Appeal No. EAT/82/92

	EMPLOYMENT APPEAL TRIBUNAL
	58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

		At the Tribunal
		On 18 May 1993

	Before

	HIS HONOUR JUDGE N HAGUE QC

	MR E HAMMOND OBE

	MR R PHIPPS

WHARFEDALE LOUDSPEAKERS LTD	APPELLANTS

MRS J POYNTON	RESPONDENT

	Transcript of Proceedings

	JUDGMENT

Revised

	APPEARANCES

For the Appellants	MR J W JENNINGS
(PERSONNEL CONSULTANTS)
LEGAL PERSONNEL &
MANAGEMENT SERVICES LTD
CROWN HOUSE
JOHN STREET
SHIPLEY
WEST YORKSHIRE
BD18 3HU

For the Respondent	IN PERSON

	JUDGE HAGUE QC:  Mrs Poynton worked for Wharfedale Loudspeakers Ltd ("the Company") as a production supervisor until she was dismissed on 25 June 1991.  By then she had worked for the company for just under eight years and had been a production supervisor for a little over two years of that time.  In that position she was responsible for thirty operators and was a key worker.  The evidence before the Industrial Tribunal was that she performed her duties excellently.

	However during the two years prior to her dismissal, she had what the Company regarded as an unsatisfactory attendance record due to sickness, although up to twelve months before her dismissal the Company seems to have done little to deal with absenteeism problems which appear to have arisen in respect of other employees as well as Mrs Poynton.  Mrs Poynton's absences are summarised in two documents which were before the Industrial Tribunal to which we will refer in a moment.  Mrs Poynton received three written warnings about her attendance.  The first is contained in a letter dated 3 July 1990, which is addressed to her under her previous name of Mrs Metcalfe.  This reads as follows:

"Your recent absence from work has made it necessary to examine your attendance and timekeeping record.

Over the last 9 months of 175 days available work you have attended 139 days i.e. 20.6% absence.

Over the last 2 months your attendance has deteriorated, and of 39 days available work you have attended only 26 days i.e. 33.3% absence.

This letter should be accepted as a written warning regarding your attendance.  Unless there is an immediate and lasting improvement in your attendance further disciplinary action will be taken.

This warning will remain on file for twelve months.

If however you feel that this warning is unfair or unjust you have the right to appeal against it.  Any appeal should be made in writing to the Manufacturing Director, Mr C Jennings, within 24 hours of receiving this letter.

This is in accordance with the disciplinary procedure outlined in your conditions of employment."

	Mrs Poynton's second warning was contained in a printed form which was completed and dated 30 January 1991.  It says:

"Please accept this as a formal written warning with regard to your attendance and timekeeping.

Your attendance record for the period July 1st to December 31st 1990 indicates an unacceptable level of absence from work.

Unless there is an immediate and lasting improvement in your attendance further disciplinary action will be taken, which could lead to your employment with the company being terminated.

This is in accordance with the disciplinary procedure outlined in your Conditions of Employment."

The third and final warning was contained in a letter dated 12 March 1991 which reads:

"In January of this year you received a written warning regarding your non-attendance at work during the six month period 1st July 1990 to 31st December 1990.  During that period you were absent from work 17.7% of the time available.

At the time of this warning it was stated that your record would be reviewed when the attendance figures were available for the six month period 1st September 1990 to 28 February 1991.  The figures for this period indicate that you were absent from work 19.4% of the time available.

This level of absence from work is unacceptable to the company, therefore if there is not an immediate and lasting improvement in your attendance further disciplinary action will be taken, which will almost certainly be termination of employment.

This letter should be accepted as a Final Written Warning."

It will be seen that to a considerable extent that letter overlaps and relates to the same periods as the warning letter of 30 January 1991.  

	Following that warning on 12 March 1991, Mrs Poynton was not absent at all until Friday 8 June.  She came back to work on the following Monday, but from the Tuesday onwards was absent for a total of a further nine working days.  It is clear that she had contracted the unpleasant ailment of shingles and she supplied a Doctor's Certificate to that effect.  She told us that she had in fact felt rather unwell on the Monday, but it was not until the Tuesday that the doctor had in fact diagnosed shingles as being the problem.

