DWP v Mughal UKEAT/0343/15/JOJ
Appeal against a finding that the Claimant was unfairly dismissed and against an order for reinstatement. Claimant's appeal against a 75% contributory fault reduction in arrears of pay. Appeal allowed and remitted to a fresh Tribunal for a re-hearing.
The Claimant was dismissed for misconduct after it was found that she had used the DWP system to enquire about the circumstances of her own tenant. The ET found that the dismissal was unfair saying that the sanction of dismissal was outside the band of reasonable responses. The ET also made an order for reinstatement, saying that the Claimant's behaviour was not dishonest but a one off moment of madness for which a final written warning would have sufficed. A 75% contributory fault reduction was made in the arrears of pay. The Respondent appealed, and the Claimant appealed against the reduction.
The EAT allowed the Respondent's appeal. The Employment Judge relied on a matter that was unsupported by any evidence and not true as a matter of fact; and on factors that were not relied on as relevant by either party and were not explored in evidence or submissions. These features were material to the decision that dismissal was outside the range of reasonable responses, and the EAT had no sufficient confidence that the outcome would have been the same had they been properly addressed.
Appeal No. UKEAT/0343/15/JOJ
EMPLOYMENT APPEAL TRIBUNAL
FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8AE
At the Tribunal
On 14 & 15 June 2016
THE HONOURABLE MRS JUSTICE SIMLER DBE (PRESIDENT)
DEPARTMENT FOR WORK AND PENSIONS (APPELLANT)
Transcript of Proceedings
JUDGMENT**APPEAL AND CROSS-APPEAL****APPEARANCES**
For the Appellant MS LAURA PRINCE (of Counsel) Instructed by: Government Legal Department Employment Group E2 One Kemble Street London WC2B 4TS
For the Respondent MS GEORGINA BRYAN (of Counsel) Free Representation Unit**SUMMARY**
UNFAIR DISMISSAL - Reasonableness of dismissal
UNFAIR DISMISSAL - Reinstatement/re-engagement
- The central issue for the Employment Tribunal in circumstances where serious misconduct was admitted and the disciplinary process was reasonable and fair was whether dismissal was a reasonable sanction in the particular case.
- On that question the Employment Judge relied on a matter that was unsupported by any evidence and not true as a matter of fact; and on factors that were not relied on as relevant by either party and were not explored in evidence or submissions. These features were material to the decision that dismissal was outside the range of reasonable responses, and the Employment Appeal Tribunal had no sufficient confidence that the outcome would have been the same had they been properly addressed. The appeal was therefore allowed.
- Separately, the reinstatement order was flawed for similar reasons. Factors relied on by the Employment Judge to conclude that reinstatement was practical and just notwithstanding the finding of significant contributory conduct (assessed at 75 per cent) were not raised by the Employment Judge and/or were not a permissible option on the evidence.
- This is an appeal and cross-appeal from a Judgment of Employment Judge Spencer sitting alone with Reasons sent to the parties on 21 August 2015. The Employment Judge held that the Claimant, as I shall refer to her, was unfairly dismissed because no reasonable employer could have dismissed in the circumstances of the case but that she had nevertheless contributed to her dismissal by behaviour that was both culpable and blameworthy assessed at 75 per cent. The Employment Judge ordered reinstatement with effect from 14 July 2015 but directed that there should be a reduction by reference to the 75 per cent reduction for contributory fault in respect of arrears of pay.
- Both sides appeal. The Department of Work and Pensions (referred to as "DWP") appeals from the finding of unfair dismissal and the order to reinstate. The Claimant resists the appeal, and she herself appeals from the decision that arrears of pay in relation to the reinstatement order should be reduced by 75 per cent by reference to the contributory conduct found. The Employment Judge's Notes of Evidence have been obtained, and in addition to those I have also been provided with the witness statements of the Claimant, Ms Cierebiej and Ms Janagal, the investigation interview and report prepared by Carl Burge, the notes of the disciplinary hearing conducted by Ms Janagal and the notes of the appeal hearing conducted by Ms Cierebiej.
- At the beginning of the appeal hearing an application was made on behalf of DWP by Ms Prince, who appears for DWP, for an order permanently anonymising references to the Claimant's tenant (referred to as part of the history and background facts in this case) in the Appeal Tribunal's record of proceedings and in this Judgment. The Claimant, who appears by Ms Bryan, adopted a neutral stance in relation to the application. For the reasons given in a short Judgment at the beginning of the hearing, I concluded that it was necessary in the interests of justice and to protect the Convention rights of the tenant to make such an order. I had regard to the important principle of open justice and the Article 10 freedom engaged by any suggested anonymity order. I concluded that there would be limited interference with such rights since the press can fully report on the proceedings, which are public, and all parties to the proceedings will be named except the tenant, who plays a peripheral role. I had regard to the fact that the tenant is neither a party to the proceedings nor has had any opportunity to put their side of the case; and to the fact that the tenant is referred to in the context of that person's benefit status, in respect of which serious allegations potentially amounting to allegations of criminal offences are made and engage Article 8. I was satisfied that there would be significantly more publicity given to any EAT Judgment on this appeal, which will automatically be uploaded to the internet, than there has or might have been in relation to the Employment Tribunal Judgment in this case, which does identify the tenant. Following A v B  IRLR 844, where loss of anonymity involves a breach of Convention rights the Employment Appeal Tribunal has a duty pursuant to section 6 of the Human Rights Act to interpret its powers so far as possible to protect anonymity provided proper regard is had to the principle of open justice and freedom of expression. The balance comes down in favour of preserving the tenant's anonymity and, accordingly, the tenant will be referred to as "L".
- The facts as found by Employment Judge Spencer can be summarised as follows. The Claimant commenced employment on 19 April 1999. She was promoted on two occasions and by 2014 was working at Executive Officer level as a Customer Service Officer at the Ealing Jobcentre. As a Government department holding a considerable volume of personal data concerning members of the public on its computer systems, DWP has policies and procedures relating to computer use by employees. Among those policies referred to by the Tribunal were the following:
(i) A standard of behaviour procedure, that sets out the expectations of DWP of its employees, deals with the use of official information, whether security marked or not.
