The claimant was a woman working in the Royal Navy as a non-seagoing Chief Petty Officer. She applied for the post of Warrant Officer but failed to secure it, the job being given to one of her male colleagues. The board who decided on the successful candidate did not interview the applicants but instead relied upon reports made by the supervising officers and commanding officers responsible for the applicants concerned. The claimant claimed that she was the best candidate and that she had been directly and indirectly discriminated against, using her colleague who had been promoted as a comparator. The ET agreed, saying that the burden of proof, that the claimant had not been directly discriminated against, had passed to the respondent and they had failed to discharge that burden. On the indirect discrimination issue, the ET said that the fact that the claimant was non-seagoing and that all male counterparts were seagoing meant that, if there was a PCP which imposed a condition that the successful candidate should be seagoing, this could be discriminatory. Despite evidence from the respondent, that employees’ promotion prospects would not be affected if they were non-seagoing, the ET found that there was a PCP which applied to non sea-goers and that it was not a proportionate means of achieving a legitimate aim.

The EAT criticised the ET for not considering the question whether there was evidence of the board being influenced consciously or unconsciously by the gender of the applicant. They did not say why the comparator relied upon to substantiate direct discrimination was not as good a candidate as the claimant, nor did they make any finding about the reason why the claimant had been unsuccessful. They did uphold the indirect discrimination decision, saying that the Tribunal was entitled to conclude that the promotion system favoured the seagoing members of the Navy.

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Appeal No. UKEAT/0242/10/DM

EMPLOYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 9 & 10 December 2010

Before

THE HONOURABLE MR JUSTICE LANGSTAFF

MR A HARRIS

MR S YEBOAH

MINISTRY OF DEFENCE (APPELLANT)

MRS J CARTNER (RESPONDENT)

Transcript of Proceedings

JUDGMENT

For the Appellant
MR RICHARD COLEMAN (of Counsel)

Instructed by:
Treasury Solicitor
Employment Law Team
One Kemble Street
London
WC2B 4TF

For the Respondent
MR ANTHONY KORN (of Counsel)

Instructed by:
Messrs Irwin Mitchell LLP Solicitors
Imperial House
31 Temple Street
Birmingham
B2 5DB

SEX DISCRIMINATION

Direct

Indirect

Burden of proof

PRACTICE AND PROCEDURE – Appellate jurisdiction/reasons/Burns-Barke

The Employment Tribunal decided that the failure of a woman CPO to gain promotion in the navy to WO was caused by both direct and indirect discrimination, central to which was her claim to opt to be non seagoing. There was sufficient evidence to find indirect discrimination made out, but the ET have not said why the comparator relied on to substantiate direct discrimination was not as good a candidate as she was, nor made any finding about "the reason why" she had been unsuccessful. It relied on shifting the burden of proof because of a systemic disadvantage the non seagoing suffered, but did not then identify and analyse the reasons for selection preferred by the Department.

1. This is an appeal from an Employment Tribunal sitting at Southampton which took five days to hear evidence and submissions and further days to consider its decision. It gave reasons on 12 January 2010 for finding unanimously that the Respondent, the Royal Navy, had discriminated against the Claimant, a serving Chief Petty Officer, contrary to the provisions of section 1 of the Sex Discrimination Act 1975 and against section 6 of the Act. It went on to make declarations which were once the subject of appeal but in respect of which the appeal has not been pursued before us because the Tribunal has agreed to reconsider.

1. It found that there had been both direct and indirect discrimination against the Claimant in the failure to promote her from the post of Chief Petty Officer in the Royal Navy to that of a Warrant Officer. So far as direct discrimination is concerned she compared her candidacy to that of a candidate known as Number 3 who, in the events which have since happened, gained appointment as a Warrant Officer, although he was placed on the reserve list by a promotions board.

1. She, the Claimant, was one of 34 candidates for one post as a Warrant Officer. She was ranked 7 out of the 34 by the promotions board. One was appointed; three, in the events which transpired, became reserves who gained appointment since; those ranked fifth and below have not gained appointment.

1. The background revealed by the Tribunal's decision is this. It set out that the Claimant had become a WRN in 1988 in the Radar specialisation. The WRNS was disbanded in 1990 and became part of the Royal Navy. At that time she was assured that if she chose to remain shore based and not seagoing that would have no effect upon her prospects of promotion. She elected to remain upon her then existing terms of engagement and not to go to sea.