	Shortly after Mrs Poynton returned following that absence, she was summoned to a disciplinary hearing which took place on 25 June 1991.  It appears from a memorandum of that meeting that the persons present were Mr Oxley the Chairman, Mr Haggas the Management Spokesperson, Mr Hick who was in fact the person who compiled the memorandum, Mrs Poynton herself and Mrs Meadowcroft, a colleague of Mrs Poynton.  The memorandum reads as follows:

"The Chairman, Mr S A Oxley, opened the hearing and explained who everyone was and why they were there.

The Management Spokesperson Mr J E Haggas addressed Mrs Poynton and stated the companys complaint against her, the complaint being that her absence from work was still at the unacceptable level of above 10%, and also her last period of sickness for which she had submitted a medical certificate, she had been seen out socialising in the Eccleshill Working Mens Club on two occasions, these being Saturday 15 June 1991 and Wednesday 19 June 1991.  On both occasions there were witness's (sic) who were prepared to come forward and make statements.

Mr J E Haggas asked Mrs Poynton if she wished the witness to come into the hearing to give a statement and also question the witness herself, Mrs Poynton declined the offer.  Mr Haggas asked Mrs Poynton if she had anything further to say on the matter, Mrs Poyntons response was "I am not admitting anything and I am not denying anything".

She then went on to say that she felt that she had been singled out and victimised regarding her sickness.  Mr Haggas explained that everyone was dealt with in the same manner.

At this point the meeting was adjourned to deliberate on a decision.

On re-convening the hearing Mrs Poynton was told by Mr S A Oxley that after considering all the facts he would have to terminate her employment with the company on the grounds of an unacceptable level of sickness and absenteeism, Mrs Poynton was then told she would have the right to appeal against the decision within five days of receipt of her letter of termination."

On the same day Mr Haggas sent to Mrs Poynton a letter of termination which refers to the disciplinary hearing and confirms the termination of her employment.  It then says this:

"The reason for your dismissal is your unacceptable level of sickness and absenteeism from work, for which you were previously given a final written warning on 12.3.91."

and it repeats she has a right of appeal against that decision.  She exercised that right but without success.  

	Mrs Poynton then made an application to the Industrial Tribunal alleging unfair dismissal.  The Company in its Notice of Appearance sets out the reasons for the dismissal in these terms:

"The application is resisted on the grounds that the applicant was properly warned in accordance with the Company's disciplinary procedures that her continued attendance record would result in dismissal if there was no marked and sustained improvement.

In spite of receiving a written and a final written warning, her attendance record did not improve and on the 25th June 1991, following a disciplinary interview she was dismissed.

The applicant subsequently exercised her right of appeal but this was not upheld by the Company's Deputy Chairman."

	The hearing before the Industrial Tribunal took place on 13 November 1991.  Mrs Poynton appeared in person at that hearing.  The Company was represented by a Mr Booth of LMPS Legal Consultants, and Mr Haggas and Mr Oxley both gave evidence.

	In the course of his evidence the Chairman's Note records Mr Haggas as saying:

"I have never challenged any of sickness absences as not genuine.  Only one unauthorised absence, namely 1 December 1990."

Mr Oxley, in relation to the socialising which is referred to in the minute of the disciplinary hearing, is recorded as saying:

"She neither admitted or denied it.  I gave very little weight to this.

Her dismissal was based on her attendance record over the last two to three years."

