Airbus UK Ltd v Webb
| Jurisdiction | England & Wales |
| Judge | Lord Justice Mummery,Lord Justice Thomas,Mr Justice David Richards |
| Judgment Date | 07 February 2008 |
| Neutral Citation | [2008] EWCA Civ 49 |
| Docket Number | Case No: A2/2007/0477 |
| Court | Court of Appeal (Civil Division) |
| Date | 07 February 2008 |
[2008] EWCA Civ 49
Lord Justice Mummery
Lord Justice Thomas and
Mr Justice David Richards
Case No: A2/2007/0477
UKEAT/0453/06/DA
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
MR JUSTICE ELIAS, PRESIDENT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Thomas Linden QC (instructed by Ms Lucy Atherton Senior Legal Adviser EEF) for the Appellant
Mr Andrew Short and Ms Joanne Sefton (instructed by Rowley Ashworth) for the Respondent
Hearing date: 25 th October 2007
Approved Judgment
Introduction
The workplace ideal is self-discipline on the part of both employers and employees. Internal procedures designed to deal fairly and effectively with suspected misconduct feature in cases of unfair dismissal brought by employees under the Employment Rights Act 1996 (the 1996 Act).
The practical points for determination in this appeal are (a) the alleged disparate treatment of employees for the same misconduct; and (b) the disputed relevance of an employee's previous misconduct, for which he had received a time-limited final written warning, when, by the date of his subsequent dismissal following the recurrence of similar misconduct, the final written warning has expired.
The provisions of the ACAS Code on keeping records of warnings and on disregarding them for disciplinary purposes state that
“22… A record of the warning should be kept, but it should be disregarded for disciplinary purposes after a specified period (eg six months)
24. The final written warning should normally be disregarded for disciplinary purposes after a specified period (for example 12 months).”
The question is whether the employer, when considering dismissal of an employee for misconduct, must, for all purposes and in all circumstances, ignore an employee's previous misconduct because a final written warning received for it has expired.
In a reserved judgment sent to the parties on 16 June 2006 the employment tribunal (ET) held (by a majority) that the appellant, Airbus UK Limited (Airbus), had unfairly dismissed Mr MG Webb from his employment on 20 September 2005.
On 14 February 2007 the Employment Appeal Tribunal (EAT) dismissed the appeal by Airbus, but, in granting permission to appeal, the President (Elias J) said that the issue in the case was a difficult one of some practical importance.
The general nature of the problem is easy to understand. Almost everyone in the workplace is certain to have a view about it. It is the finely balanced legal arguments, which are reflected in the authorities, that inject difficulty into reaching a reasoned decision. If Elias J, with his deep understanding and exceptional experience in current employment law, says that a point is difficult, we can be sure that it really is difficult.
Elias J put the point in this way in the first paragraph of the EAT judgment prepared by him-
“1. Is a dismissal necessarily unfair if the employee would not have been dismissed but for the employer taking into account an expired disciplinary warning?”
Mr Webb's counsel, Mr Short, put the point in the same way when responding to this appeal. He said that the correct answer to the question posed by Elias J is “Yes” for the reasons given by both the ET and the EAT. He submitted that this is the approach laid down in the authorities, both in the EAT and in the appellate courts, and that it is in accordance with good industrial relations practice and general concepts of reasonableness. This is evidenced by the ACAS Code of Practice on Disciplinary and Grievance Procedures (2000 edition), as approved by the Secretary of State and subject to negative resolution of both Houses of Parliament. The correct approach, he argued, is that it is never reasonable for an employer to dismiss an employee, who would not otherwise be dismissed, in reliance on an expired final written warning. This appeal should therefore be dismissed and Mr Webb's claim should now proceed in the ET for a decision on remedy.
The helpful short summary on the front of the EAT judgment puts the general question into the particular case.
