Appeal Nos. EAT/1165/01	                      EAT/1166/01

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 11 March 2002

Before
MR COMMISSIONER HOWELL QC
MISS A MACKIE OBE
MRS T A MARSLAND

MS BARBOUR & MR McINTOSH	APPELLANTS

1) VICTORIA & ALBERT MUSEUM 2) GALAGO LTD	RESPONDENTS

Transcript of Proceedings

JUDGMENT

PRELIMINARY HEARING

Revised

	APPEARANCES

For the Appellants	MR A GEORGE
(Of Counsel)
Appearing under the 
Employment Law Appeal
Advice Scheme	

MR COMMISSIONER HOWELL QC

1.	These are two appeals before us for Preliminary Hearing today by Mr McIntosh and Ms Barbour against decisions of the London Central Employment Tribunal set out in Extended Reasons sent to the parties on 20 July 2001.  The proceedings before the Tribunal were on Originating Applications brought by Mr McIntosh and Ms Barbour in August and October 2000 alleging breach of contract, unfair dismissal and breach of rights they claimed to remain in the Principal Civil Service Pension Scheme notwithstanding transfers of their employment.  These appear to have taken place on a rearrangement at their former employers The Victoria & Albert Museum by way of what were claimed to be partial transfers of undertakings to a firm Galago Ltd which is the second Respondent, having the protection of the Transfer of Undertakings (Protection of Employment) Regulations on and from 1 September 2000.

2.	Mr McIntosh and Ms Barbour have throughout sought to contest the validity of those purported transfers.  The main thrust of their complaint as explained to us by Mr George who helpfully appeared on their behalf this morning under the ELAAS Scheme, is that what was proposed to be done amounted to in effect a dismissal on termination of their employment with the Victoria and Albert Museum.  This was unfair in that the new employment terms to which it was sought to transfer them with the private company were not as favourable as those they previously enjoyed, effectively within the public service.

3.	The Tribunal first held a preliminary directions hearing before a Tribunal Chairman at which various matters were canvassed in particular an attempt by the Respondents to raise various jurisdictional issues and to have those dealt without a preliminary hearing.  That attempt was rejected in the directions given by the Tribunal Chairman embodied in a letter dated 9 January 2001 which is at pages 41-43 of the first appeal files before us. There it was recorded that there was some lack of understanding on the Respondents’ part as to exactly the case being made against them by the Applicants who had until that day been acting in person, but the Chairman recorded specifically that he impressed on the Applicants that it was important for them to identify exactly how they argued that case, and that it was not clear from the Originating Application and subsequent correspondence.  He also strongly urged them to consider taking legal advice about their claim since it was one that was full of difficulties.

4.	Nevertheless, the Chairman recorded that in making directions for the hearing he had considered representations made by Counsel on behalf of the Respondents that a preliminary hearing should be held on the various jurisdictional issues but nevertheless he felt it would be better for all involved if all the issues, were dealt with together and on their merits at a single hearing.  

5.	A subsequent attempt by the Respondents to have the proceedings against them struck out on grounds they asserted in a letter to the Tribunal dated 15 February 2001 at page 26 of the first appeal file was also rejected, and it was in those circumstances that the matter came on for full hearing before the Tribunal on 5 June 2001.  However, to the surprise of the Applicants the Tribunal then immediately proceeded to determine, as a preliminary issue, a question  Mr George said had not been raised specifically in the Respondents’ answers to the proceedings before the Tribunal. This was whether there was any jurisdiction at all for the Tribunal to hear complaints of breach of contract and of constructive unfair dismissal, because the Originating Applications in which these allegations had been raised were both made in August 2000; and it was common ground that the events the Applicants were contending had amounted to the termination of their employment with the Victoria and Albert had not taken place until the end of that month.  

6.	In those circumstances the Tribunal recorded that the Respondents had argued that the Tribunal did not have jurisdiction to hear the claim for breach of contract or unfair constructive dismissal since the claim had not been presented within three months of the effective date of termination.  The Tribunal also recorded that there was some doubt about what was the effective date of termination but that there was no doubt that in any event the claims made for breach of contract and unfair dismissal were dated prior to any possible date of termination, which in the Tribunal’s words:

 “has to be 1 September 2000, which is the date of the transfer from the first Respondent to the second Respondent”

7.	On that assumption the Tribunal recorded in paragraphs 15 and 16 of their Extended Reasons that they found as a fact that the claims of breach of contract and unfair dismissal were presented in advance of the possible date of termination 1 September 2000 and that they did not have before them any claim which has been brought within what they referred to as “that period of three months” under Section 111 of the Employment Rights Act 1996.  They then continued:

“Under Section 111 of the Employment Rights Act 1996, an employment tribunal shall not consider a complaint under the Section unless it is presented to the Tribunal before the end of the period of three months beginning with the effective date of termination.  The Tribunal does not consider that it was not reasonably practicable for the complaint to be presented before the end of the period of three months, and therefore the Tribunal finds that there are no grounds for extension of that period of three months.

In those circumstances the Tribunal finds that it does not have jurisdiction to hear the Applicant’s claims in respect of breach of contract and/or constructive unfair dismissal.”

8.	The Tribunal then went on to consider arguments that there had been a breach of the Applicants’ statutory rights by purporting to transfer their employment under an alleged transfer with the protection of the Transfer of Undertakings (Protection of Employment) Regulations and dismissed the whole of the complaints made to them.  Against those decisions Mr McIntosh and Ms Barbour have sought to appeal under Notices of Appeal lodged in August 2001 in which the grounds of appeal were set out by themselves.  These made reference to complaints of breach of rights they claimed under the National Heritage Act 1983, and alleged procedural error on the part of the Tribunal in that the Interlocutory Order made by the Chairman giving directions for the way the hearing should proceed had not been complied with.  That was said to be because they had not had a two day full hearing going into all the merits of their cases, and  they had been confused by   what they referred to as the Chairman’s stance of not discussing the merits and details of the cases themselves before proceeding to determination of the jurisdictional issue and dismissing  the claims altogether.  

