Appeal No. UKEAT/0090/07/DM

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 21 March 2007

Before
HIS HONOUR JUDGE McMULLEN QC
(SITTING ALONE)

MRS A HARRIS	APPELLANT

TOWERGATE LONDON MARKET LIMITED	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	Mr Oliver Assersohn 
(of Counsel)
Instructed by:
Rowley Ashworth Solicitors
247 The Broadway
Wimbledon
London
SW19 1SE	
For the Respondent	Mr Daniel Matovu
(of Counsel)
Instructed by:
Towergate Partnership
Towergate House
2 County Gate
Staceys Street
Maidstone
Kent
ME14 1ST	

SUMMARY
Practice and Procedure – 2002 Act and Pre-action Requirements

Six weeks after the Claimant’s dismissal by the Respondent, she attended a meeting with management and her union officer.  Further information about her selection for redundancy was promised and was forthcoming.  On advice from her union, the Claimant launched a grievance.  She did so within the three-month limit for presenting an unfair dismissal claim, but the Respondent contended that as she had been dismissed it was under no obligation to respond to a grievance.  Although in a sense this was an appeal to the respondent against her dismissal, the only statutory question when she submitted a claim and sought the benefit of the three-month extension to the primary limitation period was whether she reasonably believed that a dismissal procedure was being followed.  As a matter of construction of the grievance letter and appreciation of the oral evidence she gave, the Tribunal had wrongly focused on whether there was an appeal and was wrong to conclude that she did not reasonably believe that a procedure was being followed. The appeal against that judgement was allowed.

HIS HONOUR JUDGE McMULLEN QC

1.	This case arises out of the inability of a Claimant to have a hearing of her claim of unfair dismissal having been shut out of the judgment seat by the application of the Employment Act 2002 (Dispute Resolution) Regulations 2004.  I will refer to the parties as the Claimant and the Respondent.

Introduction
2.	It is an appeal by the Claimant in those proceedings against a judgment of an Employment Tribunal Chairman, Mr B Walton, sitting alone at Stratford (East) registered with reasons on 6 December 2006.  The parties were represented respectively by Mr Oliver Assersohn and Mr Daniel Matovu, of Counsel.  

3.	The Claimant was in the process of contending that her dismissal for redundancy was unfair when the Respondent contended that she had not complied with the 2004 statutory dispute resolution scheme.  The issue for the Employment Tribunal was whether she was entitled to an automatic extension of the three month time limit for presenting an unfair dismissal claim. This arises when a Claimant reasonably believed that there is en train a procedure affecting the dismissal.  The Chairman decided against her.  The Claimant appeals and I gave directions sending this to a full hearing.  

The legislation
4.	The relevant provisions of the legislation are not in dispute and they are the Employment Act 2002 (Dispute Resolution) Regulations 2004 para 15:

15	Extension of time limits
	(1)	Where a complaint is presented to an employment tribunal under a jurisdiction listed in Schedule 3 or 4 and-
(a)	either of the dismissal and disciplinary procedures is the applicable statutory procedure and the circumstances specified in paragraph (2) apply; or
(b)	either of the grievance procedures is the applicable statutory procedure and the circumstances specified in paragraph (3) apply;
the normal time limit for presenting the complaint is extended for a period of three months beginning with the day after the day on which it would otherwise have expired.
	(2)	The circumstances referred to in paragraph (1)(a) are that the employee presents a complaint to the tribunal after the expiry of the normal time limit for presenting the complaint but had reasonable grounds for believing, when that time limit expired, that a dismissal or disciplinary procedure, whether statutory or otherwise (including an appropriate procedure for the purposes of regulation 5(2)), was being followed in respect of matters that consisted of or included the substance of the tribunal complaint.”
       (3)		The circumstances referred to in paragraph (1)(b) are that the employee presents a complaint to the tribunal-
	(a)	within the normal time limit for presenting the complaint but in circumstances in which section 32(2) or (3) of the 2002 Act does not permit him to do so; or
	(b)	after the expiry of the normal time limit for presenting the complaint, having complied with paragraph 6 or 9 of Schedule 2 in relation to his grievance within that normal time limit.”

