Appeal No. UKEAT/0287/11/LA

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

	At the Tribunal
	On 1 December 2011

Before
THE HONOURABLE MR JUSTICE WILKIE
(SITTING ALONE)

MR R SHARMA	APPELLANT

NEW COLLEGE NOTTINGHAM	RESPONDENT

Transcript of Proceedings

JUDGMENT

APPEARANCES

For the Appellant	MR M HAY
(of Counsel)
Instructed by:
Hathaways Solicitors
19 Regent Terrace
Gateshead
Durham
NE8 1LU

	
For the Respondent	MR A WASTALL
(of Counsel)
Instructed by:
Lyons Davidson Solicitors
St Martins House
Britannia Street
Leeds
LS1 2DZ

SUMMARY
PRACTICE AND PROCEDURE – Striking-out/dismissal

Employment Tribunal to take the same approach where considering making a deposit order as it does when considering striking out a claim.  Where there were underlying disputes of fact, the Employment Tribunal Judge erred in relying solely on the contents of contemporaneous correspondence which were inconsistent with the Claimant’s version of events as sufficient to conclude that there was no reasonable prospect of success in making a discrimination claim.

THE HONOURABLE MR JUSTICE WILKIE
Introduction
1.	Rohit Sharma is employed by New College Nottingham and has been since 27 July 2004.  On 16 July 2010, he began proceedings in the Employment Tribunal against his employer.  At part 5 of the ET1, which invites the applicant to identify the claim that was being made, Mr Sharma has ticked box E, which relates to “other complaints”.  At paragraph 5.2, he was asked to set out the background and details of his claim and he did so in brief, but far reaching terms, as follows:

“My complaint is that I was racially discriminated against, in that I was subject to harassment and bullying in relation to the way I handled a Grievance Investigation I was undertaking on behalf of the College, in my capacity as a manager.”

2.	He then goes on to say:

“Harassment and bullying has gone on for a number of years in various forms and was the subject of a previous internal complaint, under the College’s Harassment Procedure.
The most recent incident occurred on April 22 2010, since when I have been off work with Work-Related Stress.”

3.	Under part 7, “Other Information”, he was invited to add any extra information that he wanted the Tribunal to know, to which he said:

“I have extensive evidence of discrimination against me over a number of years that I will submit in paper form in due course”.  

4.	That was the extent of the substance which was contained in the ET1.  The Respondent put in a substantive ground of resistance.  It acknowledged that the Claimant was employed by the Respondent since July 2004 and was currently employed as Head of Service Delivery in the ICT Department.  It identified the claim of racial discrimination made as being in the form of:

 “…harassment and bullying in relation to the way that the Claimant handled a grievance investigation he was undertaking on behalf of the Respondent.”

5.	It then set out its case in respect of that particular role and, in effect, indicated: that he had conducted that grievance hearing on their behalf on 1 April 2010; that although a swift response was required, as the person invoking the procedure was signed off sick at the time and had made it plain that a timely response was important for his health, the Claimant failed to finalise the grievance result letter in a timely manner, despite having been provided with a draft decision letter; that significant effort was made to allow provision of time to the Claimant so he could finalise the letter; and that a clear and reasonable instruction was given to the Claimant that this was his highest priority task.  The Respondent further contended that its actions did not amount to racial discrimination.  As far as other matters were concerned, it indicated that it did not have sufficient information to enable it properly to respond.  

6.	A Chairman of Tribunals gave a direction on 13 September 2010, that a Pre-Hearing Review be held, to take place on 8 November 2010.  The subject matter of that hearing was to be as follows:

“To determine whether the claim should be struck out as having no reasonable prospect of success, or a deposit be payable by the Claimant, it having only little reasonable prospect of success.”