(ii) That procedure also sets out the uses for which computer systems provided by DWP to employees are permitted and makes clear that that authorisation and permission is for use for the designated purposes required for the individual's job and not in any circumstances for use to access or attempt to access the individual's own records as a DWP customer or the records of friends, family members or ex-partners, nor is it permitted to access the records of other customers, including celebrities, even to find out an address or a birthday date, without authorisation and a legitimate reason. Access without authorisation for a legitimate reason is a disciplinary offence that is taken seriously and will result in disciplinary action that can lead to dismissal.
(iii) The Civil Service Code applies to staff within the DWP and sets out expectations and standards of behaviour expected of members of staff, placing an emphasis on acting with integrity, honesty and a requirement not to misuse the individual's official position.
(iv) DWP procedures make clear to employees that unauthorised access of customer records is normally considered to either be serious or gross misconduct.
- The Tribunal also referred to guidance given by DWP to managers dealing with information security breaches in a disciplinary context by means of an "information security policy scenario matrix" (referred to as "the matrix"). The matrix sets out examples of security breaches and suggested disciplinary consequences for such breaches. The Tribunal set out an extract from the matrix at paragraph 24. It identifies two examples of security breaches, both described as gross misconduct:
(a) The first example (paragraph 1.1) refers to an employee with authorisation to access personal data or information as part of their normal duties, who accesses records without legitimate business reasons or authorisation and uses the information themselves or on behalf of a third party for personal gain or to falsify claims for benefits. This scenario is said to merit dismissal in all cases where access to the data was used for inappropriate reasons. The only exception identified is where an employee was acting under extreme duress, violence or threat of violence.
(b) The example at paragraph 1.2 of the matrix identifies a situation where an individual accesses or browses through multiple customer records, possibly including their own or family, friends' or celebrities' records without a legitimate business reason or appropriate authorisation. The matrix describes this too as gross misconduct. It states that when determining the appropriate level of penalty, the motive of the individual in accessing the records is relevant, together with the number of records accessed and any resulting impacts. In terms of possible outcome for a paragraph 1.2 scenario, dismissal is appropriate if the manager believes the actions to be suspicious or malicious and no reasonable justification for accessing the records can be provided. A final written warning is said to be appropriate if the employee can provide some reasonable explanation as to why they may have accessed the records or some other relevant mitigation.
- Employment Judge Spencer found that the Claimant was aware of the content of all relevant policies and procedures and indeed at paragraph 26 referred to the fact that the DWP computer system also contained a warning to the user each time the user accessed confidential information and reminding the user of their obligations.
- The Claimant had an unblemished disciplinary record over her 15 years of service. She had a number of significant personal issues, including financial problems, in 2014. She rented a room in her home to a tenant, L. L defaulted on rent payment obligations which put the Claimant in a difficult financial position.
- On 15 July 2014 the Claimant went into work and soon afterwards accessed L's personal information on the DWP labour market system (paragraph 28):
"28. … viewing sections including client details, client conversation, submission history and sensitive personal details screens for approximately four minutes. …"
The Claimant then made a separate access to L's Jobseeker's Allowance record for approximately half a minute (paragraph 28). The Employment Tribunal held:
"… There was no legitimate business reason for that access and it was not authorised …"
- The Claimant discovered that L had been in receipt of housing benefit. Later in the day the Claimant rang the London Borough of Hillingdon ("Hillingdon"), again during working hours, and posed as L to obtain confirmation from Hillingdon that housing benefit had been paid. After 3.00pm, the Claimant emailed Hillingdon from the DWP email system confirming that she was L's landlady, complaining about the failure by L to pay rent, confirming that she now knew that L was in receipt of housing benefit and asking for assistance from Hillingdon. In her email the Claimant gave some of L's personal information including a housing benefit reference number and L's parents' address. The Claimant asked Hillingdon to investigate the situation, and, as the Tribunal recorded at paragraph 29, wrongly indicated that Jobcentre Plus was investigating whether L was working while claiming benefits.
- On 17 July L made a complaint to DWP about the Claimant's conduct and the fact that she had obtained and accessed information about L's benefits, which was investigated. The Claimant was not suspended during the course of the investigation and continued to have full access to the DWP computer systems despite the nature of the allegations made against her.
- There was an investigation meeting. The Claimant explained her personal and financial situation and made no attempt to conceal what she had done, explaining that the actions she took were to find out if housing benefit was being paid or Jobseeker's Allowance received in circumstances where she understood L was working. The investigation report (dated 24 September) reflected that she readily and fully admitted her breach of policies and procedures, and that she apologised during the course of the investigation meeting. The report also recorded her explanation for her actions, citing frustration at her situation with L and the fact that the Claimant said her actions were out of character and out of desperation. Mr Burge, who conducted the investigation and compiled the report, concluded that the Claimant had a case to answer, and a disciplinary process followed.
- The Claimant attended a disciplinary hearing and was candid in her admissions, recognising that what she did was wrong. The Tribunal found (at paragraph 35) that she mentioned at the disciplinary hearing that she had notified her line manager immediately after her actions on 15 July. That finding is the subject of one of the grounds of appeal.
- The dismissing officer, Ms Janagal, sought advice from HR after the disciplinary hearing. The advice suggested that the offence "would seem to fit within Section 1.1 of the matrix". The Employment Judge disagreed with that analysis, concluding that the offence fitted (paragraph 37):
"37. … within paragraph 1.2 of the matrix given that the access was not for the purpose of personal gain or to falsify a claim for benefits."
That conclusion is the subject of another of the grounds of appeal.
- Ms Janagal concluded that four incidents of misconduct were committed: two accesses of the DWP computer system and two communications to Hillingdon. She concluded that the conduct was a serious breach and amounted to gross misconduct, the sanction for which was summary dismissal.
