Appeal No. UKEAT/0397/12/ZT

EMPLOYMENT APPEAL TRIBUNAL
FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8JX

			At the Tribunal
		On 30 January 2013

Before
HIS HONOUR JEFFREY BURKE QC
MR D G LEWIS
MR H SINGH

MUMTAZ FOOD INDUSTRIES LTD	APPELLANT

MR S JAVED	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR BEN DANIEL
(Solicitor)
Ford & Warren Solicitors
Westgate Point - Westgate
Leeds
West Yorkshire
LS1 2AX	
For the Respondent	MR GHAZAN MAHMOOD
(of Counsel)
Direct Public Access Scheme

SUMMARY
DISABILITY DISCRIMINATION – Justification
PRACTICE AND PROCEDURE – Bias, misconduct and procedural irregularity

The Employment Tribunal found in favour of the Claimant on the basis of disability related discrimination; but the case was run wholly on direct discrimination.  Remitted to ET - same Tribunal - to reconsider.

HIS HONOUR JEFFREY BURKE QC
Introduction
1.	In this appeal, the Respondents before the Employment Tribunal, Mumtaz Food Industries Limited, seek to overturn the conclusion of that Tribunal, sitting at Leeds and presided over by Employment Judge Burton, that they were guilty of disability discrimination against the Claimant, Mr Javed.

2.	In a judgment sent to the parties on 26 April 2012 the Tribunal found that the Respondents had unfairly dismissed the Claimant and were guilty of disability discrimination.  There is no challenge to the former conclusion.  The Notice of Appeal against the latter conclusion contains three grounds.  They are: Ground 1, that the Employment Tribunal erred in law in that it reached a decision based on a failure properly to apply the relevant legislation and case law; Ground 2, the Tribunal failed to identify and set out the list of issues to be determined, and, in so doing, addressed a claim that was not pleaded; and, Ground 3, that, in short, the Tribunal reached a perverse conclusion.  We shall, throughout this judgment, call the parties as they were before the Tribunal, the Respondents and the Claimant.

3.	At the sift stage of the Employment Appeal Tribunal’s procedures, HHJ McMullen QC permitted the first ground and part of the second ground to go a full hearing; but part of the second ground and the third ground were not so permitted and have gone, and could have gone, no further.  There has been some discussion today as to which part of the second ground survived the sift stage.  It is agreed that the part which survived is that part in which the Respondents complain that the Tribunal decided the disability discrimination claim on a basis which was not pleaded.

4.	For reasons which will appear, we have decided, with the acceptance of counsel on both sides, to hear the argument on that ground before hearing, if necessary, any argument on the broader ground that the Tribunal applied the wrong law to their decision on disability discrimination.

Background facts
5.	We turn briefly to the facts.  The Claimant was employed by the Respondents from January 2007.  Between then and 2009 he was promoted three times, eventually reaching the salaried position of Production Manager, a position, the Tribunal found, of some responsibility.  He worked a six‑day week and, on the Tribunal’s findings of fact, extraordinarily long hours.  The Respondent, because they are food manufacturers, had a system which involved employees filling out a health questionnaire, according to their General Manager, Mr Baker, every six months.  But the system plainly was not operated as Mr Baker said it was, because the Tribunal found that the Claimant had been asked to complete such a form only twice in three years.

6.	From his promotion, Mr Javed began to suffer from symptoms which he put down to tiredness, but were later medically attributed to depression.  Those symptoms included bouts of sickness.  When filling in a health questionnaire in February 2010, Mr Javed did not disclose those problems.  However, only a few days earlier, the Tribunal found, he had spoken to Mr Baker about his health, telling him that he had suffered from light‑headedness and nausea.  Over the next few months Mr Javed’s health deteriorated.  There is no need to go into detail.  He had to work extremely hard, particularly during a period when the other Production Manager was away; and his symptoms increased.  More than once he collapsed; eventually, his GP diagnosed severe depression and he went off work.

7.	When he returned he was told by Dr Akhtar, whose position in the Respondents is not identified but was obviously a senior one, that he was thenceforth to work as an ordinary operative in the dairy department and would be on an hourly rate.  That department worked only two to three days a week.  So Mr Javed’s earnings, he believed, would be substantially reduced.  He has a wife and a child and bills to pay; perhaps unsurprisingly, these events aggravated his depression and he went off work again, never to return.  He sensibly consulted an advice centre.  As a result, he put in a grievance about the arbitrary changes which the Respondents were seeking to make to his contract of employment.  A grievance meeting was arranged for 3 August, and when it started Mr Javed explained the history in relation to his illness.  Then extraordinarily, as now seen with hindsight, without any warning Dr Akhtar produced a copy of the questionnaire completed by Mr Javed in February and said that it had not been accurately completed.  Mr Javed explained that he had been told that it was a formality and, as is clear from the Tribunal’s findings of fact, Mr Baker knew all about his illness anyway.  The meeting continued.

