Appeal No. UKEAT/0490/06/JOJ

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 9 January 2007

Before
HIS HONOUR JUDGE McMULLEN QC
MR D NORMAN
MR P A L PARKER CBE

METROBUS LIMITED	APPELLANT

MR A L COOK	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR MARTIN PALMER
(of Counsel)
Instructed by:
Messrs Dean Wilson Laing Solicitors
96 Church Street
Brighton
East Sussex  BN1 1UJ	
For the Respondent	MISS SARAH BEECHAM
(of Counsel)
Instructed by:
Messrs Drakers Green Brett Solicitors
The Captain’s House
Central Avenue
Pembroke
Chatham Maritime
Kent  ME4 4UF	

SUMMARY
Disability Discrimination – reasonable adjustments
Practice and Procedure – 2002 Act and pre-action requirements

On the Claimant’s concession that the Employment Tribunal, not having being shown Tarbuck, erred in applying Mid Staffordshire, this error did not contaminate two other findings of actual breach of the duty to make reasonable adjustments which were not related to the failure to consider adjustments. While it is possible for contamination to occur, these freestanding findings showed no error here.

On the Respondent’s concession at the Employment Tribunal that it failed to carry out the statutory dispute resolution procedure and so automatically unfairly dismissed the Claimant contrary to the Employment Rights Act 1996 s 98A, the Employment Tribunal was under no duty to make findings under s 98 relating to ordinary unfair dismissal. 

The 40% uplift of compensation was justified by the Employment Tribunal’s finding of blatant failure and was not manifestly excessive or perverse.    

HIS HONOUR JUDGE McMULLEN QC

1.	This case is about disability related discrimination and failure to make reasonable adjustments for a disabled employee. It also concerns automatic unfair dismissal for failing to follow a statutory dismissal procedure. The Judgment represents the views of all three members.  We will refer to the parties as Claimant and Respondent.

Introduction

2.	It is an appeal by the Respondent in those proceedings against a Reserved Judgment of an Employment Tribunal sitting at Ashford, Kent, Chairman Mr M Kurrein, registered with reasons on 12 July 2006.  The parties were represented respectively by Miss Sarah Beecham and Mr Martin Palmer (of Counsel). The Claimant claimed unfair dismissal and disability discrimination, other claims being withdrawn. The Respondent accepted the Claimant was disabled and that he was dismissed for a reason related to his disability, but it denied discrimination. Its statutory defence of justification for one aspect of its treatment of the Claimant was rejected and is not appealed.  It conceded unfair dismissal in the following terms, to which we shall return: 

“It is conceded by the Respondent that it is in breach of that procedure because it did not send a Step 1 letter and that, in those circumstances, it is inevitable that the Tribunal will find the Claimant was automatically unfairly dismissed. We so find.”

It is both an unappealed finding and a concession not sought to be withdrawn.

The issues
3.	The essential issues, as defined by the Employment Tribunal and as now relevant on appeal, were to determine whether there was discrimination related to disability, contrary to section 3A(1) of the Disability Discrimination Act 1995; to determine whether there was a failure to make reasonable adjustments; and, in respect of the dismissal, whether the dismissal constituted unlawful discrimination; and unfair dismissal, either in its ordinary sense or in its automatic meaning, for the employer failed to carry out the statutory dismissal procedures. 

4.	The Tribunal decided in favour of the Claimant on all his claims then live before it, having withdrawn others. The Respondent appeals. Directions sending this appeal to a full hearing were given in Chambers by HHJ Pugsley. 

The legislation

5.	The relevant provisions of the legislation deal on the one hand with discrimination and on the other with unfair dismissal. So far as discrimination is concerned, section 3A provides as follows: 
“3A	 Meaning of “discrimination”
(1) For the purposes of this Part, a person discriminated against a disabled person if-
(a) for a reason which relates to the disabled person’s disability, he treats him less favourably than he treats or would treat others to whom that reason does not or would not apply, and
(b) he cannot show that the treatment in question is justified.
(2) For the purposes of this Part, a person also discriminates against a disabled person if he fails to comply with a duty to make reasonable adjustments imposed on him in relation to the disabled person.
(6) If, in a case falling within subsection (1), a person is under a duty to make reasonable adjustments in relation to a disabled person but fails to comply with that duty, his treatment of that person cannot be justified under subsection (3) unless it would have been justified even if he had complied with that duty.”

