A1/2003/0626 
Neutral Citation Number: [2003] EWCA Civ 1675
IN THE SUPREME COURT OF JUDICATURE 
IN THE COURT OF APPEAL (CIVIL DIVISION) 
ON APPEAL FROM THE ORDER OF THE EMPLOYMENT APPEAL TRIBUNAL
Royal Courts of Justice 
Strand 
London, WC2 

Monday, 6 October 2003
 
B E F O R E:

LORD JUSTICE WARD 
 
LORD JUSTICE LATHAM 
 
LORD JUSTICE KEENE 
 
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BRITISH TELECOMMUNICATIONS PLC
Appellant/Appellant 
-v-
 
REID 
Respondent/Respondent 
 - - - - - - -
(Computer-Aided Transcript of the Stenograph Notes of
Smith Bernal Wordwave Limited
190 Fleet Street, London EC4A 2AG
Tel No:  020 7404 1400  Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
 - - - - - - -
MR P THORNTON (instructed by BT Group Legal Services of Milton Keynes) appeared on behalf of the Appellant
MR C MYERS (non-practising barrister) appeared on behalf of the Respondent 
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J U D G M E N T 

1.	LORD JUSTICE WARD:  
The Issue 
At issue in this appeal is the proper amount of damages to be awarded for direct race discrimination and whether aggravated damages are appropriate.
The Facts 
2.	They can be shortly stated.  The respondent to this appeal Mr Reid is a 37 year old black man of Afro-Caribbean descent who has been employed by the appellant, British Telecommunications plc, since the beginning of 1997.  Following his promotion to a higher grade he was transferred to a technical division of British Telecom working from St. Albans.  He was working employed on a shift with Mr John Scott and Mr Norman Edwards.  They did not form a happy team.  There were a number of acrimonious disputes.  The Employment Tribunal had to examine four incidents.  The first occurred in January 2000 on the second day of Mr Reid’s work at St. Albans when there was a serious confrontation about taking meal breaks.  The second incident occurred a month later in February 2000 and this arose because Mr Reid was being allowed time away from his post in order to fulfil his duties as a trade union representative.  In April 2000 Mr Reid inadvertently looked at a personal file kept by Mr Edwards.  Thereafter Mr Reid kept himself very much to himself and on the surface at least the shift worked without major incident.  The peace was finally shattered by the fourth incident on 5th November 2001.  Since this was the only matter which the Employment Tribunal found proved, it is necessary for me to set it out in a little more detail.
3.		It appears that the members of the team had use of a cordless telephone which was intended to be used only for taking urgent orders from other BT centres.  On occasions,  however, it was used by the team for personal communication.  Although Mr Scott had so used it he apparently took some objection to Mr Reid receiving a telephone call from his wife.  Mr Reid felt the rebuke to be unjustified, particularly since his wife suffered sickle cell anaemia, pain in her legs and depression.  The argument became very heated.  Mr Edwards then intervened.  Mr Edwards was later made the second respondent to Mr Reid's complaint of direct race discrimination.  The Employment Tribunal in their decision promulgated on 5th July 2002 made these findings:
"xvi) ..... The second respondent lost his temper and came over to the applicant in an angry mood.  John Scott decided to walk off.  The second respondent then started prodding the applicant in a threatening manner.  He then told the applicant that he knew people with baseball bats and that he had better watch out.  The second respondent then said to the applicant: 'I will get someone to put you back in your cage'.  The second respondent, once he had calmed down, then adopted a threatening manner towards the applicant.  Eventually, the applicant decided to leave at about 11 p.m. as by now he was in some distress."
