Collective redundancies and consultation

Securicor Omega Express Ltd v GMB (2004) IRLR 9

An employment tribunal ruled that employers had failed to consult with the recognised trade union about proposed redundancies in accordance with section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992, because the decision to close two branches was made before the union was involved.

The Employment Appeal Tribunal (EAT) allowed an appeal.

Consultation for the purposes of section 188 'must in general be fair and meaningful and certainly must not be a sham' but the consultation need not 'extend to the economic background or context in which the proposal for redundancy arises'.

The key issue was not whether the union was consulted about economic decisions, such as plant or branch closures, but rather whether there was adequate consultation in respect of the consequences of those decisions, with a view to reducing, and perhaps even avoiding, the redundancies which were consequential on them.

Although when the employers met the union, they had already decided to close two branches, they had not made any decision either as to the numbers of the redundancies or as to who should be made redundant.

They were required to consult about ways of avoiding the dismissals that would result from the branch closures, reducing the numbers of employees to be dismissed and mitigating the consequences of those dismissals.

That is what occurred at the meeting.

Furthermore, the EAT ruled that there is no requirement to serve a notice under section 188(4) prior to the start of the consultation exercise; the ruling to the contrary in E Green & Sons (Castings) Ltd v ASTMS (1984) IRLR 135, was not followed.

That decision was made under the previous legislation, whereas the present rules clearly refer to relevant information being supplied by the employer in good time 'during the course of the consultations'.

The service of a notice under section 188(4) forms part of the wider question as to whether, in a particular case, there has been proper consultation.

The information supplied by the employers did not fully comply with section 188(4) in that nothing was said about the total number of employees of the description affected by the redundancies, or as to the proposed method of calculating the amount of any redundancy payments to be made.

A nominal protective award of one day's pay was therefore made.

The union's submission that the award should also apply to those who are threatened with redundancy under the original proposal, but subsequently retained, was rejected.

Those who have not been dismissed do not qualify for a protective award.

GMB and Amicus v Beloit Walmsley Ltd (In Administration) and others (2004) IRLR 18

The EAT overturned a tribunal's ruling that the unexpected decisions of a US parent company to withdraw financial support and work from the respondent employers were 'special circumstances' which made it not reasonably practicable for the employers to comply with the obligation to consult under section 188 of the 1992 Act.

Tribunal procedure

Roberts v Skelmersdale College (2004) IRLR 69.

An employee claiming unfair dismissal failed to attend the tribunal hearing and gave no reason for non-attendance.

The tribunal therefore dismissed his complaint pursuant to rule 9(3) Employment Tribunals (Constitution & Rules of Procedure etc) Regulations 1993.

A majority of the EAT allowed an appeal on grounds that the tribunal had given inadequate reasons for why it considered it appropriate to dismiss the application, rather than requiring the employers to give evidence as to the reason for dismissal and its fairness.

The Court of Appeal restored the tribunal's decision.

When an applicant fails to attend or be represented at a hearing, rule 9(3) does not impose on a tribunal a duty of its own motion to investigate the case before it, or to be satisfied that, on the merits, the respondent has established a good defence to the claim of the absent applicant.

The tribunal may adjourn the hearing to a later date, dismiss the application or dispose of it in some other way.

The tribunal had a discretion under rule 9(3) to require the employers to give evidence, but no duty to do so.

Logan v Commissioners of Customs & Excise (2004) IRLR 63

The Court of Appeal has emphasised that in employment tribunal cases 'submissions of no case [to answer] are dangerous to make and to allow'.

The relevant principles are:

- There is no flexible rule of law and practice that a tribunal must always hear both sides, although that should normally be done;

- The power to stop a case at 'half-time' must be exercised with caution;

- It may be a complete waste of time to call on the other party to give evidence in a hopeless case;

- Even where the onus of proof lies on the applicant, as in discrimination or constructive unfair dismissal cases, it will only be in exceptional or frivolous cases that it would be right to take such a course;

- Where there is no burden of proof, as under section 98(4) of the Employment Rights Act 1996, it will be difficult to envisage arguable cases where it is appropriate to terminate the proceedings at the end of the first party's case.

