Appeal No. UKEATS/0002/12/BI

EMPLOYMENT APPEAL TRIBUNAL
52 MELVILLE STREET, EDINBURGH, EH3 7HF

	At the Tribunal
	On 12 June 2012

Before
THE HONOURABLE LADY SMITH
MR M SIBBALD
MR P M HUNTER

MR THOMAS McCAFFERTY	APPELLANT

ROYAL MAIL GROUP LTD	RESPONDENT

JUDGMENT

	APPEARANCES

For the Appellant	MR R MacKINNON
(Solicitor)
P O Box 5059
Alexandria
G83 3AL	
For the Respondent	MS L CARTWRIGHT
(Solicitor)
Morton Fraser LLP
145 St Vincent Street
Glasgow
G2 5JF	

SUMMARY
UNFAIR DISMISSAL – Reasonableness of dismissal

Unfair dismissal.  Gross misconduct.  Members’ majority found dismissal to have been fair.  Appeal dismissed: the majority were entitled, on the evidence, to conclude as they did.  The conclusions of the Employment Judge were, conversely, contrary in some respects to the findings in fact and amounted to substitution.  Observations on the role of the lay members in an unfair dismissal claim.

THE HONOURABLE LADY SMITH 
Introduction
1.	Mr McCafferty was employed as a postman by Royal Mail Group until 18 December 2010 when he was dismissed for gross misconduct.  His claim for unfair dismissal was dismissed by an Employment Tribunal chaired by Employment Judge Lucy Wiseman.  Their judgment and reasons were registered on 22 November 2011.  The decision was by a majority consisting of the lay members.  The Employment Judge concluded that the dismissal was unfair.

2.	We will, for convenience, continue to refer to parties as Claimant and Respondent.

3.	The Claimant was represented by Mr R MacKinnon, solicitor, before the Tribunal and before us.  The Respondents were represented by Ms K Brown, solicitor, before the Tribunal and by Ms L Cartwright, solicitor, before us.

Background
4.	The Claimant worked at a depot in the west end of Glasgow.  He lived in Dumbarton.  For many years, he was able to get a lift to work from Royal Mail vans passing by.  That was an informal arrangement.

5.	One day in September 2009, the Claimant was asked by the Assistant Delivery Manager, Mr Mead, to go into work on his day off.  He refused because, it being the van driver’s day off, he could not get a lift to work.  Mr Mead told the Claimant to get a taxi and provided him with the details of a taxi firm, the Respondent’s account number and their PIN code.

6.	There were 4 or 5 other occasions between September 2009 and December 2010 when Mr Mead asked the Claimant to work on his day off.  On each such occasion, the Claimant asked him if he could use a taxi to travel to work that day and Mr Mead provided him with the details of the taxi account for that purpose.  Plainly, Mr Mead was not aware that the Claimant had retained those details and used them to take taxis to work on normal working days.

7.	The Claimant began to experience difficulties in getting a lift to work – once the tolls were removed from the Erskine Bridge, vans found it faster to use that route rather than the one that was convenient for the Claimant.  He would go out to wait for a van to pass in the morning and if one did not do so, he would return home and call a taxi, giving his name and address but using the Respondent’s account to do so.  He took taxis on 87 occasions between September 2009 and October 2010, at a total cost to the respondents of £2422.80.  Latterly, he was using a taxi almost every day.  The taxis delivered him to the depot and Mr Paton, Delivery Manager, often saw him arriving at work in a taxi.  On occasion, he commented on it.  He did not, however, know that the Claimant was charging those taxis to the Respondent’s account.

8.	The Tribunal found that the Claimant thought that Mr Paton knew he was charging the taxis to the Respondent’s account.  They do not, however, make any findings in fact to the effect that Mr Paton said or did anything to indicate to the Claimant that he realised that he was charging these taxis to the Respondents.

9.	The Glasgow taxi account was reviewed by the Respondent’s finance department in October 2010 and they raised concerns about a number of the charges to it, including those incurred by the Claimant.  The taxi account was closed at the end of October 2010.

