Appeal No. UKEAT/0270/09/CEA

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 27 January 2010
Judgment handed down on 23 April 2010

Before
HIS HONOUR JUDGE SEROTA QC
MR T MOTTURE
MR H SINGH

MILTON KEYNES GENERAL NHS TRUST	APPELLANT

MS M SOUTHCOTE-WANT	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR DANIEL TATTON-BROWN
(of Counsel)
Instructed by:
Messrs Hammonds LLP solicitors
2 Park Lane
Leeds
West Yorkshire
LS3 1ES	
For the Respondent	MR PHILIP JONES
(of Counsel)
Instructed by:
Messrs Southcote Scott
Metroline House  117 College Road
Harrow
Middlesex 
HA1 1BZ	

SUMMARY
UNFAIR DISMISSAL
Reasonableness of dismissal
S.98A(2) ERA
Although the ET correctly directed itself as to the law it inadmissibly substituted its own view of the facts for those of the Employer and failed to consider the evidence as a whole but examined the allegations of misconduct against the Claimant separately and in isolation from other evidence which may have provided a context.

HIS HONOUR JUDGE SEROTA QC
Introduction

1.	This is the full hearing of an appeal by the Respondent from a decision of the Employment Tribunal at Bedford (Employment Judge Adamson and lay members) which was sent to the parties on 22 April 2009 after a hearing that lasted some five days.  The Employment Tribunal spent no less than four days in their deliberations and produced a 28-page closely typed judgment with Reasons running to some 98 paragraphs.

2.	The Employment Tribunal decided that the Claimant had been unfairly dismissed.

3.	On 16 June 2009 Burton J referred the matter to a preliminary hearing.  On 18 August 2009 the appeal was referred to a full hearing by HHJ Ansell.

Factual background

4.	We largely take the factual background from the decision of Employment Tribunal.  The Respondent, as its name suggests, is a National Health Service hospital trust responsible for the Milton Keynes General Hospital.  It has some 3,000 employees.

5.	The Claimant became Acting Director of Nursing from 1 September 2004 and subsequently became Director of Nursing.  She reported directly to the Chief Executive of the Respondent, Ms Rodney.  At the material time she was separated from her husband.  We note that she put down her subsequent difficulties with the Respondent to action by her estranged husband and a Health and Safety Officer, Mr Harper.

6.	The Claimant had formed a friendship with one Kim Murphy.  This apparently was not of a sexual nature although it has to be said that the Respondent at the relevant time believed the Claimant and Mr Murphy were having an affair.

7.	Mr Murphy had experience working in the leather industry and some experience in risk management but no experience in clinical risk management, although he acquired some limited experience while working for the Respondent.

8.	At the relevant time risk management was a significant issue in the National Health Service and the Respondent was seeking foundation status.  It needed to implement various National Health Service requirements which would entail recruiting persons to undertake its risk management and the appointment in due course of a Risk Manager.

9.	On 1 May 2006 the Claimant recruited Mr Murphy as a consultant at a monthly fee of £2,500.  Mr Murphy’s responsibilities were to prepare necessary procedures and documentation in relation to risk management as was needed for the Respondent’s application for foundation status.  Mr Murphy had no previous experience of working for the National Health Service nor of clinical risk management and the Claimant alone was responsible for agreeing and documenting the basis upon which he was retained at a consultant.

10.	At page 186 of the bundle there is a letter from the Claimant dated 6 July 2006 which purports to show Mr Murphy having commenced consultancy duties on 6 July 2006.  The Respondent complains that the Claimant had given no explanation why she should document the commencement of his duties two months after they began and then produce a document that purported to show he had just started.  We are not sure that anything turns on this.

11.	On 20 July 2006 Mr Murphy applied to undertake a course run by a firm of solicitors, Messrs. Capsticks.  Capsticks had expertise in carrying out work related to the National Health Service and organised a diploma course in Clinical Risk Management.  This was an important qualification for risk management within the National Health Service and indeed an essential qualification for the post to which Mr Murphy was subsequently appointed.  It would appear that Mr Murphy completed an application form and in relation to arrangements for payment informed Messrs Capsticks that the invoice should be directed to the Respondent.  This would suggest some pre‑arrangement as one would not ordinarily expect the Respondent to pay fees for a consultant to attend a course even if the consultant were to reimburse the Respondent in the absence of some prior discussion.  It was accepted by the Respondent that payment of the fees would not have been misconduct on the part of the Claimant provided that they were to be reimbursed. 

12.	It is by no means clear what the course of events was in August 2006 when Mr Murphy attended the course.  The invoice from Capsticks was sent to the Respondent.  It ultimately found its way to the Claimant, who claimed in subsequent disciplinary proceedings that she had telephoned Miss Catherine Macartney of Capsticks to ask her to re-direct the invoice to Mr Murphy.  Miss Macartney subsequently informed the Respondent’s investigating officer that she did not recall such a telephone conversation.  The Respondent was criticised by the Employment Tribunal for not contacting Miss Macartney sufficiently early because it was unsurprising that when she was asked about the matters over a year later she had no recollection.  It is clear, however, that no invoice was ever sent to Mr Murphy.

13.	On 18 August 2006 (see pages 191-192) the Claimant took it upon herself to authorise payment of Mr Murphy’s consultancy fees in advance for the month of September.  Viewed in isolation this matter may be of no particular concern but when one looks at this as part of a pattern of alleged preferential treatment for Mr Murphy on the part of the Claimant it is clear that it is possible to view this decision of the Claimant in a more critical light.

14.	Similarly the Claimant agreed to pay Mr Murphy’s accommodation expenses at the Respondent’s hospital and also his travel costs to Capsticks.  Again, viewed in isolation these matters may be of no concern but one would not ordinarily expect such expenses and costs to be borne by the Respondent.

15.	On 23 October 2006 (see page 218) the Claimant raised a requisition to pay Capsticks’ fee.  It is by no means clear why the Claimant chose to raise the requisition on this date because the statement / reminder at page 219 is dated 24 October 2006 and the Employment Tribunal found that it was not received by the Respondent until 30 October.  The Claimant signed a further document “signed as requested” on 27 October 2006.  Again, if one places this in the context of other matters said to reveal preferential treatment of Mr Murphy critical comment might be made of the fact that the Claimant used the code for a “consultant” rather than “training”.  The Respondent has suggested that the use of this code was an attempt to divert attention from the payment because it was known that Mr Murphy was a consultant and if the code for “training” had been used it might have raised questions as to why the Respondent was paying the fees for training of a consultant.  The Claimant maintained that she had an innocent explanation in that she did not appreciate the details of the coding.

16.	One of the most contentious documents in the proceedings before the Employment Appeal Tribunal is a document we have at page 222.  It purports to be a letter written on the Respondent’s note paper with the Claimant’s reference addressed to Mr Murphy “Trust Risk

Manager”.  The letter reads as follows:

“Dear Kim
Re: Capsticks' course fees
I have -received a reminder for the Capsticks' course fees, despite my phone call to Catherine after receiving the first invoice, to request that they send it to your home.
In order not-to delay payment to Capsticks I have signed off an invoice today.  I have copied this to Gill Watt, Financial Accountant, so that the Trust will invoice you for the course fees.  I do not know what the timing of that will be.
Yours sincerely
Maggie Southcote-Want 
Director of Nursing”

The letter includes the following 

“Cc Gill Watt, Financial Accountant”

I shall deal later in this judgment with the circumstances in which this letter came to the attention of the Respondent but the following matters should be noted for present purposes: (a) it was sent by internal mail rather than email (b) no copy of this letter was found in Mr Murphy’s personnel file which was retained in the Claimant’s office (c) it was not received by Miss Watt and was not in her file.  The Respondent maintained that the sending of a letter was a somewhat unusual means of communication, particularly between the Claimant and Miss Watt because their usual means of communication was by telephone or email.

17.	The invoice has never been paid by Mr Murphy although he must have known that it formed a significant part of the disciplinary complaint against the Claimant.  

18.	These matters again might be wholly innocent but might take on a different complexion in the context of other matters to which we have referred.

The post of Risk Manager

19.	I have already noted that it was necessary for the Trust to establish the post of Risk Manager for the purpose of its application for foundation status.  The Claimant drafted the original specification.  This specification did not require the applicant to have a post-graduate qualification but this was amended to include such a requirement.  Miss Waller emailed the Claimant on 21 July 2006 to ask if the diploma was HMD or postgraduate.  The Claimant subsequently varied the specification on 26 September 2006 (see page 194) to a Diploma in Risk Management or “working towards” as Mr Murphy was.

20.	Discussions also took place as to the banding of the post of Risk Manager.  The Claimant recommended that it be placed in a band said to be appropriate for a person with a post-graduate qualification.  The salary, therefore, was to be £49,000 per annum.

21.	The Claimant had originally stated that the post should be externally advertised.  It was not externally advertised at the Claimant’s direction although it was advertised internally to all persons on the National Health Service Redeployment Register for the South of England and in certain Jobcentres.  The advertisement produced one application from someone rejected by the Claimant because he had no clinical experience (we believe he was a Professor who had applied through a Jobcentre).  It also produced an application from Mr Murphy and a Ms Errington.  