6.	The form in which discrimination occurs and is made unlawful occurs in section 4(2)(d), which says this:
“It is unlawful for an employer to discriminate against a disabled person whom he employs-
(d) by dismissing him, or subjecting him to any other detriment.”

7.	Section 4A deals with the duty to make adjustments, known as “reasonable adjustments”.

8.	 As to unfair dismissal, section 98 is headed “general” and requires an employer to put forward a reason for dismissal, and under section 98(4) the determination whether or not the dismissal was unfair is to be made in accordance with that section. Section 98A provides as follows: 
“98A 	Procedural fairness
(1) An employee who is dismissed shall be regarded for the purposes of this Part as unfairly dismissed if-
(a) one of the procedures set out in Part 1 of Schedule 2 to the Employment Act 2002 (dismissal and disciplinary procedures) applies in relation to the dismissal,
(b) the procedure has not been completed, and
(c) the non-completion of the procedure is wholly or mainly attributable to failure by the employer to comply with its requirements.
(2) Subject to subsection (1), failure by an employer to follow a procedure in relation to the dismissal of an employee shall not be regarded for the purposes of section 98(4)(a) as by itself making the employer’s action unreasonable if he shows that he would have decided to dismiss the employee if he had followed the procedure.”

9.	The reference to the procedures in that case are to the statutory procedures set out in the Employment Act 2002 (Dispute Resolution) Regulations 2004, which requires a number of steps to be taken before an employer may dismiss. So far as is relevant to our case, a statement must be given to an employee of grounds for action to be taken against him and an invitation to a meeting in writing. As will be clear from the concession, that was not done. The effect of such a failure appears in section 98A and also section 31 of the Employment Act 2002, which deals with what is described in this Employment Tribunal Judgment as a penal consequence and an uplift in compensation. The provision is as follows:

“31 	Non-completion of statutory procedure: adjustment of awards
(1)	This section applies to proceedings before an employment tribunal relating to a claim under any of the jurisdictions listed in Schedule 3 by an employee.
(2) If, in the case of proceedings to which this section applies, it appeals to the employment tribunal that-
(a) the claim to which the proceedings relate concerns a matter to which on e of the statutory procedures applied,
(b) the statutory procedure was not completed before the proceedings were begun, and
(c) the non-completion of the statutory procedure was wholly or mainly attributable to failure by the employee-
(i) to comply with a requirement of the procedure, or
(ii) to exercise a right of appeal under it,
it must, subject to subsection (4), reduce any award which it makes to the employee by 10 per cent, and may, if it considers it just and equitable in all the circumstances to do so, reduce it by a further amount, but not so as to make a total reduction of more than 50 per cent.
(3)	If, in the case of proceedings to which this section applies, it appears to the employment tribunal that—
(a)	the claim to which the proceedings relate concerns a matter to which one of the statutory procedures applies,
(b)	the statutory procedure was not completed before the proceedings were begun, and
(c)	the non-completion of the statutory procedure was wholly or mainly attributable to failure by the employer to comply with a requirement of the procedure,
it must, subject to subsection (4), increase any award which it makes to the employee by 10 per cent and may, if it considers it just and equitable in all the circumstances to do so, increase it by a further amount, but not so as to make a total increase of more than 50 per cent
(4)	The duty under subsection (2) or (3) to make a reduction or increase of 10 per cent does not apply if there are exceptional circumstances which would make a reduction or increase of that percentage unjust or inequitable, in which case the tribunal may make no reduction or increase or a reduction or increase of such lesser percentage as it considers just and equitable in all the circumstances.”

10.	Regulation 12 is also relevant for it says this:
“12 Failure to comply with the statutory procedures
(1) If either party fails to comply with a requirement of an applicable statutory procedure, including a general requirement contained in Part 3 of Schedule 2, then, subject to paragraph (2), the non-completion of the procedure shall be attributable to that party and neither party shall be under any obligation to comply with any further requirement of the procedure.”