1. On 7 April 2001 she became a Chief Petty Officer. As soon as she became eligible for promotion to Warrant Officer her name went before a succession of promotion boards where she always did well but failed to secure promotion. It is the last of those boards with which this case is concerned. That was held between 28 January 2008 and 30 January 2008.

1. The Tribunal, therefore, one might have hoped, would have directed its mind to the reasons why the Claimant was not appointed and was ranked seventh, and her comparator was placed on the reserve list and ranked higher. It had before it the evidence of two of those who served on the promotions board; a third member of the board being unavailable to give oral evidence but providing written material.

1. In its judgment the Tribunal described a system which in the view of the Tribunal contained a number of serious deficiencies by comparison with many modern systems of appointment and promotion. One feature, however, the Tribunal did not criticise. That was that the board did not interview candidates for promotion. It seems likely that there were important operational reasons for that. Rather, the board took heavily into account reports made annually by the supervising officers and commanding officers responsible for the applicants concerned. Those appraisal reports were placed before the Tribunal for all the leading candidates in the assessment. We have copies of those documents in our papers.

1. They are only to some extent, formalised, requiring the ticking of boxes and numbers but, to a much larger extent are discursive requiring a description by, for instance, the Lieutenant Commander under whose command the officer came and signed and countersigned by the Commander with his own particular comments.

1. The promotion was determined, as the Tribunal were to describe, on the members of the board ranking individually those who were candidates for appointment having considered these reports in particular. They had available to them a document, which is at page 236 of our bundle, headed "Criteria for assessing quality". This did not impose criteria; it, however, suggested what might be appropriate criteria. Amongst them, and we shall have need to refer to these particular features later in this judgment, were the statements:

* "Evidence of broad (and we emphasise that word) management capability is an essential factor.

* Employability is also a crucial criterion, and it should be borne in mind that those selected for WO1 might be employed in a wider management role outside of their specialisation".

1. Recorded performance and potential were to be regarded as measures. "Merit" was defined as suitability and capacity to be employed in the next higher rate and beyond, with the note:

"Promotion is not awarded purely for current and previous good performance. Factors such as consistency of success (especially in the face of particular challenge), leadership and management acumen, accomplishment with people, ability to think at a level above peer group and future employability in both specialist and broader drafts all constitute merit."

1. The criteria note:

"It will be appreciated that the "Very Strong" or "Strong" potential identified for this board must be observed in the context of the remainder of the report […]"

1. Summarising what is a commendably short judgment for a diversity case the Tribunal found that Captains Powell and Carter, from whom they heard evidence, relied heavily, and it may well be centrally, upon the words used in the reports by the officers who knew the individual applicants concerned. It set out at paragraph 17 a number of features about the Claimant and her comparator which might be easy to compare. Thus, whereas the Claimant joined in 1988, her comparator joined in 1986. She became a Petty Officer on 1 August 1997; he, it was suggested in the report, we are told in error, on 13 March 2003 (we think the actual date was 1998). She became a Chief Petty Officer on 7 April 2001; he on 11 April 2003. So, it might be said that his progress through the ranks was somewhat slower than hers.

1. They had both become qualified educationally to be a Warrant Officer, known by the acronym QEWO. Each had particular distinctions. In 2000, before she became a Chief Petty Officer, she had been selected NATO Headquarters Military Member of the Year and in 2001 was awarded an MBE. He had been awarded a Capitan's Efficiency Prize for his professionalism (at sea) in 2005/06 when he was a Chief Petty Officer, an award which, we understand from the papers, had considerable kudos within the service. Both had worked, though arguably she to a greater extent, in charities outside immediate service life.

1. In her reports a grade was given by letter for effectiveness. The Tribunal noted that for the four years, 2003/04 2006/07 she had achieved an A grade each and every year; he by comparison had had three A grades and one B. It went on to describe an explanation put forward by the promotion board for their interpretation of these effectiveness ratings, that being that the B in his case was because he had undertaken a new posting and one would not expect an A early in a new post. The fact remains, nonetheless, that there were four As for her effectiveness compared with three As and a B over the timescale of 4 years adopted by the Tribunal.