5.	The procedure for challenging a dismissal is regulated by the 2002 Act schedules 3 and 4.  A three-step procedure is to be gone through, step 3 of which is an appeal if a wish to appeal is indicated by the Claimant. The general requirement under paragraph 12 of Schedule 3 to the Employment Act 2002 is that steps in these procedures should be taken without unreasonable delay.

6.	The consequence of a failure to comply with the dismissal procedures is set out in section 98A of the Employment Rights Act 1996 which makes the dismissal automatically unfair.

7.	There are also consequences in relation to the calculation of compensation providing for, respectively, uplifts and reductions where an employer or an employee has not followed the relevant procedure.  By paragraph 6(5) of the 2004 Regulations the procedure is inapt where the subject of the grievance is dismissal:-

“Neither of the grievance procedures applies where the grievance is that the employer has dismissed or is contemplating dismissing the employee.”  

The facts
8.	The facts can only be tentatively stated in relation to the underlying dispute between the parties for of course there has been no trial.  The Claimant was earning £40,000 a year as an insurance broker for the Respondent in the City of London from 2002 until she was dismissed by reason of redundancy on 31 October 2005.  

9.	The decision to make her redundant was made following an assessment and those engaged in this exercise considered performance and behaviour.  The redundancy fell upon a pool of seven brokers who had been selected according to criteria and the three lowest scorers had been made redundant, including the Claimant.  

10.	Shortly after receiving her notice of redundancy on 24 October 2005, following a period of consultation, she attended a leaving party where some people had had a lot to drink and comments were made.  She had been "stitched up" in that a proper process, based upon the merits of her performance, had not been gone through. She had been pinpointed in advance for redundancy.  

11.	In accordance with her contract, two relevant provisions applied.  She was entitled to three months' money in lieu of notice, so she was paid full benefits until 31 January 2006. She had an opportunity to appeal against the decision to make her redundant.  This was communicated to her in a letter written on 24 October 2005 which she was invited to sign as being correct.  The appeal was directed to be made in writing to the HR Manager Ms Jean Thomas within seven days.  The Chairman found that this was in accordance with the procedures and no point has been taken that the procedure is unduly short.  She also agreed that the monetary calculations were correct.

12.	The Claimant never did appeal but she was concerned at the comments made at her leaving party and contacted her union, Amicus.  She had the advantage to be represented by Mr Brian Harris (no relation), a Regional Officer, who applied to Ms Thomas for a meeting.  The meeting was held on 16 December 2005 where the three of them attended.  The notes of Ms Thomas, written in the first person singular, were available to the Tribunal, It is plain that Mr Harris was raising criticisms of the method of assessment and of the pool for selection and he made a telling point for he said this:-

“AH stated categorically that she had never had a formal assessment.  JT also advised that a manager could make an assessment based on his/her judgment of that person’s work performance and behaviour.  BH agreed but said that unless there were defined guidelines for completing the assessment even small consistencies could make the difference between being made redundant and being retained.”

It is noted that the Claimant had not asked for an appeal when the opportunity had been given and that the Claimant was in possession of certain information.  At this stage Mr Harris asked for three pieces of information: the Claimant’s assessment forms, the time scales and guidance given to managers as to the assessment process. He was critical that there had been subjective criteria in the calculation and the assessment of only one manager.  To this end therefore he sought that information.

13.	What followed is important.  He said this, according to the note taken by Ms Thomas:-

“I said that I would have to ask about Anne’s form, as normally this would be reviewed during the appeal process, but I saw no problem in getting this information to them next week.
I asked BH what the next steps would be.  He said that somebody in the union (better qualified than him) would review the forms to determine whether it had been a fair process, if it had been he would inform me, if it had not he would take the matter further.”

The Chairman depicted this as an alternative position: if nothing satisfactory came up, the Claimant was heading for an Employment Tribunal.  

14.	What she did on receipt of the information on 5 January 2006 was to write to various officers of the Respondent, the gist of which is this:-

“Dear David
I wish to raise a formal grievance in respect of the above on the grounds that I believe the assessment criteria used to make me redundant was unfair and inaccurate.  I am entitled to a meeting to resolve this issue and to be accompanied by my Trade Union Representative.
I would appreciate this issue being resolved within the next 28 days and await your comments.”