The facts

11.	The Tribunal introduced the parties in the following way:
“4.	The Claimant was born on 23 January 1944. For many years he worked in the motor trade in a variety of capacities. Thereafter, for a period of some 20 years, he was the purchasing manager for a small group of hotels until it went into liquidation. Following that, he commenced his employment with the Respondent’s predecessor on 7 January 1995.
5.	The Respondent is, as its name implies, a bus company. It was independent prior to January 2000 when it became a subsidiary of the “Go-Ahead Group”. At that time the Respondent had depots at Orpington, Godstone and Crawley. The Godstone depot has more recently been transferred to Croydon. Although the Respondent operates semi-autonomously, it is an associated company for the purposes of employment legislation. Those associated companies employ some tens of thousands of staff.
6.	The Claimant had an accident-free record as a bus driver for some seven years. In August 2003 he had an accident at work that caused significant pain in his shoulder. It is common ground that no-one was to blame for that accident. There is no personal injury claim proceeding in any other jurisdiction. The cause of that pain was unidentified for a long period. The Claimant was able to work but took some time off. He was later signed off work on 20 November 2003 as unfit to drive. He was never able to return.”

12.	Throughout his period of sickness, the Claimant was in touch with his employer and made an offer to do alternative work which did not involve driving, as it adversely affected his disability. There were over 400 drivers based at the Orpington depot where the Claimant was employed and there were numerous other staff positions. The Claimant was set down for an MRI scan in November 2004 and at all times informed his employers of the progress.

13.	By January 2005 he was on a waiting list for an operation on his shoulder which would resolve his problem. However, the incoming manager, Mr Driscoll, took a different view and summoned the Claimant to a meeting on 4 May 2005. The Claimant could not provide a date for his operation and during the course of that meeting the manager, now Mr Coyle, decided that he would dismiss the Claimant. There was no appeal. 

14.	The Tribunal noted the concession that the Respondent knew of the disability of the Claimant by July 2004 and that it had a duty to make reasonable adjustments. Four were suggested by the Claimant: the first was of further investigation and assessment; the second was that he should not be dismissed while his operation was pending; and the third was alternative work, which he was ready and able to perform. The fourth was rejected by the Tribunal and is not pursued. 

15.	The Tribunal upheld the Claimant’s case that his dismissal was disability related under section 3A(1). It rejected the defence of justification which was targeted solely at the availability of alternative employment, it being recalled that the Respondent had failed to satisfy the Tribunal that there was no suitable alternative employment for the Claimant. The claim for breach of section 3A(2), reasonable adjustments, was therefore upheld. 

16.	The Tribunal turned then to consider the dismissal itself and held that, since that could not be justified, it too constituted unlawful discrimination on the grounds of the Claimant’s disability. 

17.	The Tribunal turned to the automatic unfair dismissal provisions and noted that the Respondent had failed in a number of key respects, which it recorded as follows: 
“24.1 the Respondent did not inform the Claimant of his right to be accompanied to that meeting;
24.2	 the Respondent did not tell the Claimant that it was to be a meeting at which he might be dismissed;
24.3 the meeting did not comply with paragraph 13 of the procedure because of the numerous interruptions that took place;
24.4	 the appeal did not take place within a reasonable time, contrary to paragraph 12.”

Those failures engaged the provisions of the 2002 Act and Regulations and the Tribunal said this: 
“27.	On the basis of those provisions we take the view that the Respondent’s initial failure to Comply with Step I of the procedure results in an inevitable finding that the non-completion of the procedure is attributable to the Respondent, and the Claimant is potentially entitled to an increase in any relevant award which may be made of at least 10%.
28.	We took the view that the Respondent’s failures in complying with the stautory procedure were serious. The Respondent, in its own right, is a large employer with substantial resources. The requirements imposed by the 2004 Regulations had been in place for a considerable period before the events with which we are concerned. The requirements are not complex. They are designed to ensure minimum standards of natural justice. It is disappointing to find that an employer of the Respondent’s size and status has blatantly failed to comply with them. The provisions are more penal than compensatory in nature. In our view, the Respondent’s breaches of these provisions make it just and equitable to make a further uplift of 30%, so as to increase any relevant award to the Claimant by a total of 40%.”

