Appeal No. UKEAT/0368/12/DM
UKEAT/0427/12/DM

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

		At the Tribunal
		On 15 February 2013

Before
THE HONOURABLE MR JUSTICE MITTING
MR D J JENKINS OBE
MR G LEWIS

UKEAT/0368/12/DM

MR G BURRELL	APPELLANT

MICHELDEVER TYRE SERVICE LTD	RESPONDENT

UKEAT/0427/12/DM

MICHELDEVER TYRE SERVICE LTD	APPELLANT

MR G BURRELL	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For Mr G Burrell	MR NEIL HINTON
(of Counsel)
Instructed by:
Leonard & Co Solicitors
First Floor
Oakwood Court
62a The Avenue
Southampton
Hampshire
SO17 1XS

For Micheldever Tyre Service Ltd	MS ALICE MAYHEW
(of Counsel)
Instructed by:
Thomas Eggar LLP
Brunel House
21 Brunswick Place
Southampton
Hampshire
SO15 2AQ

SUMMARY
RACE DISCRIMINATION
Inferring discrimination
Detriment

Conduct capable of being racially discriminatory – burden of proof transferred to employer – whether Employment Tribunal entitled to conclude it had not been discharged – whether ET also entitled to conclude that employee was required to change his place of work by reason that he had undertaken a protected act, raising a grievance about racial harassment and the manner in which the employer had dealt with it.

THE HONOURABLE MR JUSTICE MITTING

1.	We have two appeals; one brought by the employee and one brought by the employer.  To avoid confusion we shall call the employee the Claimant throughout and the employer the Respondent throughout.

2.	The Claimant was employed as a tyre-fitter from 11 November 2008 until he was dismissed on 28 July 2010.  The Respondents are a large firm of tyre-fitters with depots all over the country; two of their depots were at Fareham and Micheldever.  Micheldever it seems was the centre of their operation, Fareham an ordinary branch.  The Tribunal found that some 40 people were employed at Micheldever which had a turnover of £10 million.  We are told, and it is not controversial, that some ten people were employed at Fareham.

3.	The Claimant was the only black employee at Fareham.  His line manager was Paul Wright.  The foreman was Chris Thompson. 

4.	The Respondent’s case was that from the start there was an exchange of banter between the Claimant and the other white employees of a racial nature.  Their case was that the Claimant gave as good as he got and at least at the start did not take exception to it.  His case was that he had objected to it at the start.  The Tribunal determined that issue against him as they were entitled to.  They found that the Respondent’s account that the Claimant was a willing participant in those exchanges until September 2009 was right and that the exchanges up to that time had been fundamentally good natured on all sides.

5.	In September 2009 the position changed.  The Claimant complained to Mr Wright.  He called a team meeting for the Fareham employees on 11 September 2009 and made it clear to the whole team in unambiguous terms that there should in future be no more name calling or abusive remarks, whether or not in jest between team members.  For a short while matters improved but the banter restarted.  

6.	The Tribunal accepted that from the time of the meeting onwards the Claimant’s attitude to racial and abusive name calling changed.  In November 2009 he told Miss Shore, the Respondent’s Human Resources Manager, that he did not find such language and exchanges funny anymore.  Coincidently he had been off sick with a viral illness.  On 3 November he had a return to work interview with Mr Wright.  As the Tribunal pithily put it, it turned into “a return to work argument”.  The Tribunal were far from clear what the cause of the argument was but were about the outcome: Mr Wright sent the Claimant home.  He then asked whether he would be paid the next day.  Miss Shore sensibly arranged for him to come back to work on 5 November.  He made it again clear to Mr Wright and Darren Godwin, the Local Area Manager, that name calling had become annoying and was unwelcome.  He was told that he could bring a grievance about it if he wished, which he then declined to do.  Four days later Miss Shore wrote to him, reminding him of his right to bring a grievance and telling him that the Respondent would take seriously any further incidents of name calling or abuse and would take disciplinary action against anyone responsible.

