Appeal No. UKEAT/0358/08/ZT

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 24 September 2009

Before
HIS HONOUR JUDGE PUGSLEY
(SITTING ALONE)

MR W A HARRIS	APPELLANT

TENNIS TOGETHER LTD	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR W A HARRIS
(The Appellant in Person)	
For the Respondent	MR R SMITH
(Representative)
Peninsula Business Services Ltd
Litigation Department
Riverside
New Bailey Street
Manchester M3 5PB	

SUMMARY
CONTRACT OF EMPLOYMENT
Damages for breach of contract

This case proceeded on the amended Grounds of Appeal, drafted by Ms Karon Monaghan QC.  The issue was whether the Employment Tribunal was correct in finding that the Claimant had failed to mitigate his loss by refusing an offer of alternative employment when the terms offered were materially different from the original contract.  Remitted to a differently constituted tribunal to reconsider the issue and to make further findings.

HIS HONOUR JUDGE PUGSLEY
1.	I hope the parties instead of spending their time in employment tribunals will actually get together and resolve this matter.  I hope that they will do that.  The point is a narrow one.  

2.	The Tribunal Employment Judge Taylor found that there should have been a reasonable period of notice.  There was an agreement between the parties that there should be three months and the Tribunal at paragraph 34 of its decision endorses that view.  The Tribunal then found that in breach of contract the Respondents failed to give sufficient notice of dismissal to the Claimant.  Accordingly, the complainant’s complaint that he was wrongfully dismissed succeeded (paragraph 35 of the decision).

3.	The final issue to determine is whether the Claimant has mitigated his loss.  Whether an employee has mitigated his loss is a question of fact for the Tribunal to determine in each case.  Having considered the circumstances of the case, the Tribunal decided the Claimant failed to mitigate his loss.  In arriving at this decision the Tribunal found the Claimant unreasonably refused to continue working with the Respondent.  The Tribunal set the position out in Para. 37:

“It had been made clear throughout the discussions that this was an offer of work that the Claimant could carry out during the proposed fixed term period and which the Respondent wanted him to do.  It was work, which the Claimant was capable of doing, and was work, which he had defined and had agreed was necessary.  Furthermore, the Tribunal finds that the Claimant had been responsible for causing this crisis.  The Claimant in his capacity as Financial Director knew or ought to have known that the Respondent Company was not in a position to offer him any more guarantee of payment than had been available to him during his past years of service.  The Claimant’s belief that Mr Gabb was no longer trustworthy or that the Respondent Company would seek to avoid paying him either deliberately or otherwise, or that the involvement of SLG Ltd would influence whether or not he would be paid was not a reasonably held belief.”

4.	With the greatest of respect to the Employment Judge, that summation of the conclusion does not set out the test that Sedley LJ applied in Wilding v British Telecommunications plc [2002] EWCA Civ 349.  It does not set out the terms, namely that although he would be employed on a monthly salary of £5,000, the equivalent to that which he had enjoyed under his original contract, that such would be paid at the rate of £2,000 paid on his last day provided the company had adequate funds; that the new contract of employment be subject to summary termination; that the Appellant would not be permitted to take holiday during the period of his employment without the written agreement of the Respondent and/or notice in advance and any for attending interviews.  

5.	It does not take any step of setting out, if I may say so, in a way that should be set out, the basis on which the Tribunal reached the conclusion that the Claimant unreasonably refused to continue working.  There is no citation of law by which one can see that the Employment Judge has applied the proposition that it is for the wrongdoer, in this case the employer, to prove that it is that the innocent party was acting unreasonably in declining to take up this job offer, especially since there is no evaluation as to what the terms were in relation to the original contract.  I think it would be a matter of a degree of argument whether or not it really could be said that the fact that the Claimant was, it is said, partly to blame for the poor financial state of the company is a proper matter to take into consideration.  The Tribunal gives its conclusion and not its reasoning; its conclusion has become its reasons.  

6.	I have come to the view that I should allow this appeal to the extent of remitting it.  I really think that it is important that justice be seen to be done, to send it back to the same district judge, apart from adding to the delay would I think cause a certain sense of grievance on behalf of the Appellant.  It is not one of those cases where parties spend thousands of pounds on a long case.  This is just one issue left: did the employer prove the employee failed to mitigate?

7.	In deference to the able arguments put to me on behalf of the Respondents I should say that I am allowing this appeal only on the second ground of the amended ground of appeal.  The first ground of appeal is that “a dismissed employee under a duty to mitigate will never fail to discharge that duty by reason only that he has refused an offer of new employment with the dismissing employer, where that employer has committed an unlawful or wrongful act in respect of him.”

8.	I accept that this is not an accurate formulation of the law.  Such a formulation runs counter to the guidance given in such cases as Wilding v British Telecommunications (2002) IRLR 524; Gallear v J F Watson & Son (1979) IRLR 306 and Sweetlove v Redbridge & Waltham Forest Area Health Authority (1979) IRLR 195.  Each case is fact specific and the proposition urged in ground 1 is far too abstract and absolute in its terms.  The fact that an employee has been wrongfully dismissed is obviously an issue to be considered but is not a determinative matter.  All circumstances have to be considered.  If in a large company a John Smith was dismissed for misconduct but the letter was sent to another employee with the same name it would be absurd to suggest that the victim of such a mistake could reject the employer’s apology and offer of withdrawal of the mistaken dismissal and offer of reinstatement.