	Mr Booth endeavoured to cross-examine Mrs Poynton when she gave evidence as to the reasons for some of her absences.  The Chairman refused to let Mr Booth continue that line of cross-examination, because there had been no suggestion previously that the sicknesses had been other than genuine.  We think that the Chairman was entirely right in refusing to let Mr Booth continue on that line of cross-examination.  Another matter which arose and caused some difficulty, was that Mr Booth only put in to evidence the Company's timekeeping and absence schedules at the hearing, even after Mr Haggas had started to give evidence.  The Chairman took the view that that was much too late and was not the way in which people representing employers should conduct their cases, and that Mrs Poynton should have been supplied (as indeed the Industrial Tribunal should have been supplied) with those schedules some time beforehand.  We also agree with those criticisms.  There was also some difficulty in that Mr Booth endeavoured to refer to a reported case without giving a reference or supplying a copy.  Again we think that that was unfortunate.  However, at the end of the day it does not make any difference.

	The Industrial Tribunal announced at the conclusion of the hearing on 13 November their finding that Mrs Poynton had been unfairly dismissed.  They gave their Full Reasons which were sent to the parties on 2 January 1992. 

	Paragraph 3 of the Full Reasons reads as follows:    

"Mrs Poynton complained that she had been unfairly dismissed by the respondent.  The respondent contended it had dismissed the applicant for a reason related to conduct, namely her sickness and absenteeism record and that in treating that as a sufficient reason for dismissal the respondent acted reasonably."

It is unclear to us whether the mention of a reason related to conduct derives from Mr Booth (or the Company) or from the Tribunal itself.  At a later stage in the Tribunal's reasons which we come to in a moment, the Tribunal remark that:
"If a person is genuinely off sick, that cannot be counted as conduct or misconduct"

and we agree.  We find the particular wording of paragraph 3 a little difficult to follow and we think that from the documents which we have referred to in some considerable detail, it is quite plain that the dismissal was for the reason of her absenteeism record.  Whether one calls that related to conduct or not is another matter.

	In paragraph 4(i) if the Full Reasons the Industrial Tribunal find as a fact:

"that it is clear that she complied with the final written warning and it was only when she was genuinely ill from shingles that she was dismissed.  The respondent does not try to say that it dismissed her for any other reason; that that was the trigger for her dismissal."

In paragraph 5 the Industrial Tribunal comments as we have said that genuine sickness cannot be counted as conduct or misconduct.  The Tribunal then discusses the question of capability and whether a period of sickness can serve as grounds of capability and quite rightly says that on the facts of this case it could not.  It had not been put forward as the reason for the dismissal.

	We now come to paragraph 6 which we regard as important.  It reads as follows:

"In the circumstances, therefore, the tribunal is not satisfied as to the reason for dismissal, that it falls within the potentially fair reasons in the Employment Protection (Consolidation) Act 1978, because the tribunal says it cannot fall within conduct and is not the sort to be made out as falling within capability in this case."

That paragraph is plainly a reference to section 57(1) of the 1978 Act 1978 which provides as follows:

"In determining for the purposes of this Part whether the dismissal of an employee was fair or unfair, it shall be for the employer to show -

(a)what was the reason (or, if there was more than one, the principal reason) for the dismissal, and
(b)that it was a reason falling within subsection (2) or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which that employee held."

The reasons which are specifically specified in sub section (2) include capability and conduct.

	As we have said, it is perfectly plain from the documents which we have referred to that the reason for the dismissal was Mrs Poynton's absence record.  In paragraph 6 the Industrial Tribunal, having said that that was neither conduct nor capability, seem to have come to the conclusion that therefore it did not fall within any of the potentially fair reasons in the Act, but with all respect that cannot be correct.  The Tribunal failed to consider whether it might come within the words:

"..some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which that employee held."

	It is clear from settled cases that persistent absenteeism, albeit on genuine sickness grounds, may well justify the dismissal of an employee, particularly an employee holding a responsible position.  We think therefore that the Tribunal failed to consider section 57(1) and (2) correctly.  