- There was an appeal. The Claimant attended a hearing on 6 November, describing her actions as a moment of madness. The Tribunal found, again, that in the course of the appeal hearing she confirmed (paragraph 40) "after she had done it, she had met with her line manager to explain the situation to her". The appeal officer, Ms Cierebiej, confirmed the decision to dismiss. The Employment Judge accepted that the Claimant was dismissed by reason of her conduct and that the Respondent followed a fair and reasonable procedure at all stages. The Judge found that DWP was plainly entitled to conclude that the Claimant committed the four acts of misconduct.
- The Employment Judge (not unnaturally) regarded the critical issue as whether the decision to dismiss was so harsh as to take it outside the band of reasonable responses. In dealing with that issue, the Judge found the Claimant's behaviour was clearly serious misconduct; she knew that what she was doing was wrong, and knew her actions were a breach of DWP procedures. Moreover, she accepted her actions would normally amount to gross misconduct. The Judge found, however, that there were very significant mitigating factors all known to the Respondent, including the following:
"47.1. The Claimant had admitted her wrongdoing to her line manager immediately after the incident. Her line manager appears to have taken no action; and
47.2. She had admitted wrongdoing at all stages of the process and acknowledged at all stages that what she had done was wrong; and
47.3. The Claimant was under significant financial and personal pressures at the time; and
47.4. She was in poor health including mental health issues, suffering from stress and depression; and
47.5. The motivation for her actions were [sic] not for obvious financial gain; and
47.6. It was a one-off incident. I accept that there are four instances of misconduct but they all occurred on the same day and are plainly all part of the same factual matrix and were, as the Claimant put it, part of the same moment of madness; and
47.7. There is the fact that the Claimant had 15 years' service with the Respondent and an unblemished disciplinary record."
- The Judge then held:
"48. I approach this case was some caution. I recognise that it is not for me to substitute my judgment in this case. However, having seen the Respondent's witnesses cross-examined, I have concerns. Neither witness gave me the impression that they had attached any real weight to the substantial mitigating circumstances in this case. When cross-examined, neither witness could really be shifted from the rigid and inflexible mind-set that the punishment of dismissal fits this crime regardless of the circumstances. I was satisfied from the Respondent's witnesses that either [sic] had placed sufficient weight on the very significant mitigation in this case. The Respondent's approach was summed up in my view from the advice from their HR Department on page 138 of the bundle. This demonstrated the somewhat blinkered approach that the Claimant's actions were gross misconduct and could only be excused if there was violence or threats of violence. In my view the Respondent relied too rigidly on the matrix in their policy documentation and demonstrated a reluctance to take a step back to look at all the circumstances in the round as any reasonable employer would have done. This is not a case where in my view the Respondent placed enough weight on the significant mitigating circumstances. To place it in the wording of the Section 98 test [sic]. It is not the weight to which a reasonable employer would have attached. I therefore find that dismissal was unfair as in my view the sanction of dismissal was outside the band of reasonable responses."
- So far as remedy is concerned, the Judge assessed the Claimant's contributory conduct as 75 per cent, and, having regard to that finding, recognised that he was required to consider whether it was just to order reinstatement, having concluded that reinstatement was practical in the circumstances. At paragraph 49 he held:
"49. I go on to deal with the Respondent's arguments concerning remedy. The most significant is the question of whether I should make an order for reinstatement. I am conscious of the fact there are various factors that I need to consider under Section 116 ERA [Employment Rights Act]. The first of those is whether the Claimant wants an order for reinstatement to be made. Clearly she does. That has been confirmed during the course of the hearing. I must go on to consider whether it is practicable to reinstate. The Respondent has raised two issues in this respect. Firstly, the argument that the Claimant might commit misconduct once more if she is re-instated. I reject that argument. Reinstating the Claimant on a final written warning would clearly be sufficient to deter her from committing such misconduct in the future. It is quite clear to me from the Claimant's evidence before me that she has learned from this episode. I consider it highly unlikely that she would commit the same misconduct again. I am also not satisfied from the Respondent's evidence that it will be impractical to reinstate the Claimant. The evidence is somewhat thin. The suggestion is that the Claimant's job has not been filled by a permanent replacement and is currently being filled with what Ms Cierebiej described as "internal moves within the district". The evidence to support the Respondent's contention that it would be impractical to reinstate the Claimant is vague. I am not satisfied from this evidence that it makes it impractical for the Respondent to reinstate. The Respondents have [sic] not come close to establishing sufficient evidence in this regard. I also must consider whether it would be just to order reinstatement where the Claimant's conduct might have contributed toward the decision to dismiss. It is clear to me that the Claimant's actions did amount to serious misconduct. It is clear to me that on the Claimant's own admission that her behaviour was both culpable and blameworthy and was a significant contributory factor for the Respondent's decision to dismiss [sic]. For those reason [sic] I assess contributory conduct to the extent of 75%. Bearing in mind that finding, I must go on to consider whether it is just to order reinstatement. This is a case where I consider it is practicable for the employer to reinstate. The Claimant's behaviour was not dishonest, it was my view a one off moment of madness as she put it for which a final written warning would suffice and in the circumstances I am persuaded to make an order for reinstatement. However, any award of compensation for the losses suffered between the dismissal and reinstatement will be reduced by 75% for the Claimant's contributory conduct."**The Liability Appeal**
- DWP challenges the finding of unfair dismissal on three grounds. First, it is said that the Tribunal erred in law in making a finding of fact for which there was no evidence (namely that the Claimant voluntarily reported her misconduct to her manager immediately after the events in question). Secondly, the Tribunal erred in law in relying on matters that had not been mentioned or treated as relevant during the course of the hearing (the suggestion that the Claimant informed her line manager of her misconduct immediately and voluntarily, and the finding that the Claimant's misconduct was not carried out for personal gain, and the finding that the misconduct came within paragraph 1.2 rather than paragraph 1.1 of the matrix). The third ground raises a perversity challenge.