7.	In fact, the hearing did not take place until 4 April 2011.  At a Case Management Discussion which took place on 20 January 2011, that Pre-Hearing Review was adjourned generally.  However, the following direction, amongst others, was made as item 2 of the order:

“The Claimant shall on or before 4pm on Friday, 18 February 2011, supply in writing to the Respondent additional information of his complaint of racial discrimination, setting out in detail his role in the management of Zia Khan’s grievance and how he was treated less favourably by his line manager and members of the Respondent’s HR staff.  In particular, he shall point to any facts that he intends to prove at the Hearing, from which a Tribunal could conclude that the Respondent’s treatment of him was on racial grounds.  If the Claimant relies on earlier incidents, other than those which have already been the subject of litigation, he shall include details of those incidents, but only to the extent that they show or support an inference that the Claimant was treated less favourably on racial grounds, in respect of his handling of the Zia Khan grievance.”

8.	Pursuant to that order, the Appellant submitted a Scott Schedule which contains 23 numbered allegations.  The Employment Judge, in the course of his decision, analysed these in the following way.  He concluded that certainly numbers 1 to 8, and potentially 9 to 11, of the allegations dealt with the circumstances of Zia Khan’s grievance.  Those matters stretched from January 2010 through to 22 April 2010.  In each case, they were said to amount to direct racial discrimination, racial victimisation and whistle-blowing detriment.

9.	Of the other allegations, from numbers 12 to 22, which spanned a period from 15 December 2006 to March 2009, and an additional one - number 23 - said to be ongoing, the Employment Judge said that they were understood as background information.  In my judgement the characterisation of those matters in that way cannot sensibly be impugned and, therefore, insofar as the scope of any subsequent hearing is defined by the Employment Judge’s Judgment on 4 April, in my judgement it must stand as a proper analysis of the claim, and those matters which are properly to be regarded as within the claim.

10.	The Scott Schedule, in relation to items 1, 2, 3 and 5, made assertions of bullying and harassment, some of them explicitly, others implicitly, which were said to have been verbal.  One of the allegations, number 4, was an allegation that the grievance hearing notes were manipulated.  Other complaints, in particular 6, 7 and 8, were complaints of procedural manipulation in the form of either withholding information, withholding documents, or delaying the provision of documents to him in his capacity as the manager dealing with the grievance.

11.	Allegations 9, 10 and 11 concern allegations of being isolated, ignored and excluded and not consulted about various matters.  The Employment Judge, in his decision, having characterised the Scott Schedule as I have indicated, said, in paragraph 4, that the nature of the allegation had been clarified and was that the Appellant had been appointed as manager to deal with the grievance because the Respondent had a particular outcome in mind - to dismiss that complaint - and their perception of him was that, as an Indian manager, he would be more malleable and more susceptible to persuasion to “toe the party line” and to conclude the matter in the way that they had already determined.

12.	In the alternative the Claimant said that, having done a protected act i.e. brought unsuccessful Tribunal proceedings in 2007, he was placed in the position as a manager so that he could be put under pressure to come to a certain conclusion as a deliberate punitive act by the Respondent.  Further, he claimed that the way he was treated, in the course of his conducting the grievance procedure, amounted to unwanted conduct towards him, which meets the definition of harassment, which, he says, was on racial grounds.  In support of the contention, that race was the reason he was treated less favourably, he relied upon a lengthy pattern of allegedly unfavourable treatment.

13.	In paragraph 5 of the decision, the Employment Judge indicated that he felt there were serious difficulties in the way of arguing that the earlier incidents were connected in any way with what was the nub of the current dispute, namely the treatment of the Appellant in connection with his conducting the grievance hearing in respect of Mr Khan.  In paragraph 6 of the decision, the Employment Judge says that although he had come close to striking it out, he was not going to do so, but, he concluded, the claim had little reasonable prospect of success.  He went on to say as follows:

“6.	Although as Mr Hay properly points out there is a great public interest in allowing proper claims of discrimination to be heard in full and for evidence to be tested, which militates against strike out or any bar to proceedings, there is a well accepted category of case where, notwithstanding what may be a genuine belief on the part of the Claimant, the assertions of less favourable treatment on racial or other grounds are at odds with the cotemporaneous documentation.  Although not going so far in this case to say that the documents do fatally undermine the Claimant’s contentions they do, in my opinion, come very close to it.”