7.	The Claimant then appears, not for the last time, to have changed his mind.  He submitted a grievance on 11 November.  It was focused on the nature of his suspension by Mr Wright following the argument on 3 November.  Later he wrote to Miss Shore in clear terms on 16 December making it plain that he complained about a number of matters including bullying, harassment and discrimination.  No steps were then taken to investigate his complaints until the end of January 2010.  The Claimant sent her a chasing letter on 8 February 2010, she then considered his grievance.  She wrote him a lengthy outcome letter on 18 February 2010.  By this time the Claimant was again signed off sick.

8.	In her letter Miss Shore addressed the Claimant’s complaints.  She concluded that the meeting held by Mr Wright in September 2009 (that is the meeting at which he made it clear that banter and such like was to cease and would be the subject to disciplinary action if it continued) had been ineffective and that name calling had continued.  She said she believed that both the Claimant and his colleagues were equally involved in unacceptable behaviour and that as a result she had decided to take no disciplinary action but would attempt to deal with the situation informally.  She said that she had spoken to Darren Godwin, the Area Manager, and asked him to hold a meeting at Fareham at which the staff would be told that this type of conduct must cease immediately and any subsequent breach would result in disciplinary proceedings.  The Tribunal found that there was no evidence that any such meeting as envisaged by Miss Shore in fact took place.  That, as we shall explain, was a significant finding.  The Claimant appealed, as he was entitled, against Miss Shore’s determination.  A grievance appeal hearing conducted by Mr Harley took place at Micheldever on 15 April 2010.  

9.	The Claimant appears to have concentrated on procedural questions.  Mr Harley’s decision to was uphold Miss Shore’s determination.  He dismissed the appeal for reasons which are set out in the letter of 24 May 2010.  At that point the grievance procedure came to an end.  The Claimant was dissatisfied with the outcome and submitted the first of his two ET1 forms on 6 April 2010.  Matters then came to a head.  On 8 June the Claimant unexpectedly and without prior warning returned to work at Fareham.  There was a dispute about what had then occurred.  The Respondent’s case was that the Claimant had at least made veiled threats towards some of his colleagues at Fareham by telling others of his colleagues that “they were in the clear”.    The Tribunal was not persuaded that the Claimant did make veiled threats.  On the following day 9 June, the Claimant was given two weeks paid leave whilst at the Respondent’s suggestion and with his agreement ACAS were to be involved to try and mediate and resolve the differences that had arisen.

10.	The Claimant then changed his mind and withdrew his consent to that initiative which accordingly lapsed.  It was not clear to the Tribunal on the evidence which it heard whether the Claimant ever returned to work thereafter apart from attending meetings at Micheldever to deal with his case.  A second grievance process appears to have been started although nothing more is said about that.  The Tribunal said that they were inclined to accept that he did not return to work for more than two days. 

11.	On 25 June the Respondent wrote to the Claimant putting forward the first time a suggestion that he should relocate and come back to work as a tyre-fitter at their Micheldever site rather than returning to Fareham.  There was a meeting on 29 June at which the proposal was discussed.  The Claimant’s reaction was that he wanted to return to Fareham but he would go away and think about the proposal.  On 2 July the Respondent wrote to the Claimant reiterating their offer and pointing out that there were now two vacancies at Micheldever; one for a tyre-fitter, the second for a mechanic.  The Claimant would choose which he preferred.  The Respondent said that they believed that his journey to work time and costs would be the same to Micheldever as to Fareham but if they were more they would subsidise them, and further that the opportunities at Micheldever in terms of salary, were significantly better than at Fareham.

12.	There was a further meeting on 13 July at which those proposals were discussed.  The Claimant by that stage was adamant that he would not go Micheldever.  He said he liked working at Fareham.

13.	The Claimant’s terms of employment permitted the Respondent to require him to work at another work place other than Fareham.  