- In relation to ground one Ms Prince relies on three findings made by the Employment Judge, all to the effect that the Claimant met with her line manager immediately after her actions on 15 July to explain what she had done:
(i) The finding at paragraph 35 that the Claimant mentioned at the disciplinary hearing the fact that she had notified her line manager immediately after her actions on 15 July.
(ii) The finding at paragraph 40 to the effect that the Claimant:
"40. … referred to [her] actions as being, in her words, 'a moment of madness' and again confirmed that after she had done it, she had met with her line manager to explain the situation to her."
(iii) The finding at paragraph 47.1 that a very significant mitigating factor known to the Respondent throughout the process included that:
"47.1. The Claimant had admitted her wrongdoing to her line manager immediately after the incident. Her line manager appears to have taken no action; …"
Had the Claimant self-reported her misconduct on a voluntary basis to her line manager on 15 July 2014 or immediately after, DWP submits that would have been a very significant mitigating factor. Accordingly if that was the basis or one of the bases on which the Employment Judge proceeded it must have been a material consideration.
- The Claimant accepts that as a matter of fact she did not make any voluntary confession to her line manager on 15 July or shortly thereafter. That did not happen, and it is accepted that she did not give evidence to the Tribunal that this occurred. Nevertheless, Ms Bryan submits there was evidence entitling the Tribunal to reach the conclusion that the Claimant did make such a report without waiting first for a complaint to be made against her. Even if that is wrong, she submits this finding made no material difference to the Tribunal's decision in circumstances where there was evidence in any event that the Claimant informed the fraud or compliance manager of her actions at an early stage and this prompted no disciplinary action or any suspension. Moreover, and in any event, Ms Bryan submits this is a case where the important decision makers were found to have taken a blinkered approach, displaying a rigid and inflexible mindset that the punishment of dismissal fitted the crime regardless of the circumstances so that an immediate admission to the Claimant's line manager, even if not made, could not have affected or altered that conclusion.
- Ms Bryan relies in particular on the notes of the appeal meeting (page 149 of the appeal bundle) which record the Claimant explaining that, "As soon as she had done it she met with her line manager to explain the situation to her". She submits that, taken at face value, this was evidence available to the Tribunal capable of being relied on to support the finding that the Employment Judge made. Ms Bryan recognises that the sentence cannot be read as meaning that the Claimant confessed of her own volition on 15 or 16 July once the true facts are known and understood, and that in fact the sentence must have referred to something else, but this was not explored in the course of the hearing. She submits that despite not raising this point to clarify what was meant with either side or any of the witnesses, the Employment Judge was nevertheless entitled to rely on that sentence as he did, accepting that the situation is not ideal.
- It is clear beyond doubt that neither side referred in the course of evidence, to the passage in the notes of the disciplinary and appeal hearing referred to above: see the Employment Judge's Notes of Evidence and Submissions, together with the written submissions. It is also clear that save for the reference in the notes of the appeal (and to a lesser extent in the disciplinary hearing) all evidence on both sides pointed against any such self-report having been made. The Claimant's witness statement made no reference to such a report. In evidence the Claimant said nothing to suggest she made such a report. The Respondent's witnesses made no reference to such a report. Moreover, when Ms Janagal was cross-examined to the effect that the Claimant had explained at the first opportunity about the difficulties she had experienced with L, she said, "first time she spoke was at investigation. Not when it happened. …". She was asked whether the Claimant admitted everything and at the earliest opportunity, and her answer was, "At the investigation". In answer to a later question she repeated this, stating, "Didn't talk to Line Manager. Only following investigation that she admitted it. Not straightaway". When asked the question, "She didn't confess of [her] own volition?" the answer she gave was, "No". Ms Janagal was not further challenged, and no reference was made to the note recorded in the disciplinary hearing (see page 145) whether in cross-examination of her by the Claimant's representative or by the Employment Judge. It was not suggested to her that this did happen, that she knew about it and on the footing that it did happen that it amounted to or should have been treated as amounting to very significant mitigation. The appeal officer gave evidence and was not challenged to the effect that significant mitigation in the form of a voluntary confession made by the Claimant to her line manager immediately after the events in question was disregarded by her; nor was page 149 put to her by anyone in the course of her evidence.
- To the extent that the Claimant relies on a voluntary confession as to her actions to the fraud or compliance manager the following day, the evidence demonstrates quite clearly that this did not happen either. Rather, the Claimant's evidence to the Tribunal and to her employer was that she spoke to compliance (referred to by her as the fraud department) not to report her own misconduct but to complain about the behaviour of L in failing to pay the rent and to see if there was any other way to get the rent paid.
- Can it be said, as Ms Bryan submits, that this finding was immaterial to the outcome? It was listed by Employment Judge Spencer as the first of a number of "very significant mitigating factors all of which were known to the Respondent throughout the disciplinary process" (paragraph 47) and in respect of which he found no real weight nor sufficient weight was attached by the dismissing or appeal officer in the case. I am quite unable to say in those circumstances that this was an immaterial finding. To the contrary, I accept the argument advanced by DWP that this was a material and significant factor. It would have been treated as such by the Respondent, and it is unsurprising in those circumstances that it was listed as the first significant factor and described as such by the Judge.
- Given that there is in fact no question but that the Claimant did not make an immediate voluntary confession and such a finding was not contended for by her, nor relied on in evidence nor treated by her as relevant in any way to the Employment Judge's consideration, I am quite satisfied that fairness demanded that DWP and its witnesses be given the opportunity to address their understanding and knowledge of the suggested self-report and the meaning of the references at pages 145 and 149, before the Employment Judge could fairly conclude that they knew throughout the processes that the Claimant did make an immediate voluntary confession. There was otherwise no evidence at the hearing to support a finding that she did or that this was their understanding. This is not a point on which the Tribunal could proceed safely on the basis that no useful comment or explanation could have been provided. The opposite is demonstrably the case. The grounds of appeal accordingly succeed in relation to this finding, and I shall deal below with the extent to which it affects the outcome following my consideration of the other grounds of appeal.