4.		The following day Mr Scott sent an e-mail to the line managers informing them that Mr Reid had left the building and had not returned to work.  Mr Reid, for his part, reported the incident to his local police station and wished to file a complaint of common assault against Mr Edwards.  The police realising that this was an incident at work advised the applicant to make a complaint under the internal grievance procedures as, in their view and experience, British Telecommunications had a good reputation in this regard.  (I should add in parenthesis that that is a matter which has been expressly conceded on the part of Mr Reid.)  As a result of Mr Scott's communication, the employer began general disciplinary procedures against Mr Reid, the allegation being that he had abandoned his duty.  Having heard his side of the story, a file was opened under the same procedure against the second respondent relative to the part he had played in the incident concerned.  The tribunal then made the following findings at sub-paragraph (xxi) to (xxiii):
"(xxi) The result of Mr Makey's investigation into the applicant's alleged abandonment of duty was that he should have told his superiors that he was leaving his shift and that his actions showed a lack of respect and consideration not only for his colleagues but his managers and the First Respondent as a whole, and a clear lack of regard for his duties.  He therefore submitted his report for consideration by the First Respondent under the Serious Offence Disciplinary Procedure.  In respect of the allegation by the applicant against the Second Respondent, in that investigation he concluded that there was nothing to substantiate the claim of any racist behaviour by the Second Respondent on the night in question or that the second respondent had been provocational.  That discipline case was therefore closed.
 (xxii) Mr Makey then decided to transfer the applicant onto a different shift (A Shift).  This was on a temporary basis to cover for an employee on sick leave.
 (xxiii) The applicant was seen by the Occupational Health Service of the First Respondent and by a report dated 10 May 2001 they advised Mr Makey that the applicant should be placed in an environment where he was not likely to have contact with the second respondent.  The report indicated that the applicant was willing to consider working at another place of work.  Mr Makey therefore made arrangements for the applicant to work at the sister site in Bletchley."
5.	Mr Reid found that the journey to Bletchley was too much for him and arrangements were made, with his consent, to move him to a post in Central London where he has remained.
6.	In the Spring of 2001 both Mr Scott and Mr Edwards successfully applied for new, different posts at St. Albans.  In July 2001 they were successful in their applications and received promotion which placed them senior to Mr Reid.  Mr Reid himself was not eligible for those posts for other reasons. 
7.		In May 2001 Mr Reid sought a review of his complaint against Mr Edwards or, perhaps more accurately, on that date his complaint was reviewed.  The conclusion reached - after what was described as a thorough investigation by the Operations Manager Mr Godsafe - was that Mr Reid had not been the victim of racial harassment by Mr Edwards or any other member of the team.  Mr Reid appealed against that finding.  Miss Corby, the Human Resources Director, likewise was not satisfied that Mr Edwards had made the offensive comment with which he was charged. 
The Proceedings before the Employment Tribunal 
8.		Mr Reid brought his complaint of direct race discrimination relying on the four incidents.  The tribunal came to the conclusion that British Telecommunications had not proved that it took such steps as were reasonably practicable to prevent Mr Edwards from doing the acts alleged to have been done by him, and that it was therefore liable in respect of any of the complaints found to have been proved.  The tribunal held that so far as the first three incidents were concerned the treatment of Mr Reid was not less favourable than the treatment that would have been applied to a hypothetical white comparator, and in those circumstances his complaints failed.  In respect of incident No. 4 the complaint succeeded because -
"The tribunal concludes that the words complained of were spoken and amount to direct race discrimination."
9.		The tribunal then went on to deal with compensation for injury to feelings, and came to these decisions set out at page 33 of our bundle:
"The applicant had a very unpleasant time after the 5 November incident and had to suffer the indignity of a disciplinary investigation, which was totally unjustified.  His health suffered and he had to have a considerable time off work.  He went back to work on 17 April 2001 at St Albans and was transferred to Bletchley on 29 May 2001.  He found this stressful and became sick on 8 October 2001 with stress.  He was transferred to Mondial House on 30 October 2001.  The grievance investigation by Mr Godsafe was not finalised until 11 December 2001 and the appeal by Ms Corby was not finalised until 12 February 2002.  The applicant therefore had some 14 months while he was waiting for his grievance to be dealt with.
