Appeal No.	EAT/1057/98

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 3 December 1999
Judgment delivered on 27 January 2000

Before
THE HONOURABLE MR JUSTICE LINDSAY (PRESIDENT)
MR J R CROSBY
MR W MORRIS

PPP/COLUMBIA HEALTHCARE LIMITED	APPELLANTS

MS R SOYOYE & OTHERS	RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised

	APPEARANCES

For the Appellants	MR R GREENING
(of Counsel)
Instructed by:
Ms Jasy Loyal
PPP/ Columbia Healthcare Ltd
4 Connaught House
1-4 Connaught Place
London
W2 2ET	
For the Respondents	MR R WHITE
(of Counsel)
Instructed by:
Mr D Jones
Graham & Rose Colley
Solicitors
6 Bowden Street
Cleaver Square
London
SE11 4DS	

	MR JUSTICE LINDSAY (PRESIDENT):		PPP Columbia Health Care Ltd trades as The Harley Street Clinic (“the Clinic”).   The Clinic appeals against the decision of the Employment Tribunal at London (North) under the Chairmanship of Mr P.R.K. Menon.   Extended Reasons were sent to the parties on the 1st July 1998 after a hearing spread over 3 days in March 1998 and a day in April 1998 in Chambers.   The Tribunal had had before it 4 IT1s from, respectively, Ms R. Soyoye, Mrs F.A. Benson, Mrs M. Ofri-Baah and Mrs G. Hooper, black women who had been employed by the Clinic as Housekeeping Assistants at its clinic in Weymouth Street, W.1.   The Tribunal’s decision was in part unanimous, in part that of a majority;  there was unanimity that all 4 had been unfairly dismissed and that Mrs Hooper had also been discriminated against on the grounds of her sex.   The majority held also that all 4 had been discriminated against on racial grounds.   On 6th August 1998, the Clinic, for whom Mr Greening appears, lodged its Notice of Appeal.   It will be necessary to divide our judgment into separate headings for the 5 different aspects we shall need to deal with but, first, we shall say something of the background.

	All four applicants below are of West African origin.   At the material time, May 1997, each had been employed by the Clinic for a number of years.   In February 1997 the Clinic had wished to reorganise the housekeeping arrangements at the clinic.   Before the 16th May 1997 the Clinic wrote to all 21 housekeepers inviting them to a meeting on that day.   They were told at the meeting of a new Housekeeping Structure which would reduce the number of housekeepers to 10.   They were told that the Clinic was looking for 10 volunteers for redundancy and that if enough were not forthcoming then the Clinic would have to embark on compulsory redundancy.   No information was given as to the criteria that would be used.   A few days later the Clinic handed out letters that indicated that the new structure was to be implemented on 1st June 1997.   It made no mention of the selection criteria for redundancy.   By 21st May 5 housekeepers, but none of the applicants, had volunteered for redundancy.

	On the 21st May the Clinic’s management carried out an individual assessment of the housekeepers based on their last annual assessment and the first hand knowledge of the Executive Housekeeper.   No notes were made of the  discussions that took place.   By then 5 more redundancies needed to be found.   An individual points rating system for each of the remaining housekeepers emerged.   Ms Soyoye, Mrs Ofri-Baah and Mrs Hooper were the 3 lowest scorers in that points-assessment and they, together with another low-scorer, Mrs Osuji, and a higher scorer, the applicant Mrs Benson, together with the five who had volunteered, made up the total of 10 accepted or selected for redundancy.   Accordingly on 22nd May 1997 the Clinic sent to the home addresses of those volunteers and of those it had chosen for compulsory redundancy a letter asking them to attend a meeting on 27th May.  The letter did not mention redundancy or that the meeting would be concerned with that subject.

	There had been no consultations with the housekeepers between the meeting of the 16th and 27th May.