That was met by a short letter from Ms Thomas who said this:-

“Contrary to your assertion that you are entitled to a meeting to resolve this issue, I am afraid that I have to advise you that under the Employment Act 2002 Dispute Resolution (Regulations 2004) Regulation 6(5) we are not obliged to deal with a grievance as the grievance procedure does not apply when the person is no longer employed by the company.
In line with our redundancy policy we did offer you the opportunity to appeal in our Notice of Redundancy (dated 24 October 2005) which you did not take.

15.	On 21 April 2006 the Claimant lodged her claim form.  

16.	The primary limitation period for presenting a claim of unfair dismissal which took effect on 31 October 2005 is 30 January 2006.  If an extension is given pursuant to the Regulations, then the secondary limitation period is invoked i.e. to 30 April 2006.  So, if her letter of 26 January 2006 was capable of invoking the secondary limitation period, it is common ground the claim was in time; but not otherwise.  The Chairman decided as a matter of construction first, that the letter itself did not look like an appeal letter but looked like a grievance letter.  It said so, and she had been advised by her union to put in a grievance and that is what she did.  

17.	The Chairman went on to say this:-

“9.	I have not heard from her Union but it is likely that the Union official expected that by putting in a grievance before the expiry of the limitation period there would be a three month extension in time.  That, in respect of some claims but not all, does extend the time for a further three months.”

18.	The approach to dealing with this was to look at whether or not there was an appeal.  This is because of the way in which the Claimant had presented her thinking in her witness statement
“2.	Following a consultation meeting I was given formal notification of the termination of my employment by letter dated 24 October 2005. The letter from Towergate informed me that I had a right to appeal the decision to dismiss me, which I should do in writing within seven calendar days. The reason for my dismissal was redundancy, and at the time I had no reason to doubt that my selection for redundancy was genuine, and all above board. As such I did not appeal the decision at that time.
4.	I was shocked to learn that my selection and dismissal had been a stitch up and made an appointment to see my Union representative to find out what I could do about it. I saw my Union representative the following Thursday, 3 November 2005. I discussed the matter with Brian Hams, my Union representative, who explained to me that I needed to challenge the dismissal using the internal procedures, and then if it could not be resolved I could pursue the matter in an Employment Tribunal. He told me the way to challenge the decision was to lodge a grievance.
5.	I therefore sent three letters to David Green, challenging the dismissal, as I felt that the assessment criteria used to make me redundant were unfair and inaccurate. My intention was to challenge the dismissal, and although my letters state that I am lodging a grievance, I suppose in reality it is an appeal, as I am challenging my dismissal. I only called it a grievance because that is what I had been told it was.

On the basis of this material, the Chairman dismissed the Claimant’s contention that she was in time. .The witness statement was subject to cross-examination.  She gave evidence about what was in her mind. It will have been the subject of some dispute.

The Claimant’s case
19.	On appeal, it is submitted that the Chairman added another layer to the requirements set out in the regulations which is: Did the claimant believe on reasonable grounds that there was in place a procedure dealing with dismissal?  This case wrongly concentrated on the construction of the letter and the invocation of an appeal.  It was also contended that the Chairman had reached a perverse conclusion.  

The Respondent’s case
20.	On behalf of the Respondent, it is contended that the Chairman dealt with the matter as it was presented to him, based upon the assertion that the letter registered an appeal and an appeal is step 3 in a statutory dismissal procedure which must be complied with.  The consequence of reading the matter as an appeal is serious for any employer, because the regime under section 98A is likely to be applied, that is that there was no meeting within the meaning of the Act.  The Respondent replied by saying “since you are no longer an employee you may not raise a grievance” and she would therefore, if this case went forward, be entitled to claim unfair dismissal.  In any event, the decision was not perverse and would not reach the high standards required in the EAT for overturning a judgment on the ground of perversity.

