Appeal No. UKEAT/0470/07/LA

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 7 November 2007

Before
THE HONOURABLE MR JUSTICE NELSON
MRS R CHAPMAN
MR B R GIBBS

CORTEST LTD	APPELLANT

MR K O’TOOLE	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR PATRICK HOWARTH
(Solicitor)
Messrs Foot Anstey Solicitors
21 Derry’s Cross
Plymouth
Devon
PL1 2SW	
For the Respondent	MS LYDIA HYDE
(Representative)	

SUMMARY
Unfair dismissal – Constructive dismissal – Dismissal/ambiguous resignation – Reason for dismissal including substantial other reason – Automatically unfair reasons
Dismissal or resignation.  The interpretation of s.57A ERA 1996.  Mistaken belief employee had resigned when may in fact have been a fair reason for dismissal.  1-2 months off work to care for dependants - held unreasonable under s.57A ERA.  Case remitted on facts.

THE HONOURABLE MR JUSTICE NELSON

1.	This is an appeal by the Appellant employer against the decision of the Southampton Employment Tribunal on 9 June 2007 when it held that the Claimant/Respondent had been unfairly dismissed and awarded him a total of £7243 in damages.  

2.	The facts were substantially in dispute and the findings of the Tribunal particularly in relation to one ground, namely whether the Claimant resigned on 4 January 2007 or was dismissed on that date, are challenged.  There has been no agreement between the parties as to any note of evidence and the Chairman’s notes are not before this Tribunal.  The facts which are taken from the judgment of the Employment Tribunal are that the Claimant commenced work with the Respondent on 5 May 2004 as a street lighting engineer.  That employment was terminated on 4 January 2007 without notice in circumstances which the Tribunal found amounted to a dismissal.  It also found that the statutory disciplinary procedures applied to such a dismissal and had not been followed by the Respondent.  

3.	The background to those events was that the Claimant lived with Ms Lydia Hyde, his partner, they had three children 2 to 8, the youngest Kieron being aged 2.  In the months prior to Christmas 2006 various pressures, largely caused by lack of funds, mounting debts and the very long hours the Claimant was working put the family relationship under very great strain.  This situation, the Tribunal found, was compounded by the fact that Ms Hyde was finding it extremely difficult to cope with the two year old son who was proving to be a very difficult child to manage.  

4.	The Tribunal found that matters came to an unexpected head in early January 2006 when despite the Claimant taking two days sick leave to endeavour to ease his partners difficulty the domestic situation came to a head.  The Tribunal accepted Ms Hyde’s evidence that circumstances had reached such a pitch that she was not able to cope and simply had to leave the house for her own sanity.  The Claimant’s family were not in a position to make childcare arrangements as they had no money and the nearest relation, Ms Hyde’s mother, worked full-time.  The family were left with no alternative than for the Claimant to seek time off to give his partner the rest that she needed.  The Tribunal found that although the situation that created this had built up through a whole variety of different circumstances the situation in which she considered that she had to leave came about urgently.  

5.	The Claimant telephoned his employer, Mr Wyeth, on 4 January 2007 and asked if he could have 1 month off to enable the situation to return to normal.  The Tribunal found that the Claimant had reasonable cause to believe that his request would be considered favourably because Mr Wyeth was aware of his personal circumstances.  The Tribunal accepted the Claimant’s evidence as to the nature of the conversation that took place.  Mr Wyeth’s reaction to the request for time off was that it could be taken provided the Claimant resigned his employment.  He indicated that provided there was work available he would re-instate the Claimant when his domestic position had improved.  The Tribunal also accepted the evidence of Ms Hyde that she was capable of overhearing and did overhear the Claimant’s side of the telephone conversation with Mr Wyeth. There was a fundamental conflict between the Claimant and Mr Wyeth as to the resignation.  Mr Wyeth said that he clearly understood the Claimant in the course of that conversation say that he wanted to resign.  The Claimant on the other hand said he said no such thing, a fact which the Tribunal found to been born out by the corroborative evidence of Ms Hyde who could of course hear Mr O’Toole’s side of the conversation; she was firmly of the view that the word resignation was not uttered by the Claimant.  That evidence was accepted, as was the evidence that the conversation ended without a particular conclusion.  The Claimant maintained he did not resign and says it would have been stupid for him to have done so in his financial circumstances and he told Mr Wyeth that a requirement to resign was unfair.  The parties did not speak again until 17 January.  That conversation was triggered by the Claimant receiving the letter from the Respondent setting out what he understood to be the nature of the conversation on 4 January.  That letter sought confirmation of the verbal resignation.  The Tribunal found that immediately the Claimant sent a fax on 17 January to Mr Wyeth which denied that he had agreed to terminate his position and continued: 