14.	The learned Employment Judge then went through the sequence of events and he described a series of letters or emails which were passing between the parties, for the most part between the Respondent and the Appellant, but, in one case, a letter of 28 April, some five days after he had gone off sick, from the Appellant to the Respondent raising a grievance about the way that he had been treated.

15.	The learned judge came to the conclusion, which is not disputed, that the documentation he described was sent, for the most part, by the Respondent to the Appellant in the terms which were placed before him and which he then recorded as part of his chronological sequence of events.  Those documents included the notes of a meeting dated 1 April in which, it was said, there was bullying and harassment.

16.	The Employment Judge commented that those notes did not appear to bear the interpretation which the Appellant was giving in support of that particular complaint.  In fact, in respect of a document dated 8 April, being notes of a grievance hearing, the Appellant had contended that those notes were manipulated.

17.	It is unclear from the Scott Schedule and unclear from the chronology, that the notes dated 8 April were notes of the meeting held on 1 April, so the question whether his allegations about the conduct of the Respondent on 1 April were or were not sustainable on the documentation, may or may not depend upon whether the notes, referred to as being manipulated notes, were notes of that meeting.  There is some factual uncertainty as to that particular point.  The Employment Judge, having described and, to an extent, quoted from the various documents, came to a conclusion at paragraph 16 of his decision, in the following terms:

“16. So, because the contemporaneous documentation which appears to be perfectly proper and polite in tone does not bear out the allegations made somewhat belatedly by the Claimant of discriminatory treatment towards him as Chair of the grievance,  I conclude that this claim has little reasonable prospect of success.”

18.	It is well established that it is important to bear in mind, in deciding whether a Claimant has proved facts from which the Tribunal could conclude, in the absence of an adequate explanation, that the Respondent has committed an act of unlawful discrimination against the Claimant, that it is unusual to find direct evidence of discrimination.  Few employers would be prepared to admit such discrimination, even to themselves.

19.	In some cases, the discrimination will not be intentional, but may be based on an assumption. In deciding whether the Claimant has proved such facts, the Tribunal will usually consider what inferences it is proper to draw from the primary facts found by it. In considering what inferences or conclusions can be drawn from the primary facts, the Tribunal must assume that there is no adequate explanation for those facts.

20.	This approach to the first stage in the process of determining whether or not there is a sufficient case to pass the burden of proof to the Respondent is well-established and is contained in the annex to the Court of Appeal decision in Igen v Wong [2005] EWCA Civ 142.  Given that approach of the appellate courts, the question in this case arises, to what extent is it within the powers of an Employment Judge, at a Pre-Hearing Review, without hearing any oral evidence or coming to any determination on what may be disputed facts, to strike out a claim as having no reasonable prospect of success, or make an order for a deposit on the grounds that the claim has little reasonable prospect of success?

21.	In my judgment, it would be illogical to require an Employment Judge to have a different approach, depending on whether he is considering striking out, or making an order for a deposit as either order is, on any view, a serious, and potentially fatal, order.

22.	The position has been considered by the House of Lords in the case of Anyamu v South Bank Students Union and Others [2001] ICR 391, in which Lord Hope of Craighead said at paragraph 37:

“37. I would have been reluctant to strike out these claims on the view that discrimination issues of the kind which have been raised in this case should, as a general rule, be decided only after hearing the evidence.  Questions of law that have to be determined are often highly fact-sensitive.  The risk of injustice is minimised if the answers to these questions are deferred until all the facts are out.  A Tribunal can then base its decision on its findings of fact, rather than on assumptions, as to what the Claimant may be able to establish if given an opportunity to lead evidence.”
	