22.	We have Mr Murphy’s application and cv.  These are dated approximately, we believe, 10 October 2006.  Applicants were required to fill out details of their further education (page 197).  Mr Murphy included the following under the following headings.  In relation to the College / University / Medical / Dental School he stated “Capsticks / Open University”.  In the column headed Degree / Diploma he stated “Post Grad Diploma in Clinical Risk Management”.  He repeated this statement in his cv (see page 205) where under the heading Education and Training he had included the following “Post graduate diploma in Clinical Risk Management – Present”.  The Respondent has always maintained it was well-known to the Claimant that Mr Murphy was not studying for a Post-Graduate Diploma.  The Claimant maintained that she did not notice this “error” on his cv.  On his cv (see page 202) under the heading Key Achievements Mr Murphy wrote “20 years experience of management post with experience in clinical and non clinical risk”.  While this may be somewhat ambiguous it does lead to the possibility of someone misinterpreting his experience in clinical risk.

23.	The selection for the short list was left to the Claimant and Mr Benson the Assistant Facilities Manager who although subordinate to the Claimant did not report to her.

24.	The Respondent was critical of the manner in which the Claimant marked down Miss Errington and placed her on a short list, although on the Claimant’s own case she did not meet three basic requirements.  This led the Respondent to suggest that she was being put forward as a “straw” opponent for Mr Murphy.  Mr Murphy evidently performed well in interview; Miss Errington did not.  

25.	However, it may be instructive to have regard to their relevant qualifications.  Miss Errington (see p. 214) had studied a foundation course at the Associate Institute of Banking, she had a post graduate diploma in Human Resource Management from the University of Glamorgan, a diploma in midwifery from the University of Wales, Swansea and an LLB degree (2:1 Honours) from University College London (Birkbeck) and was currently undertaking a post graduate diploma in risk management.  Mr Murphy’s qualifications apart from the diploma in clinical risk management which he was completing, included an HND in Management Studies, a NVQ level 4 in Operations & Landfill sites and a diploma in leather technology.

26.	Mr Benson was unaware of the falsity of Mr Murphy’s claim to be undertaking a post graduate diploma in clinical risk management and gave equal marks for “qualifications/education” to Mr Murphy and Miss Errington.  The Claimant however marked Mr Murphy as a “2” in relation to qualifications/education but Miss Errington only as a “1”.  The Respondent has suggested that this was clear evidence of favouritism or partiality and it is something that cannot be rationally justified.  Again, taken in isolation these matters may have been explicable with a wholly proper explanation but in the context of other matters it might be proper to view the Claimant’s marking and failure to take action in relation to Mr Murphy’s misrepresentation in a more critical light.

27.	In December 2006 Mr Murphy was appointed as Risk Manager reporting to the Claimant.  He was to be responsible for both clinical and non-clinical risk.

28.	On 1 March 2007 the Respondent received reports through an employee that Mr Murphy had been appointed because he was having an affair with the Claimant.  The Respondent put this down to being a rumour and took no action.

29.	However, in May 2007 further reports came to the attention of the Respondent in relation to the appointment of Mr Murphy, and an HR consultant Mr Griffiths was instructed to report on the allegation that Mr Murphy had secured the post of Trust Risk Manager because of his relationship with the Claimant.

30.	On 1 June 2007 Mr Griffiths reported and his report raised a number of issues including the following: 

(a)	Mr Murphy had no prior National Health Service experience; 

(b)	he queried why the Respondent should have paid for Mr Murphy to attend a Capsticks’ course;

(c)	Mr Murphy’s application form was misleading; 

(d)	Mr Griffiths queried the salary level.

Mr Griffiths, however, reported that he had no evidence to substantiate the allegation he had been called upon to investigate.

31.	On receipt of Mr Griffiths’ report, Ms Rodney, who as I have said was the Chief Executive of the Respondent, considered that matters had now arisen beyond those in the initial terms of reference to Mr Griffiths.  On 12 June 2007 she wrote to the Claimant to inform her of these issues and stated they required further investigation.  This included questions as to whether the procedure to appoint Mr Murphy was fair and whether the Claimant may have abused her position as Head of Nursing to appoint Mr Murphy.  The inquiry was thus broadened.  These matters are set out at paragraph 14 of the decision of the Employment Tribunal.  An external consultant Ms Pullen was instructed to commence investigatory procedures.

32.	Some time in the middle of July Ms Pullen reported.  Her report ran to 74 pages with three pages of executive summary.  Among the points raised were the following: 

(a) 	There had been inadequate advertising for the post and HR advice had not been sought.  She considered that the Claimant would have been advised to advertise externally in appropriate journals.  
(b) 	The short listing suggested some bias.  The strongest candidate was short listed as being the weakest.  
(c) 	There was no reference from a recent employer acceptable to the Claimant because the Claimant was able to provide information based on her knowledge of Mr Murphy; (I point out that she had in fact herself produced a reference in support of Mr Murphy‘s application.)
(d) 	No attempt had been made to contact Bellway Homes for whom Mr Murphy had worked as a consultant between 2004-2006.  
(e) 	Mr Murphy had applied for and attended the Capsticks’ course while undertaking consultancy work.  
(f) 	Mr Murphy and the Claimant said that Mr Murphy had self-funded the course.  
(g)	There was no evidence that Mr Murphy would refund the cost which had been paid for by the Respondent.

33.	Ms Rodney therefore determined that it was appropriate for there to be a formal disciplinary hearing; and on 20 July 2007 the Claimant was given notice (after a meeting) that there would be a disciplinary hearing.  She was suspended on full pay.  The Claimant was informed in terms that the scope of the investigation had taken into account the following:

“As you are aware, the scope of the investigation has taken into account the following:-
1) The advertising arrangements for the post
2) The shortlisting-process used and the consideration given to the content of the applications for employment received, taking into account the applicant's qualifications and experience
3) The interview 
4) The references
5) The salary offered at appointment
6) In addition, the reports have raised issue in relation to invoicing for courses, travel and equipment.”

34.	The disciplinary hearing, contrary to the Respondent’s policy was to be conducted by Ms Rodney, who was the Claimant’s line manager, as I have already said.

35.	The Claimant and her trade union representative objected to Ms Rodney conducting the hearing because she was the Claimant’s line manager and it was contrary to the Respondent’s procedures.  Further, she was herself a witness, albeit in respect of a minor matter relating to a conversation that took place after she had been appointed to take the disciplinary proceedings.

36.	On 21 July 2007 the Claimant went on holiday and on her return her GP certified that she was sick.  She never returned to work.

37.	On 13 September 2007 the Claimant attended by appointment with the Respondent to clear her desk and extracted from her desk the letter purporting to have been dated 31 October 2006.  Ms Chown of the Respondent’s HR Department was at some point in time given a list of documents but it is not at all clear when a copy of the letter of 31 October 2007 was made available to the Respondent.  The Claimant had not referred to this letter during the course of the investigations.

38.	On 26 September 2007 the disciplinary process commenced.  The Claimant objected to Ms Rodney conducting the procedures and also to the presence of Ms Wilkinson, who sat with Ms Rodney as a HR adviser.  The objection to Ms Wilkinson was that she had made a witness statement to Mr Griffiths which was part of the material before Ms Rodney.  During the course of the hearing the Claimant produced the letter of 31 October 2006, which was seen for the first time by Ms Rodney.  Ms Chown made enquiries from Ms Watt and other persons in the Respondent’s Finance Department, none of whom had any recollection of seeing the letter before.  A paper search was made for the letter which could not be found.  Enquiries were then made of an employee at Capsticks, Ms Macartney, who had no recollection of the Claimant asking for the invoice to be sent to Mr Murphy personally.  However, the Employment Tribunal found at paragraph 41 that those enquiries were made about a year after the events had or were alleged to have occurred and it found that the lack of recollection to be “unsurprising at that distance”.  On 28 September 2007 the Claimant was dismissed for gross misconduct.  Ms Rodney concluded that: 

“the process you used to appoint Mr Murphy to the post of Trust Risk Manager was not fair and that you abused your position as Director of Nursing to deliberately appoint Mr Murphy to a substantive position within the Trust”. 

Ms Rodney set out her reasons as follows:

“(1)	deliberately supported and funded Mr Murphy to undertake the "Capsticks" Diploma in risk Management when at the time he was an independent consultant working at the trust on a short term assignment unrelated to the Trust Risk manager post
  (2)	deliberately developed the advertisement, job description and person specification so as to ensure that Mr Murphy met all the essential requirements
  (3)	deliberately supported the banding of the Trust Risk manager post to ensure it attracted an 8b banding and its associated salary
  (4)	deliberately advertised the post with a person specification that did not require a Post graduate qualification and job description so as to ensure that Mr Murphy would meet the essential criteria
  (5) 	deliberately advertised the post internally so as to restrict wider competition
  (6)	deliberately scored Mr Murphy higher than the only other candidate when on paper Mr Murphy is the weaker candidate
  (7) 	deliberately shortlisted Mr Murphy for interview, when in practice Mr Murphy did not have any clinical risk management experiences or suitable qualification
  (8) 	deliberately designed the questions at interview so as to favour Mr Murphy's knowledge, skills and experience and by do so disadvantaging the other candidate
  (9)	deliberately did not ask Mr Murphy to provide you with a reference from his most recent employment or work assignment and chose to rely solely on your own reference and one from a former employer
  (10)	deliberately appointed Mr Murphy to the post of Trust Risk Manger on the penultimate point of the banding when there was no evidence to support that Mr Murphy had the relevant qualifications, knowledge, skills or experience to justify this
  (11) 	deliberately provided Mr Murphy with what you called “good will” payments whilst he was a- consultant at this Trust, as opposed to renegotiating the terms of the assignment.”