1. Those matters were set out, as we say, at paragraphs 17 and 18. They were discussed at the paragraphs which followed before the Tribunal turned to consider what might be made of the reports. There was a distinction in favour of the candidate 3, it might be said, in the terms in which their respective commanding officers had written their reports. Thus, in his case, it appeared the Tribunal focussed heavily upon the words "my very best CPO" in the latest report, consistent with a view which had been developing over the years toward that, compared to a final statement from her commanding officer that she was "within my top ten" (that being of 66 eligible candidates, whereas we are told that the evidence was that there were some 30 in his case).

1. The Tribunal pose themselves a question at paragraph 26, having looked at the deficiencies, as it thought, in the promotion system which led it to describe the procedure employed as "frankly primitive", with the good human resources practice of establishing criteria, valuing the criteria and then marking against them being something "alien to the members of the board", leading to a conclusion that the board had adopted a process which, in the Tribunal's view, was:

"[…] an almost total exclusion of fact and almost total substitution of opinion based upon written reports which the board members themselves acknowledged could be unhelpful."

and taking the view that the members of the board might have had regard to their professional judgment or subjectivity, whichever word was used, in reading the reports from commanding officers and, as the Tribunal regarded it, "ignoring the facts relating to the candidate" (see the concluding words of paragraph 25).

1. The question it posed itself was:

"The Tribunal must then decide whether the way in which the promotion board was conducted arose from a lack of training, a lack of understanding or a desire to reach a conclusion which eliminated the appointment of a woman to Warrant Officer rank. The factors which give concern to the Tribunal have been outlined in the previous paragraph…" (that was reference to the deficiencies, as the Tribunal saw it, in the process, summarised in our paragraph 16)

"….but it becomes necessary to consider whether there is any evidence to support the Claimant's contention that the decision of the board was a discriminatory one."

1. It then had regard to seven particular points. The first was it found that the Royal Navy was struggling with the status of those who were non seagoing, a description which was far more likely to apply to a woman than a man because, as it understood, all men in the navy are seagoing.

1. Secondly, there were statistics which demonstrated that women might be at a disadvantage in Royal Naval promotion. Only one female Warrant Officer had been appointed in the AWT branch (which is the Above Water Tactical branch, for which the Claimant was an applicant) at any one time.

1. Thirdly, statistics produced to the Tribunal showed that the percentage of females obtaining the rank of Petty Officer or above was such that the chance of a man obtaining the rank of Petty Officer or above was double. That, of course, does not relate directly to the position of Warrant Officer on appointment from Chief Petty Officer but was a general point about the difficulties of promotion for women within the navy, coupled with a note that the percentage of commissioned female officers in the navy was 7% lower than in any branch of the services other than the chaplaincy.

1. Next, the Equalities and Human Rights Commission had had concerns about the harassment of women naval personnel generally within the service.

1. Fifthly, that there had been no assessment of the equality impact of promotion policy, next there was a lack of effective equality and diversity training, and lastly the wording in the promotion board dossier in respect of the Claimant was to describe her physical attributes - tall, fair haired - and comment upon her family life - "adept at maintaining a healthy work/life balance, leaving enough time for her family" etc.- in a way in which although it might have been common coinage prior to the Equality and Human Rights Commission report, one might have hoped had ceased thereafter.

1. It should be noted that before that report, on the evidence available to the Tribunal, this latter matter was not an aspect of the services which appeared to represent a stereotypical view of one sex, because commentary as to physical attributes and family life was made irrespective of gender, as the Tribunal recognised. The point was rather that in the case of a woman the observations of the Equality and Human Rights Commission did not appear to have been taken on board fully and acted upon.

1. Having mentioned all those matters the Tribunal said at paragraph 32:

"The Tribunal considers that there is enough evidence of previous concern with regard to sexist behaviour in the Navy, sufficient concern that equality and diversity training was not being taken as seriously as the agreement between the commission and the Navy would seek to attain and there was an untutored attitude to report writing, even as late as 2006 which indicated a lack of understanding about equality and diversity. There was also a more general problem with regard to the Navy in respect of those people like the Claimant who were non seagoing and had been given a specific guarantee about promotion. Clearly, the Navy was taking a view, as evidenced by the letter of 10 July 2007, that they would like that situation to change."

We shall come to that letter later.