Discussion and conclusions
21.	The approach to these regulations as a whole has been set out in the judgment of the EAT Burton J and members in Shergold v Fieldway Medical Centre [2006] ICR 304 where this is said:-

“26	Before we give our reasons for disagreeing with the tribunal, and for allowing the appeal, we would wish to say this. It is quite plain that the purpose of this legislation was to encourage conciliation agreement, compromise and settlement rather than the precipitate issue of proceedings. It is not unlike the system of pre-action protocols in relation to High Court and county court litigation, although hopefully it is even more likely to succeed because of the relationship, or the immediately preceding relationship, between the parties in an employment dispute.
27	To that extent, therefore, the need for parties to understand each other’s position before proceedings are launched (and the opportunity for resolution short of litigation) is to be welcomed, but what must be guarded against, once such legislation has been enacted, is that it can create its own hostage to fortune and, in fact, introduce an entirely and, we are satisfied, unintended result of creating undue technicality and over-sophistication, which can result in problems for both sides.
28	So far as the employee is concerned, the statutory wording is, so far as paragraph 6 of Schedule 2, Part 2, to the Act is concerned, very simple, and we believe that it was intended to be simple. Of course an employee, before this statutory procedure is invoked, must set out something in writing, because otherwise employers will not necessarily appreciate that there is a grievance to deal with, but they are not required to set it out in technical detail, certainly, so far as the standard procedure is concerned. The danger is obvious that the kind of pernickety criticism of the form or content of the “writing” exemplified here can result in an employee being barred from the judgment seat entirely, as occurred here. It is, of course, equally important from the point of view of the employer that an employer should know where it stands, and it is as well for employers to appreciate that there is no requirement for excessive technicality in relation to the form in which a grievance is set out in writing, so that they can easily appreciate when they must fulfil their obligations under the 2002 Act and the 2004 Regulations; otherwise they might find themselves down the slippery slope leading to an automatically unfair dismissal. It is not, in our judgment, the intention of the legislation either that employees should be barred or that employers should unwittingly find themselves liable for automatic unfair dismissal. Those are sanctions which should be very rarely used; the purpose of the legislation is quite other, as we have described.
33	Thirdly therefore we make clear that it is not necessary to make it plain in the writing that it is a grievance, or is an invocation of a grievance procedure. The statute might have so provided; for example, paragraph 8 to Schedule Al to the Trade Union and Labour Relations (Consolidation) Act 1992 requires that a trade union making a request to an employer for statutory recognition is required to refer specifically to the relevant Schedule. No such requirement is made here.”

22.	The nature of an internal appeal is dealt with in a judgment I gave in Codemasters Software Company Ltd v Wong (UKEAT/0639/06) at paragraph 13 which says this:-

“13.	It must be born in mind that the central tenet of the Claimant’s belief is based upon what his solicitor told him which is that if he lodged an internal appeal within the primary time limit for unfair dismissal his claim would be heard.  That evidence is not the subject of appeal.  The finding that the Claimant believed he had been following the statutory procedure because of the advice on the statute give to him by his solicitor seems to me to be unimpeachable.  It was not perverse.”

23.	I have also dealt with the general requirement that steps in these procedures be taken within a reasonable time: Masterfoods v Wilson EAT/0202/06 at paragraph 63. It is clear that although the wish to appeal, pursuant to step 3, may be put in general terms it must include an unambiguous expression of such a wish.  It is also clear from King and Khan v The Home Office EAT/0026/06 that a period of three months following the submission of an appeal where an employer does nothing is unreasonable given the short time scales of analogues such as the three-month time limit for presenting an unfair dismissal claim.  

24.	It seems to me that the approach in this case was flawed by the necessity in the Chairman’s mind to find that there was an appeal.  This departed from the statutory test which is to examine the grounds on which the Claimant believed that a dismissal procedure was being followed.  Several things must be noted.  The grounds must be reasonable.  The procedure is a dismissal or disciplinary procedure. In this case it obviously related to a dismissal.  It is either a statutory procedure, “or otherwise”.  The distinction drawn in Regulation 15(1) between, on the one hand, dismissal and disciplinary procedures and, on the other, grievance procedures, is not fully carried into effect in Regulation 15(2), for 15(2) includes the words "or otherwise".  It seems, therefore, that a wider view is to be taken but it is not so wide as to include any procedure, it must be a dismissal procedure, that is a procedure capable of being utilised by a person who is or is about to be dismissed.  It requires some sort of formality, because the statute requires that the procedure is believed to be followed.  Logically, a step in a procedure following a dismissal is an appeal against the dismissal and that of course is the way in which the statutory treatment is given to it.  But it does not exclude a more general procedure between the parties aimed at resolving a dispute over a dismissal.  In this case, the only reason the Claimant consulted her union, and the union acted on her behalf at the meeting, and Ms Thomas sent the information to the union, was because, as the Claimant said, she was challenging her dismissal.  Analytically, the challenge is based on grounds familiar to those engaged in employment relations, that is to attack a redundancy on the grounds that the assessment had been badly or inaccurately made or that the pool for selection was incorrect.  