8.	On 6 August, three days later, Mr Javed was informed by letter of the result of his grievance.  The letter sought to justify the change in his duties.  It then went on to accuse him of taking copies of his timesheets to the advice centre and described that as a theft.  Fortunately, the Respondents, although that was raised in their ET3, did not at the hearing run that as a justification of dismissal.  What they did run as a justification of dismissal was, as put forward in the ET3 and in the letter was that Mr Javed was summarily dismissed for gross misconduct in not filling in the questionnaire to which we have referred accurately.  Thus Mr Javed’s employment came to an end.

The issues
9.	At the hearing, the Respondent admitted that the dismissal was unfair.  There has been no disciplinary investigation or procedure at all; and Mr Javed’s appeal was dismissed by the company’s accountant who consulted with Mr Baker whose decision it was that was the subject matter of the appeal.  Thus, when this case came before the Tribunal there was no longer any dispute about unfair dismissal.  There were, however, three issues which the Tribunal had to decide.  The first was what we can safely describe as the Polkey issue, that is to say if the Respondents had followed fair procedures what were the chances that the Claimant would have been fairly dismissed.  The second issue was that of contributory fault.  The third was disability discrimination.  The precise nature of that issue we will consider in a moment.

10.	The Tribunal decided that the incorrect completion of the questionnaire was not the true reason for the Claimant’s dismissal, but was used as a pretext by the Respondents who were, through Mr Baker, fully aware of what the Claimant was suffering from and, therefore, did not need to have the questionnaire answered fully as they sought to suggest.  They drew attention to the fact that, although Mr Baker was so aware, no steps were taken to take the Claimant off work and have him medically investigated as the Respondents would have done if the questionnaire was as vital to the safety of their manufacturing unit as they sought to say it was.

11.	The Tribunal concluded that the reason given by the employers for the dismissal was, as we have said, a pretext and that they did not know what the reason for the dismissal was.  The Respondents, they said, had failed to discharge the burden of proof which lay upon them to demonstrate that the Claimant was dismissed for a potentially fair reason; therefore, they could make no Polkey reduction; and they did not make any such reduction.  They similarly found on the facts that there was no contributory fault.  No appeal has been brought against those two conclusions and, on the findings of fact, no such appeal could have been seriously contemplated. 

12.	That is the factual background to the disability discrimination claim, which the Tribunal turned to and dealt with in bare terms, briefly, at the end of what otherwise was a detailed and considered judgment.  It is not necessary to go through what they said for reasons which will become clear.

13.	At the beginning of the judgment the Tribunal said this, in relation to the issue as to disability discrimination:

“3. In terms of the discrimination claim it was found at an earlier Pre‑Hearing Review that at the time of his dismissal the Claimant was a disabled person and accordingly we have to determine whether his dismissal related to that disability and, if it did, whether nonetheless the Respondents can justify that act of less favourable treatment.”

 It is clear that they focusing on the issue of disability‑related discrimination.

14.	Under the Disability Discrimination Act 1995, as amended in 2003, there was a distinction between what was often called - and still is often called for cases involving the 1995 Act which still come before the Employment Appeal Tribunal, and quite possibly before the Employment Tribunal, and will continue to do so for some little time - direct disability discrimination and disability‑related discrimination.  There was also a third type of disability discrimination, namely failure to make reasonable adjustments, but that was not pursued in this case at the hearing.

15.	Employment Tribunals and the Employment Appeal Tribunal have regularly seen cases in which the three types of discrimination are pleaded, the three types are relied upon and the Tribunal has to make decisions on all three.  The distinction between the first two is to be found by comparing section 3A(5) of the Act, as amended, with section 3A(1).  Section 3A(5) provides as follows:

“A person directly discriminates against a disabled person if, on the ground of the disabled person’s disability, he treats the disabled person less favourably than he treats or would treat a person not having that particular disability whose relevant circumstances, including his abilities, are the same as, or not materially different from, those of the disabled person.”

16.	In contrast section 3A(1) provides as follows:

“For the purposes of this Part, a person discriminates against a disabled person if—
(a) for a reason which relates to the disabled person’s disability, he treats him less favourably than he treats or would treat others to whom that reason does not or would not apply, and
(b) he cannot show that the treatment in question is justified.”

17.	Section 3A(6) provides that in a case falling within subsection (1), that is to say a disability-related case, it is open to the Respondents to put forward a defence of justification.  That does not apply in the case of direct discrimination under section 3A(5).