- Ground two challenges as in error of law the Tribunal's reliance on matters not treated as relevant during the hearing without giving the parties an opportunity to give evidence or make representations about those matters. I have already dealt with the first matter relied on by DWP, namely the finding that the Claimant made a voluntary confession of her misconduct immediately after the incident.
- Two further linked findings are relied on by Ms Prince: first, the Employment Judge found that the Claimant's misconduct was not carried out for the purpose of personal gain; and secondly, that it was misconduct within paragraph 1.2 rather than paragraph 1.1 of the matrix. Ms Prince submits these material findings informed the Employment Judge's conclusion that another very significant mitigating factor known to the Respondent throughout the disciplinary process was the fact that the motivation for the Claimant's actions was not for obvious financial gain (see paragraph 47.5). Although the Employment Judge asked Ms Janagal which scenario she regarded the offence as falling within and received the answer that it fell within paragraph 1.1 of the matrix because there was personal gain in that the Claimant accessed systems for her gain in the form of the rent money she sought to obtain from L by accessing information and contacting the housing benefit department, those answers were neither challenged by the Employment Judge or on the Claimant's behalf during cross-examination nor was the Employment Judge's own view of the matter explored with that witness, any other witness or with counsel during submissions. She submits there was no other evidence to support the findings. (I note here that neither the Employment Judge's conclusion at paragraph 37 that the offence seemed to fit within paragraph 1.2 rather than paragraph 1.1 of the matrix, nor other impugned findings are challenged on the basis that the Employment Judge wrongly substituted his own view for that of the DWP officers rather than addressing the reasonableness of their views by reference to the band of reasonable responses.)
- Against the submissions made by DWP Ms Bryan accepts that there was no challenge to the evidence given by Ms Janagal nor did the Employment Judge explore his concerns having raised the question about personal gain. She submits, however, that what the Employment Judge did was sufficient because he did not rely on the finding that this was a paragraph 1.2 rather than a paragraph 1.1 case, or that there was no personal gain in concluding that the dismissal was unfair. Rather, she repeats the submission made in relation to the earlier finding that the Tribunal's conclusion on liability turned on the central finding that the dismissal and appeal officers adopted a closed-minded and inflexible approach to the case and not on the correct application of the matrix. She submits that further opportunity to canvass these points would not have made any difference to the outcome accordingly.
- I do not accept that the Employment Judge did not rely on the finding in relation to personal gain. Although at paragraph 47 he referred to the absence of obvious financial gain as a motivation for the Claimant's actions - another of the very significant factors found by the Judge to have been known by the Respondent throughout the process - that finding was inextricably linked to the conclusion that this is a case involving no personal gain reached at paragraph 37. In any event, none of the DWP witnesses was asked by anyone - the Employment Judge or in cross-examination - whether it was their understanding and known to them that the motivation for the Claimant's actions was not for obvious financial gain. Ms Bryan accepted in the course of argument that there is an obvious link between what the Claimant did in accessing the computer systems relating to L and then contacting Hillingdon posing as L to obtain confirmation that housing benefit had been paid and her own very difficult financial position. The Claimant's obvious concern was receiving payment of her rent. She accessed private and confidential information in her personal capacity as a landlady and to which she would otherwise not have had access, in order to put her in a position to obtain the money owed to her in view of her financial problems. In these circumstances, and in light of the evidence given by Ms Janagal, it is likely that, if asked, she would have said that her understanding was that the whole purpose of the Claimant's actions was to obtain rent money owed and in that sense her actions were for financial gain. This question ought to have been explored if the Employment Judge intended to rely on it.
- Ms Bryan submits that personal gain in context means gaining something to which the individual was not previously entitled. I disagree. In any event, this was not the meaning adopted by Employment Judge Spencer, nor was it relied on by anyone below. It is not the meaning adopted or understood by Ms Janagal or Ms Cierebiej, nor was it put to them or explored in evidence. In the context of DWP providing computer systems to employees for the purposes of fulfilling their official responsibilities and functions and authorising the use of computer systems for that purpose only, it would be surprising if personal gain had such a restricted meaning. It seems to me that the emphasis by DWP in relation to information security is on the use of computer systems for the purposes of the legitimate business interests of DWP only and on the prohibition of the use of such systems for an employee's own personal interests or personal gain, whatever that gain might be.
- In light of the evidence of Ms Janagal and in the context of the information security policies as a whole, I am not satisfied that the findings of fact made by the Employment Judge on this issue were obviously and unarguably correct findings on which neither party could make any useful comment or provide any useful information. I am persuaded that Ms Prince is correct that the finding that the Claimant's misconduct was not for personal nor obvious financial gain was a material finding in the context of the Tribunal's conclusions at paragraphs 47 and 48, and accordingly it was incumbent on the Employment Judge as a matter of fairness to give the DWP witnesses the opportunity to address a point on which he relied to support his conclusion. I return to this issue below to deal with the consequence of that conclusion in relation to the outcome.
- Ground three raises perversity. The high hurdle that must be established in order successfully to mount a perversity appeal is acknowledged by Ms Prince and emphasised by Ms Bryan. An Employment Tribunal is entitled to find that dismissal was outside the band of reasonable responses without being accused of substituting its own view or placing itself in the position of the employer. Having accepted that DWP followed a fair and reasonable procedure and that the dismissing and appeal officers were entitled to conclude that the Claimant had committed the four acts of misconduct amounting to serious misconduct, which she knew to be wrong and in breach of DWP procedures, it was for the Employment Tribunal to decide whether dismissal represented a reasonable response to that conduct. That is what the Tribunal did, and, subject to the points made above and to two points made below under this heading, I am not persuaded that there was perversity in the Tribunal's findings and conclusions. I deal briefly with each of the particular grounds of perversity relied on, save for those in respect of which I have already concluded that the findings were in error.