39.	On 7 October 2007 Mr Murphy was dismissed for gross misconduct in that he had provided deliberately misleading information in the application form.  We were told that Mr Murphy did not appeal against this decision or otherwise seek to challenge it.  We also note that Ms Rodney conducted the disciplinary hearing so far as it concerned Mr Murphy.

40.	On 16 October 2007 the Claimant appealed against her dismissal.  She sought to obtain notes of the disciplinary hearing before Ms Rodney (apparently shorthand writers had been present).  These were not provided to her and the Employment Tribunal (paragraph 20) found that the Respondent’s decision not to provide these as being “inexplicable”.

41.	The appeal commenced on 7 November 2007.  The appeal was conducted by the Chairman of the Respondent, Mr Rowland.  It was adjourned part-heard to 18 January 2008 when it was continued.  Complaint is made by the Claimant, and indeed by the Employment Tribunal, that the Respondent had attempted “to shoehorn” the appeal into one day only and that the setting of such a short time limit suggested the result of the appeal was pre-determined.

42.	The appeal was dismissed on 22 January 2008.  It was clear, say the Employment Tribunal, from Mr Rowland’s evidence that he regarded the letter of 31 October as being a forgery and that convinced the Appeal Panel that Ms Rodney had been correct in finding the Claimant had manipulated the recruitment process and had agreed to pay Capsticks in respect of Mr Murphy’s attendance at the Risk Management course.

The Decision of the Employment Tribunal

43.	The Respondent says that there was insufficient time at the Employment Tribunal for oral submissions to be completed.  Mr Tatton-Brown, therefore, who had produced written submissions did not have time to develop them and asked the Tribunal to consider them when it retired.  The Employment Tribunal do not refer to these at all although they set out evidence relied upon by the Respondent some of which has not been referred to by the Employment Tribunal.  We have to say that we are surprised we have not been able to identify a number of matters raised in those submissions as having been considered by the Employment Tribunal in its judgment.  The Employment Tribunal correctly directed itself in relation to the effect of dismissal procedures under the Employment Act 2002 and as to the relevant authorities to determine whether a dismissal was unfair, in particular having regard to the range of reasonable responses set out in cases such as HSBC v Madden [2000] ICR 1283 and Sainsburys Supermarkets v Hitt [2003] ICR 111.  The Employment Tribunal concluded that the statutory dismissal procedures had been complied with.

44.	At paragraph 33 it considered the report prepared by Ms Pullen.  The Employment Tribunal criticised this report in a number of respects:

(a)	It was wrong to say that it was inappropriate to advertise without HR input and that HR would have advised external advertising.  The decision as to how to advertise was that of the manager i.e. the Claimant. 

(b)	The statement by Ms Pullen that Mr Murphy was the weakest candidate on paper was an opinion not a fact (we pause to remark that such a statement could only be a statement of opinion).

(c)	It was unclear as to how Ms Pullen had arrived at her conclusions.

(d)	The Employment Tribunal made additional criticisms.

(e)	At paragraph 43 the Employment Tribunal criticised the standard of the investigation into the issue of whether the Claimant had in effect caused the Respondent to fund Mr Murphy’s attendance at the Capsticks’ course when he was on short term assignment as a consultant.  

(f)	The initial payment of fees by the Respondent was not considered untoward, of course, on the basis that Mr Murphy would reimburse the Respondent.

(g)	The Respondent had not carried out an electronic trawl to try to find the letter of 31 October 2006 on its database.  There was evidence that correspondence would go missing and it was unsurprising that witnesses could not recall the events of a year before;  again, we observe that this was a matter that must have been apparent to those carrying out the investigation and to Ms Rodney.  Nevertheless, the Employment Tribunal concluded the standard of the investigation was outside the band of reasonableness.

45.	The Employment Tribunal considered that it was wrong for Ms Rodney to criticise the Claimant in relation to the banding of the post of Risk Manager because this was not within the scope of the letter of 27 July 2007 and was outside the disciplinary charge.  No account should have been taken of this.

46.	Ms Pullen had reported that there was no evidence that HR advice had been sought on advertisement of the post and Ms Rodney had been misled in finding that the Claimant acted contrary to the Respondent’s procedures in not having the post advertised externally.

47.	At paragraph 47 the Employment Tribunal considered whether the Respondent could reasonably conclude that the Claimant had deliberately developed a job description and personal specification for the post of Risk Manager so that it suited Mr Murphy.

48.	The Employment Tribunal concluded that the Claimant had followed the Respondent’s procedure and template.  She employed Mr Murphy.  She had referred to comparable posts in other NHS Trusts.  Further the Employment Tribunal concluded that Ms Pullen had misstated the evidence to her of Ms Lindsay Waller confirming that the Claimant had said that the post would have a requirement that applicants had a post graduate diploma.  This was so that the post could be banded as 8B.  The Employment Tribunal concluded that Ms Waller had not been so certain; although she had endorsed a document contemporaneously “post graduate”.  Ms Waller had also said it was a manager’s responsibility to grade the job based on the job description and her recollection of matters when giving evidence to Ms Pullen was “vague”.  Again we pause to point out that the Employment Tribunal should have been addressing itself as to the evidence that was available at the disciplinary hearing; the approach to this evidence strongly suggests to us that the Employment Tribunal was in effect rehearing the case and does not address itself to the question of whether the Claimant had tailored the job description.  The Employment Tribunal concluded that although there was conflicting evidence as to whether the job should have a post graduate qualification, it appeared to accept the Claimant’s evidence.  Again in passing we note that this begs the question of the role of the hearing before Ms Rodney.  The fact that a witness’s recollection was said to be “vague” or less clear than the Claimant’s did not mean Ms Rodney was wrong to disregard it.  The question the Employment Tribunal should, surely, have addressed was whether Ms Rodney, who conducted the disciplinary hearing, could properly on the evidence before her conclude as she did. 

49.	The Employment Tribunal at paragraphs 50, 52 and 54-55 sets out the Claimant’s case as to why clinical risk experience was less significant than non-clinical risk.  

50.	The Employment Tribunal then went on to examine Ms Rodney’s finding that the Claimant had advertised the post internally to restrict wider competition. At paragraph 56 the Employment Tribunal point out that Ms Errington in fact had been scored down similarly not only by the Claimant but also by Mr Benson.  There was no evidence that Ms Rodney had carried out her own scoring.  Ms Pullen’s view that Ms Errington was on paper a stronger candidate was not the Claimant’s analysis nor that of Mr Benson unless they were acting dishonestly and there was no such evidence in the case of Mr Benson.  In those circumstances the Employment Tribunal, at paragraph 56, concluded that Ms Rodney could not reasonably conclude that the Claimant had deliberately scored Mr Murphy higher.

51.	The Employment Tribunal then went on to consider the question of selection for interview.  Mr Benson and the Claimant had both considered the candidates had given sufficient information although Ms Pullen and Ms Rodney disagreed with this view.  This was, however, a difference of professional judgment.  In the absence of dishonesty on the part of the applicant it was not a conduct matter.  Then again we feel bound to ask whether this finding meets the case that while there may be disagreement or not the Claimant was motivated not by reason of professional disagreement but of a desire to favour Mr Murphy.

52.	There was no suggestion of duplicity or dishonesty on the part of Mr Benson and although it was suggested he had been “duped” no evidence to the Respondent substantiated that he had been.  We note, however, that Mr Benson was unaware, as the Claimant was aware, of the misrepresentations in Mr Murphy’s application and cv.  

53.	The Employment Tribunal went on to conclude that Ms Rodney’s opinion that questions had been deliberately designed to favour Mr Murphy and disadvantage Ms Errington was not supported by evidence other than the opinion of Ms Pullen, and no reason for her opinion other than her professional judgment had been established.

54.	In relation to references for Mr Murphy the Claimant had given one although this was not on the file.  Mr Benson did not consider there was anything untoward in the Claimant providing a reference for Mr Murphy.  One of the matters in this case that causes us concern is that the Claimant had provided a reference for an applicant when she was responsible together with Mr Benson for interviewing applicants and then appointing to post.  The Employment Tribunal then criticised Ms Rodney for her concern that no reference had been obtained from Mr Murphy’s most recent employer because his most recent employment was with the Respondent and the Claimant had provided a reference.

55.	Ms Rodney had considered that the Claimant deliberately appointed Mr Murphy to a post on the penultimate point of banding when there was no evidence he had the relevant qualifications, skills or experience.  The Claimant told Ms Rodney she had seen tax returns showing that Mr Murphy had earned £58,000 a year.  There was no evidence to the Respondent, say the Employment Tribunal, that this was not the case.  

56.	The Employment Tribunal considered that where a person was placed on the band was a matter of judgment and the Claimant’s judgment after negotiations was that Mr Murphy was in the appropriate place on the band and there was evidence before Ms Rodney to show this was not out of line with Mr Murphy’s previous earnings for years’ ended April 2006 and 2005. 

57.	The Employment Tribunal then turned its attention to the ‘good will’ payments.  It recognised at paragraph 67 that “payment of ‘goodwill’ payments to a consultant would appear to many to be unusual”.  It characterised the Respondent’s position that the terms of consultant’s fees should have been renegotiated as a distinction of form without a difference of substance.  There were business reasons for the payments to be made, the payments were made openly and were within the Claimant’s remit.  