18.	As counsel agree, direct discrimination is, in general terms, more difficult to prove than disability‑related discrimination because of the need for the Claimant to establish facts which indicate, or could indicate, that the employee was differentially treated on the grounds of his disability as opposed to circumstances which indicate a relationship between the relationship and the differential treatment.  There is the second difference, of course, of justification to which we have referred.  These distinctions no longer, at least in the same form, in the Equality Act 2010; but the events in this case took place before that Act came into effect.

19.	Mr Daniel, on behalf of the Respondents submits that the case, which the Respondents went to the Tribunal to meet and answer, and were throughout the hearing answering, was one of direct discrimination under section 3A(5) and not disability‑related discrimination under section 3A(1).  Yet the Tribunal decided on the disability discrimination issue in favour of the Claimant on the basis of disability‑related discrimination, although that had not been pleaded or argued, and he submits that the Respondents prejudiced as a result.

20.	Mr Mahmood would like to but cannot go behind Mr Daniel’s assurance, derived from his instructions from his solicitor who was representing the Respondents before the Tribunal, that no question of the Claimant pursuing the disability‑related claim arose, save in this respect - that at some stage there was a discussion, presumably between the Employment Judge and the solicitors on both sides, about the fact that a direct discrimination claim is more difficult to prove than a disability‑related claim.  Other than that, it appears that no reference to a disability‑related claim was ever made.

21.	There can be no doubt that the decision was based on disability‑related discrimination, for the reasons we have set out.  Although the Tribunal did not go into justification, that is not relied upon as an indication that they were, in reality, deciding on the basis of direct discrimination.  Did the Tribunal, in deciding on that basis, make an error?  The ET1, which might have assisted, is neutral.  It was not professionally pleaded; and nothing in it indicates which of the two types of claim (leaving aside reasonable adjustments) was being pursued.  No doubt for that reason, at a case management discussion held on 30 August 2011, after a pre-hearing review at which the Tribunal had decided in favour of the Claimant on the issue of disability, it was ordered at paragraph 1 of the Tribunal’s Order, that, if the claim of unlawful disability discrimination continued, the Claimant was to file and serve information particularising the complaint brought.

22.	That was done at page 29 of our bundle.  There is an undated document plainly akin to a pleading, or an answer to that paragraph of the order made at the case management discussion.  It has two paragraphs, the second paragraph relates to failure to make reasonable adjustments; but that part of the case was dropped so there is no need to refer to it.  What is much more important is the first particular.  The first paragraph is headed “Direct Discrimination”.  Underneath the heading these words appear,

“That the Claimant was dismissed because of his disability in breach of Disability Discrimination Act 1995, s4(2)(d).”

23.	The reference to section 4(2)(d) does not assist.  In that sub-paragraph it is provided that it is unlawful for an employer to discriminate against a disabled person whom he employs by dismissing him or subjecting him to any other detriment.  However, the words, “The Claimant was dismissed because of his disability” are put forward by Mr Daniel as indicating that a direct discrimination claim was being pleaded and only that claim was being pleaded.  Mr Mahmood submits that that pleading does not contain the language of direct discrimination as opposed to disability‑related discrimination.  “Because”, he submits, is a word which is not used in section 3A(5) or section 3A(1).  That is true.  However, the word ‘because’ is much closer to ‘on the grounds of’ than ‘related to’ and the pleading, albeit  containing some ambiguity in the paragraph which has the words ‘that’ down to ‘s4(2)(d)’ has to be read, and can only be read, sensibly together with the heading which precedes it.  That heading is totally unambiguous.  It says, “Direct Discrimination”.  In our judgment, that pleading could not be read as anything other than an assertion that the claim which was being brought was a claim under section 3A(5) and not a claim under section 3A(1).

24.	Mr Mahmood points to other indications in the contrary direction, however, as to how the Tribunal might have seen it.  First of all he refers to the ET3 which uses, at paragraph 29, these words:

“Further it is denied that the Claimant was dismissed for any reason relating to any illness or condition […]”

25.	However, that pleading was a response to the ET1, which did not specify which of the two ways of putting the case was being advanced.  It is not surprising that those who drafted the ET3 might have wanted at that stage to anticipate a disability‑related discrimination claim.  Any ambiguity about the ET1, and there was an ambiguity, was then removed, in our judgment, by the Claimant’s advisor’s response to the Tribunal’s order.  The terms of the ET3 do not alter the position.