10.	The Claimant tried to order a taxi on 1 November 2010 and was told that the account was closed.  He made no mention of the matter at work and in the two days after closure of the taxi account, the Claimant travelled to work by public transport.  He was late as his shifts started early in the morning and he could not get to the west end of Glasgow from Dumbarton, by public transport, in time.  He apologised to Mr Paton for being late, explaining that there had been no van and he had had to get public transport; he did not mention the unavailability of taxis, he did not offer the closure of the taxi account as a reason for his difficulties in getting to work nor did he question its closure.

11.	On 4 November, the Claimant was asked to attend an interview at which he was cautioned and informed that theft was being investigated.  He was asked about the taxi account and admitted that he had been using a taxi to get to work.  He explained that he had been advised about the taxi account by Paul Mead when he was asked to work his day off and no delivery van was available; after that, if he experienced difficulties with his lift or for his own convenience, he would order a taxi.  On being told that he should not have been using taxis he offered to repay the costs involved.  He was suspended.

12.	By letter dated 8 November, the Claimant was invited to a disciplinary hearing.  The letter informed him that it was alleged that he had committed misconduct consisting of:

“…theft, in that you knowingly, without authorisation, used the Royal Mail taxi account for your own personal purposes.”

13.	The disciplinary hearing took place on 12 November before Mr Terry Gibb, Delivery Sector Manager.  The Claimant stated that he did not believe he was doing anything wrong.  He also pointed to having supplied his name and address to the taxi firm.  Mr Gibb questioned whether the Claimant could have believed that he was not doing anything wrong.  He repeatedly asked the Claimant why, if he did not think he was doing anything wrong, he stated to his manager – on more than one occasion – that his mode of transport to work was by Royal Mail van, without reference to taxis.  He was asked, in particular, why, when late, including after the end of October 2010, he had made no mention of the use of taxis – he only ever referred to a van not appearing.  His was unable to answer these questions.  He said he did not know why he had not mentioned his use of taxis.  At one point he said he probably should have mentioned it to his manager.

14.	The charge in respect of which the Claimant had been called to the disciplinary hearing was found to have been established: he had, knowingly, without authorisation, used the Respondent’s taxi account for his own personal purposes.

15.	Mr Gibb decided to dismiss the Claimant.  In reaching that decision, he took account of the fact that he did not believe the Claimant when he said that he did not think he was doing anything wrong.  He concluded that he knew what he was doing was wrong and also that he had tried to conceal the fact that he was charging these taxi journeys to the Respondents.  He had two reasons for that.  First, the Claimant had told his manager that he travelled to work in a van.  Second, the Claimant had made no mention of taxis to Mr Paton when explaining the reason for his lateness after the taxi account was closed.

16.	The Claimant appealed and his appeal was heard on 25 January 2011 by Mr Cassidy, Appeals Casework Manager.  The Claimant continued to insist that he did not know that he was doing anything wrong.  Mr Cassidy upheld the decision to dismiss.  He had three reasons for doing so.  First, he concluded that the Claimant knew he had no authority to use the taxi account (other than those days when Mr Mead had specifically authorised it).  Secondly, the Claimant had asked Mr Mead if he could use the taxi account when he was asked to work on his day off – if he was doing nothing wrong, why seek authority after the first occasion?  Thirdly, the Claimant had tried to conceal his use of the taxi account as evidenced by the fact that he made no mention of it when explaining to Mr Paton why he had been late after the account was closed.

17.	The Claimant had a clean disciplinary record and had been employed by the Respondents for nineteen years.  Both Mr Gibb and Mr Cassidy took account of those factors.  They considered, however, that the job for which he was employed demanded absolute trust and integrity and that his integrity had been compromised to such an extent that they had lost trust and confidence in him.  Nineteen years service was not be of sufficient mitigation to outweigh the seriousness of his actions.

The Tribunal’s Reasons
18.	The Employment Judge and members all concluded that, overall, there had been a reasonable investigation and that the Respondents had been entitled to conclude that the Claimant had no authority to use the taxi account other than the occasions when he was asked to work on his day off and that he knew that that was the limit of his authority.  Beyond that, they parted company.