“Today we spoke again and you wish me to terminate my employment.  I do not wish to terminate my contract but I do require more time off.  If this is causing you problems then you need to terminate my contract.”

They also spoke on 17 January.  Mr Wyeth maintained the Claimant said he had changed his mind, saying he did not mean it, that is the resignation, and explained that the delay had been caused because he had been advised to give the Claimant time to reflect on his resignation before seeking to implement it.  

6.	The Tribunal found that Mr Wyeth’s understanding of what was said on 4 January to be mistaken, either the words were not said or if said were quoted by Mr Wyeth out of context.  The Claimant was faced with a desperate situation in which he had no alternative than to take time off work.  The Tribunal also found when considering the issue of contributory conduct in which they found there was none, that the dismissal came about by reason of the employer’s erroneous interpretation of the situation and not the resignation or conduct of the Claimant.

7.	In its conclusions the Tribunal found that the Claimant did not resign but he was dismissed.  They did not accept that Mr Wyeth was right to regard the conversation as amounting to an unequivocal resignation.  Mr Wyeth fairly accepted that he told the Claimant that he would have to resign in order to get time off.  He maintained that the company had good business reasons for this requirement which related to the nature of the work and it was simply not possible to give him the time off.  He then maintained that in response to that the Claimant agreed to resign.  The Tribunal then went on to say that if the Claimant did say that he would resign then it was an instant reaction and not a considered response.  If there was any doubt about that the Tribunal found the Claimant’s reaction to the Respondent’s interpretation of the conversation as soon he found out what it was, was to immediately take the contrary view on 17 January, and the Tribunal had no doubt that if the Claimant had believed that Mr Wyeth had thought he was resigning he would have taken action to correct that impression immediately. Whilst the Tribunal accepted Mr Wyeth genuinely believed the Claimant had resigned, that belief, they found, was based upon information that he had misunderstood.  

8.	On the facts the Tribunal found that the Claimant’s request for time off fell within s.57A(1)(d) of the Employment Rights Act 1996 which was “because of the unexpected disruption or termination of arrangements for the care of a dependant”.  The circumstances were that his partner had to leave the house for a period of two weeks to restore her sanity, and the Claimant felt duty bound to look after his family as his number one priority.  The Tribunal concluded that the request for absence was made as soon as reasonably practicable and as much notice as possible was given.  The request for unpaid leave was for a month or maybe two.  

9.	The Tribunal concluded that the amount of time requested was reasonable although they said that it was very much at the top end of what might be permitted.  Their findings were made on the circumstances as they found them.  This was not a case, they said, where it was appropriate to take annual leave on notice.  They considered the length of the employment, the circumstances of the Claimant, including the fact that his request was for unpaid leave and found that as matters turned out he would not have required any longer than 4 weeks.  The request would have caused difficulties for the Respondent but that was not a factor to take into account under 57A.  They found the dismissal was in the circumstances unfair under s.99D of the Employment Rights Act Regulation 20 or the Maternity and Paternal Leave Regulations 1999.  They considered the EAT decision in Qua v John Morrison Solicitors [2003] IRLR 184.  They had put before them an alternative submission that the dismissal, if it was a dismissal, was for a fair reason.  They rejected that, they said the circumstances as found by them did not indicate that there was “some other substantial reason” and if it was the case that the employee was simply refusing to attend work following a request, that would be a matter relating to conduct and not capability.  

10.	On the facts as to compensation they found that the Claimant had found alternative employment on 27 April in spite of the fact that it had been said in the Claimant’s application form that he had in fact found another job on 1 February 2007.  They found that that was a mistake.  

