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Appeal against a finding that the claimant was entitled to a redundancy payment following the conclusion of her fixed term contract. Appeal dismissed.
The claimant was employed on a fixed term contract of 1 year in succession to earlier employments of some 8 years duration with the respondent. Her contract was not renewed after the year was up. The respondent did not pay her redundancy because, they argued, the claimant knew of the short term nature of her employment at the time it commenced, and therefore she was not entitled to regard her dismissal as being by reason of redundancy. The ET heard no evidence before finding that the claimant had been dismissed because of redundancy, saying that s139 of the ERA had been satisfied. The respondent appealed, claiming that they had not been allowed to put forward a different defence. The Tribunal enlarged on their judgment at the request of the EAT and the EJ expressed a view as to the only matter that he was aware of as being in dispute, which was the knowledge of the claimant at the outset, and asked the parties if they wished evidence to be heard. Counsel for the respondent declined to call evidence although the exact circumstances were in dispute. The respondent appealed.
The EAT rejected the appeal. In the absence of verified contradiction against what had happened at the Tribunal hearing, the EAT accepted the ET judgment. Observations were made as to the desirability of making it quite clear what matters of facts and which issues were agreed before taking the course of resolving a claim without evidence, but the EAT held that the EJ was, in the particular circumstances of the case, not acting unfairly, nor in error of law.
Appeal No. UKEAT/0038/12/SM
EMPLOYMENT APPEAL TRIBUNAL
FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8JX
At the Tribunal
On 23 May 2012
THE HONOURABLE MR JUSTICE LANGSTAFF (PRESIDENT) (SITTING ALONE)
MANCHESTER MENTAL HEALTH AND SOCIAL CARE TRUST (APPELLANT)
MISS M K SINGH (RESPONDENT)
Transcript of Proceedings
For the Appellant
MR PAUL GILROY (One of Her Majesty's Counsel)
Freeth Cartwright LLP Solicitors
3rd Floor, St James Building
61-95 Oxford Street
For the Respondent
MR RICHARD GRAY (of Counsel)
Birchall Blackburn Solicitors
45 Victoria Street
REDUNDANCY – Definition
Employment Judge heard no evidence before resolving that there was entitlement to a redundancy payment. After discussing the issues of law raised in the employer's case, he invited leading counsel to call evidence if he should wish, but counsel did not do so (the exact circumstances were in dispute, but all of evidential value the EAT had were the comments of the EJ and his Judgment, which in the absence of verified contradiction it accepted). Observations made as to the desirability of making it quite clear what matters of facts and which issues are agreed before taking the course of resolving a claim without evidence, but held that the EJ was in the particular circumstances of the case not acting unfairly, nor in error of law.
THE HONOURABLE MR JUSTICE LANGSTAFF (PRESIDENT)
1. This is an appeal against a decision of the Employment Tribunal at Manchester, Reasons for which were given on 26 August 2011. Employment Judge Reed ruled that the Claimant was entitled to a redundancy payment. The circumstances in which the ruling was made are quite remarkable. It had been agreed between the parties that the Claimant had been dismissed. The decision depended upon the factual finding made necessary by section 139 of the Employment Rights Act 1996 (ERA). Though offered a chance to do so, leading counsel for the Respondent employer elected to lead no evidence.
2. The background is this. The Claimant was employed on a fixed term contract in succession to earlier employments of some eight years' duration with the National Health Service, and was entitled on its termination to a redundancy payment if the factual basis for such a payment were made out; that is, that the dismissal, which termination of the fixed term constituted, was attributable to – that is, caused by – section 139(1)(b):
"the fact that the requirements of [the business] for employees to carry out work of a particular kind […]
have ceased or diminished, or are expected to cease or diminish."
3. If no facts other than dismissal were established, then in an application for a redundancy payment, which this was, it is statutorily to be presumed that dismissal was by reason of redundancy (section 163(2) of the ERA). That provides:
"[…] an employee who has been dismissed by his employer shall, unless the contrary is proved, be presumed to have been so dismissed by reason of redundancy."
4. Thus the employer had a burden of proof yet elected to call no evidence. Why was it that the employer did not call evidence? It is asserted that it was denied the right to do so. In the Notice of Appeal it is said in paragraph 11 that the Employment Judge had stated that he would not accept the Appellant's arguments that had been advanced to it by leading counsel and that he was reluctant to hear evidence and (paragraph 13) "declined to do so". To decline to do so presupposes an invitation to do so.