	At the meeting on 27th May Mrs Benson did not attend;  she had been in Ghana on holiday from the 4th May, as the Clinic was aware.   She was not due to return until 3rd June 1997.   Mrs Hooper, who was on maternity leave, was late arriving at the meeting.   At the meeting Ms Soyoye and Mrs Ofri-Baah were handed letters from the management terminating their employment by reason of redundancy.   There was no discussion as to alternative employment, nor as to the criteria that had been used to select them, nor any invitation to consultation either over a period or at all.   They were told that their employment would end on 31st May.   They were told they could choose not to attend for work on the remaining 2 or 3 days.   As Ms Soyoye and Mrs Ofri-Baah, who chose to leave there and then, left in order to hand in their uniforms, locker keys and name badges etc., they met Mrs Hooper, coming in late.   Management went through the same procedure with her;  she was handed a similar letter and was told she had been made redundant.   She had no doubt but that her employment had ended.   She asked if she could be given a part-time job as she was on maternity leave.   The answer was “No”.   She left to hand in her uniform etc., meeting up with Ms Soyoye, Mrs Ofri-Baah and the other low-scorer, Mrs Osuji, who had similarly been dismissed.   Together they were escorted off the premises by the Executive Housekeeper.   The letters they had been handed  made it plain they had been dismissed for redundancy.

	On 28th May the Clinic sent all the applicants their payslips, P60s and P45s.

	Also on 28th May the Clinic wrote to Mrs Hooper appearing to cancel her redundancy and saying that as she was currently on maternity leave her position would be kept open till 2nd August 1997 (when she was due to return to work) and that if any suitable position became available in the meantime she would be offered it, failing which she would be made redundant on 2nd August 1997.

	Throughout this period Mrs Benson had been on holiday abroad.   She opened the letters on her return on 3rd June and was shocked to find she had been dismissed whilst away.

	So far as concerns racial discrimination, the IT1s alleged, incontrovertibly, that all 4 applicants were black, but none attempted any further description of race beyond that.

	That suffices as background.   We now turn to the 5 separate headings under which we have heard argument.

1.   	Unfair Dismissal
	Whilst the Tribunal was not critical of the criteria used for selecting for redundancy, it did hold there was unfairness at several points in the process leading to dismissal.   There had been no consultation between 22nd May (after initial selection for redundancy) and 27th May (notice of termination).   There was no provision for the Clinic’s receipt of representations from those selected nor for consideration of possible alternatives to dismissal such as shorter hours, part-time employment, job sharing or work in other clinics run by the Clinic.   The Tribunal, giving reasons for their view, added:-

“They were not treated as individuals, but as a group.”.

The Tribunal directed itself on the law, by reference to Mugford -v- Midland Bank plc [1997] ICR 399 EAT, that unless a reasonable employer would have concluded that consultation would be utterly futile, the lack of consultation with the employee in a case, such as this, where there was no Union representation, would normally make the dismissal unfair.   It has not been argued that the Tribunal was wrong in accepting that direction.   Moreover, the Tribunal expressly held that it was unable to find that consultation would have made no difference.   The consultation process, it held:-

“.... was so inadequate as to render the dismissal unfair.”.

After so holding the Tribunal went on to hold that the Clinic had no made any attempts to find alternative employment for the Applicants at its 3 other clinics or elsewhere.   This leads to one of the two criticisms by the Appellant of the Tribunal’s conclusion on Unfair Dismissal.   Mr Greening argues that the evidence of Mr Weller, Hotel Services Manager at the Clinic, was to the contrary and was not rejected and that no evidence was led contrary to that of Mr Weller.   However, it is plain enough that the Tribunal formed no good opinion of Mr Weller as a witness.   Another version than his was believed as to a conversation on 27th May with Mrs Hooper and the Tribunal expressly states that it did not find him to be an impressive witness.   When, in relation to attempts to find alternative employment for the Applicants, the Tribunal held that such attempt had not been made, they continued:-

“Apart from Mr Weller’s assertion, no evidence has been adduced .....”.

They were plainly aware that they were concluding contrary to the unopposed evidence of Mr Weller but there is not necessarily any error in law in failing to accept even the unopposed evidence of a witness who has been found to be an unimpressive witness and one whose evidence has been (albeit on another subject) declined to be accepted.   This first attack on the Tribunal’s conclusion thus fails but, even if it did not, the topic of alternative employment was dealt with, as we have already noted, only after the Tribunal had held the dismissals were unfair.   It would thus appear that that conclusion could stand even if, contrary to our view, there had been the necessary error of law in the Tribunal’s failure to accept Mr Weller’s assertions on the issue.

	The other criticism of the decision as to Unfair Dismissal is that the conclusion was infected, so to speak, by the Tribunal’s belief that the Applicants had been racially discriminated against in the process of selection for redundancy.   The Tribunal dealt with Unfair Dismissal and came to the conclusion we have described before it turned to racial discrimination, as to which, of course, it gave itself quite different directions to those it had given itself on Unfair Dismissal.   We have studied the text of the decision with Mr Greening’s assistance but we have been unable to detect any passages that show that the impending decision on race - that the Clinic had discriminated - had somehow tainted the Tribunal’s first decision, on Unfair Dismissal, or that the reasoning adopted was such that the decision on Unfair Dismissal could not stand if the decision on race fell.