11.	The grounds which are put before the EAT are six, four relating to liability and two to quantum.  The first is that the Respondent resigned on 4 January rather than was dismissed and that the finding of dismissal was contrary to the evidence and perverse.  Secondly, that there was no automatic unfair dismissal.  That could not be so because the Respondents request for time off was not reasonable for the purposes of a request for time off for dependants under s.57A.  Thirdly, if there was a dismissal it was not automatically unfair as the request for time off did not fall within the remit of a request for time off for dependants under s.57A, as the Respondent was proposing during the time off to act as carer for his children whilst his wife was away.  Fourthly, it is said that if there was a dismissal the reason for the dismissal did fall under one of the potentially fair reasons for dismissal set out under s.98(1) and (2) of the Employment Rights Act, namely some other substantial reason and was fair.  Fifthly, in relation to quantum it is said that the Respondent was not entitled to any losses during his unpaid leave.  He had put forward a request that he should be off work for a month or maybe two months, he had in fact been off for about a month and as that was brought about by his own request and his own conduct it could not have been brought about by the employer’s conduct and so for that period of time he was not entitled to recover any damages even thought the Employment Tribunal awarded them to him for the whole of that period.  Sixthly and lastly, he submitted that in determining the losses they should run only to 1 February, namely the date of reemployment as stated in the application form, rather than 27 April the date given in evidence as to the date when he had started work.  

12.	Those then were the six grounds and it will be helpful if I summarise briefly the submissions in relation to those.  Firstly, the resignation dismissal point.  One of the features of the evidence of Mr Wyeth was that he produced a near contemporaneous note of the conversations he had both on 4 January, that note was compiled on 5 January, and the conversation he had on 17 January, that was compiled rather closer in time.  The note of 17 January appears to have been considered expressly by the Employment Tribunal but the contemporaneous note of the conversation with the Claimant on 4 January, although Mr Howarth on behalf of the Appellant submits it was important, was not in fact considered at all.  It should have been Mr Howarth suggests.  Secondly, in relation to this point, there are major inconsistencies in the findings of the Employment Tribunal.  Firstly under 5.9 and 5.10 the Employment Tribunal accepts the evidence of the Claimant and the corroborative evidence of Ms Hyde but yet in paragraph 5.14 they then appear on the face of it to retract from that by saying that there may have been a mistake in relation to that.  The Tribunal found that Mr Wyeth’s understanding of what was said on 4 January to be mistaken “either the words were not said or if said were quoted by Mr Wyeth out of context”.  Also in paragraph 5.13 there is another passage in which the Tribunal say “if the Claimant did say that he would resign then it was an instant reaction and not a considered response. Those passages do not sit well with the acceptance of the Claimant’s evidence and Ms Hyde’s evidence at paragraphs 5.9 and 5.10.  It appears as if the Tribunal was uncertain as to what findings it was making and hence leaves the parties uncertain as to what in fact had been found by them.  Lastly on this issue it was submitted by Mr Howarth that as the dismissing officer, namely Mr Wyeth, mistakenly believed that the Claimant had resigned there could not be a dismissal in those circumstances. 

13.	The submissions in relation to grounds 2 and 3 were made in relation to s.57A of the Employment Rights Act and there were various passages which were relied upon in the case of Qua v John Morrison Solicitors [2003] IRLR 184 and in the DTI guidance document entitled “Time off for dependants” dealing with s.57A of the Act.  Mr Howarth’s submissions on this head were that 1 to 2 months was contrary to the intent of the legislation which is there to deal with emergencies and give time to enable a parent to put in place other arrangements for the care of the dependent who needs it.  It is not intended for substantial periods of time to be taken off by the parent himself or herself.  It is plainly and obviously intended he submits for short term situations anything which is longer term is something in respect of which unpaid parental leave under the Act should be sought.  That could not have happened here because this was an emergency situation and indeed no written request was made for it.  Both the guidance and the case of Qua suggest that period of 1 to 2 days is the norm in cases of this kind and Mr Howarth accepts that of course each case will be fact sensitive.  S.57A simply does not deal with the situation of difficult times within a family and that indeed is what the Employment Tribunal were making findings about in this particular case.  