5. In the skeleton argument of Mr Gilroy QC, who, I should emphasise, was not counsel before the Tribunal, it is asserted that the right to call evidence was denied. It would be unfair for an Employment Tribunal – indeed, an abandonment of its function – to refuse to hear evidence relevant to the issues in the case; that is common ground between counsel before me, trite, and needs no citation of authority, though there is copious authority. Mr Gilroy QC argued this appeal on the basis of procedural unfairness. That, in effect, consisted of the Judge reaching a conclusion as to that which the facts which might be established by evidence showed, when they did not or would not justify that conclusion and suggesting that other evidence that he considered irrelevant need not be given. This Appeal Tribunal is thus cast by the Notice of Appeal and by the points made in the skeleton argument, and against that background, in the role of primary decision-maker as to whether at the Employment Tribunal there was indeed something properly to be characterised as a denial or a declining of the right to give evidence, as asserted.
6. The material that I have before me to determine that comes from two sources. The first, and principal, is from the Employment Judge himself. In his Reasons, which were made if not contemporaneously then relatively so, he said that he had identified a fundamental dispute of fact between the parties, that being what the Claimant knew about the intended duration about her employment upon appointment. He set out section 139, and then said this:
"7. The case put forward on behalf of the Trust was that since Miss Singh knew of the short term nature of her employment at the time it commenced, she was not entitled to regard her dismissal as being by reason of redundancy. Reliance was placed on two authorities, namely Perry [sic; it is in fact "Terry"] v East Sussex County Council [ 1 All ER 567] and North Yorkshire County Council v Fay [1985[ IRLR 247]. I derived little assistance from them. Firstly, both were principally concerned with unfair dismissal. The Perry [sic] case in particular is principally concerned, on the face of it, with distinguishing between redundancy and 'some other substantial reason'. In the Fay case there appears to have been an express finding that there was not a diminution in the requirements of the department where the employee worked.
8. Equally, I am bound to observe that in both cases the state of knowledge of the employee in question (as to the nature of his or her employment at its commencement) was considered by the court or tribunal that heard the case as important. I was at a loss to understand that approach. It seemed to me that there were two possible analyses of the facts put forward on behalf of the Trust. The first was that Miss Singh was taken on for a specific period in order to carry out a specific task or tasks. Those tasks having ended, so did her employment. If that was the case, then it seemed to me an inescapable conclusion that the specific work she was carrying out was 'work of a particular kind'. When it finished, the requirement of the Trust for an employee to undertake that work had ceased. That, on the face of it, satisfied the test within Section 139.
9. Alternatively, Miss Singh could be regarded as part of the 'equality and diversity function' within the Council and that might have been the work of a particular kind. During the currency of her employment there were three people undertaking that work. At its end there were two. Again, it was difficult to see the basis upon which Section 139 was not satisfied.
10. Having canvassed these issues at length with Mr Benson on behalf of the Trust and having observed that I could not understand the argument the Trust was putting forward, I asked the parties if, in any event, they wished me to make findings of fact as to the contested issues. Although those findings would not be relevant for my declaration, they might assist if the matter proceeded elsewhere. My invitation was not meant with any enthusiasm and therefore I did not hear any evidence."
7. The Judge had plainly recognised (see paragraph 2 of his Judgment) that it was perhaps an unusual step not to hear evidence.
8. Those observations were enlarged upon more recently in a letter of 17 May 2012 written by the Employment Judge in response to a request from this Tribunal to do so. He said, materially, in that letter that at the time of the hearing he had not appreciated that the employer had been seeking to put forward a completely different defence to that which he considered. He expressed a view as to the only matter that he was aware of as being in dispute, which was the knowledge of the Claimant at the outset, and asked the parties if they wished evidence to be heard.
9. The other material before me relates to the anticipated content of the argument in so far as the originating application, response, further and better particulars and skeleton argument can supply it; they cannot and do not assist as to whether the Judge denied the right to put material forward. Neither party has placed any other material of any evidential value before me, nor invited me to adjourn to obtain such material. The assertions made in the Notice of Appeal and the skeleton argument are unsupported by any such material, despite the Appellant's being represented by highly experienced lawyers. It would be inconceivable that if any application that the Employment Judge should hear evidence had been made, it would not have been recorded. If leading counsel then appearing for the employer had regarded it as necessary to call evidence to establish any relevant fact, it is difficult to imagine that he would not have applied to do so. As HHJ Peter Clark said on the sift, why counsel did not lead evidence was beyond him, and, since I have not been told the reason, it is beyond me too.