58.	At paragraph 68 the Employment Tribunal note that Ms Rodney’s reasons for dismissal all use the term “deliberately”.  The consequences for the Claimant if the disciplinary charge were proved would be catastrophic so there was need for a careful and conscientious investigation not only of whether the matters of which the Claimant was accused had occurred but also as to whether they constituted misconduct.  The Employment Tribunal accepted that the investigation need not be the same as a police investigation.  The Employment Tribunal concluded that Ms Rodney did not have sufficient information from which she could reasonably conclude that the Claimant had been guilty of misconduct as charged and for which she had been dismissed.

59.	The Employment Tribunal noted that the Claimant did not dispute that Ms Rodney had a genuine belief in her misconduct.  It noted that there were surrounding circumstances that would have given the Respondent cause for concern and enquiry.  The Employment Tribunal went on to find that issues as to “banding” which formed part of the decision to dismiss the Claimant were not within the constrained disciplinary charge and that in itself was unfair.  Further the Respondent had failed to take steps to investigate the authenticity of the letter of 31 October (we note that at no time did the Claimant or her representatives ever ask for an electronic trawl).  (The Claimant maintained that she was not aware that the provenance of the letter of 31 October was challenged until Mr Rowlands gave evidence before the Tribunal.)  There was no evidence to disprove the Claimant and Mr Murphy’s assertion that he always understood he would pay for the Capsticks’ course; again we note that this begs the question of whether the assertion by the Claimant and Mr Murphy was, in all the circumstances, credible or acceptable.  The Employment Tribunal also concluded that the suggestion that the Claimant had developed the advertisement for the post of Risk Manager so as to favour Mr Murphy was not established by the evidence.  This, it is said, was a managerial matter within the Claimant’s remit.

60.	At paragraph 74 the Employment Tribunal repeated that the banding of the post was outside the disciplinary charge and the evidence was that the job did not require a post graduate qualification.  (In that case one might ask why it was banded at a rate appropriate to those with such a qualification.)  The Employment Tribunal noted that the Claimant had herself attended the Capsticks’ course and knew it was not a graduate qualification.  The Employment Tribunal noted that there was a dispute between the Claimant and the Respondent as to how the grading had come about. 

“74.	... We can understand how the Respondent had concluded on the information before it that the Claimant had participated in informing those who were undertaking the desk top exercise to grade the post that a post graduate qualification was needed when the requirements of the job did not require such a qualification.  As we have said however that was not part of the disciplinary charge.”

61.	The Employment Tribunal at paragraph 75 noted that there was a difference of judgment as to whether a key function of the post of Risk Manager was clinical or non clinical risk; there was no suggestion that Mr Benson was dishonest.

“We find that there was a difference of judgement between managers about the essential requirements for the post of Trust Risk Manager.  The fact that Ms Rodney was the Chief Executive does not affect that conclusion.”

62.	At paragraph 76 the Employment Tribunal found that the Claimant had advertised the post in accordance with the Respondent’s internal guide.  Ms Rodney had been misled by HR and it was unreasonable for her to conclude that the Claimant had deliberately advertised the post internally so as to restrict wider competition.

63.	Scoring and shortlisting was a matter of judgment and the fact there was a difference of opinion did not mean that Mr Murphy had deliberately been scored higher.  There was no evidence that Mr Benson had been “duped”.  It was unreasonable for Ms Rodney to conclude as she did.  There were no reasonable grounds for concluding the Claimant had somehow acted inappropriately.  Even if there were managerial shortcomings in relation to the interview process there was nothing that would enable Ms Rodney to conclude that questions had been written so as to favour a particular candidate.  The Employment Tribunal also concluded (paragraph 79) that the Claimant was entitled to make a managerial decision not to obtain references in respect of Mr Murphy’s short term assignments in which he had worked in recent years; (including presumably the time he spent working for Bellway Homes between 2004 and 2006).  Ms Rodney could not reasonably conclude there was any misconduct in the failure to obtain further references.

64.	The Employment Tribunal did not think the Claimant could be criticised for appointing Mr Murphy to the point on the salary band at which she had although it was “high” as she had been given evidence regarding his tax returns and made a managerial decision.  The “goodwill” payments could not amount to misconduct, or if any, serious misconduct.  And at paragraph 83 it concluded:

“Having regard to our findings of fact we consider that the investigations carried out by this Respondent with the resources available to it and the potential consequences for the Claimant were outside the rage [sic] of reasonableness in this case.  We find that Ms Rodney did not have information from which she could reasonably conclude that the Claimant had committed an act of gross misconduct.”

65.	The Employment Tribunal considered it was severely prejudicial for Ms Rodney to have conducted the disciplinary hearing as it was contrary to agreed procedures and there might have been alternatives.  Further Ms Rodney had been involved in the process by instructing the investigations and as a witness and she relied on her own managerial view; again we note that the Employment Tribunal has not set out what it considered to be the severe prejudice suffered by the Claimant.

66.	The Employment Tribunal found that the decision to dismiss the Claimant was unfair at that stage and it then went on to consider whether the overall decision was unfair and it went on to consider the appeal before Mr Rowlands.  At paragraph 88 the Employment Tribunal noted that the Respondent’s determination to fix the disciplinary hearing for half a day and then extend it to one day: 

“causes us to doubt whether there was any real intention by the Respondent to conduct a full re-hearing having regard to the length of the disciplinary hearing, the grounds upon which the Claimant appealed, and that an additional witness was to be heard.”

67.	The Employment Tribunal then recorded Mr Rowlands’ evidence to the Tribunal that a major factor of the appeal panel decision process was the Claimant’s letter of 31 October 2006:

“89.	…which he said had been produced on the day of the disciplinary hearing.  While the letter had been produced by the Claimant at that disciplinary hearing it had of course been disclosed to Ms Chown earlier, on the 13th September …”

(There is significant doubt on the evidence whether the Employment Tribunal has accurately recorded when that letter was first made available to the Respondent, but we do not investigate this matter further or place reliance upon that.)  Mr Rowlands and the disciplinary hearing concluded the document was a forgery.  Mr Rowlands readily accepted that had not been put to the Claimant and he did not ask for any enquiry to ascertain it was genuine and did not know whether the Respondent had at that time interrogated any of its computers.

68.	At paragraph 90 the Employment Tribunal record Mr Rowlands as having told the Tribunal:

“that he did not have any reason, and thus we take it that the appeal panel did not have any reason, to disbelieve that the Claimant had spoken to a Ms Macarthy at “Capsticks” regarding the invoice for the course being the responsibility of Mr Murphy and not of the Respondent.”

This does not do justice to the evidence because it is clear that what Mr Rowlands told the Tribunal (and that was as far as he could go) was that there was no direct evidence to the contrary of what the Claimant had said; however, this is not a matter that affects our ultimate decision.

69.	At paragraph 93 the Employment Tribunal addressed Ms Rodney’s conclusion that the Claimant had deliberately supported and funded Mr Murphy to undertake the Capsticks’ diploma.  Mr Rowlands had given evidence that if the Respondent paid the course fees on the basis these would be repaid by Mr Murphy it was not wrong.  Accordingly Ms Rodney must have found the letter of 31 October was a forgery.  The Employment Tribunal was not satisfied that the appeal had reasonably investigated the provenance of that letter.  The appeal process was unfair and the appeal panel’s reliance on the conclusion that the letter was forged when Mr Rowlands’ acceptance:

“94.	…that he had no reason to disbelieve the Claimant had telephoned Capsticks regarding the invoice being the responsibility of Mr Murphy, to have greatly prejudiced the Claimant.”

70.	The Employment Tribunal concluded that the failure to provide the Claimant with the notes of the disciplinary hearing was inexplicable and disadvantaged her as she was unable to use them at the appeal.  

71.	The Employment Tribunal found that the Respondent’s conclusion on the 31 October 2006 letter without ever questioning the Claimant about its integrity at appeal was outside the range of reasonableness.  It found that the refusal of the Respondent to provide the Claimant with a transcript of the disciplinary hearing notes, despite the terms of the ACAS guide and the Respondent’s disciplinary procedure, were outside the range of reasonableness.  For those reasons it found the appeal hearing was unfair.  It also was not persuaded the Respondent had any genuine intention of conducting a rehearing because of the Respondent’s persistence in attempting to shoehorn the event into an unrealistic timescale.  That indicated to the Tribunal a pre-determination on the Respondent’s part.

72.	The Employment Tribunal dealt with the effect of s. 98A(2) of the Employment Rights Act 1996 at paragraph 97:

“We considered whether if the Respondent had carried out another procedure within the range of reasonableness the outcome would have been different.  Because of the fundamental flaws in the Respondent's procedure we cannot, on the balance of probabilities, conclude that the Respondent would have dismissed the Claimant in any event. We find the Respondent's dismissal of the Claimant to be unfair.”

The Respondent’s submissions

73.	Mr Tatton-Brown reminded us of certain uncontroversial principles including firstly that the Employment Tribunal was not to substitute its views for those of the employer in relation to the scope and nature of any investigation and to its appreciation of the evidence.  He also acknowledged the height of the hurdle he had to surmount in asserting that findings of the Employment Tribunal were perverse.  Mr Tatton-Brown submitted the Employment Tribunal’s decision that there was no sufficient information before Ms Rodney to conclude that the Claimant was guilty of misconduct as charged could not stand and he took us through the evidence, much of which is not specifically referred to in the Employment Tribunal’s conclusions notwithstanding that it was in his written submissions.  He submitted, however, the Employment Tribunal had substituted its own view of the facts for those of Ms Rodney as to the Claimant’s conduct in holding as follows:

(a)	At paragraph 68 that Ms Rodney did not have sufficient information from which she could reasonably conclude the Claimant was guilty of the misconduct of which she was charged and dismissed.