1. It concluded having set out the law and made reference to the well known case of Igen v Wong [2005] IRLR 258 at paragraph 37 that:

"For the reasons set out above the Tribunal is satisfied that on the balance of probabilities the Claimant has proved sufficient facts from which the Tribunal can conclude, in the absence of an adequate explanation that the Respondent has committed an unlawful act of discrimination against the Claimant."

1. Then it said this, a central focus for the argument before us, at paragraph 38:

"The only basis upon which the Respondent appears to be attempting to rebut the effect of Section 36A of the Act…" (the Tribunal said 36A but meant 63A)

"…is to say that what it did was for the good of the service and this primarily through the evidence of the witnesses. It was not explained how this would be so, although Commander Carter did state in his evidence that the methodology employed in commercial organisations of a similar size to the Navy would not be appropriate because the Navy had to take the view that it might fight a war. The Tribunal confesses that it does not see the logic of his argument because the purpose of a promotion board should be to seek out and promote the best people for the good of the Navy and to use the best and approved methodology available. Under the provisions of Section 36A…" (again meaning 63A)

"…therefore the Tribunal upholds the complaint of sex discrimination under Section 1 of the Act."

1. The Tribunal then proceeded, having resolved the complaint of direct discrimination in those terms by applying the reverse burden of proof and assuming it had no explanation which it needed to evaluate or alternatively having an explanation which it did not, so far as we can see, evaluate, turned to the question of indirect discrimination. Here the Tribunal's decision was short.

1. The claim was that the promotion board had imposed a provision, criterion or practice in its selection processes which was that the successful candidate should be seagoing. The Respondent accepted that if that were a precondition to promotion then it would be a provision, criterion or practice for the purposes of section 1(2)(b) of the Act. It also was the case that the Respondent accepted that if it were established that there were such a provision, criterion or practice it would operate in a discriminatory way. That is obvious. All male naval personnel are seagoing, some female naval personnel are not. Such a criterion is inevitably, therefore, discriminatory if it exists.

1. Secondly, there was no attempt in this case to justify the provision, whatever may be the justification arguable elsewhere or more generally (as to which specifically we would not wish to make any comment here) because this Claimant had been promised it would make no difference to her promotion prospects. So, viewed in relation to her case in particular, there was no justification for the application of any such indirect criterion, and none was advanced.

1. The question, thus, was whether there was such a provision, criterion or practice. The Tribunal's conclusions as to this appear to us not simply to be contained between paragraphs 39 and 43, though they are centrally discussed there, but also include some of the matters to which the Tribunal had had regard in coming to its conclusion in respect of direct discrimination. Thus, one of the matters which, as we have noted, caused the Tribunal to consider that the burden of proof had shifted under section 63A was the way in which the Navy regarded its seagoing as opposed to non seagoing personnel.

1. At paragraph 26 the Tribunal set out the relevant passages from the letter of 10 July 2007 to which we said we would return. It reads:

"The strategic role of the naval service has evolved since 1990. The declarations you made then may not be relevant today --"

We interpose to say this was written to the Claimant, and was plainly an invitation to her to reconsider her non seagoing declaration. The Navy were saying that to do so was or might well be her own best interests. Continuing:

"-- and could be denying you the opportunity to be considered for certain attractive and beneficial assignments. In particular, the requirement for shore based operational tours (Op tours) has greatly increased since 1990 when the only OP tour was service in the Falkland Islands. You will be aware that there is an increasing RN involvement in land operations in conflict zones around the world; especially the Middle East at present. For pay and other reasons, RN Op tours are designated as sea service, with the consequence that your NOVOLSEA (non volunteer sea) declaration debars you from assignment for these shore based Op tours despite your declared willingness to bear arms."

1. The Tribunal went on to note specifically paragraph 5, which seems to us to be of importance:

"Please give serious consideration to options A and B and the greater range of assignment opportunities they might offer you. If you are unsure of the consequences of your choice, your career manager will be able to advise you. […]" (italics added)

1. The Tribunal's conclusion as to that was that it was not a large step from that letter to appreciate that the Claimant may have become an anomaly in Royal Naval terms, and her anomalous position would have been translated to conformity had she decided to opt for a seagoing path. It at least seems open to the observation that the Navy were here seeking to encourage the Claimant to cease to be non seagoing, and as part of that encouragement suggested that greater opportunities for her might arise if she did so elect, and that they might have consequences which, because the advice as to those consequences was to be given by the career manager, carried with it a clear implication that the consequences would be career, i.e. promotion consequences.