10. Nothing, therefore, evidentially causes, or could cause, me to doubt the account given by the Employment Judge. On the material before me, I find that there was no denial of the right to call evidence, nor was any application to do so refused. The consequence of that finding is, as Mr Gray, for the Claimant, says in response to this appeal, that there was no procedural irregularity, and that even if the Judge had not expressed a view, then, since the dismissal had been agreed, there would be bound to be a finding of redundancy.
11. That conclusion does not finally dispose of this appeal. There is still room for Mr Gilroy's argument that in the findings he did make the Employment Judge materially misunderstood the Appellant's case and reached the Judgment he did make on that mistaken basis.
12. The material before him, relevantly, was this. The originating application at paragraph 4 said that the Claimant's case was that her contract was not renewed and her position not replaced; she was being made redundant as a cost saving exercise. The response, in grounds of resistance occupying more than one A4 sheet, states that the Claimant had been employed for a year as head of equality and diversity; in paragraph 2, that she was employed to undertake and complete "particular short term tasks" that related to the equality and diversity agenda of the employer. Paragraph 2 goes on to say she did that within the period of the fixed term contract. At paragraph 4:
"The tasks required had been completed within the 12 month period, therefore the Respondent did not renew the contract."
13. On its face, that was a statement by the employer that the dismissal was attributable to the completion of the tasks. On its face, if it stood alone, it would fit entirely within section 139(1)(b) and leave no scope for possible argument. Paragraph 6 repeats the same point. It says:
"[…] the fixed term contract was adopted for a specific and genuine purpose. That purpose and its temporary nature was known to the Claimant, and the purpose for which the contract was adopted has ceased to be applicable given that the tasks allotted to it have been completed."
14. It is, however, also apparent from paragraph 6 that the Respondent thought that, on the law as it stood given the cases of Terry and Fay, the knowledge of the Claimant as to the intended duration of her contract was the critical feature. Thus on the initial pleadings the decision that the Judge came to in the paragraphs I have quoted was amply justified. The only issue of fact thus far raised might be whether the purpose and temporary nature of work to be done was known to the Claimant. Like the Judge, I have some difficulty in understanding in these particular circumstances, whatever may be the relevance elsewhere, how the knowledge of the Claimant would be relevant to the situation comprehended by section 139.
15. Matters, however, did not stop there. The Claimant asked for further and better particulars; they were given. Those particulars included setting out the Claimant's task and observing that the duties so set out were within the remit of the associate director of service user and carer engagement, who was supported by an equality and diversity advisor, but they had been undertaken by him prior to the Claimant commencing her employment and they reverted back to him after she finished. That is emphasised further in paragraph 1 of the further and better particulars, where it is said that the duties, prior to and subsequent to her employment, were undertaken by the associate director. That thus created a picture of the Claimant being an employee who temporarily slotted in, similar to those cases in the law reports of teachers who had accepted temporary contracts whilst another teacher was absent and such as would apply if another employee was absent on a sabbatical, long term sickness or for an anticipated childbirth.
16. The paragraph, however, adds that the duties were part of the associate director role:
"[…] however, due to the short time scale within which these duties needed to be completed, and the Associate Director [not being] in a position to complete them within the set timescales, it was determined the Trust would engage an individual on a consultancy basis."
17. A different reason was given for the non renewal of the Claimant's contract. It is said (paragraph 4) that the Claimant's duties reverted back to the associate director of service user and carer engagement, and that that was the reason. The Tribunal would, if it had heard evidence, have heard, if he had been called, from Mr Adrian Childs. His witness statement is in the bundle. That says, at paragraph 11, that:
"On 21 October 2010 I met with [the Claimant] to discuss her work at the Trust. [The Claimant] wanted to continue working at the Trust after the end of the fixed term contract. I explained that the post was not a substantive established job within the Trust. It was a project based position that would not exist once the project work was completed. The project work [the Claimant] was commissioned to complete was done. […] There was no other project work needed at her level. Therefore, I informed [the Claimant] that her employment would end on 3 January 2011 as originally agreed."