14.	In letter of 15 July they informed the Claimant that they had the contractual right to relocate him to an alternative work place but they wished him to go to Micheldever as either a tyre-fitter or a mechanic, at his choice, but they believed that that was a reasonable request or instruction and if he continued to refuse it they would consider terminating his employment.  They set out their reason for that request or instruction: a return to Fareham was not a sensible or realistic option given the past history and difficulties between the Claimant and other employees there and the Respondent’s continuing duty of care towards all their employees including the Claimant.  They proposed that the relocation should take effect on 21 July.  There was a further meeting on 20 July, the Respondent told the Claimant that moving him rather than his Fareham colleagues to Micheldever was the only practical solution.  The Claimant was adamant that he should return to Fareham and the other staff should be disciplined and that it was he who was being victimised. 

15.	On 21 July the Respondent wrote to the Claimant changing his place of work from Fareham to Micheldever and telling him that he should attend for work there from 23 July onwards and that any failure to do so would be treated as a disciplinary matter likely to lead to dismissal.  The Claimant did not come to work on 23 July but attended another meeting on 28 July at which he was dismissed by Mr Harley.  He exercised his right of internal appeal against that.  A Mr Sawney rejected it and wrote to him on 8 September upholding the decision to dismiss.

16.	The Claimant brought three complaints before the Employment Tribunal: first that he had been the victim of direct racial discrimination in the manner in which the Respondent had dealt with his grievance arising out of the manner in which he had been treated by his colleagues at Fareham; secondly, he complained that he had been victimised because he had been dismissed because he had raised a grievance against that conduct; and, thirdly, that he had been unfairly dismissed.

17.	The Tribunal analysed first of all how the Respondent had dealt with the grievance, it reached the following conclusions; first Miss Shore did not seem to have appreciated that what may have been previously acceptable to the Claimant was acceptable no longer; secondly, there was a lack of firm, decisive and effective action such as did occur at other depots to ensure that unacceptable conduct ceased at Fareham; thirdly, there was no evidence that a meeting with the Fareham workforce as recommended by Miss Shore had ever taken place.  The Tribunal expressed the view, unsurprisingly that there should have been clear and unambiguous written instructions to all staff at Fareham to ensure that such behaviour ceased immediately and that disciplinary action would follow in the event of any recurrence.  The Tribunal concluded that that did not happen and the objectionable behaviour continued.

18.	Finally, the Tribunal noted that concerns had been expressed by Miss Shore to Mr Harley and Mr Godwin in February 2010 about the incidents at Fareham which were not acted upon by them.  That is a reference to her recommendation to Mr Godwin in his capacity as Area Manager to convene a meeting at which staff would be told that this type of conduct must cease immediately and that a subsequent breach of that instruction would result in disciplinary proceedings.

19.	The Tribunal then addressed itself to the law.  It concluded, uncontroversially as Ms Mayhew for the Respondent accepts, that failing to take effective action upon the Claimant’s grievance and delaying the process of dealing with it was conduct which could give rise to the conclusion that in the absence of an adequate explanation the Respondent had committed an act of discrimination against the Claimant.  In so doing, it correctly directed itself to section 54A of the Race Relations Act 1976 which provides that in those circumstances the burden of proof is transferred to the Respondent.

20.	We accept Ms Mayhew’s proper concession that the Tribunal were entitled on the evidence that we have referred to, to reach that conclusion.  They then asked themselves the correct question, “Whether they have proved that those flaws and failings are not so attributable”.  Their conclusion was that they did not believe that they had done so. The only explanation offered by the Respondent was the lack of staff in a small human resources department.  They accepted that that was to some extent understandable and that the delays were not, “obviously gross” but did state that they would expect an investigation into such a troubling state of affairs where overtly racist name calling was admitted and accepted, “to be a top priority of the Respondent” and that it was not clear that it was.  Secondly they concluded, “the lack of managerial action in such circumstances is both troubling and largely unexplained”.  No reason was given for the failure to take firm and decisive action on or after 5 November 2009.  Accordingly, the Employment Tribunal found that claim proved.

21.	Ms Mayhew submits that the Tribunal was not entitled to reach that conclusion without conducting a detailed analysis of the thought processes of all involved in the procedural failings.  There is, she submits correctly, no adverse finding against Miss Shore.  She draws attention to a recent authority of this Tribunal, Royal Bank of Scotland Plc v Morris UKEAT/0436/10/MAA in which on the findings made by the Employment Tribunal about failings in a disciplinary process within the bank, it held that the Employment Tribunal was not entitled to conclude that there had been direct discrimination.  