1. The board had already addressed that letter and referred back to it, albeit briefly, at paragraph 39, but adding that Captain Powell had given evidence that if the opportunities such as referred to in the letter "were available to the Claimant they would improve her promotion prospects". The Tribunal went on to emphasise at part of the evidence that:

"[…] in shore jobs a candidate must be careful to be in the eye of the line manager so what he or she does is noted and recorded."

whereas by contrast at sea such exposure is in effect inevitable and obvious, perhaps, therefore, reflecting that in the Tribunal's view it appeared that those who were shore based had a more difficult task in making their particular qualities known.

1. At paragraph 40 the Tribunal observed that the witnesses had been "quite denigrating" about the challenges offered at Northwood, where the Claimant had worked, that being a shore based job, particularly since she had been engaged in three tours doing essentially the same thing. They did not accept a factual point as to the difference in and the challenges made onshore but appeared to regard the challenges which were available to somebody who had the opportunity of working both onshore and on ship as being greater.

1. At paragraph 41 the Tribunal drew attention to attributes which, to them, appeared to be common to most successful candidates, which reflected the time at sea (although one may have to be careful, we reflect, about this in a promotion board which was considering persons who were largely sea based).

1. Whether there was in fact such a policy criterion or practice as the Claimant alleged is not a decision for us. We have to ask what the Tribunal themselves relied on to reach that conclusion and then, at a later part of this judgment, decide whether they were entitled to do so. They did rely upon comments as to specific candidates which suggested that their promotion prospects would be rather better after they had had a full sea draft (in one case) or a good performance at sea (in another), and concluded that sea service, in particular certain kinds of sea service - they had in mind time at "FOST", i.e. Flag Officer Sea Training, or "as a sea rider" - were considered to be yardsticks by which a candidate's success could be measured, and that this was reflected regularly in the reports written by commanding officers who clearly took the view that sea time was a necessary pre requisite to promotion.

1. Then the Tribunal said this:

"Whether the individual members of the board either directly took the view that seagoing was an essential criterion and condition for promotion or whether it was inherent in the way they exercised their professional judgment is to the Tribunal immaterial. The undertaking given by the Royal Navy to the Claimant was that she would not be prejudiced in terms of promotion by her choice not to be seagoing. In addition the guidelines given to the board specifically told the board that "non sea volunteers will be considered alongside male ratings for all vacancies available. Whilst giving due regard to the seagoing plot, each of these categories must be considered on equal terms". The evidence again is such that the Tribunal having found that there is a provision, criterion and practice and that provision, criterion and practice applied to non sea goers is more likely to apply to female ratings then it is to make ratings. Realistically all male ratings are seagoing unless for health reasons they are confined to shore appointments. […] Therefore, the Tribunal must be satisfied that this is a discriminatory provision and it is for the Respondent to show whether that provision, criterion and practice is a proportionate means of achieving a legitimate aim. […]"

They go on to say that that could not be done.

1. The Tribunal then spent two paragraphs issuing declarations which are no longer the subject of appeal before us and are being reconsidered. At paragraph 44 it added this, which may be of some importance in considering the arguments, in particular as to direct discrimination:

"Finally in coming to the issue of remedy […] it was the Claimant's case that she was the best candidate before the promotion board. The Tribunal cannot say that, there is not enough evidence for that decision to be made. Moreover as pointed out above it is justifiable to apply professional judgment and that is a skill which the Tribunal do not have in this context. The reality is that this Tribunal cannot say who was the best candidate. What it can say is that the procedure was inadequate and that it preferred a candidate (the comparator) who upon objective standards was inferior to the Claimant and that it discriminated against the Claimant contrary to the provisions of S.1. and S.6. of the Sex Discrimination Act."

1. Against that decision the Navy take three grounds of appeal: one relating to direct discrimination; second, to indirect; and thirdly arguing that both decisions were affected by perversity.

1. As to direct discrimination, Mr Coleman submits that the Tribunal did not relevantly ask itself the appropriate questions, nor give them an appropriate answer. He submits that properly understood the approach, whether or not the burden of proof is transferred, must focus in any claim for direct discrimination upon the reason why the decision in question was taken as it was, or if it had been a discriminatory act which is complained about, why the act was done.