- Although Ms Prince accepts that in principle it is possible to have a finding of 75 per cent contribution and a finding that a dismissal is substantively unfair, she submits that such a finding is rare. She relies on Moreland v Newton (t/a Aden Castings) UKEAT/435/92, where Mummery P, as he then was, dealing with a case where the Tribunal found the dismissal unfair because a reasonable employer would have given a warning rather than dismissing the employee, but on the other hand held the employee 100 per cent to blame for the dismissal, concluded that a finding of unfair dismissal and a refusal to award any compensation on the grounds of contributory fault is a rare and unusual combination requiring justification by reference to evidence and the giving of reasons. In this case, there was no finding of 100 per cent contribution. The Tribunal explained the significant contribution of the Claimant and the significant blame she bore for the events leading to the dismissal while nevertheless finding the dismissal unfair in light of the blinkered and inflexible approach to the Claimant's case that failed to have regard to the very significant mitigating factors identified by the Judge. Accordingly, I am not satisfied that this is one of those rare cases in which the conclusion can be said to be perverse on this ground.
- It is unnecessary to address points (b), (c) and (d) in the context of perversity, in light of my conclusions set out above. As to point (e), Ms Prince contends that the Employment Judge found that the Claimant's misconduct was serious rather than gross and that this was perverse. I disagree. As Mummery LJ said in [Fuller v London Borough of Brent ]() IRLR 414:
"31. … The ET judgment must be read carefully to see if it has in fact correctly applied the law which it said was applicable. The reading of an ET decision must not, however, be so fussy that it produces pernickety critiques. Over-analysis of the reasoning process; being hypercritical of the way in which the decision is written; focusing too much on particular passages or turns of phrase to the neglect of the decision read in the round: those are all appellate weaknesses to avoid."
- Even on the footing that the conduct fell within paragraph 1.2 of the matrix, this scenario is also described as gross misconduct, and I do not accept, as Ms Prince suggests, that the Tribunal was distinguishing here between serious or even very serious and gross misconduct. Moreover, even where a Tribunal concludes that an employer is entitled to find that an employee has committed an act of gross misconduct, because a reasonable investigation has been carried out and there were reasonable grounds for the belief in question, that is not the end of the task required to determine statutory fairness under section 98. The Tribunal must still address the question whether dismissal was within the range of reasonable responses in relation to that employee for that conduct. There will be many cases where the answer to that question is that it was, but that is not always the case and cannot be safely assumed. The Tribunal's task is to assess whether the employer's behaviour is reasonable or unreasonable having regard to the reason for dismissal. In approaching that task the Tribunal is required to consider the whole of the circumstances together with the equity and substantial merits of the case. That assessment necessarily includes a consideration of matters that might be advanced by way of mitigation.
- Ms Prince next challenges the finding that the misconduct was a one-off incident despite the fact that it related to four incidents over a six-hour period. Although I have some sympathy with her criticism of the description adopted by the Employment Judge of the Claimant's misconduct as being a one-off incident in light of the evidence, I am unable to conclude that this characterisation was not a permissible option. As Ms Bryan submits, the conduct all took place on the same day and was part of the same factual matrix. The Employment Judge expressly recognised those features and was entitled to characterise the misconduct as he did in the circumstances.
- Ms Prince did not pursue the next contention, which was a broad contention that the finding that DWP gave insufficient weight to the Claimant's mitigating circumstances was perverse. She was right not to do so save to the extent that she has advanced particular arguments in relation to this overall conclusion. I do not consider that perversity is made out as a separate head here.
- The remaining matters challenged by Ms Prince under this heading relate to findings made in the context of dealing with remedy but have some relevance to questions of liability. First, there is a challenge as perverse to the finding at paragraph 49 when dealing with the question whether it was just to order reinstatement bearing in mind the significant contributory conduct found, that the Claimant's behaviour was not dishonest. Ms Prince relies on two features of dishonesty in the Claimant's misconduct. First, as the Employment Judge found at paragraph 29, having accessed the confidential records relating to L the Claimant then:
"29. … rang Hillingdon … during her working hours posing as [L] to obtain confirmation from them that housing benefit had been paid. …"
Although not referred to by the Employment Judge, the DWP investigation report found that had Hillingdon known that the caller was the Claimant and not L, no information would have been provided to her. Furthermore, again recorded at paragraph 29, the Claimant emailed Hillingdon thereafter confirming that she was L's landlady and complaining about the failure to pay despite receipt of housing benefit. In the email sent by the Claimant, in addition to providing Hillingdon with L's personal information, the Claimant:
"29. … wrongly indicated that the jobcentre plus were [sic] investigating whether [L] was working while claiming benefits. …"
The Claimant knew that not to be true. She had not made any formal report whether on a fraud referral form or otherwise, and she knew that there was no fraud investigation accordingly.
- While frankly accepting the force of these points, Ms Bryan nevertheless submits that the Employment Judge was entitled to look at the Claimant's actions in the round and to characterise them in the round as not dishonest. I disagree. There was no dispute that in relation to the two features identified, the Claimant made false representations that she knew to be untrue. That was, on any view, dishonest. There was no basis in the evidence for the Judge's conclusion that the Claimant's conduct as a whole was not dishonest. This finding was not a permissible option.
- Finally, Ms Prince challenges the conclusion of the Judge at paragraph 49 that a final written warning would have sufficed by way of sanction for misconduct found. There is no dispute that the question whether a final written warning would suffice was not raised during cross-examination of DWP's witnesses nor explored by either party or the Judge in the course of submissions. The finding was material to the Judge's conclusion on remedy, and accordingly it was incumbent as a matter of fairness on him to raise it with the parties to ensure fairness in circumstances where neither side raised it themselves. Here, too, the Judge was wrong to rely on that matter having failed to do so.