22.	All of these cases turn on their particular facts and little assistance is to be derived from comparing one with another.  In this case, the Tribunal correctly identified that the Respondent had not investigated serious complaints with the speed and diligence and effectiveness required, and that they had not taken the steps which had been recommended by the person who did investigate the grievance, Miss Shore, to ensure that they would not occur again.  They did not call Mr Godwin, the person charged with the task of enforcing discipline in this respect at Fareham.  In those circumstances it is hardly surprising that the Tribunal concluded that the Respondent had not discharged the burden cast upon them by section 54A of proving that conduct which was on its face capable of being discriminatory was not.

23.	The Tribunal was entitled to reach their conclusion and accordingly the Respondent’s appeal against the first of their findings is dismissed.  

24.	The next issue which the Tribunal determined was the victimisation claim.  To our mind, surprisingly, the Tribunal expressed the view that the issue was, “relatively straightforward”.  It cited Chief Constable of West Yorkshire v Khan [2001] ICR 1065 and directed itself in these terms:

“In order to determine whether there has been less favourable treatment the statute calls for a simple comparison between the treatment afforded to the complainant who has undertaken the protected act and the treatment which was or would be afforded to other employees who have not done the protected act.”

25.	It was common ground that the protected act was the raising of the grievance.  As a bald statement of the law that was inadequate.  It is not sufficient simply to compare what has happened to someone who has undertaken a protected act with what has not happened to someone who has not.  The Tribunal went on to compound the error by observing:

“The reason or motive for that treatment is immaterial at least as far as the issue of liability is concerned”

26.	That, with respect to the Tribunal, is a misstatement of the statutory test as explained in binding case law.  Section 2 of the 1976 Act provides:

“(1)	 A person (“the discriminator”) discriminates against another person (“the person victimised”) in any circumstances relevant for the purpose of any provision of this act if he treats the person victimised less favourably than in those circumstances he treats or would treat other persons, and does so by reason that the person victimised has … 
(c) otherwise done anything under or by reference to this act in relation to the discriminator or any other person.”

27.	The critical phrase is, “by reason that”.  That does require an analysis of the reason for taking the step said to constitute victimisation, as the House of Lords unanimously made clear in the case to which the Tribunal was referred, Chief Constable of West Yorkshire Police v Khan: see for example the speech of Lord Nicholls at paragraph 29:

“The phrases, “on racial grounds” and, “by reason that” is different exercise.  Why did this alleged discriminator act as he did?  What, consciously or unconsciously, was his reason?  Unlike causation this is a subjective test … Causation is a legal conclusion, the reason why a person acted as he did is at question of fact.”

28.	It was necessary, therefore, for the Tribunal to ask itself the question whether or not the less favourable treatment, the requirement to move to Micheldever, was, “by reason that” the Claimant had undertaken a protected act, the raising of the grievance.  The Tribunal then directed itself to the conclusion which flowed from the test which it posed:

“Applying that test, it is plain that at least part of the reason for the Claimant’s proposed relocation from Fareham to Micheldever was because of his having raised a grievance, the protected act in question, which involves allegations against his Fareham colleagues.  As a result it was proposed to move the Claimant from his existing place of work whereas his colleagues who had not raised any such grievance were to remain where they were.  That must, it seems to us, amount to less favourable treatment.  Accordingly, the victimisation claim must succeed.”

29.	To draw the sting from that conclusion, however, the Tribunal went on to make the following observations:

“We should say at this point for the avoidance of doubt that we do not find the Respondents actions in proposing to relocate the Claimant to amount to what is popularly misunderstood as being victimisation in the sense that the Respondents were only proposing the move in a cynical attempt to try to get rid of the Claimant.  We do not accept that.  We do accept that the Respondents were, to a considerable extent of their own making, in a very difficult position in the early summer of 2010 in seeking to ensure the Claimant’s return to work at Fareham and that what they proposed was, we accept, a reasonable and arguably the best solution that they could come up with.”