The Respondent’s case

18.	The Respondent, by an amended Notice of Appeal, for which we granted permission, it being unopposed, made four points. First, it was contended that the Tribunal had in its application of the Judgment of the EAT in Mid-Staffordshire General Hospitals NHS Trust v Cambridge [2003] IRLR 566, EAT Keith J and members. We will call this the Tarbuck point; a reference to Tarbuck v Sainsbury’s Supermarkets Ltd [2006] IRLR 264. 

19.	The short point is that in Tarbuck the EAT, Elias J (President) and members declined to follow Mid-Staffordshire. Mid-Staffordshire had determined that a failure to carry out an adequate investigation and assessment is itself a failure to make a reasonable adjustment. In Tarbuck it was decided, following an earlier Judgment of Keene J and members in British Gas Services Ltd  v McCaull [2001] IRLR 60 EAT, that it was a breach only if there were an actual failure. In NCH Scotland v McHugh UKEATS/ 0010/06 I decided on behalf of the EAT, in a majority, to follow Tarbuck out of respect for the Judgment in that case. Having indicated that in advance to the parties as my own view, Miss Beecham accepted that that was to be the position today. Thus Mr Palmer’s first point that the Tribunal erred in following Mid-Staffordshire is, without opposition, upheld. 

20.	What he contends, however, is it has a lingering, contaminatory effect. This is his second point. The error of law committed by the Tribunal permeated its Judgment elsewhere on the condemnation of the employer for failing to carry out reasonable adjustments. The two reasonable adjustments identified by the Claimant and upheld by the Tribunal were that the Respondent should not dismiss the Claimant and that it should provide him with alternative work. It was, submitted Mr Palmer, plain that the Tribunal’s approach had been infected by its earlier error. 

21.	Thirdly it was contended in respect of automatic unfair dismissal as the Tribunal recorded it and as it is helpfully known, the Tribunal erred in law by failing to make a judgment on the case put by the Claimant. The Claimant had put in his claim that the dismissal was unfair by reason of failure to follow the procedures and also was unfair in ordinary unfair dismissal terms, and the Tribunal had failed to make a judgment on the latter. As a result it could not be known what the Tribunal’s reasons were. And this takes us to his fourth point, which is that the Tribunal failed to explain why it had made the uplift, of a total of 40%. Miss Beecham contended that essentially it was put as a perversity argument and in reply no argument was advanced to gainsay that proposition. 

The Claimant’s case

22.	On behalf of the Claimant it is contended that the error of law did not affect in any way the correctness of its judgments on the other two reasonable adjustments, for there were substantive findings, not of a failure to consider or to investigate, but of actual failure to carry out a reasonable adjustment, as is plain from, for example, these passages:

“We are also of the unanimous view that the actual failure of the Respondent to make an offer of one of the roles that did become vacant was a failure to make a reasonable adjustment.”
“We therefore took the view that it would have been a reasonable adjustment for the Respondent to await the outcome of the anticipated operation, even though the date of that operation was not then known.”

23.	As to automatic unfair dismissal, it is contended that the substantive obligation on the Tribunal is to determine whether there has been an unfair dismissal, which is the Claimant’s right to complain under section 94. In the light of the concession there was no obligation upon the Tribunal to decide the matter under section 98. She accepts that there may be circumstances when it is useful for a Tribunal to make judgments under both ss98 and 98A, but not as here where it is conceded. In any event the point does not arise since relying on Mason v The Governing Body of Ward End Primary School [2006] IRLR 432 the argument advanced by Mr Palmer must relate to a procedure outside the statutory procedures and, as she points out, breach of the statutory procedures alone has been conceded. 

24.	Finally as to the contention that the Tribunal was wrong and failed to give proper reasons for its finding of an uplift of 40%, this was a matter of fact for the Tribunal and the Respondent had not surmounted the high threshold required to establish before the EAT that the Judgment was perverse.

