Appeal No.	 EAT/1141/98

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 12 March 1999

Before
HIS HONOUR JUDGE PETER CLARK
MR K M HACK JP
MR D J JENKINS MBE

STUDIO MASTER DIAMOND LTD	APPELLANT

MR S M ALI	RESPONDENT

Transcript of Proceedings

JUDGMENT

PRELIMINARY HEARING

Revised

	APPEARANCES

For the Appellant	MR W DIAMOND
(Consultant)
Peninsula Business Services Ltd
Advocacy & Litigation Dept
2nd Floor, Stamford House
361-365 Chapel Street
Salford, Manchester M3 5JY	

	JUDGE PETER CLARK:	The Respondent to this appeal, Mr Ali, was employed by the Appellant company from September 1991 until his dismissal by reason of redundancy on 1 October 1997.  Initially he was engaged in UK sales, and later became Export Sales Manager, a position which he held until his dismissal.  The company carries on the business of manufacturing (partly through an associated company, Ravenlace) and distribution of professional audio equipment.

	Following his dismissal the Applicant presented a complaint of unfair dismissal and racial discrimination to the Employment Tribunal.  The case came on for a hearing on liability on 27 April 1998 before a full Employment Tribunal consisting of the Chairman Mr C E H Twiss and lay members, Ms K Boak and Mr J Thakoordin.  By a reserved decision with Extended Reasons dated 12 May 1998 the Tribunal found that the Respondent had been selected for redundancy on grounds of his race and without the proper procedures being followed.  There was no prior consultation and the Tribunal found that the Respondent was selected by Mr Malik, himself Asian, and Mr Hollway, the senior people in the company, because they felt that the perception was that it was an Asian company and they needed a white face in sales.  Another person in sales, Mr Russell, was retained.  He was white.

	The Tribunal concluded that, stripping out the factor of race, had a proper procedure been followed there was a 50% chance that the Respondent would still have been dismissed.  The question of remedies for unfair dismissal and racial discrimination was adjourned to a further hearing.

	That hearing took place on 8 July 1998.  The liability decision is not the subject of appeal.  

	In their remedies decision with Extended Reasons dated 29 July 1998, the Tribunal found that it was reasonable for the Respondent to pursue a career in another industry on a self-employed basis, rather than pursue a career in the audio equipment business in which he had been engaged for 16 years.  However, they found the question whether he had taken reasonable steps to mitigate his loss a marginal one.

	He had been unemployed for 40 weeks up to the date of the remedies hearing.  His net loss of earnings to that date was £12,788, allowing for 6 weeks pay in lieu of notice.  He had received a redundancy payment some £1,509 in excess of his statutory entitlement.  The Tribunal found that his future loss should be limited to three months loss of earnings.  Compensation for injury to feelings, under the Race Relations Act, was assessed at £750.  

	On that basis, the compensatory award for unfair dismissal, allowing a 50% Polkey deduction, was assessed at £7,579.  The award under the Race Relations Act was assessed at £9,083.50, no allowance being made for state benefits received between dismissal and the date of the remedies hearing in that calculation.  Avoiding any double recovery, the Tribunal awarded the Respondent that latter sum.

	Against the remedies decision this appeal is brought.  The Notice of Appeal contained six grounds of complaint.  Mr Diamond who has presented the appeal on behalf of the company today, effectively abandons the grounds of perversity set out at paragraphs 6(ii), (iii) and (iv) of the Notice of Appeal.  That leaves grounds 6(i), (v) and (vi)  which may be broadly divided into two complaints.  

	The first is a complaint of bias.  We are conscious that the question when such an allegation is raised on appeal is not whether the Tribunal or any one member of it was in fact biased, but whether the appearance of bias would have been given to an impartial observer with some knowledge of the case.  The specific complaints made by Mr Diamond are first that a member of the Tribunal, Mr Thakoordin made interventions during the course of the Respondent's cross-examination by Mr Diamond, which were or appeared to be designed to fill gaps in the Respondent's answers to questions which went to the issue of mitigation of loss and in particular, his decision not to seek employment in the industry in which he had formerly been employed for some 16 years.

	The second complaint relates to closing submissions.  Mr Diamond says in an affidavit sworn in these proceedings and supported by another affidavit sworn by his trainee, who was present at the hearing, that during the course of his closing submissions that member Mr Thakoordin took no notes at all and appeared to be wholly disinterested, whereas during the course of the Respondent's solicitors closing submissions the member took copious notes.

	We bear in mind that the question of mitigation of loss was, as the Chairman put it, on the margin.   It was that part of the Respondent's evidence which it is alleged, was assisted by the intervention of the lay member.  We, as a Tribunal, at this preliminary hearing stage feel a certain unease concerning this allegation, and we think it right that it should go forward to a full, inter partes, hearing, so that the Respondent may make submissions.  For that purpose we direct that the Respondent to the appeal be at liberty to file an affidavit if so advised in response to the affidavits sworn on behalf of the Appellant company within 21 days of the promulgation of this judgment, in addition to the Chairman’s comments presently before us and dated 11 November 1998.

	The second ground of complaint relates to the way in which the Tribunal dealt with the assessment of compensation.  The point put simply by Mr Diamond is that by taking the larger calculation notionally under the Race Relations Act of £9,093, the Tribunal failed to give credit for the benefits received as against that calculation.

	It is true to say the benefits would be recouped under the Recoupment regulations which apply to the award of unfair dismissal but the result is, submits Mr Diamond, that the Respondent has been overcompensated to the extent of some £2,000 which is the rough assessment of the benefits to date of the remedies hearing.

	Again, we think that this point is at the least arguable and should also proceed to a full hearing.  In these circumstances we shall allow the appeal to proceed on grounds 6(i), (v) and (vi) of the Notice of Appeal.  We shall dismiss grounds (ii), (iii) and (iv).   For the purpose of the full hearing, the case will be listed for half a day, category C.  There will be exchange of skeleton arguments between the parties not less than 14 days before the date fixed for the full hearing.  There are no further directions, save that the skeleton arguments shall at the same time be lodged with this Tribunal.