In the circumstances, the tribunal consider that the appropriate amount for compensation for injury to feelings is £6,000.  Further, the tribunal consider that a sum of £2,000 aggravated damages is appropriate, given that the transgressor, the second respondent, was not punished, remained in his post and achieved promotion to a position higher than the grade of the applicant.  The tribunal do not consider it appropriate to make an award of any sum against the second respondent.  In those circumstances, the first respondent is ordered to pay the applicant the sum of £8,000."
The Appeal to the Employment Appeal Tribunal 
10.		British Telecommunications appealed.  In their judgment, set out in their decision sent to the parties on 5th June 2003, the appeal tribunal came to the conclusion expressed at page 59:
"Although the finding of actual race discrimination was in respect of one incident only, it involved very unpleasant conduct by Mr Edwards, which included physical threats and the words 'I will get someone to put you back in your cage.'  It is hardly surprising that the Employment Tribunal took account not only of the inevitable distress to Mr Reid occasioned by that incident, but also what they clearly found to be consequential effects on him."
11.	In their judgment the Employment Appeal Tribunal were of the view that it was for the Employment Tribunal to find the facts and matters in the context of the particular  circumstances of each case.  They hear the evidence and have to come to their conclusions on it.  They did not feel that the award was excessive and dismissed the appeal against the award for injury to feelings.  As for aggravated damages, the view taken by the appeal tribunal was -
"We can see that the reference by the Employment Tribunal in respect of promotion for Mr Edwards may have been overstating the position so far as justification for aggravated damages is concerned, but what the Employment Tribunal clearly found was a weak approach by BT management in dealing effectively with the transgressor when there was clearly sufficient evidence to indicate race discrimination occurring.  In particular, by imposing no sanction whatsoever on Mr Edwards, that clearly exacerbated the situation and added to Mr Reid's distress.  We are not able to say the tribunal was at fault in deciding to add £2,000 for aggravated damages in the particular circumstances."
So they dismissed the appeal.  
12.	The appeal to this court was brought with permission that was granted at an oral hearing sought by British Telecommunications after the single Lord Justice had refused permission on paper. 
The Appellant’s Case 
13.		No appeal is made against the finding of liability and the challenge is brought only to the separate award of damages for injury to feelings and aggravated damages.  The appellant’s case is cogently put forward by Mr Philip Thornton in his helpful skeleton argument and in his sustained submissions before us this morning. 
Damages for the injury to feelings 
14.		Mr Thornton correctly analyses paragraph 7 of the decision of the Employment Tribunal into five constituent elements which they took into account in making their award.  They are:
(a) the events constituting the fourth incident itself on 5th November 2000 and the 'very unpleasant time' Mr Reid had thereafter;
 (b) the fact Mr Reid thereafter had to suffer the indignity of a disciplinary investigation that was 'totally unjustified';
 (c) the fact his health suffered causing him to have time off work;
 (d) the fact that Mr Reid suffered from stress as a result of being transferred to Bletchley; and 
 (e) the fact that he had to wait 14 months for his grievance to be dealt with.
15.	Mr Thornton 	stresses that the only finding of race discrimination was in the words that were spoken on 5th November.  There was no finding of discrimination in the subjecting of Mr Reid to a disciplinary investigation, to transferring him to Bletchley or in the manner in which his grievance against Mr Edwards was conducted.  That is of course true.  Mr Thornton submits that it was therefore improper for the tribunal to take those matters into account.  I cannot accept that submission.  In my judgment, if those matters arose out of the act of discrimination and were consequential upon it, then they are relevant to the inquiry into the extent of injury to the feelings of the complainant.  After all, as this Court has recently held in Vento v Chief Constable of West Yorkshire Police (No. 2) [2003] IRLR 102, 109 [2002 EWCA Civ 1871], a decision handed down after the decision made by this tribunal: 
"Subjective feelings of upset, frustration, worry, anxiety, mental distress, fear, grief, anguish, humiliation, unhappiness, stress, depression and so on and the degree of their intensity are incapable of objective proof or of measurement in monetary terms.  Translating hurt feelings into hard currency is bound to be an artificial exercise.”