	We have found no error of law as to the Tribunal’s conclusion on Unfair Dismissal.

2.   	Polkey
	Although the Tribunal did not go on to provide a remedy for the Unfair Dismissals there and then it did express a view on whether there should be any reduction of the kind discussed in Polkey -v- A.E. Dayton Services Ltd [1988] ICR 142 HoL..   The view was terse;  it consisted only of the sentence:-

“It would be inappropriate to apply the Polkey reduction to the facts of this case.”.

Apart from whether so concise a conclusion offends against the Meek -v- City of Birmingham principle that a party is entitled to know why he has lost or won and, so far as concerns the loser, to be informed with sufficient clarity to be able to weigh whether or not there is an appealable error of law, that conclusion is vulnerable to other attacks.   If it has any foundation it can have been based only on earlier conclusions, one of which we have already referred to, namely that the Tribunal was unable to say that consultation would not have made any difference and that:-

“The Tribunal is unable to find that consultation would have made no difference ......”.

Neither of those represents a conclusion either that consultation was so hopeless of any helpful result as to be utterly futile nor that even if the most reasonable of consultations had taken place the likely result would not have been other than it was, namely dismissal (albeit, perhaps, later than, as it was, on 31st May 1997).   Consistently with the Tribunal’s conclusions we have mentioned, it could have been held, merely to give an example, that there was, say, a 65% chance that even if due process had been followed an Applicant would have been dismissed, though perhaps 3 weeks later than she had been.   In that context we regard the Tribunal’s conclusion as to Polkey as a material error of law.

3.   	Sex Discrimination
	Sex discrimination was in issue only as to Mrs Hooper.   She was dismissed during her maternity leave.   The Clinic sought to undo that dismissal by its letter to her of 28th May 1997 but the Tribunal held that the Clinic had dismissed Mrs Hooper and that her employment had ended, during her maternity leave, on 31st May 1997.   We do not understand there to be an appeal against that conclusion.   There is an appeal, which we shall turn to later, against the Tribunal’s conclusion that Mrs Hooper was unfairly dismissed (other factors to that end apart) by reason of s.99 (1) (c) of the Employment Rights Act 1996.   However, having decided that Mrs Hooper’s employment thus had ended during her maternity leave, the Tribunal immediately afterwards continued as follows:-

“It follows that the [Clinic] discriminated against her on the grounds of her gender/sex under sections 3 (1) (a) and 6 (2) (b) of the 1975 Act.”.

The Tribunal does not say why that follows and we fail to see that it does.   As that is the only reason found for there being sex discrimination and as that sole ground is, in our view, baseless, we must conclude that the Tribunal erred in law on this subject.   There is no ground for supposing that where there is a dismissal rendered unfair by s. 99 (1) (c) that there is, necessarily and without more, sex discrimination under the 1975 Act.

4.   	Unfair Dismissal of Mrs Hooper by reason of s.99 (1) (e) of the 1996 Act
	For the reason to have been unfair by reason of s. 99 (1) (e), section 77 of the Employment Rights Act has to have been not complied with.   Section 77 (2) requires (in context) that where there is suitable vacancy it must be offered to the woman on maternity leave before the end of her current employment and be offered it under a new contract taking effect immediately upon the ending of her current employment.   The offer must be of suitable work and on terms not substantially less favourably than her current terms.   

	After the Clinic had terminated Mrs Hooper’s contract it wrote to her, as we have mentioned, on 28th May but the offer was not of a new contract but, in effect, a denial, which the Tribunal did not accept, that the earlier one had ended and an offer that it should continue.   It is true that the Tribunal make no express finding that, so far as concerned Mrs Hooper, there was some suitable available vacancy but, against that, the Clinic said they would keep her position open, which suggests that there was one.   On that basis section 77 (2) was not complied with and therefore s.99 (1) (e) was open to Mrs Hooper, as the Tribunal held to be the case.   It does not avail the Clinic to argue that s.77 did not apply because it was not held to be “not practicable” to continue Mrs Hooper’s employment.   The statutory language is less than pellucid but that requirement as to impracticability appears in s.77 (1) as part of the circumstances which determine, normally, whether s. 77 applies.   But s. 99 (1) (e), which raises the question of whether s. 77 has been “complied with”, seems to ASSUME that  s.77 applies.   Accordingly, for immediate purposes, whether s. 77 is complied with is determined by seeing if s.77 (2) and (3) are complied with, not by examining, within s. 77 (1), whether the section applies, which it is, in effect, assumed to do.   We thus see no error of law in the Tribunal’s ruling that Mrs Hooper was unfairly dismissed by reason of s. 99 (1) (e).