26.	Mr Mahmood also refers to the fact that the Respondent’s skeleton argument (which does not have Mr Daniel’s name on it and we are not sure that it is his or his solicitor’s and it does not matter) regularly refers to the expression ‘Lewisham comparator’.  That expression means a comparator of the type identified by the decision of the House of Lords in Malcolm v Lewisham London Borough Council [2008] UKHL 43.  However, we do not regard the use of that expression as any indication of an understanding that the claim was a disability‑related claim rather than a direct discrimination claim.  The decision in Malcolm, insofar as it identifies how one approaches the vexed question of ascertaining who is the correct comparator in a discrimination claim, applies equally to a direct disability discrimination and a disability‑related discrimination claim.  We do not see that there is anything there that Mr Mahmood can build into a compelling argument, or even an influential argument, against those that have been put forward by Mr Daniel.

27.	In our judgment, it would appear that the Tribunal made their decision on the basis of a claim which was not pleaded and not addressed.  While at an earlier stage of this appeal a question of the Employment Judge might have been asked about how the proceedings went, in order to clarify the issue, it would be unfair now to take that course, which neither side has suggested; and we hope we cause no offence to the Employment Tribunal by now resolving this matter as we are resolving it rather than referring back to them for further information.

28.	Mr Mahmood then asks the question, “Well, what prejudice have the Respondents suffered?”  He submits that, as a result of the Malcolm case, the two different types of claim have very little real difference between them.  On the other hand, Mr Daniel points us to the decision of the Employment Appeal Tribunal, Keen J presiding, in British Gas Services Ltd v McCaull [2001] IRLR 60 in which, at paragraph 31, the Employment Appeal Tribunal said:

“It is important that tribunals in such cases should deal with the complaints of ‘less favourable treatment’ as they are defined by the applicant and not as the tribunal subsequently chooses to define them.  If a Tribunal finds less favourable treatment in some act or omission of which the applicant has not complained there is a grave danger that there will have been a breach of the rules of natural justice because the other party will not have been put on notice that this might be held against it … It did not receive a fair hearing and the decision in consequence cannot stand.”

29.	The circumstances of that case were not identical to this; but the principle, in our judgment, applies equally.  In any event, it seems to us that, because the evidence  required for a disability‑related claim can be seen as being less strong than that required for a direct discrimination claim, the Respondents were entitled to know that they were answering such a claim and to address arguments towards such a claim before the issue could be concluded against them; and, of course, they could have run justification if the claim was of disability-related discrimination, although whether they could have successfully done so may be very open to question on the findings of fact which the Tribunal made.

30.	For these reasons we conclude that the Tribunal reached their decision on disability discrimination in error of law and that decision, therefore, cannot stand.

31.	What should we now do?  Both parties agree that, if we reached the conclusion that we have reached, there is no point in going on to hear the arguments about the mistakes in law which the Tribunal are said to have and may or may not have made in reaching the conclusion that they did.  Secondly, it is agreed that it is now open to the Claimant to run a disability‑related discrimination claim and that his claim should be remitted to the Tribunal to enable him to do so.  That gives rise, thirdly, to this question: should the remission be to the same or a different Tribunal?  The Tribunal whose judgment we have been considering have found the facts after hearing evidence over a substantial period of time, after a three‑day hearing, in considerable detail.  There is nothing which indicates that they cannot be trusted now to hear and determine the disability‑related discrimination claim fairly and according to law.  The time which has passed is not such as to make that difficult; and the fact that they have made a decision once does not mean that they will not consider the case properly when they come to consider it again.

32.	In our judgment, it is appropriate that this matter goes back to the same Tribunal and we remit it to the same Tribunal.  Before we do so, however, it is necessary to say two things.  First of all, it may be that the Employment Tribunal will want to look carefully at what needs to be proved before the burden of proof can be said to have been transferred to the Respondents of putting forward an explanation inconsistent with discrimination.  We are not suggesting that the Tribunal should conclude that issue one way or the other; we are merely pointing out, because it has been raised before us, that, first of all, the Tribunal will need to bear in mind that unreasonable behaviour is, on the authorities, not of itself, enough.  Secondly, it is not enough to say that what happened could have indicated discrimination without more; see the decision in the Court of Appeal in Madarassy v Nomura International Plc [2007] ICR 867.  We make those comments by way of guidance, having read and considered the skeleton arguments of both sides in relation to ground one.  Whether and to what extent it is necessary to identify comparators and whether that indeed can be done at all on the facts of this case will be a matter for the Tribunal to consider.  We need to say, and should say, no more. 

33.	Finally, it may well be that the parties would be well advised now to consider that the cost of going back to the Tribunal can be avoided by negotiations and discussions, whether through ACAS or by mediation, or otherwise.  That will be for them to consider; we cannot make them do any such thing.  However, we will be distressed if it did not occur to either and indeed both parties that therein lies a sensible way forward.