16.		For my part, I can readily see that a complainant having to undergo a totally unjustified disciplinary investigation into his own conduct could be an indignity which exacerbates his wounded feelings arising from the act of discrimination   itself.  Likewise, stress in coping with the aftermath of the act of discrimination is an element of his injury.  The fact of having to wait for 14 months for the grievance procedure to be concluded can, on the facts of a particular case, be another factor which prolongs the upsetting consequences of an act and can be taken into account in the assessment of damages.  I stress that each case will, of course, depend upon its own facts.  But on the facts of this case I, for my part, cannot see that the tribunal erred in treating those factors as relevant to their decision.  The tribunal would only have erred in law if they had had regard to matters which were irrelevant.  In my judgment they did not fall into that error.
17.		Mr Thornton’s second submission is this:  if the factors were, contrary to his primary argument, relevant factors, then they are only relevant if they are consequential upon the act of discrimination.  I would agree.  So, he submits, the judgment here does not explain this element of causation at all and the decision is, therefore, open to the criticism that it is not sufficiently reasoned for the unsuccessful party to have understood why it lost.
18.		So far as the latter criticism is concerned, I agree that the judgment is not as fully reasoned as it might have been and I am sure that it could have been more felicitously expressed.  Without wishing to dilute in any sense at all the observations from this court about the need for reasoned judgments, one must nonetheless bring attacks of this kind into perspective and read the judgment or decision as a whole to see whether the losing party and the appellate court or tribunal truly can know why the case has been lost.  As I read paragraph 7 of their decision, the Employment Tribunal were expressing their conclusions as to what had happened to this applicant after he had been subjected to the very unpleasant attack upon him on 5th November.  They may not have expressly said that what followed was the result of that act of discrimination but that is the only sensible understanding of their judgment.  I would therefore reject the submission that the decision is insufficiently reasoned.
19.		Mr Thornton submits in particular, in analysing whether these matters were consequential upon the act of discrimination, that there was no medical evidence to support the conclusion that any medical condition from which Mr Reid suffered was actually caused or contributed to by the remarks made to him on the day in question.  The transfer to Bletchley because of the clash of personalities between Mr Reid and Mr Edwards may just as well have been a result of the earlier incidents.  His health may have been affected by worry over his wife's medical problems.  I see the force of the argument as one which arises from a microscopic analysis  of the decision, but it seems to me to give scant acknowledgment to the recitation of the facts as they were found by the tribunal.  The tribunal noted that the applicant was seen by the employer’s Occupational Health Service.  The Occupational Health Service recommended that the applicant be placed in an environment where he was free of contact with the second respondent.  Bearing in mind the lack of hostility between them had lasted for some 18 months before the final incident, that final incident can be and can only have been seen to have been the final straw which broke this camel’s back.  It was an incident which was so stressful that the applicant had to leave work there and then.  It was an incident which apparently left him unable to go back to work until 17 April, that is to say some five months later.  The only implication arising from those facts seems to me to be that his health suffered because of that final incident. 
20.	Moving on from there, if the transfer to Bletchley was linked to the racial discrimination and if working at a distance from home added to his stress, as the tribunal found, then I can see no reason why a causal link between the incident and the further stress is not sufficiently established in that regard.
21.		Mr Thornton submits that the time taken for the grievance procedure to be concluded is quite remote from Mr Edwards’ behaviour.  Again I regret that I do not agree.  It was because of Mr Edwards’ behaviour that Mr Reid invoked the grievance procedure.  Having invoked it, he was left waiting.  The tribunal were entitled to take into account the length of time this was taking and the sense of uncertainty for Mr Reid whilst these matters were hanging in the air; all would have added to the sense of frustration which arose directly from the incident itself.  I cannot find, for my part, that the causal link was not established.
22.	My conclusion on this part of the case is that each of the factors mentioned by the Employment Tribunal was capable of being taken into account in gauging the extent of the injury to feelings, and, in the result, I see no error of law in their approach.  The facts were there for them to find and they did not misdirect themselves. 