30.	They went on to find that the suggested relocation was neither unfair nor unreasonable and explained in the passage of their decision that dealt with the unfair dismissal claim that:

“The great difficulties involved in integrating him back to work at Fareham and the risks involved in so doing for both the Claimant and his colleagues, it was reasonable for the Respondents to seek to relocate the Claimant rather than his colleagues given both the numbers involved and where they all lived at another depot.”

31.	And further that:

“The alternatives the Claimant put forward of either relocating all the staff at Fareham involved or dismissing them were, we find, not reasonable”

32.	Mr Hinton, who appears today for the Claimant and who represented him at the latter stages of the hearing below accepts that there is nothing in the other findings made by the Tribunal to support or justify the conclusion that:

“At least part of the reason for the Claimant’s proposed relocation from Fareham to Micheldever was because of his having raised a grievance which involved allegations against his Fareham colleagues.”

33.	It seems to us that on the clear findings of the Tribunal made in relation to the history as to how matters had got to where they ended up and as to the lack of any realistic alternative to relocating the Claimant from Fareham to Micheldever, that far from the raising of the grievance having been in the minds of anyone responsible for the decision to require him to relocate, it played no part in it.  

34.	The history which we have recited demonstrates that matters came to a head a fortnight after the grievance had finally been resolved by Mr Harley on 8 June 2010 when the Claimant unexpectedly and without prior warning returned to work at Fareham.  That gave rise to the sensible decision by the Respondent to require him to take two weeks’ fully paid absence and to involve ACAS in an attempt to resolve the differences which had arisen.  It is only after the Claimant has withdrawn his consent to that initiative that the Respondent first made the proposal that he should relocate to Micheldever which they did by letter of 25 June.  That proposal was, as the Tribunal found, a reasonable one and, indeed, arguably the best solution to the problem which had arisen.  We are, therefore, driven to the conclusion that there was no foundation in the evidence for the Tribunal’s conclusion that it was the raising of the grievance which formed at least part of the reason for the proposed relocation.  If there is no evidence upon which such conclusion can be based and if it flies, as it does, in the face of the other findings of fact made by the Tribunal then the Tribunal have made an error of law in reaching the conclusion.  We, therefore, allow the Respondent’s appeal against the second of its findings.

35.	The Claimant appeals against the finding that he was fairly dismissed.  In the light of all that we have said it is self-evident that the Tribunal were entitled to conclude that the dismissal was fair.  Mr Hinton submits that what set the train of events in motion which lead to dismissal was, as the Tribunal found and were entitled to find, an act of direct racial discrimination.  Accordingly, he submits that everything that occurs thereafter is tainted by it and that while in other circumstances it may have been reasonable for the Respondent to treat the Claimant’s refusal to relocate to Micheldever as sufficient to justify his dismissal, in the particular circumstances it was not.  That was a matter of judgement for the Tribunal; it made no error of law in reaching the conclusion that it did and we dismiss the Claimant’s appeal against the third of its findings.

36.	We do not wish, however, to leave the appeal without some concluding remarks.  The fact that there is an undisturbed finding of direct racial discrimination in favour of the Claimant will require the Tribunal, when dealing with remedies, to examine the loss which that has caused to him in consequence.  

37.	The fact that he has been fairly dismissed is but a feature of what occurred to him following upon that direct discrimination.  The Tribunal will have to consider carefully whether or not the Claimant can properly seek compensation for the period after dismissal.  In so doing it will no doubt consider whether or not he has unreasonably failed to mitigate his loss by accepting the offer of relocation.  All of those are issues for the future.  It does not, however, automatically follow that because the dismissal was fair, so no compensation can be awarded in respect of any period after it occurred.  These are far from straightforward issues which if not resolved by the parties by agreement will have to be determined at the remedies hearing by the same Tribunal as that which heard the liability issues.

38.	For the reasons which we have given, we allow the Respondent’s appeal against the victimisation finding.  We dismiss the Respondent’s appeal against the finding of direct discrimination.  We dismiss the Claimant’s appeal against the finding that he was fairly dismissed and we remit the matter to the same Tribunal to consider remedies in respect of the upheld finding of direct discrimination.