1. This is described, he points out, by Lord Nicholls in his speech in the case of Shamoon v Chief Constable of the Royal Ulster Constabulary [2003] UKHL 11. It has been the relevant question, as he points out, because it is necessary to know whether or not the decision in question is or is not made on the grounds of sex. This necessarily derives from section 1 of the Sex Discrimination Act 1975:

"1. (1) A person discriminates against a woman in any circumstances relevant for the purposes of any provision of this Act if

(a) on the ground of her sex he treats her less favourably than he treats or would treat a man, or --"

We shall go on later to consider but will set out now for convenience subsection 2(b) relevant to indirect discrimination:

"(b) he applies to her a provision, criterion or practice which he applies or would apply equally to a man, but—

(i) which puts or would put women at a particular disadvantage when compared with men,

(ii) which puts her at that disadvantage, and

(iii) which he cannot show to be a proportionate means of achieving a legitimate aim.

1. The ground for the treatment or decision is, therefore, the focus of a Tribunal's attention. Mr Coleman argues that where a decision maker puts forward a decision which is, on the face of it, not inherently unreasonable, it is incumbent upon the Employment Tribunal, if it chooses not to accept that reason, to say why that is.

1. Here, he says, the Tribunal never answers that question. It sets out how the panel went about its decision making, as we have described. It deals with a number of matters which are general to the Navy but not particular to the members of the board to conclude that the burden of proof had shifted in respect of those members' decision. Then, at paragraph 37, it looked for an adequate explanation of the Respondent's action. The Respondent here, maintains Mr. Coleman, had given an adequate explanation. He would argue that it was an explanation which the Tribunal were bound to accept, but we shall come to that when we deal with his arguments on perversity. Assuming perversity to be a step too far, he pointed out that there was no complaint made here by the Claimant that there had been any discrimination, any direct discrimination that is, by her commanding officers when they had prepared the reports upon her which came before the board.

1. The Tribunal had based itself heavily upon words which were capable of supporting its conclusion that candidate number 3 was to be preferred over candidate number 7, the Claimant. That was reinforced by the way in which the panel had treated candidate number 4. On the evidence before the Tribunal he was somebody who worked in exactly the same establishment as did the Claimant. The commanding officer, the same, therefore, in each case, had rated him as his best CPO and her as being within his top ten. It was, therefore, plain that he rated him above her and with no suggestion that that view was directly tainted by sex. Yet, the board, as between him ("No.4") and number 3, had rated number 3 better.

1. He, therefore, wished to point out that the Tribunal in coming to the conclusion that it did would have to explain why it was that the Tribunal would inferentially have thought that 3 was better than 4, a decision which could not have been based upon any consideration of sex or seagoing status, and yet 7 better than 3. It had to be the foundation of the decision as to direct discrimination that number 7's claims to be appointed were better than number 3's. Thus, he said, this required consideration by the Tribunal. Instead, he argues, the Tribunal addressed the wrong question.

1. At paragraph 38 it dealt with matters - the good of the service, etc - to which we have already referred, which were relevant to the procedure which was adopted, which the Tribunal had criticised - but beyond showing that the procedure was, in the Tribunal's words, one which justified the expression primitive, this could not help with whether the decision in question was or was not based upon any direct discrimination, that is, was made by the members of the panel on the grounds of sex whether consciously or unconsciously.

1. He might have said in addition that when the Tribunal came to paragraph 44 where it concluded that the preference was for a candidate who, upon objective standard was inferior to the Claimant, that the Tribunal had not itself said why. It had set out a number of comparison factors, in paragraphs 17 and 18, but had not proceeded to any process of evaluation of those factors. He complained in his written argument, and to some extent orally, that the Tribunal had said that it was justifiable to apply professional judgment which the Tribunal could not do. So, he would argue, the Tribunal here was saying that it could not say who was the best candidate and was not, therefore, in the position in which it would need to be before the burden of proof were to be shifted, that of being able to say that the decision was one which should be called into question as to the grounds upon which it had been reached.

1. For his part, Mr Korn drew our attention to the approach which Igen v Wong advocates. Thus, at paragraph 76 the court, in the words of Peter Gibson LJ giving its judgment, issued guidance, though recognising it was only guidance and no substitute for the statutory language. That was as follows:

"76. […]

(1) Pursuant to section 63A of the SDA, it is for the Claimant who complains of sex discrimination to prove on the balance of probabilities facts from which the Tribunal could conclude, in the absence of an adequate explanation, that the Respondent has committed an act of discrimination against the Claimant which is unlawful by virtue of Part II or which by virtue of s. 41 or s. 42 of the SDA is to be treated as having been committed against the Claimant. These are referred to below as "such facts".