Aggravated damages 
23.		In Alexander v Home Office [1988] IRLR 190, 193, May L.J. observed that it is open to a tribunal in a discrimination case to include in the compensatory award: 
" ..... an element of aggravated damages where, for example, the defendants may have behaved in a high handed, malicious, insulting or oppressive manner in committing the act of discrimination."
24.		In Armitage Marsden and H.M. Prison Service v Johnson [1997] IRLR 162, the Employment Appeal Tribunal, presided over by Smith J., held:
“40 We consider that, as a matter of principle, aggravated damages ought to be available to plaintiffs or applicants for the statutory torts of sex and race discrimination.  Damages are at large and, at least so far as direct discrimination is concerned, the torts may be sufficiently intentional as to enable the plaintiff to rely upon malice or the defendant's manner of committing the tort or other conduct as aggravating the injury to feelings."
25.		In that particular case the Employment Appeal Tribunal went on to list the factors the tribunal could take into account, one of which was the employer’s conduct of the investigation of the complaint of race discrimination.  At paragraph 42 Smith J. held: 
"The tribunal described this as a travesty of what it should have been.  Instead of providing the respondent with a remedy for the wrongs which he had suffered, the third appellants added to his injury by attributing all his problems to his own defects of personality.  We think that this was a true case of aggravation:  a case where the appellant’s actions rubbed salt in the respondent’s wounds."
26.		In H.M. Prison Service v Salmon [2001] IRLR 425 the fact that the employer perceived the entire incident to be trivial and communicated that perception to the applicant by the way that it dealt with it was sufficient to constitute aggravating conduct in the view of the Employment Appeal Tribunal.
27.		Bearing those matters in mind, Mr Thornton submits that there was no finding of triviality and the mere fact that the transgressor was not punished did not, on its own, demonstrate that BT treated the incident as trivial.  He submits that there is no finding of any high-handed malicious, insulting or oppressive, behaviour and no finding that the conduct was "intentional so as to enable the claimant to rely upon malice".  The fact of promotion did not of itself lead to an implication of such high-handed conduct sufficient to aggravate the award of damages.  These submissions have caused me more anxiety.  The decision is again lacking in an expanded treatment of the reasons which justify the conclusions, and the same criticism of the adequacy of the reasoning can be levelled at this part of the case as it was to the treatment of the injury to the claimant’s feelings.
28.	Nonetheless I have concluded that the reasons are sufficiently discernible from the judgment.  The tribunal were, in my view, entitled to take account of the fact that the transgressor was, as a matter of fact, not punished and remained in post.  The striking fact is that Mr Edwards was promoted even though the charges against him had not been determined.  I am far from laying down any principle that an employer cannot promote an employee whilst disciplinary proceedings are hanging over his or her head, but it can, in the particular facts and circumstances of a particular case,  be a material factor demonstrating the high-handedness of the employer.  Once again I conclude that these were factors which cannot be said to be irrelevant and, accordingly, the tribunal did not err in having regard to them.
Conclusion 
29.	My conclusion is therefore that there being no attack  that the awards were so excessive as to have been irrational - a case which would have been very difficult to sustain -  in those circumstances, on the grounds put forward which I  have rejected, this appeal should be dismissed.
30.	LORD JUSTICE LATHAM:  	I agree. 
31.	LORD JUSTICE KEENE:  I also agree, and wish only to add a few brief comments of my own.
32.	I do not accept that the Employment Tribunal's reasoning in respect of the award of damages for injury to feelings was inadequately spelt out.  A sensible reading of the relevant paragraph, paragraph 7, of the extended reasons indicates that the tribunal regarded a number of matters as arising out of the act of discrimination on 5 November and that the tribunal was seeking to reflect those in the award.  Although the  tribunal could have dealt with those reasons at greater length, it seems to me that it said enough to indicate to the parties why it had come to the conclusion which it had reached.  Once it has been established that the tribunal was treating these various matters as consequential to the act of discrimination, it then follows that it was unnecessary for each of those matters to be in itself discriminatory, as Mr Thornton has sought to maintain.  
