Power Packing Casemakers Ltd v Faust

This appeal raises a new point of law on the construction of a statute, a point taken for the first time before the Employment Appeal Tribunal on appeal from an Industrial Tribunal.

On 17th December 1980 the Appeal Tribunal decided that the three appellants had been dismissed by the respondent employers for taking part in "other industrial action" than a strike within s.62 (1)(b) of the Employment Protection (Consolidation) Act 1978; and as no other relevant employees had not been dismissed or offered re-engagement, the Industrial Tribunal had no jurisdiction to determine whether their dismissal was fair or unfair by virtue of s.62 (2). The Appeal Tribunal therefore allowed an appeal from the Industrial Tribunal, who had heard the appellants' claims for compensation for unfair dismissal and had determined on 2nd April 1980 by a majority that their dismissal was unfair, and on 5th March 1981 the Appeal Tribunal gave the appellants leave to appeal.

The appellants were dismissed without notice on 26th November 1979 for refusing to work overtime at the respondents' request. The respondents are a small company employing a staff of fifteen only, nine of them on the shop floor. They make packing cases for goods for despatch and they got a rush order for an export job, which they claimed and the appellants denied, required their workmen to work overtime to get the goods packed and on board ship before a deadline. All the workmen, when threatened with dismissal, complied with the request to work overtime, except the three appellants. They refused and were dismissed.

The only point taken before the Industrial Tribunal was whether it was a term of their contracts of employment that they should work overtime when requested. That depended on whether an appendix to a Recognition and Procedure Agreement between the respondents and the Transport and General Workers' Union incorporated such a term into their contracts. The majority of the Tribunal decided that it did not. The dissenting member thought that it did, and further that an employer may have a right to dismiss a workman who will not cooperate by working overtime to help the employer out of a temporary difficulty. The decision of the majority was that, as the appellants were not in breach of contract or guilty of misconduct in refusing to work overtime, they were unfairly dismissed.

The respondents' challenge to this decision on the ground that there was a term of their contracts obliging them to work overtime if reasonably requested was abandoned at the start of their appeal to the Appeal Tribunal. The only point taken before the Appeal Tribunal was a point on s.62 not taken below. The Appeal Tribunal allowed it to be taken because it went to jurisdiction, decided it in the respondents' favour, decided that it was unnecessary to remit the case to the Industrial Tribunal and allowed the appeal. Mr. Jones, to whom the court is indebted for the manner in which he has argued the appeal before us, concedes that the Appeal Tribunal were right to hear and decide the point and not to remit the case if it was correct to decide it as the Appeal Tribunal did. The sole question for us, therefore, is whether the Appeal Tribunal did decide the point rightly.

In my opinion they did. I agree with the reasons given by Mr. Justice May in giving the judgment of the Appeal Tribunal with one exception, but in view of the importance of the case and of the arguments addressed to us, I shall state my opinion in my own way, though in many of the words used by Mr. Justice May.

S.62 provides as follows. By sub-section (1):

"The provisions of this section shall have effect in relation to an employee who claims that he has been unfairly dismissed by his employer where at the date of dismissal—

• (a) the employer was conducting or instituting a lock-out, or

• (b) the employee was taking part in a strike or other industrial action.

(2) In such a case an industrial tribunal shall not determine whether the dismissal was fair or unfair unless it is shown—

• (a) that one or more relevant employees of the same employer have not been dismissed, or

• (b) that one or more such employees have been offered re-engagement, and that the employee concerned has not been offered re-engagement.

Sub-section (4) defines "date of dismissal" and "relevant employees".

All relevant employees were dismissed because only the appellants refused to work overtime. So the question is: In refusing to work overtime, were the appellants taking part in "other industrial action" than a strike within s.62(1)(b)?

It has not been suggested, except from the Bench, that they were taking part in a strike. But were they taking part in the same kind of industrial action as a strike? For that is the question prompted by what I regard as the natural and ordinary meaning of the words in their context. There was, according to the findings of the Industrial Tribunal, a history of a dispute about wages after an increase in November 1978. The respondents half promised a further increase, but refused to implement the increase. "The men" (I quote from paragraph 7 of the Industrial Tribunal's decision) "through Mr. Cullinan" (the second appellant) "stated that they would take industrial action". According to the Industrial Tribunal, they did. In passages from paragraphs 6 and 9 of their decision, which the Appeal Tribunal quoted, they found, first:

"….. that the ban on overtime which was indulged in by the workforce was in connection with wage negotiations. Undoubtedly the workforce used it as a weapon. It was industrial action but it was industrial action which did not amount to a breach of contract and was not therefore misconduct. That is the firm view of the majority of this tribunal".

Secondly, they found:

"….. the fact remains that these three applicants were dismissed for taking industrial action by refusing to work overtime".

The written grounds of each appellant's complaint were these; I read from p.15 of our bundle, paragraph 12:

"For some time before my dismissal, I and the other men employed at the factory had been asking our employers for an increase in wages. We approached them both directly through our shop steward and through the local officer of our union. The management avoided meaningful negotiations and the workforce decided on limited industrial action. For taking part in this I was dismissed without any warning or operation of the ACAS Code of Conduct or the disciplinary procedure set out in the terms and conditions of our contract of employment. The circumstances leading to the dismissal were artificially created by the management and were not bona fide".

The opinion which each applicant gave as to the reason for his dismissal was:

"The company wished to get rid of us because we had several times asked for increased wages or at least to intimidate us so that we would drop our claim for increased wages"—that is paragraph 13.

The Appeal Tribunal stated their view in this way; I read from p.7 of the transcript:

"….. first, it is clear from the evidence and from the reasons the industrial tribunal gave for their decision that the material refusals to work overtime occurred at a time when the employees generally were in dispute with their employers about wages. We refer back to the sentence which we have already quoted from paragraph 6 of the Reasons for the decision of the industrial tribunal. It is also clear, we think, that this was the situation from the evidence of the three employees themselves, who were the applicants before the industrial tribunal, and the notes of whose evidence by the Chairman appear at pages 36/37/38 and 40 of the bundle of papers before us. At 36, for instance, one of the witnesses (that was the second appellant) "said 'no rise came…..' that is no rise in pay came '….. in spite of redundancies. We had no alternative but to ban overtime'. Later: 'I made clear that over refusal to do overtime we were taking industrial action'. Later still: 'All refused to work overtime. A ban because of the pay rise dispute'. Then another witness" (that was a Mr. Smith, a fork lift truck driver) "'we were told that in no way could they afford to give us a rise so we said we would take industrial action'. Then the last quotation which I need incorporate in this judgment, there are others, from another witness: 'We all agreed to ban overtime until we heard about our pay rise'".

To that I would add, from pp.42 and 43, two answers by the third appellant:

"I think management created a confrontation over overtime because a dispute over wages had been going on for some time"

and in cross-examination:

"it seemed to me that management brought about the confrontation. We were wanting to negotiate a wage rise but management produced the deadlock".

The Industrial Tribunal were not addressing their minds to s.62 and the meaning of the words "industrial action" there. But I find that that makes the material provided by...