9.	Mr George who has appeared on their behalf today has to some extent refined and reformulated the grounds of the appeal very helpfully before us, and they can be summarised by saying that first there is an appeal on procedural grounds.  The Tribunal at the full hearing had  misdirected themselves in dealing with the question of jurisdiction as a preliminary issue at all, having regard to the directions of the Chairman earlier that there was not to be a preliminary hearing to deal with jurisdictional issues in advance of the full hearing of the case itself.  In those circumstances it is argued that the Tribunal at the full hearing did not have the power to in effect depart from the directions given by the Chairman at the Directions Hearing, and ought to have proceeded with the full hearing of the case before determining any question of jurisdiction that did arise.

10.	Secondly, it is argued that there were in any event substantive errors on the part of the Tribunal in the way they did determine that preliminary issue and in the way they then proceeded to address questions of the merits of the underlying issues in the case itself about whether the Transfer of Undertakings Regulations did or did not apply to what had been done by the Victoria and Albert at the end of October 2000.
11.	  On the first (procedural) argument we have not been persuaded that it is right to say that the Employment Tribunal at the full hearing had no discretion or jurisdiction to decide for itself whether the matter could be disposed of without hearing the full evidence in the case.  In our judgment even with the directions given by the Chairman at the earlier Directions Hearing that all such matters should be left to be dealt with then raised at the full hearing of the case, it remained within the powers of the Tribunal charged with conducting the full hearing to deal with any question of jurisdiction at the outset of the hearing instead of after hearing the evidence.  We were not satisfied that the case of Montali v Goldman Sachs Services Ltd in the Employment Appeal Tribunal on 19 October 2001 was really authority for saying that the normal discretion of a Tribunal conducting a full hearing had been limited in the way suggested, as a result of the Directions given earlier that there should be no specific preliminary hearing to determine that issue.

12.	However a Tribunal proceeding to determine a jurisdictional issue of this kind at the outset of the full hearing, without hearing the evidence and details of the facts of the case, has in our judgment got to be particularly careful, especially in a potentially complex case such as this one, to satisfy itself that the issue it is purporting to deal with at the outset really can be decided without considering the evidence at all. We have been satisfied by Mr George’s argument that it is arguable that it was at that point this Tribunal began to err, and that it was not such an issue as could have been properly decided in the absence of hearing the evidence in the case: in particular in order to enable the Tribunal to satisfy itself whether the TUPE regulations really did or did not apply to what had happened on the facts here.

13.	We therefore have been satisfied that there are arguable grounds to warrant directing a full hearing before the Employment Appeal Tribunal, on the question of whether the Tribunal misdirected themselves in the way they determined the preliminary issue on whether they could hear the unfair dismissal claim, in particular as to the effect of Section 111 of the Employment Rights Act 1996 by apparently assuming that proceedings brought before the three months from the effective date of termination of employment were outside the prescribed time limit in Section 111. This in fact is phrased in terms requiring only that proceedings should be “brought before the end” of that three months period. In this respect it is materially different from the provisions of the Extension of Jurisdiction order and that was a material difference which Mr George explained to us was adverted to by Mummery LJ in the case of Capek v Lincolnshire County Council [2000] IRLR 590 to which the Tribunal were referred as recorded in paragraph 14 of their Extended Reasons.

14.	We for our part are satisfied it is arguable that the Tribunal misdirected themselves in saying that proceedings brought before the end of the period of three months but before that three months started to run were outside the time limits specified in Section 111(2).  It is further arguable that the Tribunal misdirected themselves by not adverting to the provisions of Section 111(3), in view of the fact that notice had been given to the Applicants that their employment with the Victoria and Albert Museum would in any event come to an end at the end of August; and further that the Tribunal may arguably have misdirected themselves as to the question of reasonable practicability, in the particular circumstances in which these Originating Applications were presented after notice had been given but before the effective date of termination was to take place.

15.	Further, we have been satisfied that there was an arguable point whether the contracts of employment had been terminated at all on 31 August 2000; that would have depended on whether this was properly a transfer within the Transfer of Undertakings (Protection of Employment) Regulations.  On that we are satisfied it is arguable that it was necessary for the Tribunal actually to hear the evidence about the nature of the transfer, and what was being transferred under it, before determining that the transfers had got the protection of the regulations so that they did not operate as a termination of the original contracts of employment.  We are also satisfied from that Mr George said that it is arguable that the Tribunal in any event erred in proceeding, as they apparently did, to determine specifically in favour of the Respondents that these were relevant transfers within the terms of the 1981 Regulations in reliance on what appears to have been simply a statement by Counsel on behalf of the Victoria and Albert Museum, and without proceeding to hear the evidence relevant to that issue at all as appears to have been the case from what they say in paragraphs 8, 9 and 19 of the Extended Reasons dated 20 July 2001.

16.	Accordingly on those grounds we will direct that the case should be set down for a full hearing before the Employment Appeal Tribunal.  We will direct that an Amended Notice of Appeal should be lodged to specify the grounds of appeal that Mr George argued before us and we have felt it right to accept as arguable, and to substitute those grounds for the original grounds in the Notice of Appeal.  That should be done within 14 days from today in respect of both appeals although a combined similar Notice of Appeal can of course be lodged in respect of both.  In each case we will direct that the appeal should be set down for a full hearing, listing Category B, Estimated Time half a day.