(b)	At paragraph 56 in holding that in the absence of dishonesty it could not be said that Ms Rodney could reasonably conclude the Claimant had deliberately scored Mr Murphy higher than Ms Errington.

(c)	At paragraphs 72 in holding there was no evidence to disprove the Claimant’s assertion that she always understood Mr Murphy would pay for the Capsticks’ course.

(d)	At paragraph 76 that it was unreasonable for Ms Rodney to hold that the Claimant had deliberately advertised the post internally so as to restrict wider competition.

(e)	At paragraph 77 that Ms Rodney did not have reasonable grounds for concluding the Claimant had behaved in an appropriate manner in the shortlisting process.

(f)	At paragraph 78 that Ms Rodney could not conclude that the interview questions had been written so as to favour one candidate and her conclusion that the questions were designed to favour Mr Murphy was not supported by any other evidence other than the opinion of Ms Pullen.  

(g)	He challenged the finding of the Employment Tribunal at paragraph 83 that Ms Rodney did not have information from which she could reasonably conclude that the Claimant had committed an act of gross misconduct.

74.	In the alternative Mr Tatton-Brown submitted that the Employment Tribunal’s conclusions on those matters having regard to the totality of the evidence were perverse.  He submitted the Employment Tribunal had submitted its own standards of what was a reasonable investigation rather than considering what could objectively be expected of a reasonable employer.  It had also substituted its own views of the evidence for those of Ms Rodney.  He pointed to the manner in which the Employment Tribunal had dealt with Ms Waller’s evidence as to the banding of the post and of her conversation with the Claimant (we referred to this matter earlier when setting out the relevant facts).  In relation to the interview process the Respondent had raised a number of concerns.  It had complained that although the Claimant had acknowledged that there might be seen to be a possibility of bias if she sat on an interview panel, Mr Tatton-Brown asked forensically why was a panel not arranged with three as opposed to two members and why were additional references not sought.  This is a matter that formed part of the submissions to the Employment Tribunal which the Employment Tribunal have not dealt with.

75.	Mr Tatton-Brown submitted that in cases such as this an employer and the Employment Tribunal must appreciate that it is necessary to consider the evidence as a whole and be ready to draw inferences as to whether the evidence as a whole pointed to the misconduct alleged.  The Employment Tribunal in this case has compartmentalized the evidence and viewed each piece of evidence in isolation and not in its context as being related to other evidence.  This was particularly important in relation to the evidence relating to the payment of the Capsticks’ invoice and the selection process for appointment to the post of Trust Risk Manager.  As a result the Employment Tribunal’s decisions as to the investigatory and disciplinary process and whether overall the decision to dismiss were unfair were flawed.

76.	Mr Tatton-Brown was specially concerned at the failure of the Employment Tribunal adequately to deal with the position under s. 98A(2) of the Employment Rights Act.  The reasons given at paragraph 97 were so brief as not to be Meek compliant.  He submitted that had the Employment Tribunal properly considered the evidence as a whole it would have concluded that the likelihood was that even allowing for any defects in the investigation and disciplinary process the result would have been the same.  He submitted following the judgment of Elias J in Software 2000 Ltd v Andrews [2007] IRLR 568, that the Respondent could seek to prove that the dismissal was fair on the basis that but for the procedural failures on the balance of probabilities it would still have dismissed the Claimant.  The Employment Tribunal had to consider the evidence advanced by the Respondent and relevant submissions on the facts, even if those particular submissions had not been made to the dismissing officer.

77.	The Employment Tribunal should also have asked itself whether the breach of contractual disciplinary procedures had the effect of denying the Claimant the opportunity to show that the real reason for her dismissal should not be treated as a sufficient reason; see Westminster City Council v Cabaj [1996] IRLR 399.

The Claimant’s Submissions

78.	Mr Jones submitted that it was necessary to consider individual grounds of complaint against the Claimant as asserted by the Respondent in the disciplinary proceedings.  If they were all inadmissible then it was impossible to make them admissible by conflation.  He also submitted that the Respondent could not justify the dismissal by reference to facts and matters that were not in the mind of Ms Rodney when she took the decision to dismiss.  Mr Jones also pointed out that there were no challenges to findings as to how the appeal process rendered the dismissal unfair.  Between Ms Rodney’s dismissal of the Claimant and the confirmation of this on appeal the key consideration for dismissal had changed radically and the appeal decision was founded on the belief that the letter of 31 October 2006 was a fabrication.  This was a point that had never been suggested to the Claimant and on which she had never had the chance to give an answer.  Accordingly were one to accept the points made on behalf of the Respondent the dismissal was unfair by reason of the manner in which it was conducted.

79.	In relation to Capsticks’ invoice no arguments had been advanced as to Mr Murphy’s cash flow difficulties before Ms Rodney or the Employment Tribunal; (whatever may have been the position before Ms Rodney in the appeal panel it was clearly raised before the Employment Tribunal, see the Respondent’s skeleton at paragraph 3(e) at p. 58 of our bundle).

80.	Mr Jones emphasised the exculpatory effect of the letter of 31 October 2006.  In relation to issues of shortlisting and the interview the Employment Tribunal was entitled to find as it did.  Relying upon the decision of the Court of Appeal in Wilson v Racher [1974] IRLR 114 Mr Jones submitted that the Respondent would in effect have to show dishonesty on the part of Mr Benson and the Claimant were the Employment Tribunal to have found that the shortlisting and interview process had been deliberately skewed in favour of Mr Murphy.  It was necessary for there to be a repudiatory breach of contract on the part of the Claimant and a mere difference of opinion, especially an honest difference of opinion, between the Claimant and Ms Pullen and Ms Rodney would not be sufficient.  There was no evidence that Mr Benson had been “duped” and it was a matter of opinion whether the questions asked at interview were appropriate or not.  Mr Jones also submitted the Employment Tribunal’s decision in relation to the question of whether or not it was appropriate or necessary for there to be outside advertising and as to whether “banding” was part of the disciplinary charge were correct and could not be interfered with by the Employment Appeal Tribunal.

81.	In so far as the investigation was concerned Mr Jones stressed the importance of the failure to have an electronic trawl and he referred to the duty of the Respondent to investigate exculpatory evidence as well as evidence pointing towards guilt.  In this regard he drew our attention to the case of A v B [2003] IRLR 405.  

82.	He stressed to us that no arguments as to the authenticity of the letter of 31 October 2006 had ever been put to the Claimant, to Ms Rodney or to the appeal panel.  The Employment Tribunal was correct in finding that when the Claimant maintained she had spoken to Capsticks Ms Pullen should have gone straight back to them and not waited.    

83.	In relation to the question of whether Ms Rodney acting as disciplinary officer had caused serious prejudice to the Claimant, Mr Jones recognised that there was no express finding as to why this was but the Employment Tribunal at paragraph 84 must have found implicitly that the prejudice was that Ms Rodney held managerial views whereas the process should have been conducted by an outsider whose view was likely to be rather more dispassionate than that of the Claimant’s own line manager who had her own “baggage” and had given evidence herself.

84.	In relation to Mr Tatton-Brown’s submissions on s. 98A(2) Mr Jones submitted that the conclusion of the Employment Tribunal at paragraph 97 although succinct came at the end of a long and well reasoned decision.  It was for the Respondent to demonstrate that had there been a proper procedure the Respondent would still have dismissed the Claimant, and the evidence did not support that.  It was necessary to have regard to the other matters found by the Employment Tribunal and it was quite impossible to speculate on what the Respondent would have done had there been a fair procedure. 

85.	If we were against Mr Jones on the s. 98A(2) point he submitted that the matter should be remitted to the same Employment Tribunal to determine that issue.  

The law

86.	The principle upon which the Employment Tribunal must act in determining whether or not a dismissal is unfair is well established and not in doubt.  The Employment Tribunal must determine whether the employer genuinely believe on reasonable grounds after as much investigation as was reasonable that the employee had committed the act of misconduct alleged, and that it was proper to dismiss him for that misconduct. The Employment Tribunal’s function is not to substitute its view for that of the employer but to review the decision of the employer.  If the employer’s decisions throughout the dismissal process are within the range of reasonable responses there is no room for the Employment Tribunal to interfere with the employer’s decision.  In this case the Employment Tribunal in general correctly directed itself as to the law; the issue is whether it applied and acted upon the principles upon which it directed itself.

87.	It is helpful to have in mind the helpful guidance of Mummery LJ in London Ambulance NHS Trust v Small [2009] IRLR 563 at paragraph 43

“It is all too easy, even for an experienced ET, to slip into the substitution mindset. In conduct cases the claimant often comes to the ET with more evidence and with an understandable determination to clear his name and to prove to the ET that he is innocent of the charges made against him by his employer. He has lost his job in circumstances that may make it difficult for him to get another job. He may well gain the sympathy of the ET so that it is carried along the acquittal route and away from the real question - whether the employer acted fairly and reasonably in all the circumstances at the time of the dismissal.”