25.	The purpose of those steps was to have material to challenge the dismissal.  At the end of the meeting things were not left open.  Two steps are envisaged.  Once they were completed, either Mr Harris will be satisfied that the process was fair and he will advise his member, or if not, he will take the matter further as the Claimant did.  She wrote her letter which envisaged a further meeting.  She called it a grievance because that is what she had been told. She believed that: once she wrote the letter complaining that the redundancy was based on unfair and inaccurate material, she was entitled to a meeting.  The use of the word entitlement indicates that she viewed it as a right within some sort of procedure and that she could be accompanied by her union representative.  She also believed, no doubt reflecting advice given by her representative, that the matter should be resolved within 28 days.  Those three matters therefore point to a belief by the Claimant that there was a procedure, and the procedure was there to enable her to challenge the criteria and the procedure upon which she had been made redundant. So the question is not “Was this a formal appeal?” but “Did the Claimant believe on reasonable grounds that there was an ongoing procedure to enable her to challenge her dismissal?”  In my judgment the focus on the word appeal was misplaced in this case. On the material presented to the Chairman, the correct view both as a matter of construction of the letter, and of the witness statement, is that she did believe that there was a procedure that she could attach herself to.  It was not suggested that her belief was untrue.  As the Chairman found, she did as she did because the Union advised her to do so.  This should have been treated as evidence of a reasonable belief by the Claimant such as to enable her to take advantage of the extension in time.  

26.	I have to say that a responsible union Officer failed to understand the statutory procedures which had by this time been in place over a year and did give the Claimant incorrect advice.  The second thing I have to say is in relation to the fear expressed by Mr Matovu that the Respondent might be in for an automatically unfair dismissal.  This is not strictly necessary for my decision.  But the way I would approach the matter is this.  There being no dispute that seven days is a reasonable period for an appeal to be lodged, the Claimant did not then lodge an appeal. However, the Respondent did hold a meeting and did offer further information which considered the Claimant’s case that she had been subjected to an unfair process.  One way of looking at it is that this was indeed some form of appeal, albeit out of time, but done by the grace of the Respondent to allow her to make her point.  If so, there could not be a criticism that it had failed to follow the statutory procedure.  Equally, an appeal had been made available but no wish to appeal had been expressed by the Claimant therefore no meeting was required and the Respondent could not be in breach.  By either route, it seems to me that the Respondent would not be in breach of section 98A and this an automatically unfair dismissal.  

27.	Indeed I would go further and say that what the Respondent did here by the meeting in December and by the sending of further information to the Claimant’s representative was fair and reasonable.  Although it took a rigid stand on receiving the grievance letter, taking it at face value as a grievance and applying the regulations strictly, it did not take that approach when approached by Mr Harris to discuss the matter. So another way of looking at this is that the process which began with the meeting on 16 December 2005 continued through the dispatching of the information on 5 January 2006 and continued to the Claimant’s letter on 26 January.  

28.	For those reasons I uphold the Claimant’s submissions.  This appeal will be allowed and the case remitted to a Tribunal to now hear unfair dismissal, unless the parties are able to resolve this between them.  The case is now back in the Employment Tribunal.  ACAS conciliation will be available.  Now that the Respondent knows that it was not entitled flatly to reject the letter, and that the Claimant is in possession of the assessment forms and wishes to challenge them, it might wish to consider whether it should hold a meeting and try and conciliate the matter now.  That was all she was asking for, a meeting.  She was not saying that she was going to the Employment Tribunal but she wanted an opportunity to put her point with her union official based on the material which had then been vouchsafed to her.  

29.	I would very much like to thank both counsel for their assistance. Permission to appeal is refused [reasons not transcribed].