18. That reverts to the reason originally given in the employer's response: the reason for termination was that the particular work, the project work being done by the Claimant, had finished. However, the evidence of Mr Childs is not all one way. At paragraph 3 Mr Childs noted that after the fixed term appointment came to an end responsibility reverted to the associate director; that is, responsibility for equality and diversity. That was expanded upon in paragraph 4: that the duties were part of the associate director role but that, due to a short timescale in which they had to be completed, he had not been in a position to complete them. It had therefore been determined that the Trust would engage an individual to carry out the required work, and, he goes on to say:
"The Trust needed a highly skilled person with previous experience in equality and diversity to assess where it was up to with the implementation of the Agenda, set out what still needed to be done, carry out the bulk of the implementation and then leave the Trust in the position that the Associate Director and the Equality and Diversity Advisor could handle the workload going forward."
19. That is just as capable of supporting the slotting in approach as it is of suggesting that the need for an employee to do work of a particular kind had, though it had not ceased, diminished.
20. In the skeleton argument produced by counsel for the hearing before the Employment Tribunal, this same approach of looking both ways on the factual issue is echoed. At paragraph 5 the fact that the work to be done was project work – i.e. work that was ever likely to have a conclusion as particular work, and work of a particular nature – is emphasised. At paragraph 11 counsel makes reference to a letter of reference made subsequently by Mr Childs that reads:
"Ms Singh was on a one year fixed term contract and employed as head of equality and diversity. Her remit was to establish the foundations of the Trust's approach to ensuring it complied with current legislation and guidance and to devise and implement the systems required to ensure that the Trust was able to embed the equality and diversity agenda throughout its everyday practice."
21. "This statement", commented Counsel, "it is contended, accurately sums up the purpose for which the Claimant was engaged and which she completed; in short, "job done"". Although Mr Gilroy submitted that "job done" might refer to someone whose temporary slotting in had come to its natural conclusion, in context it appears rather to be consistent with the first way in which the Respondent had addressed its response. At paragraph 15 the matter is even clearer:
"The respondent submits that the claimant was genuinely engaged for a specific purpose for a specific period within which it was anticipated the work would be completed (as was the case)."
22. Then there is a reversion to the argument by reference to the knowledge of the Claimant: "See Terry supra". He added:
"15. […] Furthermore the claimant was at all times aware that this was the case. She had negotiated with the Respondent [et cetera].
16. In those circumstances the respondent submits that the reason for dismissal was some other substantial reason and not redundancy."
23. However, in paragraph 7 it is said that the work undertaken by the Claimant was within the remit of the associate director. Ordinarily the duties would have been undertaken by that director, but, owing to the timescales within which they needed to be completed, it was resolved that a consultant would be engaged. In paragraph 19, and importantly, the Respondent's case factually was said to be that the requirements of the Respondent for employees to carry out the work had neither ceased nor diminished:
"The situation merely involved the allocation of work from one person to another and then, following the end of the latter's contract, the reversion of that work to the former. At any one time only one person was undertaking the work. There was no cessation/diminution in the requirements of the respondent's business for employees to carry out the work undertaken by the claimant/associate director. There was no redundancy as defined."
24. Thus, before the hearing in Manchester, two strands of factual evidence had been reflected in the employer's case, which appear to me to be inconsistent one with the other. The first was that that the project was special work; it was a project, properly so defined. It had ended. The employer's need for the employee to do work of that kind had ceased or diminished, justifying the use in two places of the word "therefore", that there was a dismissal. The second strand was contradictory, in that the work was not to be regarded as special but of a type done by others; that is, as I have indicated, analogous to the employee slotting in in the absence of another. When such an employee's fixed term ends, there is a dismissal, but it is not by reason of redundancy because there is no change to the number of employees nor in the demand of the employer to have the work performed, and therefore there is no redundancy. This latter situation, however, is open to questions of whether the nature and quality of the work performed has diminished even if it has not ceased. There may in some cases be a significant difference.
25. I can therefore understand a forensic decision, if it were made, having reviewed the available evidence and having consulted the witnesses, to the effect that it was unlikely that the evidence would sustain the second strand to the extent required to persuade the Tribunal. I do not know what was said by counsel to the Employment Judge on behalf of the Respondent. I have the skeleton argument upon which Mr Gilroy understandably focuses. Although it is inconsistent, on one view of the facts there would be no redundancy. Thus evidence should have been heard. That presupposes that upon reflection before the Tribunal counsel had advanced an argument exactly in line with his skeleton argument. That is what one might normally expect, but it is not inevitably so.