23.	That approach is clear in relation to those facing an application for a finding of discrimination.  In a similar context, namely in relation to whistleblowing cases, there is more recent authoritative statement of the law, in the case of Ezsias v North Glamorgan NHS Trust [2007] EWCA Civ 330, a case which, I am informed by Mr Wastall, was before the Employment Judge and may indeed have informed what he stated to be his understanding, in paragraph 6, to which I have already referred.

24.	In that case, the Court of Appeal had to consider a number of issues, one of which was the question of the circumstances in which an Employment Judge could conclude that there was no reasonable prospect of success.  In the lead Judgment, with which the other two Lords Justices agreed, Kay LJ referred to a number of authorities and also cited what was said by Elias J (as he then was) in the EAT decision in that case, where he said this:

“However, where the facts themselves are in issue in my judgement it can only be in the most extreme case that the chairman can say that without any evidence being tested in cross-examination that the disputed facts would inevitably or almost inevitably be resolved against the claimant.
[…]
Mr Pitt-Payne submits that it must in principle be possible for a tribunal in a clear case to make a finding that a claimant has no chance of establishing the facts alleged.  I would not discount the possibility that very exceptionally it might be.  But it seems to me that, at the very least if such a step is going to be taken then the primary factual basis of which a tribunal infers that the dismissal must have been for the reason advanced by the employer and not the counter varying reason advanced by the employee must itself be undisputed.”

25.	Kay LJ at paragraph 27 of the decision then said this:

“27. I too accept that there may be cases which embrace disputed facts but which nevertheless may justify striking out on the basis of their having no reasonable prospect of success [he then refers to a commercial authority in the Court of Appeal].”  However, what is important is the particular nature and scope of the factual dispute in question.”

26.	He then went on to say that in that case, the factual dispute was stark and he concluded that in that case, given the extent of the factual dispute, it was legally perverse to conclude, as the Employment Tribunal had done, on the following basis which he set out at paragraph 29:

“29. It seems to me that on any basis there is a crucial core of disputed facts in this case that is not susceptible to determination otherwise than by hearing and evaluating the evidence.  It was an error of law for the Employment Tribunal to decide otherwise […] It would only be in an exceptional case that an application to an Employment Tribunal will be struck out as having no reasonable prospect of success when the central facts are in dispute.  An example might be where the facts sought to be established by the Applicant were totally and inexplicably inconsistent with the undisputed contemporaneous documentation.  The present case does not approach that level.”

27.	Mr Wastall, in the course of his helpful submissions, accepted that the facts in the present case do not fall within that description in paragraph 29 in Ezsias.  In my judgment he was right to make that concession.  It is very clear from the terms of the Scott Schedule, to which I have referred, that, in particular, in respect of the occasions when it is said there is correspondence emanating from the Respondent, which is inconsistent with any allegation of ill-treatment, let alone racial discrimination, there are underlying factual disputes in which the Appellant is asserting that, behind the façade presented by those emails, there was, in fact, verbal harassment, verbal threats, aggressive bullying behaviour towards him, which constituted acts from which, in the absence of an acceptable explanation, a Tribunal could conclude that they were on the grounds that he asserts.

28.	In my judgment, it is inadequate, as a piece of legal reasoning, for the Employment Judge simply to have said that because the contemporaneous documentation appears to be perfectly proper and polite in tone, and does not bear out the allegations made, that it is in any way appropriate for an order to be made on the basis that there is little reasonable prospect of success, an order which would have the effect, if not directly, certainly indirectly, of potentially terminating claim.  That would be entirely contrary to the legal principles which have been well-established in connection with this kind of case.

29.	Of course that does not mean that it necessarily follows that the prospects of success are good, bad or indifferent.  What it means is that, on the basis of the contemporaneous documentation and given the disputed facts at the heart of this case, these matters ought in law only to be determined after a hearing at which the evidence has been received and the opportunity been given to cross-examine, respectively, on the accounts given by the Appellant and the Respondent.

30.	Accordingly, in my judgment, this appeal must succeed, and the order made by the Employment Tribunal that a deposit be paid as the condition of the case proceeding shall be quashed.