14.	As to the third ground it is submitted that it is not the purpose of s.57A to permit a parent to do as the Claimant was planning to do here, namely to act as a carer and it should be noted that there was indeed no evidence before the Employment Tribunal that any attempts were made to find out what other care might be available other than the Respondent himself, save his mother-in-law and the certain knowledge they had that they did not have much by way of funds to enable them to take any steps to take a paid child minder.  Again Qua is cited in support of the proposition that the purpose is not to enable the parent to become carer but to give the parent a breathing space to ensure that a replacement carer is found.  Were this not to be so, the decision of the Employment Tribunal, Mr Howarth submits, would be creating another branch of time-off which was simply not envisaged by s.57A which dealt, as he has submitted, with emergencies and the provision of a breathing space.

15.	In relation to the fourth ground Mr Howarth submits that he case of Ely [1994] 1 ICR 164 is authority for the proposition that if an employer mistakenly does not know of a valid reason for a dismissal but in fact such a reason exists then the fact that the employer mistakenly thought, for example, that there was a resignation as here will not prevent there being a fair reason even though he did not appreciate that there was one at the time.  The facts as he points out in the case of Ely are similar but were not properly considered by the Employment Tribunal.  Here what the Claimant did was to make a request and then when told that was difficult reacted in effect by making himself completely unavailable for a period of a month or maybe two months for work.  That was effectively a refusal to carry out his lawful instructions.

16.	As to ground 5 on quantum it is simply expressed that the loss during the time in question is not attributable to employer’s actions.  There was no causation because he would have been taking unpaid leave anyway.  In relation to ground 6 it is said that the Employment Tribunal made no proper enquiries to reach the conclusion that the entry of 1 February as the restart of employment date was a mistake.  It cannot have been a mistake, on looking at the evidence in the round that did not make sense.  

17.	So those were the Appellant’s submissions.  Ms Hyde put before us a helpful skeleton and in her additional oral submissions she said that 57A is for family emergencies, that is most certainly what faced her and her family here.  It was much worse than some temporary illness such as chicken pox.  The family found themselves in a very tight corner as to what to do, they had no money and 3 young children and the Respondent had no choice but to carry out the caring himself.  In such circumstances there was automatic unfairness through s.57A.  Those were essentially the submissions on the liability grounds in addition to those set out in a helpful skeleton by Ms Hyde and she added in relation to the quantum ground 6 that her partner Mr O’Toole, the Claimant, had obtained a job on 27 April with the London Borough of Barnet.  He had not worked between 1 February and 27 April and she had made a genuine mistake in filling in the application form.  Whether that was caused by the fact that he had certainly been applying for other jobs which he had not got around that time and mistakenly entered the details of one of those she did not know, but the fact was that it was a genuine mistake.

18.	After we had considered the submissions we considered the matter and came to the conclusion that the appeal would have to be allowed and indicated that to the parties and asked for further submissions in relation to remedy and how the matter should be dealt with.  It is submitted to us by Mr Howarth that it was appropriate in all the circumstances for us to substitute throughout our findings whereas Ms Hyde effectively submitted that that was not the case.  She submitted that even if you look to this as a dismissal by conduct it was not a case where the employers were put in substantial difficulty because in practice one of the two men team would frequently be able to either find another job or carry on with his existing job by himself.  

19.	We, having considered those submissions, come to the following conclusions.  Firstly, in relation to ground 1, there was a failure by the Employment Tribunal to consider the contemporaneous document dated 5 January 2007 setting out Mr Wyeth’s conclusions or record of what he recalled of the conversations he had had the previous day with the Claimant.  It is also right that there are on the face of the decision inconsistencies which it might be possible to explain as being consistent with the final conclusions but which give one cause for doubt as to precisely what was meant and what was in the mind of the Employment Tribunal.  We accept the submission by Mr Howarth that these are in fact errors but it is not possible for this Tribunal to reconsider the findings and come to any conclusion of its own.  There is in fact a conflict, as mentioned at the beginning of this judgment, on the evidence as to precisely what was said by the witnesses and indeed the circumstances generally, make it impossible for this Tribunal to make a finding as to whether there was resignation or dismissal.  It is therefore a matter which would have to be sent back to the Employment Tribunal for re-hearing.  It is simply not possible to substitute our own conclusions.