26. The other material that I have that indicates what was or was not said in oral submission to the Employment Judge about the case that was to be made shows that matters were said that went beyond the skeleton argument, such as, in paragraph 3, a record that the parties had agreed that a redundancy payment would be payable given the service that had been accrued; that had been in dispute earlier. The Judge identified at paragraph 7 what case he understood to be put forward. That was plainly foreshadowed in the skeleton argument that I have referred to. It depended centrally upon a particular view of what which Terry and Fay established. The Judge set out two possible views of the facts. In paragraph 9 he set out, as his understanding, that during the currency of the Claimant's employment there were three people undertaking the work and at the end there were two. Mr Gilroy points out that there is no acceptance of that in any document produced by the employer. As the extracts to which I have referred demonstrate, the Respondent's case was, rather, that the associate director moved to concentrate on other work while the Claimant was doing the special work she did; but the Judge began paragraph 10 by the words "Having canvassed these issues at length with Mr Benson on behalf of the Trust". Mr Gray points out, and I accept, that those words indicate that the Employment Judge had discussed the substance of paragraphs 7 9 with counsel before making any observation about the calling of evidence.
27. This, therefore, shows that the Judge understood that the case being made to him was not the factual case demonstrated by the slotting in scenario, as I have called it, but a rather different and legal point, and understood that there was a decision not to take any stance contradictory to the material that, I infer from the observations with which paragraph 10 begins, the Judge had put to counsel. This is supported by the Judge's note of 17 May. It is right, as Mr Gilroy QC points out, that this is made some long time after the event, and it is made in the absence of a copy of the skeleton argument and the further particulars, which he once had but no longer has; but he does recollect that the only defence being put forward was that the employment of the Claimant was temporary and for a specific purpose, and that therefore, given Terry and Fay, the Claimant was not entitled to a redundancy payment. He did not understand the defence, set out at paragraph 9 of the Notice of Appeal, to be put to him. He describes that as a completely different and additional defence. That defence was that there were two employees, and, in essence, the Claimants' role was to slot in while one attended to other work. He says that had he understood that that was the case made to him, he would have heard evidence.
28. I am bound to conclude that an argument to the effect recorded by the Employment Judge was plainly advanced. I have no material, for the same reasons as applied to my decision in respect of the denial of calling evidence, to understand what precise arguments were placed to the Judge except for the skeleton argument. It is accepted that at a hearing counsel may well develop a skeleton or, indeed, depart from it, or, indeed, concentrate, as Mr Gilroy QC effectively did in the appeal before me, and rightly so, upon one particular argument to the effective exclusion of others. Signally, I have no statement, nor has anyone sought to put any statement before me, as to the particular reasons why evidence was not proffered. I would observe that if it had been thought that the evidence would establish a significant ground of fact, properly considered, then counsel had only to ask. If it had been apparent to the advocate that the Judge was proceeding upon a basis of fact that made a material difference to the argument he wished to advance, he had only to ask for evidence to be heard. I cannot, and do not, enquire what the forensic reasons for the decision not to call evidence were, only to observe that it is quite likely that there may have been sound forensic reasons for doing so.
29. It follows, therefore, that I accept the succinct and effective submissions of Mr Gray for the Claimant that in these circumstances the Appellant is seeking a second bite at the cherry which he deliberately declined to bite on the first occasion. To be fair to Mr Gilroy QC, he accepts that if I were to take what might be described as technical approach to the issues of what occurred before the Tribunal, then I might well rule against his case. He argues that the ultimate fairness of the decision is owed the possibility of reversing it by a hearing on the facts, which would have been the normally anticipated course of events before a Tribunal. That may be. I do accept that it is in general desirable – indeed, highly so – that if a Judge is to proceed upon an agreement between the parties as to the relevant material for him to consider, that should be carefully set out. He might here have said that there had been no submissions made to him in support of that which on one view, though less emphatically so, the papers suggested, namely that the slotting in argument applied to the extent that there was not even a diminution of work. But that is a council of perfection; the failure to do so does not in the particular circumstances of this case, unusual though the circumstances are, amount, in my view, to an error of law.
30. It follows that, in these unsatisfactory and remarkable circumstances, I am bound to dismiss the appeal that has been made to me. I should not, however, depart from this Judgment without paying tribute to the careful and eloquent argument of Mr Gilroy QC, who, as I emphasise, was not counsel before the Employment Judge at Manchester. The appeal is therefore dismissed.