- Standing back at this point and taking stock, I am satisfied, for the reasons I have given, that the Employment Judge was wrong to conclude that two very significant mitigating factors were present and known to DWP throughout the disciplinary process, namely, the voluntary admission of wrongdoing immediately after the incident and that the motivation for the Claimant's actions was not obvious financial or by implication, personal, gain. Those were two of seven factors in respect of which the Employment Judge concluded that the dismissing and appeal officers attached no real weight and took a rigid and inflexible approach. Neither DWP witness was challenged that these factors were known to them and that significant weight should have been attributed to them but was not. Neither factor was relied on by the Claimant in evidence or submissions. On the other side of the scale, when determining whether the Respondent behaved reasonably in treating the misconduct as a ground for dismissal, it is implicit from the clear findings made at paragraph 49 that the Judge wrongly reduced the seriousness of the conduct by perversely concluding that there was no dishonesty in the misconduct, a matter that was again not addressed with DWP witnesses.
- The question I have found most difficult to answer on the liability appeal is whether I can safely conclude that even without these factors the Employment Judge would inevitably have concluded that the approach adopted by DWP was a rigid and inflexible one that failed to take account of all of the circumstances and in particular the significant mitigation in this case. If I were able to reach the conclusion that despite the errors found the ultimate conclusion would have been the same, then the errors can have had no material effect.
- There was, as the Employment Judge found, strong mitigation available to the Claimant in the form of her long service with an unblemished disciplinary record. There is no doubt that she was under financial and personal pressure and suffering from poor health. When challenged, she admitted her wrongdoing and acknowledged that what she had done was wrong. Against that, however, this was a case of serious misconduct. If the two factors relied on by the Employment Judge had been ventilated properly at the hearing, it is at least arguable that they would not only have been viewed by the dismissing and appeal officers as not mitigating seriousness but as aggravating features particularly in relation to the Claimant's motivations and the fact she did not make the prompt voluntary confession that the Judge wrongly thought she had. Moreover, that the Claimant's conduct was dishonest in two respects increased its seriousness.
- Looking at these matters in the round, I am unable to conclude with the necessary degree of confidence that the ultimate conclusion that dismissal fell outside the range of reasonable responses would inevitably have been the same even had these factors been properly addressed and determined. The errors made by the Judge were material to his conclusions, and I have ultimately concluded that they vitiate the finding of unfair dismissal in this case. The result is that the finding cannot stand.
- My conclusion on liability means that the remedy decision cannot stand either and falls away. In the circumstances, I deal as briefly as I can with the challenges to the remedy decision in case it should be necessary.
- I have already dealt with the findings of no dishonesty and in relation to the final written warning. Ground seven was abandoned by Ms Prince and is not further addressed. Ground four challenges the order for reinstatement on the grounds that it was made in the erroneous belief that the Claimant's contributory conduct could be taken into account when awarding compensation for back pay. It is common ground that an order for reinstatement requires the employer to treat the employee "in all respects as if he had not been dismissed", including by paying arrears of pay for the period between the date of termination and the date of reinstatement (see section 114(1) Employment Rights Act 1996). It is accordingly not possible to reduce arrears of pay ordered pursuant to a reinstatement order by reference to a finding of contributory conduct. The Judge's decision to reduce arrears of pay by reference to contributory conduct was, accordingly, in error of law and could not have been allowed to stand.
- In relation to the reinstatement order itself, Ms Prince contends that decision (to reduce arrears of pay) was wrongly taken into account when the Employment Judge decided whether it was just to order reinstatement in light of the finding of contributory fault. I do not accept that submission. There is nothing in the findings made by the Judge at paragraph 49 to indicate that he had in mind the reduction he intended to make to the award of arrears of pay, in determining whether an order should be made. That matter does not feature in his Reasons, nor is it a factor set out at paragraph 49 as part of the justification for his conclusion that a reinstatement order was both practical and just in the circumstances.
- I take the next three grounds together. Grounds five and six challenge as in error of law the order for reinstatement made in the context of a finding that the Claimant had contributed to her dismissal so significantly, and ground eight challenges the Employment Judge's conclusion that it was practicable to reinstate in reliance on matters not mentioned or treated as relevant during the hearing so that the parties had no opportunity to give evidence or make representations in relation to those matters. Tribunals have a wide discretion in determining whether or not to order reinstatement or re-engagement. The question whether to make such an order is a question of fact for the Tribunal, and the scope for appellate intervention is accordingly limited. The limits of the discretion are set out in section 116 Employment Rights Act. There are three mandatory considerations. In addition to considering whether the individual wishes to be reinstated, the practicability of compliance with such an order must be considered, and where contributory conduct has been found the justice of an order for reinstatement must be considered too. "Practicable" in this context means more than merely possible but "capable of being carried into effect with success" (see Coleman and Anor v Magnet Joinery Ltd  ICR 46 at 52A-H). Again, these are questions of fact, and appellate intervention will be rare.
- Loss of the necessary trust and confidence that must exist between employer and employee may render re-employment impracticable. In cases such as Wood Group Heavy Industrial Turbines Ltd v Crossan  IRLR 680 and ILEA v Gravett  IRLR 497, a genuine belief in the guilt of an employee of misconduct was recognised to be a factor that can affect the necessary trust and confidence that must exist in the employment relationship and accordingly a factor to be carefully weighed when considering whether re-employment should be ordered. So far as contributory conduct is concerned, section 116 makes clear that Parliament contemplated the possibility of a reinstatement order notwithstanding the finding of contributory conduct. Nonetheless, as the Appeal Tribunal observed in United Distillers & Vintners Ltd v Brown UKEAT/1471/99:
"14. … If the contribution assessment is high, it may again be necessary to consider whether the employer can genuinely trust the employee again but each case must in those circumstances depend upon its own circumstances."
- It is clear from paragraph 49 of the Reasons that Employment Judge Spencer addressed the considerations identified by section 116 in stages, dealing first with the Claimant's wish to be reinstated, finding that she did. He dealt next with the question whether reinstatement would be practicable; and then by reference to section 116(1)(c) with the question whether it would be just to order reinstatement in circumstances where there was a finding of significant contributory conduct.