33.	He then submits that those matters could not properly be regarded as the inevitable consequence of the racial insult of 5 November.  One example which he emphasises is that of the length of time the grievance investigation carried out into Mr Reid's complaint about that incident took.  That, it is submitted, is not the result of the incident and so should have been disregarded by the tribunal in arriving at its award.  The problem with that argument is that the grievance investigation itself was a natural consequence of the incident and the grievance lodged about it.  Once that position has been reached the length of that investigation becomes relevant to assessing the injury to Mr Reid's feelings.  If a grievance process about a complaint of discrimination is dealt with quickly by an employer that may help to limit the extent of the injury to the complainant's feelings.  Conversely, if it takes a considerable time, as was the case here, to deal with the complainant's grievance the injury to his feelings may well be the greater because the grievance has not been remedied and the injury is prolonged.  
34.	I therefore cannot see that the tribunal went wrong in taking account of the lengthy passage of time which passed before Mr Reid's grievance was dealt with, a period of some 14 months.  It was, in my judgment, a relevant consideration.  
35.	The award of £6,000 for injury to feelings is not out of line with the figures suggested in Vento and certainly not so high as to warrant intervention by this court.
36.	I turn to the question of aggravated damages.  I should preface my comments on this aspect by saying that I have some concern about how the concept of aggravated damages, as distinct from exemplary or punitive damages, is applied in discrimination cases where damages are already being awarded for injury to feelings.  I say that because aggravated damages are essentially compensatory in nature.  They are intended to compensate a claimant for the injury he has suffered, albeit on a more generous basis (see Lord Hailsham of St Marylebone, L.C. in Broome v Cassell & Co [1972] AC 1027 at 1073 C-D).  Such injury includes injury to feelings, and a tribunal therefore must be careful to avoid double counting in any award when a separate award for injury to feelings has been made.  I have some sympathy with the views expressed by the Northern Ireland Court of Appeal to this effect in McConnell v Police Authority for Northern Ireland [1997] IRLR 625 at 629 para 19.  Nonetheless, it is clear from the decision of this court in Alexander v Home Office [1988] IRLR 190 at 193 that it is open to a tribunal in a discrimination case to include in an award an element of aggravated damages where the party found guilty of discrimination has behaved in a "high-handed, malicious, insulting or oppressive manner." 
37.	It has not been argued on behalf of the appellant that there has been any double counting in the award in respect of injury to feelings.  In those circumstances I proceed simply to consider the argument advanced by Mr Thornton on the appellant's behalf.  In essence, he submits that his clients did not behave in the manner described in Alexander and that such matters as the promotion of Mr Edwards could not properly be regarded by the Employment Tribunal as high-handed or insulting behaviour. 
38.	I do not agree.  There is no doubt that the employer here did carry out a thorough investigation into Mr Reid's grievance about the racial insult he suffered at Mr Edwards' hands on 5 November.  The tribunal described that investigation and the subsequent appeal process as having been thorough (see paragraph 4 (xxvi) and (xxvii)).  If the promotion of Mr Edwards had followed the conclusion of that thorough investigation, then I would have some doubt as to whether aggravated damages would have been appropriate in this case.  But the employer here promoted Mr Edwards to a higher grade, which was also a grade higher than that enjoyed by Mr Reid, while that thorough investigation was still being carried out and before it had come to any conclusion.  Like my Lord, I do not say that such an action will always or even generally amount to high-handed conduct.  It is a matter of fact in every case.  Where an investigation is one into a complaint by an employee about a serious act of racial discrimination alleged by him against a fellow employee, it is open to an Employment Tribunal to regard the promotion of that fellow employee while the investigation is still proceeding as being a high-handed action and one which is insulting to the complainant.  It may, in appropriate circumstances, be seen as the employer treating the complaint as being trivial and thereby rubbing salt into the complainant's wounds. 
39.	In the circumstances of the present case I am of the view that the tribunal was entitled to make an award for aggravated damages.
40.	I, too, would dismiss this appeal.
Order:  Appeal dismissed