Bolch v Chipman (2004) IRLR 140

The EAT held that a tribunal erred in treating the employer's conduct in threatening the employee with physical violence as grounds for making an order to strike out the notice of appearance under rule 15(2)(d) Employment Tribunals (Constitution & Rules of Procedure) Regulations 2001.

Before deciding whether to make a strike-out order, the tribunal should ordinarily first conclude not simply that a party has behaved scandalously, unreasonably or vexatiously, but also that the proceedings have been so conducted by him or on his behalf.

Conduct outside the curtilage of the tribunal can result in such a finding, but there must be appropriate reasons for that finding.

The tribunal must in any event then consider whether a fair trial is still possible.

This is because, save in exceptional circumstances, a striking-out order is not to be regarded simply as a punishment.

Finally, there is the question as to what remedy is appropriate and proportionate to the tribunal's conclusion.

For instance, a respondent who is debarred from taking any further part in the case as regards liability may still be allowed to take part on the question of compensation.

Jones v DAS Legal Expense Insurance Co Ltd & others (2004) IRLR 218.

The Court of Appeal held that an applicant had failed to establish that the tribunal which rejected his claims of sex discrimination and victimisation was biased, lacked impartiality and so breached his human right to a fair hearing by reason of the fact that the tribunal chairman's barrister husband had on occasion been instructed by the respondent employers.

The relationship between the chairman's husband and the respondent's employers did not give rise to a presumption of bias.

For a presumed bias to be established, the judge must have the relevant interest in the party whose cause is before him.

Nor was there any apparent bias.

The fair-minded and informed observer, proceeding on the basis that the chairman knew in general how the employer's system of appointing barristers operated and that her husband was to some extent a beneficiary of it, would not conclude that the chairman herself, still less the tribunal as the decision-making body, was biased.

Furthermore, the applicant had in any event waived his right to object to the chairman sitting in his case by not raising any objection when given the opportunity to do so.

The essential requirements of a waiver are that the litigant acted freely and informally to the facts relevant to the decision whether to waive or not.

The litigant should understand the nature of the case, rather than the detail.

The Court of Appeal offered the following guidelines to judges confronted with a possible conflict of interest.

- If there is any real, as opposed to fanciful, chance of objection being taken by a fair-minded spectator, the first step is to ascertain whether or not another judge is available to hear the matter.

The judge should make every effort in the time available to clarify what his interest is which gives rise to this conflict, so that the full facts can be placed before the parties.

- Some time should be taken to prepare whatever explanation is to be given to the parties.

- It is vital that the judge's explanation be mechanically recorded or carefully noted where that facility is not available, so as to avoid any controversy about what was or was not said.

- A full explanation must be given to the parties, detailing what matters are within the judge's knowledge which give rise to a possible conflict of interest and explaining why the problem had only arisen so late in the day.

The parties deserve also to be told if it will be possible to move the case to another judge that day.

- The options open to the parties should be explored in detail.

- The parties should always be told that time will be afforded to reflect before electing.

That should be made clear even where both parties are represented.

A litigant in person can be directed to the CAB if that service is available and if he wishes to avail himself of it.

Sian v Abbey National Plc (2004) IRLR 185

The EAT held that the time period for lodging an appeal against an employment tribunal's decision runs from the sending of the decision, even if it is not delivered.

The decision in Mock v Commissions of the Inland Revenue (1999) IRLR 785, was preferred to that in Scotford v Smithkline Beecham (2002) ICR 264.

The EAT said that it is essential to have a firm date so that the parties should have certainty.

If time were to run from the date of receipt, great uncertainty would arise because it would never be clear what the date was from which time for a notice of appeal ran.

The 42-day period for lodging an appeal is lengthy, allowing for any risk of delay in the post.

Any potential unfairness against the party who did not in fact receive the decision can be resolved by the application of the ordinary discretion of the registrar, which enables the facts of each particular case to be considered and for an extension of time to be granted if appropriate.

By Martin Edwards, Mace & Jones, Liverpool