The legal principles

25.	The legal principles to be applied in this case emerge from the Judgments in Tarbuck and NCH. In Scott-Davies v Redgate Medical Services [2006] UKEAT/0273/06, in a Judgment I gave on behalf of the EAT, it was held that there is no freestanding right to make a complaint of failure to follow the statutory procedures and thus establish by that route a claim of unfair dismissal where otherwise there was no jurisdiction. Mr Scott-Davies did not have one year’s service and could not claim ordinary unfair dismissal, nor turn a failure to follow procedures into an automatic one. The test for determining whether a Judgment is perverse, set out in Yeboah v Crofton [2002] IRLR 7000 (CA) is to be applied, see also Stewart v Cleveland Guest Engineering Ltd [1994] IRLR 440. 
Conclusions

26.	We prefer the arguments of the Claimant and have decided that the appeal must be dismissed. We will deal with the conclusions in the same way as we have dealt with the arguments and turn first to the contention that the admitted error in relation to the Tarbuck point infects the other Judgments. This is not a submission that we can accept. There are clear freestanding holdings by the Tribunal which are wholly independent of its criticism of the Respondent for failing properly to assess the medical condition of the Claimant. We have citied both of those in relation to the reasonable adjustments the Claimant put forward: that he should not be dismissed while matters were in flux and that, in the meantime, he should be allowed to take alternative work. Those two citations are ample bases for showing that there were actual breaches of the duty to make a reasonable adjustment and not simply a failure to consider whether to make such adjustments or not. This ground of appeal must fail.

27.	Turning to the dismissal, it being accepted that this was a disability-related dismissal by the Respondent, effectively it has shown a reason for dismissal. But, since the issue in respect of unfair dismissal firstly was whether it was automatically unfair, the concession by the Respondent is a complete answer. There may be cases when there is utility in the Tribunal deciding on two bases that a dismissal is unfair; that is ordinary unfair dismissal under section 98 and automatic unfair dismissal under section 98A. 

28.	This is a dismissal of a particular character and differs from the other automatic unfair dismissal provisions, for example dealing with health and safety cases, section 100, working time cases, section 101A, and whistle-blowing, section 103A. All of these require a finding of a dismissal for a prescribed reason, whereas under section 98A the sole finding to trigger a finding of automatic unfair dismissal is that there has been a breach of the relevant procedures. Where there is a dispute to be resolved by the Tribunal as to whether there has been a breach of section 98A, and the Tribunal finds that there has, it will often be useful, it having heard evidence and argument on section 98, for it also to record its judgment upon that, lest it be wrong on its primary determination. 

29.	However, in a case such as ours where there has been a concession in terms of automatic unfair dismissal there is nothing more it need do. It must be borne in mind that the word automatic does not appear in the statute. The sole question is whether the employee has had his right not to be unfairly dismissed violated. That is under section 94(1). It can be violated in a number of ways, exhibited by for example section 98 and section 98A. Given the concession in this case of a failure to carry out step 1 and of therefore the inevitability of a finding under section 98A the Tribunal committed no error in failing to make a decision in terms under section 98(4). 

30.	Further we accept the submission of Miss Beecham, applying Mason, that section 98A(2) cannot rescue the employer here since for the reasons given in Mason it is no application where there is a breach of step 1.

31.	As for failure to give reasons for the uplift of 40%, the range that was open to it was between 10% and 50%. It was contented at the tribunal that there should be no uplift above the mandatory 10%. The tribunal in fact gave an uplift in the top half of the range. It did so having found a blatant breach of the procedure. That in our judgment is the correct test. It links directly the value of the uplift to the tribunal’s view of the equity of the case. There has been no criticism or depiction of the provision as “more penal than compensatory in nature”. No guidance to the tribunal is given as to what is equitable.  The citation by the tribunal in paragraph 24 of its reasons of the failings of the Respondent amply demonstrate why it depicted them as blatant. There is no need for the tribunal having set these out in paragraph 24 and having referred to the Respondent’s breaches of these provisions in paragraph 28 for it to cite them again. We have a clear view as to tribunal’s position on the uplift at 40% and thus we see no error of law. Indeed we respectfully say that this is a model of clear findings, reasoning and application of the law to the circumstances.

32.	We would like to thank Mr Palmer and Miss Beecham for their clear submissions. The appeal is dismissed. Costs of £200 plus VAT for the amendment awarded to the Claimant. Permission to appeal refused [reasons not transcribed].