88.	We take the view that the decision in Westminster CC v Cabaj [1996] IRLR 399 is of general relevance as to the approach to be taken by an Employment Tribunal where there has been a failure of a disciplinary process, by reason of a failure to follow a contractual procedure.  In the present case, the Respondent appointed Ms Rodney to be the dismissing officer in breach of its own procedures. The Employment Tribunal needed to ask whether the Respondent had impeded the Claimant in demonstrating that the real reason for her dismissal was not sufficient.

89.	It is helpful also to refer to s. 98A of the Employment Rights Act 1998.  S. 98A was in force at the material time.  S. 98A(1) provides that a dismissal would be automatically unfair in circumstances where one of the statutory dismissal and disciplinary procedures applies and had not been complied with.  That is not the case here.  S .98A(2) then provides:

“Subject to sub-section (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 s.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.”

90.	Elias J in Alexander v Bridgen Enterprises UKEAT/0107/06/DA made clear the simple meaning of s. 98A(2):

“56.   In our view it simply means any procedure which the tribunal considers in fairness the employer ought to have complied with.  If the employer has failed to comply with a procedure which ought to have been carried out, that will not render the dismissal unfair if the employer shows that the employee would have been dismissed anyway even had that fair procedure been adopted.”

91.	The correct approach to the application of s. 98A(2) is helpfully set out in the decision of the Employment Appeal Tribunal in Software 2000 Ltd v Andrews [2007] IRLR 568.  Elias J summarised the correct approach having reviewed the authorities as follows:

“Summary.
54.	 The following principles emerge from these cases: 
(1)	In assessing compensation the task of the Tribunal is to assess the loss flowing from the dismissal, using its common sense, experience and sense of justice.  In the normal case that requires it to assess for how long the employee would have been employed but for the dismissal.
(2)	If the employer seeks to contend that the employee would or might have ceased to be employed in any event had fair procedures been followed, or alternatively would not have continued in employment indefinitely, it is for him to adduce any relevant evidence on which he wishes to rely.  However, the Tribunal must have regard to all the evidence when making that assessment, including any evidence from the employee himself. (He might, for example, have given evidence that he had intended to retire in the near future).
(3)	However, there will be circumstances where the nature of the evidence which the employer wishes to adduce, or on which he seeks to rely, is so unreliable that the tribunal may take the view that the whole exercise of seeking to reconstruct what might have been is so riddled with uncertainty that no sensible prediction based on that evidence can properly be made.
(4)	Whether that is the position is a matter of impression and judgment for the Tribunal.  But in reaching that decision the Tribunal must direct itself properly.  It must recognise that it should have regard to any material and reliable evidence which might assist it in fixing just compensation, even if there are limits to the extent to which it can confidently predict what might have been; and it must appreciate that a degree of uncertainty is an inevitable feature of the exercise.  The mere fact that an element of speculation is involved is not a reason for refusing to have regard to the evidence.
(5)	An appellate court must be wary about interfering with the Tribunal’s assessment that the exercise is too speculative.  However, it must interfere if the Tribunal has not directed itself properly and has taken too narrow a view of its role. 

(6)	The s.98A(2) and Polkey exercises run in parallel and will often involve consideration of the same evidence, but they must not be conflated. It follows that even if a Tribunal considers that some of the evidence or potential evidence to be too speculative to form any sensible view as to whether dismissal would have occurred on the balance of probabilities, it must nevertheless take into account any evidence on which it considers it can properly rely and from which it could in principle conclude that the employment may have come to an end when it did, or alternatively would not have continued indefinitely.  
(7)	Having considered the evidence, the Tribunal may determine
(a)	That if fair procedures had been complied with, the employer has satisfied it - the onus being firmly on the employer - that on the balance of probabilities the dismissal would have occurred when it did in any event.  The dismissal is then fair by virtue of s.98A(2).
(b)	That there was a chance of dismissal but less than 50%, in which case compensation should be reduced accordingly.
(c)	That employment would have continued but only for a limited fixed period.  The evidence demonstrating that may be wholly unrelated to the circumstances relating to the dismissal itself, as in the O’Donoghue case. 
(d)	Employment would have continued indefinitely.
	However, this last finding should be reached only where the evidence that it might have been terminated earlier is so scant that it can effectively be ignored.”

92.	Here, the Employment Tribunal only briefly referred to s. 98A(2) both in its self‑direction and in its conclusions at paragraph 97.

93.	We recognize of course that the Employment Tribunal is not bound to refer to all the evidence before it or to all the submissions provided it provides adequate explanations for its decision. 

Conclusions

94.	Before we examine the grounds of appeal it is important to bear in mind the approach to allegations of the kind made by the Respondent in these proceedings. In many respects, as Mr Harminder Singh pointed out during the submissions, it is necessary for an employer to examine the facts before it as an employment tribunal would when considering an allegation of discrimination.  It is necessary to look at all the relevant factual material as a whole and in its context. The accumulation of evidence when viewed as a whole may well suggest that acts or omissions which are capable of having an innocent intention, may take on a different complexion and point to discriminatory conduct.  There is a limit to how many occasions an act or omission may be justified by coincidence or happenstance rather than the result of ‘enemy action’ (as put by the late Ian Fleming in ‘Diamonds are Forever’).  We consider that it may fairly be said that the Employment Tribunal in this case has focused on the various matters alleged by the Respondent individually and in isolation from the wider picture.  Although it recognized (see paragraph 69) that the surrounding circumstances would have given the Respondent cause for concern and enquiry, it failed to set the various allegations in the context of there being a large number of straws in the wind so as to speak.  For example, where there was evidence that the Claimant had treated Mr. Murphy in a generous way, such as by paying consultancy fees in advance, agreeing to pay his accommodation costs at the hospital and expenses in connection with attending the course at Capsticks, Ms Rodney was entitled to question the veracity of, for example, the ‘innocent’ explanations for the Claimant’s decisions to omit the requirement that the holder of the Risk Manager’s post should have a post graduate qualification or be externally advertised, and whether she ‘inadvertently’ failed to notice the misrepresentation in Mr. Murphy’s cv and application form.

95.	We are also bound to say that we find the failure to refer to the Respondent’s final written submissions at all or to many of the points on the evidence made by Respondent therein to be surprising but do not base our decision on this.

96.	This is one of those cases in which the Employment Tribunal may well have fallen into the trap referred to by Mummery LJ in London Ambulance NHS Trust v Small [2009] IRLR 563 at paragraph 43.

Findings in relation to payment for the Capsticks’ course

97.	It is instructive to examine firstly the treatment by the Employment Tribunal of Ms Rodney’s findings in relation to payment for the Capsticks’ course. The Employment Tribunal it will be recalled at paragraph 72 found that there was no evidence to disprove the assertion that it had always been understood by the Claimant and Mr Murphy that he was to pay for the Capsticks’ course. There was a great deal of evidence before Ms Rodney; we do not need to refer to it all but it is reasonable to argue from this evidence (most of it referred to in the Respondent’s written submissions) that the correct inference from the facts was that Mr Murphy never intended to pay for the Capsticks’ course and that the Claimant intended that payment should be made by the Respondent.  We do not set out all the matters upon which the Respondent sought to rely but note the following:

a.	Mr. Murphy has never repaid the Respondent, although he clearly knew that the Claimant was being disciplined in part because of this payment.  Accordingly it is possible to infer that he never intended to pay in the expectation that the Claimant would support his not having to do so.  No explanation has been given as to why he never paid the fees at the time or subsequently. 
b.	Mr Murphy had a modest income and at the time was paying for his accommodation at the hospital; see paragraph 3(e) of the Respondent’s written submissions and not referred to by the Employment Tribunal (although this was set out inthe Respondent’s written submissions).
c.	Mr Murphy lacked integrity, for example by falsely representing that the Capsticks’ course was a post graduate course.
d.	The Claimant’s explanation for paying the chasing invoice could be said to have lacked credibility.  If she had already told Capsticks to invoice Mr Murphy it could fairly be said that she would have telephoned and repeated her direction to invoice Mr Murphy rather than authorise payment.  Why, it may be asked should she pay an invoice when she claimed she had already refused to do so?
e.	The authorisation to pay the invoice at p.218 of the bundle was issued before the chasing invoice arrived; it also referred to the code for payments to consultants; her explanation was that she must have misstated the date and was in error about the codes.  It was reasonable to question why she did not simply leave out reference to the code or enquire of the Finance Department.  There is no reference in the requisitions for payment to the fact that Mr Murphy is required to reimburse the Respondent. 
f.	When initially asked by Ms Pullen who paid for the Capsticks’ course on 27 June 2007 (p.182) the Claimant said that Mr Murphy was self-funding but made no reference to having authorised payment of the fees and that Mr Murphy was required to reimburse them, or that she had written to Ms Watts.  
g.	When Ms Pullen spoke to Ms Macartney in June 2007 about Capsticks’ course Ms Macartney never told Ms Pullen that she had been told to address the invoice to Mr Murphy and it was improbable that she would have forgotten had this been the case.  The Employment Tribunal at paragraph 89 suggested that Mr. Rowlands accepted that there was no reason to disbelieve the Claimant who said she had spoken to Ms Macartney; that is really placing a gloss on what he said when cross examined that there was no direct evidence to contradict her, which is not the same as saying there was no reason to disbelieve her, as he clearly did. We do not however, decide the appeal on this point of evidence.