20.	As to the second ground, ground 2 relating to 57A(1)(d) of the Employment Rights Act, the guidance set out from the DTI indicates that the time taken off for dependants is to enable them to deal with certain unexpected events on emergencies and to make any necessary longer term arrangements when dealing with the particular sub-section (1)(d).  It refers as an example to time being taken off where the normal carer of the dependant is unexpectedly absent, for example, a child minder or nurse may fail to turn up as arranged or the nursery or nursing home may close unexpectedly.  In relation to how much time an employee can take off the guidance says that legislation does not specify the amount of time off which is reasonable because that will vary in accordance with the emergency but in most cases one or two days should be sufficient to deal with the problem.  It then goes on to say that in relation to the provisions to deal with the immediate care of the child, visiting the doctor if necessary in the case, for example, of chicken pox and to make longer term care arrangements, “the employee is not entitled to take two weeks leave to look after a sick child”.  

21.	In the case of Qua starting at paragraph 15 of the judgment Mrs Recorder Cox, as she then was, said as follows: 

“By way of general observation, and having regard to the Directive and in particular the use of the words “force majeure” when referring to time off from work during working hours, we agree with the Tribunal’s conclusions at paragraph 22 as to the nature of the absences contemplated in this section.  The statutory right is, in our view, a right given to all employees to be permitted to take a reasonable amount of time off work during working hours in order to deal with a variety of unexpected or sudden events affecting their dependants, as defined, and in order to make any necessary longer-term arrangements for their care.” 

She continues in paragraph 16:

“The right to take time off to “…. provide” assistance etc. at sub-section (1)(a) does not in our view enable employees to take off in order of themselves to provide care for a sick child, beyond the reasonable amount necessary to enable them to deal with the immediate crisis.”

Time off, she says, is to be permitted to enable an employee to make longer term arrangements for the care of a dependant, for example, by employing a temporary carer or making appropriate arrangement with friends or relatives.  

“Subsection (1)(d) would include, for example, time off to deal with problems caused by a child-minder failing to arrive or a nursery or playgroup closing unexpectedly.”

In paragraph 17 it is said that:

“The right is a right to a “reasonable” amount of time off, in order to take action which is “necessary”. In determining whether action was necessary, factors to be taken into account will include, for example, the nature of the incident which has occurred, the closeness of the relationship between the employee and the particular dependant and the extent to which anyone else was available to help out.”

In paragraph 18 she says:

“We consider that, in determining what is a reasonable amount of time off work, an employer should always take account of the individual circumstances of the employee seeking to exercise the right.  It may be that, in the vast majority of cases, no more than a few hours or, at most, one or possibly two days would be regarded as reasonable to deal with the particular problem which has arisen.  Parliament chose not to limit the entitlement to a certain amount of time per year and/or per case, as they could have done pursuant to Clause 3.2 of the Directive.  It is not possible to specify maximum periods of time which are reasonable in any particular circumstances.  This will depend on the individual circumstances in each case and it will always be a question of fact for a tribunal as to what was reasonable in every situation.”

We agree with that decision and those paragraphs which we have set out.  
22.	We are satisfied that Mr Howarth’s submissions are correct on the law and that the Employment Tribunal fell into error in both their interpretation and application of s.57A(1)(d).  The purpose of the legislation is to cover emergencies and enable other care arrangements to be put into place.  These cases are all fact sensitive but a period as long as one month or even longer for care by a parent would rarely, almost never, fall within s.57A and cannot on the facts before the Tribunal have done so here.  If longer leave is required than a short period of unpaid parental leave is available but that was not so here because it is not available for emergency situations and a request has to be put in writing.  We are satisfied that one month especially where there is no evidence that any other arrangements were sought, for example, neighbours or other relatives or any other kind cannot be reasonable on the facts as found by the Employment Tribunal.  They were in error in law, as we have said, in interpreting and applying s.57A.  We have no doubt given the facts before them that they felt a strong sympathy towards Mr O’Toole and Ms Hyde for the predicament for which they found themselves but that is not a reason for extending what is intended to be the time for putting in place other care which the section under the Act provides for.  As there was no absence under s.57A the dismissal cannot have been automatically unfair under the Maternity and Parental Leave Regulations 1999.  We substitute for those of the Tribunal our findings that the request did not fall within s.57A of the Act.  