- In relation to practicability, two interlinked points were relied on by DWP as genuine and rational considerations. First, the witnesses said that the loss of trust and confidence in the Claimant as a consequence of her misconduct led to the conclusion that reinstatement could not be practicable. Secondly, there was evidence from Ms Cierebiej, given at paragraph 12 of her witness statement, about a recruitment freeze and the fact that there were no other posts - and I infer by that she meant posts without access to secure information systems - into which the Claimant could be moved. She said that the Claimant's post had not been filled and that her role and responsibilities were being undertaken by others as a result of internal moves within the district with a reduction in resources taking place across the service that had led to voluntary exit schemes. The evidence given by Ms Cierebiej at paragraph 12 of her witness statement was unchallenged evidence. So far as the evidence given as to loss of trust and confidence is concerned, although Ms Cierebiej was challenged on the basis that the Claimant's actions were totally out of character, she gave the following answer:
"May have been. Lose trust in terms of that employee. Lose the trust. Basis of that employee when has access to so many records. If can't trust. She took her own actions."
- Later, expressly by reference to the question of reinstatement, it was put to her by the Claimant's representative that it was highly unlikely that the Claimant would repeat her misconduct, and she answered, "I say position of trust, lose trust. Nature of business. Access to lot of information". She was not further challenged, and that answer was not further explored by anyone.
- Both factors relied on by DWP in relation to practicability were rejected by the Employment Judge. He does not appear to have rejected the evidence as false or irrational but by reference to what appear to have been his own views. No point is taken in that regard by Ms Prince, and I consider it no further. The Employment Judge concluded that reinstating the Claimant on a final written warning would be sufficient to deter her from committing misconduct in the future. Secondly, he was not satisfied by the sufficiency of the evidence about the recruitment freeze and why that made it impractical to re-engage the Claimant in a different post. It is not in dispute that neither the possibility of a final written warning as a panacea to the loss of trust and confidence the witnesses spoke about nor the insufficiency of the evidence as to the availability of other posts was explored with any of the DWP witnesses in cross-examination or by the Employment Judge, and neither feature was relied on by the Claimant.
- Ms Bryan submits that canvassing those matters with the witnesses would not have made any difference to the outcome. I disagree. Had those points been pressed or the views of the witnesses challenged by reference to those points, which represented the Employment Judge's own view rather than an argument advanced by the Claimant or evidence advanced by her it is quite possible that further evidence would have emerged to clarify or fortify the views advanced by the DWP witnesses one way or another. I am unable to say with sufficient confidence that the evidence could have made no difference.
- So far as concerns the question whether it was just to make a reinstatement order notwithstanding the finding of significant contributory conduct, there is no doubt that section 116 expressly contemplates that possibility. The mere fact that such an order was made in the context of this case does not constitute an error of law. Ms Bryan accepts that in many cases where a 75 per cent reduction for contributory conduct is made, a finding that it would be just nevertheless to reinstate would be surprising. However, she submits that what made reinstatement just, notwithstanding the contributory conduct here, were the Employment Judge's conclusions that the behaviour was not dishonest and was his view a one-off moment of madness, for which a final written warning would have sufficed. In effect, she submits that the Employment Judge concluded that the concerns expressed by Ms Cierebiej about the absence of trust and confidence in the Claimant were without foundation for these reasons. Whilst the Judge may have been entitled to conclude that the Claimant had learnt from her error and that her actions were a moment of madness in circumstances where I have concluded that the Judge was wrong to state that the behaviour was not dishonest, it seems to me that his conclusion cannot stand. This was one of two factors expressly relied on by the Judge and wrongly taken into account.
- Accordingly, for all those additional reasons it seems to me that the exercise of discretion to order reinstatement was vitiated by errors of law made by the Employment Judge in this case.
- The final ground relied on by DWP challenges the conditions said to have been attached by the Employment Judge to the reinstatement order by reference to the final written warning. Here, I agree with Ms Bryan. I do not accept that the Employment Judge attached any condition to the reinstatement order whether expressly or by necessary implication. Rather, he concluded, rightly or wrongly, that a final written warning would have sufficed in this case as the only sanction available to a reasonable employer. No error of law arises in respect of the asserted attachment of conditions.
- The parties are agreed that the cross-appeal only arises if the appeal fails. In light of my conclusions, accordingly, the cross-appeal does not arise.
- So far as outcome is concerned the errors of law in relation to liability means that the finding of unfair dismissal cannot stand, and in those circumstances the remedy decision falls away. Separately, I have concluded that there were errors of law in the exercise of the Judge's discretion in relation to the order for reinstatement, and the appeal against the reinstatement order succeeds to the extent I have identified.
- Ms Prince submits in writing that if the appeal by DWP succeeds the inevitable outcome is that there was a fair dismissal given the admitted acts of gross misconduct found, following a reasonable and fair procedure. I do not accept that submission. Even in a case where there are reasonable grounds for a finding of gross misconduct, it remains necessary for the Tribunal to assess whether it was within the range of reasonable responses for the employer to dismiss the employee for that gross misconduct. It cannot be assumed that a finding of gross misconduct will inevitably justify dismissal, and in most, if not all, cases it is necessary at least, to consider mitigation and the impact of mitigation on the reasonableness of the sanction of dismissal. This is not a case where only one outcome of that consideration is available, and accordingly the matter must be remitted to the Employment Tribunal (see Jafri v Lincoln College . The parties disagree about the nature of such remission.
- Whilst I am sure that the professionalism of Employment Judge Spencer is not in doubt, given the strength of views expressed in some of his findings, made without evidence or giving an opportunity to the parties to address material matters, this is a case where the right course to adopt is to remit to a fresh Tribunal. This is not disproportionate in circumstances where this was a short hearing - the whole case was dealt with in one day - and the time and expense of a fresh hearing rather than a remitted hearing to the same Tribunal is unlikely to be significantly different. The case is accordingly remitted to a differently constituted Tribunal for a rehearing of the evidence and argument in accordance with this Judgment.
Published: 10/11/2016 14:12