98.	These matters are all matters that might point towards the fact that Ms Rodney had ample material to justify her conclusion.  It is impossible to say, in our opinion, that having regard to the accumulation of all this material that there was no evidence to disprove the assertion that it was always understood by the Claimant and Mr Murphy that he was to pay for the Capsticks’ course.  We of course recognise that there was evidence to the contrary from the Claimant, but the Employment Tribunal has in our opinion carried out its own assessment of the evidence and rather than asking whether it was open to Ms Rodney to conclude as she did has impermissibly substituted its own views for her views. 

99.	We have so far not referred to the letter of 31 October but it was also open to Ms Rodney to aggregate the evidence relating to this letter with the other matters; we recognise of course that it was never put to the Claimant in terms that this document was a forgery. This obviously impacts on the fairness of the procedure.  Nevertheless it was a matter Ms Rodney did have regard to for the following reasons:
(i)	when the Claimant authorised payment of the invoice she did not telephone or email Ms Watt as was her usual practice; she claims to have written by internal mail, something she may have been unlikely to do if she was under pressure of work and busy and had never done before or since.
(ii)	The reference in the letter to Mr Murphy as the Trust Risk Manager, a post he did not hold for a further two months and for which he had not even been interviewed, [at the time he was Risk Management Project Officer] itself suggests that the letter may not have been created on the date it bore. 
(iii)	There was no copy of the letter in Mr Murphy’s personnel file or in the Finance Department although this was kept in the Claimant’s office.
(iv)	At no time had the Claimant ever referred to this letter during the investigation.
(v)	No copy of the letter was ever found by the Claimant during the discovery process, nor was it ever suggested that the Respondent’s disclosure was defective in this regard.

100.	For the Claimant’s explanations to be accepted there would have to have been a series of what might be said to have been a series of  explanations or events which when taken together may appear improbable; 
i.	Capsticks despite being told not to invoice the Respondent and invoice Mr Murphy had ignored this instruction without explanation or apology;
ii.	The Claimant was simply in error as to the codes in describing the payment as being for consultancy rather than training;
iii.	The Claimant was in error as to the date she inserted in the requisition;
iv.	In addition if one has regard to the letter of 31 October 2006:
(1)	 the Claimant was in error in describing Mr Murphy as the Trust Risk Manager; 
(2)	the copy of the letter to Ms Watt got lost.
(3)	the copy of the letter in Mr Murphy’s personnel file had similarly been lost

101.	In the circumstances this finding of the Employment Tribunal cannot stand.

Reasonable investigation and facts available to prove gross misconduct

102.	We need to consider whether the Employment Tribunal was justified in finding that there had not been a reasonable investigation in that Ms Rodney did not have sufficient information on which to conclude that the Claimant had committed an act of gross misconduct.  We also need to consider on the other hand whether the Employment Tribunal substituted its own standards of what was a reasonable investigation for the standard that might reasonably be expected of the reasonable employer and also whether it made its own findings on the evidence rather than ask whether Ms Rodney’s findings were within the reasonable band. 

103.	It does seem to us that in so far as the investigation was concerned the Employment Tribunal has isolated one matter only, the absence of an electronic trawl and has not looked at the investigation as a whole.  We of course accept the proposition to be found in A v B [2003] IRLR 405 that the investigator who carries out enquiries into serious misconduct should focus no less on any potential evidence that might exculpate or at least point towards the innocence of the employee as on the evidence directed towards proving the charges and of the need to look at the process overall.

104.	It is clear in the present case so far as the investigations were concerned, that there were two investigations.  Firstly, Mr Griffiths produced a 6-page report with 19 appendices and interviewed seven witnesses including the Claimant.  Ms Pullen interviewed nine witnesses.  Her report ran to 47 pages with 35 appendices.  There has been no suggestion that other persons should have been interviewed or that the notes of Mr Griffiths and Ms Pullen were inaccurate save that the Claimant did criticise the accuracy of the notes of her interview with Ms Pullen although she had herself checked and amended them.  The Employment Tribunal criticised the Executive Summary prepared by Ms Pullen but made no adverse findings in relation to the accuracy of her notes.  Any errors in the Executive Summary would not in our opinion affect the relevance or accuracy of the notes of interview.  

105.	It is clear that the letter of 31 October 2006 came to Ms Rodney’s attention very late.  Even accepting the Respondent’s duty to seek exculpatory as well as incriminating evidence it is highly material that neither the Claimant nor her experienced trade union representative asked for a trawl and the absence of an electronic trawl was not one of her 18 grounds of appeal from her dismissal.  The absence of an electronic trawl did not appear in the Claimant’s 31-page witness statement nor in any other witness statement filed on her behalf.  The issue was first raised in cross-examination of the Respondent’s witnesses and the absence of the electronic trawl seems to have taken on a very much higher profile now than it had during the course of the hearing.  The Claimant maintained that she did not ask for a trawl as she did not know the authenticity of the document was challenged.

106.	We accept the submission that the Employment Tribunal appears to have failed to recognise that the provenance of the letter in any event was not determinative of the critical issue, i.e. whether the Claimant intended Mr Murphy to pay the fees.  The letter, clearly, would have provided some support for the Claimant if it could have been shown to have been put on the Respondent’s system on the date it purported to bear.  There must, however, be very real doubt on all the evidence that it was.

a.	The fact the letter might have been found on the system would not show that it was sent and would not be determinative of the principal issue, whether the Claimant intended that Mr Murphy would pay the fees.

b.	The letter ascribed a job title to Mr Murphy which he did not have until two months after the date of the letter.  This clearly pointed to its having being produced after 31 October.

c.	It was unusual that the letter had not been emailed to Ms Watts and, as we noted earlier in this judgment, no copy of the letter could be found in Mr Murphy‘s personnel file nor in Ms Watts’ file.

d.	It is surprising the letter had never previously been referred to by the Claimant although her evidence was that she knew of the letter’s existence.  The Claimant first referred to the letter at the disciplinary hearing.  We were told by Mr Tatton-Brown that in evidence the Claimant had said she always knew there was a copy of the letter in her desk but we are unable to rely upon this assertion in the absence of being shown some evidence of what the Claimant said.

107.	This material would entitle Ms Rodney to have concluded that whether the letter was dated 31 October 2006 or not it was never sent.  The Employment Tribunal did not ignore this possibility but discounted it.

108.	So far as Ms Rodney was concerned the letter had appeared out of the blue on day 1 of the hearing, a hearing that had already been adjourned twice.  Enquiries were made of recipients of the letter who denied any knowledge of it.  A search was made for a hard copy in the Finance Department and Mr Murphy’s file and none could be found.

109.	In these circumstances the Employment Tribunal has, in our opinion, failed to examine or take account of all the evidence relating to the adequacy of the enquiry and its findings that the enquiry was outside the bands of reasonableness cannot, in those circumstances, stand.

110.	So far as the finding that Ms Rodney did not have sufficient information on which to conclude that the Claimant had committed an act of gross misconduct, this finding also cannot stand.  We have earlier in this judgment found that the decision of the Employment Tribunal that there was no evidence to disprove the assertion that it had always been understood by the Claimant and Mr Murphy that he was to pay for the Capsticks’ course was flawed.  Later in this judgment we shall explain why in our opinion the Employment Tribunal has ignored other evidence that Ms Rodney could properly rely upon as showing that the Claimant had committed gross misconduct, especially when all the evidence was aggregated together.

111.	The Employment Tribunal criticised the Respondent for not making shorthand notes of the disciplinary hearing available to the Claimant.  The Claimant, however, never asserted that this in any way caused her prejudice and of course she had her own notes.

The finding that in the absence of dishonesty Ms Rodney could not reasonably conclude the Claimant had deliberately scored Mr Murphy higher than Ms Errington

112.	We need to consider the Employment Tribunal’s findings at paragraphs 56 and 57.  We are concerned that the Employment Tribunal again did not consider the aggregation of the evidence relating to shortlisting and scoring together with the other evidence showing possible favouritism towards Mr Murphy.  Further, we do not consider that it was necessary for there to be a finding by Ms Rodney of dishonesty.  Deliberate manipulation would be sufficient if this were designed to give an advantage to Mr Murphy.

113.	There is no reference by the Employment Tribunal to the striking omission highlighted in the Respondent’s written submissions to the Employment Tribunal about the Claimant’s marking of Mr Murphy‘s qualifications.  The Claimant gave him a “2” on paper whereas Ms Errington who was far better qualified, at least on paper, received a “1” only.  It is apparent from pages 202-205 that Mr Murphy had no professional qualification, he was not a graduate, he had no ‘A’ levels although he had 9 ‘O’ levels and a HND in Management Studies and a NVQ in landfill site management.  His experience was mainly in the field of leather.  On the other hand, Ms Errington was a law graduate from University College London with a 2:1 honours degree, a post graduate diploma in HR management together with professional qualifications including a diploma in midwifery, and she was studying for a post graduate diploma in risk management.  We find it impossible to see how the Claimant could properly have allocated the marks she did for education and qualifications to Mr Murphy and Ms Errington.  The “1” given to Ms Errington showed that the requirements were partially met and the “2” to Mr Murphy that they had been fully met.  Mr Tatton-Brown submitted that this allocation on the basis of the alleged bona fide exercise of a subjective opinion alone provided a clear basis upon which Ms Rodney might conclude that the Claimant had deliberately scored Mr Murphy higher than the other candidate.  It is surprising that this striking piece of evidence was apparently ignored by the Employment Tribunal although it formed part of the Respondent’s written submissions.