“The employer dismissed the employee for not working when he ought to have been. Others in the same position were not dismissed. The disparity of treatment was because he had been given a final warning for a similar act of misconduct some 13 months earlier whereas the others had clean disciplinary records. However, the final warning given with respect to the earlier misconduct had expired after 12 months. The majority of the Employment Tribunal considered that although dismissal would have been fair had all been dismissed, it was not permissible to distinguish him in this way because once the warning had expired, he had to be treated as someone with a clean record. The warning could not be relied on for any purposes. They considered themselves bound to reach this conclusion in the light of the decision of the Inner House of the Court of Session in Diosynth Ltd v. Thomson [2006] IRLR 284.”
In dismissing the appeal the EAT held that, although it is not strictly bound by decisions of the Inner House of the Court of Session, it should ordinarily follow them. I agree. Otherwise a confused situation is liable to develop in which the law in England and Wales would differ from the law of Scotland on the meaning of the provisions of the 1996 Act, which extend to all parts of Great Britain. The ET and the EAT apply the same law whether they are sitting in Scotland or in England and Wales. In this case the EAT held that the decision in Diosynth, although technically distinguishable, should be followed. It was in line with the recent EAT authorities discussed later. It followed that there was no error of law in the decision of the ET, which rightly treated Diosynth as requiring it to find that Mr Webb was unfairly dismissed.
On the basis of its analysis of the law the EAT added some helpful observations, with which I agree, on the possible ramifications of this ruling for future practice-
“61. Perhaps the lesson for employers is to take care when giving warnings, particularly final warnings, to tailor them to the circumstances-as indeed this employer did in other contexts. As we have said, para 24 of the ACAS Code indicates that although final warnings should normally have a time limit of 12 months, that need not always be so. There is in our view no reason why it should not be longer if the nature of the misconduct justifies it, and in particular if the imposition of a lesser penalty is an act of leniency. An employer might also be justified in extending the period of the warning with respect to a later act of gross misconduct which is the same or substantially the same as that for which the earlier final warning was given.
62. We recognise that to some extent there is tension between the flexibility allowed to employers to consider expired warnings and the complexity of the warning provisions prescribed by the ACAS Code. If employers are going to be denied the right to have regard to expired warnings in any circumstances, then they must be allowed reasonable flexibility to formulate their rules to allow for exceptional cases. This will inevitably make them more complex. Of course, whatever the rules, they must always be carefully drafted and clearly drawn to the attention of employees.”
This is sound practical guidance for employers and employees, whether or not this court upholds the decisions of the ET and the EAT. The question confronting this court is whether the unfair dismissal provisions in the 1996 Act have been correctly interpreted and applied by the ET in the light of the recent decisions of the Inner House and the EAT. What is the legal principle to be applied by this court to Mr Webb's case and by the tribunals to future cases in which an employer has taken account of an expired final written warning in dismissing an employee after further misconduct?
This court has had the advantage of excellent submissions on the law from Mr Thomas Linden QC for Airbus and Mr Andrew Short for Mr Webb.
Background facts
From August 1990 Airbus employed Mr Webb as an aircraft fitter at its Filton site. He was subject to the employer's written disciplinary procedures and its Employee Roles and Responsibilities. Airbus was entitled to dismiss an employee summarily for gross misconduct, which was defined as “Theft or fraud or dishonesty involving the company, its employees, customers or visitors.” In exceptional cases an alternative to dismissal was a final warning.
In July 2004 Mr Webb was accused of gross misconduct involving the misuse of Airbus premises and equipment and the fraudulent misuse of company time. He was summarily dismissed. The decision was overturned on an internal appeal. He was subjected to the lesser penalty of a final written warning under Stage 3 of the company's disciplinary policy.
The disciplinary procedure provided that
“As an alternative to dismissal and only in exceptional cases where mitigating circumstances make the dismissal inappropriate, with the agreement of both the Head of Department and the employee this may be reduced to a Stage 3 warning.”
The provisions in the Disciplinary Procedures relating to Stage 3 warnings provide for written notification to be given indicating, inter alia, “the date when the warning will cease to be live.” It is also provided that, in relation to records, the written notes will be placed on the employee's personnel file held in the Human...
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