	The Tribunal then went on in paragraph 7 of their Reasons to consider the question of fairness or unfairness that arises under section 57(3) of the Act.  However, there is a difficulty in that because they had failed to identify the reason why Mrs Poynton had been dismissed.  In SMITH v GLASGOW CITY DISTRICT COUNCIL [1987] ICR 796 in the House of Lords, Lord Mackay of Clashfern, with whom all the other Law Lords agreed, said at page 803B:

"It is important to notice that the resolution of the question what is the reason or, if there is more than one, the principal reason for the dismissal is important not only in relation to subsections (1) and (2) of section 57 but also in relation to subsection (3), for the question in subsection (3) is whether the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee and it as a sufficient reason for dismissing the employee and it must refer back to the reason or the principal reason determined under subsection (1)."

Lord Mackay referred to some dicta of Lord Simon of Glaisdale in W. DEVIS & SONS LTD v ATKINS [1977] ICR 662, at page 682 which is to the same effect.

	It may be that this lack of clarity as to the reason for the dismissal accounts for some of the observations of the Industrial Tribunal in paragraph 7 of its Reasons, the first sentence of which reads as follows:

"In any event if we are wrong in that and it does fall within the potentially fair reasons, then the tribunal has no hesitation in saying that the respondent acted unreasonably in treating this instance of genuine illness as triggering what it claims to be procedures for dismissing the applicant."

With all respect, that is not really the correct question.  The question is whether the Company was justified in treating Mrs Poynton's attendance record as a whole, including the last part of it with the reason for the latest non-attendance and the improvement in her attendance which had occurred after the final warning, as justifying her dismissal.  It was, we think, wrong to isolate the sole question of the genuine illness as the sole matter on which to test whether the Company had acted unreasonably.

	Continuing with paragraph 7 the Industrial Tribunal then referred to Mrs Poynton's work record and her length of service, which they say the Company failed to take account of.  They mention also the attendance records of other employees.  They say this:

"But, as we say, those would be additional reasons for us saying the respondent acted unreasonably and we consider that we are not stepping into the shoes of management and saying what we would have done in the circumstances but that those additional reasons of unfairness or unreasonable conduct by the employer are unnecessary upon the basic point we raised where there was a dismissal which was basically because the applicant became sick for a genuine reason and that was treated as misconduct by the respondents and incorrectly treated as such."

The final part of that rather involved sentence shows that the Industrial Tribunal is returning to consider only the question as to the last illness.  In addition it shows that the Tribunal thought that the Company was treating that as misconduct by Mrs Poynton and say it incorrectly treated that as misconduct.  With all respect, we do not think that it is correct to say that the Company did treat it as misconduct.

	For those reasons we think that the reasoning of the Industrial Tribunal, particularly in paragraphs 6 and 7 of their Full Reasons, is flawed and we do not think that the decision should stand.  With some regret, we consider that we really have no alternative except to allow the appeal and to remit the case to a differently constituted Tribunal for a re-hearing.  We say with regret because it may be that the Tribunal which hears the matter will come to a similar conclusion.  What that Tribunal has to do is well summarised in a short passage from the judgment in NEWALLS INSULATION CO LTD v BLAKEMAN [1976] ICR 543 at page 546.  In that case an employee with a poor attendance record had been dismissed after warnings, the later one of which was on 21 July 1975.   As in this case this Appeal Tribunal remitted the case to be heard by a differently constituted Tribunal and said this:

"The critical issue is, what happened before July 21?  What happened after July 21?  How many absences were there?  What sort of absences were there after July 21?  How do those particular absences, in the light of this employee's own record, fit in as part of the general picture?"

	The Tribunal will have to look at the whole of the picture in the round, including the reasons for the particular absence which in fact triggered the dismissal.  It could well be that the Tribunal will consider that in all those circumstances the Company was not acting reasonably in dismissing Mrs Poynton.  It may also be that other matters will arise which put a different light on the matter.  Before us, Mrs Poynton suggested that the real reason for her dismissal was that the bad relationship between her and Mr Oxley and that really Mr Oxley was simply finding the excuse to get rid of her; however she made no suggestion to that effect to the original Tribunal.

	For those reasons we allow this appeal and remit the matter to a differently constituted Tribunal for re-hearing unless a settlement can be negotiated in the meantime.