19.	The majority considered that Mr Gibb had reasonable grounds for also concluding that the Claimant had tried to secrete his use of the taxi account.  Their reasoning is recorded at paragraphs 114 and 115:

“114...The members considered that the claimant would, as a matter of common sense, know that it was not common practice for an employer to pay for its employees to travel to work.  The claimant had not ever sought permission to use the taxi to travel to work when the van did not show up to give him a lift, and he had not ever mentioned to his manager that he was using the Royal Mail taxi account.  The claimant had had an opportunity, when the taxi account closed, to explain to Mr Paton that he could no longer use the account, but he had not done so.  
115. The members of the Tribunal were satisfied Mr Gibb had reasonable grounds upon which to conclude the claimant had tried to secrete his use of the taxi account from his managers.  The members of the Tribunal were satisfied Mr Gibb had reasonable grounds upon which to sustain his belief that the claimant had knowingly and without authorisation used the Royal Mail taxi account for his own purposes.”

20.	The Employment Judge, on the other hand, considered that Mr Gibb did not have reasonable grounds for his belief that the Claimant had sought to secrete his use of the taxi account.  She does not appear to have taken issue, however, with the members’ conclusion that he had reasonable grounds for his belief that the Claimant had knowingly and without authorisation, used the account for his own purposes.  She considered, however, that since the Claimant openly arrived at work in a taxi on the occasions that he used one and had been seen doing so by Mr Paton, it could not be said that he had misled his manager.  She stated that there was no evidence that the Claimant had blamed the fact that a van had not turned up when he had taken a taxi and that she did not consider that Mr Gibb had any basis for attaching weight to the Claimant not having mentioned the lack of taxis when the account had been stopped given that he was late on those mornings because the van had not turned up.  She also referred to the Claimant having given his name and address to the taxi company when ordering taxis.

21.	Turning to the reasonableness of the decision to dismiss, the members were satisfied that dismissal was within the band of reasonable responses.  At paragraph 119, their reasoning is recorded:

“119…This decision recognised that not all employers might have dismissed, but in circumstances where the respondent believed the claimant guilty of the misconduct alleged, and where this had caused a breakdown of trust and integrity required in the employment relationship, dismissal fell within the band of reasonable responses.  The dismissal was fair.”

22.	The Employment Judge considered that the dismissal was unfair.  She acknowledged that the Claimant’s actions could be defined as theft and gross misconduct but that his long service, clean disciplinary record and the option of a lesser sanction required to be put in the balance and outweighed the other factors.  She also considered that the conclusions of Mr Gibb and Mr Cassidy regarding loss of trust and confidence were based more on their belief that he had tried to hide his use of the taxi account, a belief which she, for the above reasons, did not consider that they were entitled to hold.

The Appeal
23.	There were two grounds of appeal: (a) the conclusion of the majority that the Claimant had secreted his use of the Respondent’s taxi account was one which was not open to them – there was no evidence on which that conclusion could have been based; and (b) the conclusion of the majority that dismissal was within the range of reasonable responses was perverse – there was no basis for concluding that the Claimant had secreted his use of the taxi account and the Employment Judge’s reasons for finding the dismissal to have been fair were adopted.

24.	Mr MacKinnon submitted that not only was there no evidence to entitle the majority to conclude that the Claimant had secreted his use of the taxi account, there was evidence to the contrary, namely that he had given his address and name to the taxi firm on each occasion.  He made no attempt, he said, to hide what he was doing.  He referred to the stance adopted by the Claimant at the disciplinary and appeal hearings – he did not think he was doing anything wrong.

25.	Mr MacKinnon submitted that the Employment Judge’s position was correct in law.  When asked to explain what he saw as the difference in legal approach as between her and the majority, he said he did not believe that she had differed in a legal respect.  She had come to the view that there was no reasonable evidence regarding the Claimant hiding his use of the taxi account.  That was because there was no evidence of any attempt to hide the fact.

26.	Mr MacKinnon returned on a number of occasions to the fact that the Claimant had given his name and address to the taxi firm.  That, in essence, seemed to be the high point of his submissions; given that fact, the Tribunal could not, according to his submission, find that he had tried to hide what he was doing from management.

27.	It followed, on his argument, that dismissal was not within the range of reasonable responses.  There should be a remit to the Employment Tribunal to determine remedy.