114.	Ms Rodney was, in our opinion, also entitled to have regard to the fact that on the basis of the scores allotted to Ms Errington she should not have been on the shortlist at all because she failed on at least three essential criteria.  The fact that she was not excluded favoured Mr Murphy because the job was not re-advertised and he was pitted against a single candidate, who, on the basis of a shortlisting score he could expect to beat.  

115.	Further, the Claimant knew that Mr Murphy did not have a post graduate qualification and was not working towards one whereas Mr Benson would have no means of knowing that the course Mr Murphy was undertaking was not a post graduate qualification.  The Claimant certainly did not tell Mr Benson of this.  Mr Benson was clearly misled and we do not need to use the more pejorative term “duped” used by the Employment Tribunal.

116.	In the circumstances Ms Rodney was reasonably entitled to doubt the Claimant’s statement that she had overlooked the error and the Employment Tribunal should have concluded that this was evidence of the Claimant manipulating the shortlisting process when she was specifically required to consider the applicant’s qualifications.  The Employment Tribunal appears to have substituted its views as to the effect of the evidence for those of Ms Rodney when it cannot be properly be said that there was no evidence to support her findings of manipulation.

The findings of the Employment Tribunal at paragraphs 60 and 78 as to Ms Rodney’s findings as to manipulation of the interviews and advertising in favour of Mr Murphy 

117.	It will be recalled the Employment Tribunal rejected Ms Rodney’s finding that the interview questions had been manipulated so as to favour Mr Murphy because this was based on the opinion of Ms Pullen.  The question was, however, one of manipulation in any event and there was evidence not referred to by the Employment Tribunal which suggested that although the Claimant had taken it upon herself to deal with issues of clinical risk where Mr Murphy had the most limited experience the questions put were not demanding.  Ms Rodney was an experienced Chief Executive and her opinions were entitled to be given weight and she might reasonably have concluded that there was an element of soft pedalling by the Claimant.  

118.	This is another example where, in our opinion, the Employment Tribunal has ignored the aggregation of the evidence and has substituted its views on the evidence for those of Ms Rodney and not considered whether her findings were findings to which she might reasonably have come to.

119.	We are not able to accept the submission that Ms Rodney had in effect to find that the Claimant was dishonest.  The authority relied upon by the Claimant of Wilson v Racher [1974] IRLR 114 is authority for the proposition that a repudiatory breach of contract on the part of an employee requires, as put by Cairns LJ at page 170, “deliberate flouting of the essential contractual conditions”.  In our opinion the deliberate manipulation of the selection process is capable of amounting to such misconduct.

The Employment Tribunal’s criticism of Ms Rodney’s findings that the Claimant had deliberately limited the advertising of the post to avoid wider competition

120.	We refer to the criticism at paragraph 76 of the decision.  It is a fact that the Claimant had initially proposed that the post of Trust Risk Manager be advertised externally and that the Claimant subsequently changed her mind.  One asks forensically why when considering this in the light of other evidence capable of supporting the view that Mr Murphy had received preferential treatment Ms Rodney could not come to the conclusion.  This again appears to be a case where the Employment Tribunal had substituted its views of the facts for those of Ms Rodney rather than deciding whether there were reasonable grounds for Ms Rodney’s opinion.

The findings by the Employment Tribunal that the Respondent had failed to carry out a reasonable investigation and that there were insufficient facts to support the conclusion that the Claimant had committed an act of gross misconduct

121.	We refer to paragraphs 68 and 83 of the Decision of the Employment Tribunal.  It is apparent from previous passages in this judgment that our opinion is that the Employment Tribunal has wrongly discounted the facts available to Ms Rodney upon which she might reasonably rely and on the overall fairness of the investigation.

122.	We are unable to say whether the decision in this regard was perverse but it is certainly flawed because of the extent to which the Employment Tribunal has wrongly discounted evidence and substituted its views for those of Ms Rodney.  The decision will require reconsideration.

123.	We need to say something about the question of banding.  The Employment Tribunal at paragraph 74 said this was outside the scope of the charges.  On the other hand it is clearly relevant to the salary level for the post.  The Employment Tribunal appear to have accepted that there was evidence available to Ms Rodney from which she could conclude that the Claimant had, contrary to her own case, confirmed that the post was to be banded on the basis it would be available to applicants only with a graduate qualification.  There also appears to be some force in Mr Tatton-Brown’s point that the effect of this finding was damaging to the Claimant’s overall credibility.

Overall Fairness

124.	We have already explained why in our opinion the Employment Tribunal has discounted the Respondent’s case as to the reasonableness of the investigation.

125.	It is convenient at this point in time to deal with the submission concerning the affect of the Respondent’s breach of procedures in permitting Ms Rodney to conduct a disciplinary hearing.  The Employment Tribunal, in our opinion, should have asked in relation to this breach of procedures whether the appointment of Ms Rodney as dismissing officer had the effect of denying the Claimant the opportunity to show that the reason relied on for her dismissal was not a sufficient reason; see Westminster County Council v Cabaj [1996] IRLR 399.  The Employment Tribunal did not do so.  

126.	In so far as the appeal is concerned, we note the Employment Tribunal were critical of the fact that the Respondent sought to limit the appeal to a day and that this somehow suggested that the result was pre-determined.  We were told that this point was never made to Mr Rowlands.  If the fact that a court or tribunal tries to fit a case into the shortest available time were suggestive of bias, we would observe that employment tribunals and courts up and down the land would be at risk.

127.	Again when one looks at the evidence discounted by the Employment Tribunal, and its criticisms of the investigation, this may also be a case where the Employment Tribunal has substituted its views for those of the Respondent.  We recognise, however, that certainly so far as the appeal was concerned, there was a significant defect in that the appeal panel relied on its belief that the letter of 31 October 2006 was a forgery without offering the Claimant the opportunity of dealing with that allegation.  We are simply unable to say what view an employment tribunal that properly directed itself as to the question of overall fairness would have found.

Section 98A(2) of the Employment Rights Act 1996

128.	The Employment Tribunal’s approach at paragraph 97 was extremely brief and there is substance in the complaint that it is so brief as not to explain adequately why the Respondent’s case was rejected.  The essential question as it seems to us that the Employment Tribunal needed to ask itself would have been what difference the defects in the investigation would have had and whether if those defects had been overcome by a fair process the Respondent would nevertheless have on the balance of probabilities decided to dismiss the Claimant.  If one takes the various criticisms such as the provision of notes, the fact that Ms Rodney was the dismissing officer and the absence of an electronic trawl, they may or may not be shown to have had a significant effect upon the Respondent’s decision to dismiss.  We recognise that the burden of establishing a case under s. 98A(2) rests squarely with the Respondent.  We can see the force in the argument that it is inappropriate to try and recreate a perfect world.  However, as the passage from the judgment of Elias J in Software 2000 Ltd v Andrews [2007] IRLR 568 makes clear the Employment Tribunal must grapple with the difficulties and try and make appropriate findings.  In this case the Employment Tribunal’s reasoning is quite inadequate.  It has concentrated on the effect of procedural flaws rather than assessing the Respondent’s approach to the evidence before it.  Had the Employment Tribunal asked what difference a fair procedure would have made and not substituted its views or wrongly discounted the evidence available to Ms Rodney it may well have come to the conclusion on the balance of probabilities that a dismissal for gross misconduct would have been the same and was merited.  An electronic trawl may well have demonstrated beyond all doubt that the letter of 31 October 2006 was never sent either on that date or at all.  The Employment Tribunal should not have concentrated on the flaws in the Respondent’s procedure, but asked itself what would the Respondent have done had there been a fair procedure.  In the earlier part of this judgment we explained why we considered the Employment Tribunal was wrong to find that there was no evidence supporting the finding of gross misconduct.

129.	The Employment Tribunal needed to evaluate that evidence which was capable of supporting the case that the Claimant as a senior executive had displayed improper favour to Mr Murphy by manipulating the selection process, paying for the course and trying to cover up by creating the letter of 31 October.  The Employment Tribunal might only disregard the evidence put forward by the Respondent if it were so unreliable that the Tribunal may take the view that the whole exercise of seeking to reconstruct what might have been was so riddled with uncertainty that no sensible prediction based on that evidence could properly be made. 

Conclusions on looking at the matter overall

130.	It is clear that in our opinion there have been a number of instances where the Employment Tribunal has 

a	substituted its views for those of the Respondent;

b	has failed to consider, take account of or weigh appropriately the relevant evidence.  In this regard we repeat our concerns of the absence of any reference for the Respondent’s submissions.

c.	failed to give adequate consideration to the effect of s. 98A(2) of the Employment Rights Act.

131.	We are unable to say that the findings as a whole are perverse.  We accept that there were substantial defects in the appeal process.  We cannot say that a proper approach by the Employment Tribunal would have been bound to lead to a finding that the dismissal was fair having regard to the provisions of s. 98A(2) or whether it would have rejected that case.

132.	It seems to us, therefore, that the matter must be reheard.

133.	We have given careful consideration as to whether this matter can be properly submitted for hearing before the same Employment Tribunal but our concerns are sufficiently wide‑reaching to justify a rehearing before a separately constituted tribunal.

134.	The question whether the Employment Tribunal should read the decision we have set aside is for the Tribunal to decide.  The parties will of course be able to make submissions in this regard.