedding department', or it might mean a guarantee 'Whatever happens, we will see that you get the same amount of money'. It is inherent in the decision of the Industrial Tribunal that it was not made clear to the employees that they would suffer no diminution of wages in any event."

Thus, although the appeal was dismissed, that was only because of the uncertainty as to how "temporary" the transfer would indeed be and as to the effect of the financial guarantees. Browne-Wilkinson P. appeared to acknowledge that but for those points the employers would have been within their rights to effect a temporary transfer of the employees to another workplace where they would be doing different – though "suitable" – work from that for which they had been employed. Although on the facts of that case the justification for such a transfer would have been the downturn in work, it seems to us that the implied term from which the right must derive could not be not limited to that particular situation: it must as a matter of principle apply to any exceptional circumstance sufficient to justify asking the employee (temporarily) to transfer to work of a kind not expressly required by the contract.

8. What was said in Millbrook was strictly obiter, but it seems to us to be right. There is no reason in principle why a tribunal should not find an implied term in a contract of employment that the employee may be obliged to perform duties which go beyond, or are different from, those expressly required by the contract, or to perform them at a different workplace. But such a finding can only be made in accordance with the normal strict rules governing the implication of terms. Generally speaking – though there can be no blanket rule, and each case will turn on its own circumstances – we would expect such a finding to be rare: normally, where a written contract clearly defines an employee's contractual duties he ought to be entitled to proceed on the basis that he is not obliged to undertake different duties. In such a case it is likely to be legitimate to find an implied obligation to undertake a duty which is "outside the contract" (more accurately, outside the express terms of the contract) only, if at all, where the circumstances are exceptional, where the requirement to work the duty in question is plainly justified and where all the conditions stated in Millbrook – namely that the work is suitable, that the employee suffers no detriment in terms of contractual benefits or status and that the change in duties is on a temporary basis - are satisfied. It is important that employers should not be permitted to resort to an implied term in order to be able to impose what is in truth a unilateral permanent variation of the terms of the contract. Having said all that, we see no reason why an implication cannot be made in a proper case.
9. It seems to us that, despite the reference to Courtaulds, the Tribunal was in fact in para. 14 of its Judgment basing its finding of an implied term on reasoning of essentially the kind set out in the previous paragraph. It emphasised that the circumstances of the case were exceptional, and it plainly regarded it as justifiable for the Council to want Mrs. Luke to earn her salary by doing other (suitable) work during the interval while a solution was looked for. In that connection, it is important to recall that her work under the ACE contract remained open to her if she was prepared to accept the findings of the report, and that the Tribunal judged the Council's insistence on her accepting those findings to be reasonable. There is no reason to doubt that the work which the Council wished to offer to Mrs. Luke was "suitable" and on terms which preserved her contractual benefits and status: one proposal was indeed that she should simply work additional hours under the Merit contract, on which she was already engaged. The Tribunal also explicitly found in para. 14 that the proposed "redeployment" was "on a temporary basis, until a long term solution to the problem could be found". That last finding gives rise to some difficulty, which we address at para. 10 below; but, assuming for the present that it is correct, it seems to us that the Tribunal considered all the right factors and reached a conclusion which was open to it in the very unusual circumstances of the case. The question whether the employer enjoys a right of this kind in a particular case is fact-sensitive, and we would be slow to interfere with a finding of a Tribunal as, if we may use the old cliché, an industrial jury.
10. We have referred above to a difficulty arising from the Tribunal's finding that any redeployment was intended to be "temporary". That was no doubt in one sense the case, but the Tribunal does not say that the redeployment would be limited to any particular period of time; and although one of the "long-term solutions" hoped for was that Mrs. Luke could return to the ACE Centre, that was dependent on there being some change in the situation, or some change in the parties' positions, the possibility of which was entirely speculative. Ms. O'Donnell, who appeared for Mrs. Luke and argued her case very well, submitted that the position is thus essentially the same as in Millbrook: the proposed redeployment was indefinite and might indeed continue, in the Tribunal's words, "perhaps forever". The objection is a serious one, but we do not in the end believe it is well-founded. The Council was not insisting on permanent redeployment. If there was an unresolved question as to what the limits of any redeployment would be, that was because, as Tribunal explicitly found (see para. 1 (5) above) it was Mrs. Luke who was not prepared to enter into discussion: she was not prepared to entertain any proposal for a return to work save at the ACE Centre. That excluded the possibility of temporary as well as permanent redeployment. If the Council was indeed entitled to require a temporary redeployment, Mrs. Luke was making it plain that she would not comply with such a requirement: she was not, therefore, declaring herself ready and willing to comply with her full contractual obligations. There is every reason to believe, given the Tribunal's findings, that if Mrs. Luke had agreed to one of the Council's inchoate proposals (say, that she should work additional hours at Merit) subject to a condition that it should be limited to (say) three months, after which the position would have to be reviewed, that would have been acceptable. But as a result of the stance which she took that point was never reached. It was not necessary that it should be. Mrs. Luke had made it clear that she would not accept any redeployment offered: there was no obligation on the Council nevertheless formally to test her position by setting out a detailed proposal.
11. We accordingly dismiss the appeal.