28.	For the Respondents, Ms Cartwright invited us to dismiss the appeal.  Neither ground was well founded.  The first ground was, in truth, an appeal on fact not law.  There was evidence on which the majority were entitled to conclude that the Respondent had reasonable grounds for believing that the Claimant had sought to hide his use of the taxi account.  She referred in particular to paragraphs 18, 19, 32, 35, 36 and 44 of the Tribunal’s written reasons.  There was ample evidence that the Claimant had omitted to mention his use of the taxis when he could reasonably have been expected to do so.  That entitled the inference of dishonesty to be drawn – in such circumstances, it was often the case that it was omissions which were most telling.  The Claimant was given ample opportunity to explain his failure to mention to management his use of taxis and the taxi account, at the disciplinary and appeal hearings but had failed to do so.  Mr Gibb and Mr Cassidy had acted fairly and obviously carried out a balancing exercise which included having regard to his reliance on the fact that he had given his name and address when ordering the taxis.

29.	The second ground of appeal was based on perversity but nothing of that nature had been demonstrated.  Dismissal was plainly within the range of reasonable responses – Mr MacKinnon had appeared to accept that if there was in fact evidence that the Claimant was trying to hide his use of the taxi account then dismissal was within the range of reasonable responses.  The ground was, accordingly, in fact, limited and its success was dependent on success on the first ground.

30.	In the course of her submissions in relation to the first ground of appeal, Ms Cartwright referred to Foley v Post Office [2000] ICR 1283 at p.1296, for Mummery LJ’s warning to Employment Tribunals not to substitute themselves and conduct a rehearing but to decide whether the investigation was reasonable and whether or not dismissal was, in the light of that investigation, a reasonable response; the majority had heeded that warning and carried out the correct exercise.  She also referred to the well known passage in the judgment of Arnold J in British Home Stores v Burchell [1980] ICR 303 at p.37, to Iceland Frozen Foods Ltd v Jones [1983] ICR 17 at p. 24-5.

31.	Regarding the second ground of appeal, Ms Cartwright referred to Stewart v Cleveland Guest (Engineering) Ltd [1996] ICR 535 for Mummery J’s (as he then was) summary of epithets demonstrative of the rare and exceptional circumstances in which the judgment of an employment Tribunal will be susceptible to interference on perversity grounds.  She also referred to Yeboah v Crofton [2003] EWCA Civ 794 and Piggott Bros Ltd v Jackson [1992] ICR 85. Beedell v West Ferry Printers [2000] ICR 1263 was referred to as were British Leyland (UK) Ltd v B J Swift [1981 WL 187872 and Asda Stores Ltd v Coughlan UKEAT/0453/10/DM as examples of cases in which the need for the employment Tribunal to avoid substitution was discussed.

Discussion and Decision
32.	We are satisfied that there was clearly evidence which entitled the majority to conclude that the Respondents had reasonable grounds for their belief not only that the Claimant had knowingly used their taxi account without authority but that he had tried to conceal from management the fact of his doing so.  That being so, both grounds of appeal must fail, the second being as dependent on overturning the majority’s conclusion on that matter as was the first.

33.	In the end of the day, the appeal really amounted to no more than saying that different inferences should have been drawn from the evidence; in particular, that it should have been inferred from the fact that the Claimant had given his name and address to the taxi firm that he, at no time, sought to mislead his managers.  Although Mr MacKinnon submitted that there was no evidence to allow the conclusion that the Claimant sought to hide what he was doing, his submission suffered from a fundamental difficulty in that it took no account of the Tribunal’s findings in fact regarding the factors relied on by Mr Gibb and Mr Cassidy.  We refer to those factors above – they were, briefly, that the Claimant only told his manager that he travelled to work in a van (when, on over 80 occasions in a period of about a year, he had travelled to work by taxi) and that he had said nothing about the closure of the taxi account when it happened, even when he was giving his manager an explanation for being late.

34.	Mr MacKinnon was wrong to suggest there was no evidence to support the conclusion of the majority – his point was, rather, that the Tribunal should have reached a different conclusion in the light of the evidence.  We readily accept that the findings in fact plainly entitled the majority to conclude as they did.  To use the language of Piggott Brothers Ltd, their conclusion was a permissible option.  That being so, as Ms Cartwright submitted, Mr MacKinnon’s attack on the majority decision was, in reality, an attempt, on appeal, to retry a question of fact, not law.  He did not, we would add, suggest that the majority had misunderstood or misapplied the relevant law in any respect.