23.	As to ground 3 we are also clear that s.57A does not permit a parent to become the child minder for a period as long as occurred here, just short of one month, when the maximum period thought to be possible was two months but it is, as s.57A intended, to give the parent the breathing space to enable a replacement carer to be found.  Here the Respondent made it clear that he was to be the carer and Ms Hyde has said that there was no other option open to them.  Paragraphs 15 and 16 of the case of Qua are again relevant as indeed is the guidance and we are satisfied that s.57A also does not apply here for this reason.  Were it to do so we accept Mr Howarth’s submission that in such broad terms it would simply amount to another form of time off simply not envisaged by s.57A created for emergencies and to give a short breathing space.  

24.	As to ground 4 the question arises as to whether there was a potentially fair reason for dismissal.  The employer did not know this because Mr Wyeth mistakenly thought that the Respondent had resigned on the Employment Tribunal’s findings, but, the Appellant submits, there was such a reason, namely the Respondent’s refusal to work causing the employee in the employer’s mind very grave problems.  This refusal to perform the job he was employed to do was in the circumstances akin to frustration of the contract Mr Howarth submits.  In any event it certainly amounted to conduct which was “some other substantial reason” to justify the dismissal under s.98(1)(b) of the Employment Rights Act 1996.  Ms Hyde submitted that the problems for the employers were not that substantial as already indicated in his judgment as if one of the two men on the team was off work the other member of the team was able to carry on in many instances.  We think that there is merit in the Appellant’s point on the facts as found.  The Respondent may well have been guilty of conduct which amounted in law to some other substantial reason but this issue was not discussed or pursued in any detail before the Employment Tribunal and we do not feel able to substitute our own findings for the finding made under paragraph 18 of that decision.  We also note the Employment Tribunal found that the statutory disciplinary procedure applied but those procedures were not followed.  We are not in possession of sufficient facts to reach a conclusion as to whether there was a case where the dismissal, if that is what it was, was automatically unfair.  Further facts would have to be found for that matter to be properly decided.  Whilst we have found that the Employment Tribunal erred in law in its interpretation and application of s.57A of the Employment Rights Act and substituted our findings in relation to that section under grounds 2 and 3, we are unable to accept Mr Howarth’s submission attractive though it is to substitute our own views throughout.  We are satisfied that the following issues must be remitted to a fresh Tribunal for re-hearing.  Firstly, resignation/dismissal; secondly, some other substantial reason; thirdly, automatic unfair dismissal for breach of disciplinary procedures.  

25.	Finally we turn to quantum.  In relation to ground 5 the damages should have commenced when the Claimant would have gone back to work, in other words after about a month, not from 4 January as the Claimant would at that time still have been on unpaid leave anyway.  The loss during that period was not attributable to any action taken by the employer but to the Claimant’s own request.  Any award for compensation which the Claimant might receive at a hearing by a fresh Tribunal would accordingly be reduced. 

26.	As to ground 6 the start date of the new employment was a question of fact for the Employment Tribunal.  The Employment Tribunal found that the start date of the new job was 27 April.  The fact that the form wrongly filled in as 1 February 2007 was explained to the Employment Tribunal’s satisfaction by Ms Hyde.  It cannot be said in those circumstances that that was in any way wrong or perverse.  

27.	The claim for compensation will accordingly, as indicated, be lower if a fresh Tribunal were to find in the Claimant’s favour.  Furthermore any re-hearing would be on a much more limited ground than the hearing which has already taken place before the Employment Tribunal because of our findings in relation to section 57A and the substitution of those findings for the Employment Tribunal’s findings.  It would therefore be a very different set of proceedings.  This seems to us to be pre-eminently a case where the parties should, if possible, seek to compromise the matter using the good offices of ACAS if they think it appropriate to do so.  

28.	Accordingly the appeal is allowed, the matter is remitted to a fresh Tribunal for re-hearing on the issues indicated with, as a foot note, a recommendation to the parties that they seek to compromise the matter.  We are grateful to both of you for your assistance.