5.   	Racial discrimination
	This subject took up by far the greatest time on the appeal.   Mr Greening’s complaint is a simple one.   At the presentation of the IT1s and at all stages during the evidence and argument the Applicants’ case had been that they, as blacks, had been treated less favourably than the Clinic had treated or would treat other persons.   The evidence led and the comparisons made in that evidence were all intended first to make, then, on the Clinic’s part, to resist that allegation.   In particular the black Applicants had sought to compare their treatment with that of a white Portuguese housekeeper.   However, when the decision of the Tribunal was received it was found to find racial discrimination of a different character.   Thus the Tribunal says:-

“The most compelling evidence in support of the Applicants’ case is that all the five housekeepers who were selected for redundancy - the four applicants and Mrs Osuji - were of black West Africa (Nigerian or Ghanaian) racial origins.”.

A little later the decision of the majority was set out, namely:-

“..... the majority finds that in applying the [redundancy] criteria, the [Clinic] treated black West African (Nigerian and Ghanaian) housekeepers less favourable than they treated housekeepers of other racial origins.”.

This was not some unnecessary and undesirable racial pedantry on the Tribunal’s part but was a crucial part of its reasoning.   It was needed to explain why it was that the Clinic was to be regarded as discriminating notwithstanding that black women housekeepers from Trinidad and Ethiopia were kept on.   Moreover, and, hardest of all to explain without the introduction of a supposed prejudice not against blacks but only against black West Africans, was why it was that the housekeeper who was adjudged best of all and who was kept on was a black woman, from Jamaica.

	Mr Greening says, with justice, that the Tribunal “moved the Goal Posts”;  they determined a complaint that was not made and accordingly did so without the Applicants having argued that complaint or, more disturbingly, without the Clinic knowing it was being made or being able to resist it.   Mr White for the Housekeepers does not seek to say that the distinction between black, on one hand, and black West African, on the other, and between corresponding forms or prejudice or discrimination had emerged before the Tribunal’s decision was released.

	In our judgment the Clinic’s complaint is justified;  the majority in the Tribunal erred in law in drawing for the first time in their decision  a distinction as to types of racial discrimination which had not previously been made in the case.   It will be remembered, too, that on this issue the Tribunal was split.   The minority, Mr Blick, said, inter alia:-

“He sees no reason why [the Clinic] would have drawn any racial distinction between the black housekeepers of West African origin and other black housekeepers.”.

In our judgment the majority erred in law in introducing a distinction between black and black West Africans which, if to be made at all, would have had to be made clear and have been the subject of relevant evidence and argument, long before the publication of the decision.

6.   	Our conclusion
	For the reasons we have given we dismiss the appeals as to Unfair Dismissal generally and as to Mrs Hooper’s unfair dismissal by reason of s. 99 (1) (e).   We set aside the Tribunal’s conclusions as to any Polkey reduction, as to discrimination against Mrs Hooper on the ground of sex and as to discrimination against all applicants on the ground of race.

	We have considered whether remission should be to the same or to a fresh tribunal.   Given that the Tribunal found not only Mr Weller but one other important witness on the Clinic’s side to be unimpressive witnesses it would be understandable were the Clinic to feel it to be unfair to remit to the existing Tribunal.   Accordingly we remit sex discrimination and race discrimination to a fresh Tribunal.

	It would be as well that there should be a directions hearing at the Employment Tribunal before the remitted issues are dealt with.  It can deal with how the existence and scope of any Polkey reduction should be dealt with.   It may also need to deal with whether (and, if so, on what terms) the applicants should be given permission, having by now seen how the wind blew in the present decision of the Employment Tribunal, to amend so as to claim discrimination not anti-black but anti-West African black.   That, if it is attempted, may give rise to difficult questions.   They have not been raised before us.   Having criticised the Tribunal for dealing with an issue that was not raised before it and to which the argument and evidence had not been directed, we can hardly deal with an amendment application that has not yet been raised, nor would it be right to deny the parties one tier of appeal.   We thus say no more as to amendment than that it plainly raises difficult questions.