35.	We have had regard to the Employment Judge’s conclusion that the Respondents were not entitled to conclude that the Claimant had tried to conceal the fact that he was using the Respondent’s taxi account but we do not consider her reasoning to be demonstrative of error of law on the part of the majority.  Rather, we would observe that whilst she is correct in stating that the Claimant was seen arriving at work by taxi, that fact of itself said nothing about where the taxi had come from or, moreover, about how the taxi fare was being funded.  We have difficulty, accordingly, in accepting that it was open to her to conclude that that showed that the Claimant was not seeking to conceal the key factor, namely that he was not paying for the taxis himself but was charging them to the Respondent.  We would also observe that in the second element of her reasoning, the Employment Judge appears to have overlooked that the Tribunal had found in fact (paragraph 13) that the habit that the Claimant developed was to go back home and phone for a taxi if no van appeared.  Since, on the findings, he was only late when there was no van, it follows that he had taken a taxi on those occasions yet his explanations for lateness were confined to the lack of a van.  Then, in the third element of her reasoning, again the Employment Judge appears to have overlooked that, on the Tribunal’s findings in fact, on the first morning after the account had been stopped, the Claimant had phoned for a taxi (paragraph 18) i.e. the findings indicate that his lateness that day was attributable to the lack of a taxi.  Regarding the Claimant giving his name and address to the taxi company, the Tribunal made no findings in fact as to his understanding of whether or not those details would be passed on to the Respondent by the taxi company or not but the Employment Judge has not had regard to that fact.  The concerns of Mr Gibb and Mr Cassidy were, as Ms Cartwright submitted, principally what the Claimant did not say or explain – omissions which could be seen as very telling in the circumstances - but the Employment Judge does not appear to have taken account of that.  Most significantly, however, is that it is clear from her reasoning that the difference between her and the majority was in how they assessed the facts of the case.  They were not at odds as to the applicable law.

36.	In the circumstances, we need say very little as regards the second ground of appeal.  There is no basis on which it could be said that the conclusion of the majority was perverse.  The inference to which Mr MacKinnon takes exception arose from evidence led and accepted by the Tribunal.  It does not attract any of the expressions of surprise such as those recorded in the case of Stewart.  We would only add that insofar as this ground of appeal adopted the reasoning of the Employment Judge on the issue of reasonableness of the decision to dismiss, it was not well founded.  It is not the case that dismissal cannot fall within the range of reasonable responses in the case of a long serving employee with an unblemished record – which is what, at paragraph 133, the Employment Judge appears to come close to saying.  That is particularly so in the case of a job which is demanding of the highest standards of integrity.  Further, the Respondent did take account of the Claimant’s long service and clean record as is evident from the notes of both the disciplinary and appeal hearings.  The conclusions of the Employment Judge on reasonableness are, we consider, clearly the result of her substituting her own views, despite her prefacing them with a self denying ordinance to refrain from doing so.

37.	We would make a final observation.  It will not have escaped notice that this case is an example of the lay members of an Employment Tribunal reaching a different conclusion on the facts of the case – drawing in part on their valuable “common sense” and knowledge of what any employee could be expected to know (see paragraph 114) – from that of the Employment Judge.  Had this claim been one to which the new Employment Tribunals Act 1996 (Tribunal Composition) Order 2012 SI 2012/988 applied, it seems likely that it would have been heard and determined by an Employment Judge sitting alone, in which case the result would evidently have been rather different.  Some may consider that to be a sobering thought.  It certainly seems supportive of the arguments advanced in response to and against the proposal last year that Employment Judges be able to sit alone in unfair dismissal cases (see: the 2011 Government consultation paper on reform of Employment Tribunals “Resolving Workplace Disputes").  It perhaps also underlines the need to give careful consideration to any views expressed by parties as to whether or not proceedings should in fact be heard by an Employment Judge and members (see: Employment Tribunals Act 1996 s. 4(5), the provisions of which currently remain in force).

Disposal
38.	We will, in the circumstances, pronounce an order dismissing the appeal.