(2) If the Claimant does not prove such facts he or she will fail.

(3) It is important to bear in mind in deciding whether the Claimant has proved such facts that it is unusual to find direct evidence of sex discrimination. Few employers would be prepared to admit such discrimination, even to themselves. In some cases the discrimination will not be an intention but merely based on the assumption that "he or she would not have fitted in".

(4) In deciding whether the Claimant had proved such facts, it is important to remember that the outcome at this stage of the analysis by the Tribunal will, therefore, usually depend on what inference it is proper to draw from the primary facts found by the Tribunal.

(5) It is important to note the word "could" in s. 63A(2). At this stage the Tribunal does not have to reach a definitive determination that such facts would lead it to the conclusion that there was an act of unlawful discrimination. At this stage a Tribunal is looking at the primary facts before it to see what inferences of secondary fact could be drawn from them.

(6) In considering what inferences or conclusions can be drawn from the primary facts, the Tribunal must assume that there is no adequate explanation for those facts.

[…]"

1. We pause there. What Mr Korn went on to submit was that it is not requisite that there should always be a clearly defined two stage process, although, as a matter of logical analysis, there may be two stages to the argument. Cases, he argued, such as Lang v Manchester City Council [2006] IRLR 748 make it clear that the process is one of evaluation of facts by a Tribunal against the statutory background and it is not necessarily an error of law to do in one stage what might be done in two.

1. He argued, having taken us to those issues, that what the Tribunal may have concluded to have been in the mind of the officers of the panel and, hence, the reason for the Tribunal itself recognising at paragraphs 17 and 18 the importance of seagoing service, was that the members of the panel themselves instinctively had a preference for those who might be seagoing. That would fit with the comments the Tribunal made at paragraph 40, albeit in the context of considering indirect discrimination, about the denigrating approach the officers had taken to service at Northwood. Thus he maintained that there was here sufficient material in which the Tribunal had set out and explained its conclusion that these officers had discriminated directly against the Claimant in coming to the conclusion that candidate number 3 should be preferred over her with the consequence that he was promoted and not her.

1. The principles that apply seem to us to be clear. We do not think that the excessive citation of authority helps in this case to clarify the relevant points. We invited Mr Korn to tell us in the course of his submissions what the Tribunal's reasoning was for concluding that the decision that Captain Powell, Captain Carter and the other members of the board had come to was, insofar as it was, discriminatory. He was unable to identify that which the Tribunal had said. He – and we too - had to infer what the Tribunal might have thought.

1. When he was asked to identify for us whether the Tribunal itself had felt that candidate number 3 was or was not better or worse than candidate number 7 and, if so, for what reasons - they having apparently expressed the preference at paragraph 44 - he was unable to show us precisely what they had in mind. Again, it was a matter that we might have had to infer.

1. We accept that a Tribunal's decision has to be read as a whole. It cannot be read as though it were a statute; it cannot be read as though it were a trust deed; it cannot be read even as though it were a judgment in High Court proceedings. The questions which it addresses, particularly in diversity cases, frequently cover a wide range of points. The Tribunal sees and hears witnesses which no court on appeal can do. It may, therefore, be alert to nuances of answer, language and behaviour which are important in the evaluative process which it has to undergo. Yet the fact remains that the Tribunal has only the words it uses in its judgment to explain its process, its reasoning and the legal principles it applied. Here there is an absence of any consideration by the Tribunal of that which was inevitably central to its decision.

1. There was an explanation put forward by the Navy as to why it was that the decision had been made as it was. That was essentially that great weight was given to the references, or the reports, written, by the commanding officers of the respective candidates. There was no criticism advanced in this case about any direct discrimination by those officers. Accordingly, the evidence given that the members of the board had looked at and come to a conclusion reasonably open to them on review of what those reports showed, was one which commanded at least sufficient respect to require the Tribunal to say why it did not accept it as a sufficient answer if indeed it was not a sufficient answer. This point would have been underlined by considering the position, if the Tribunal had chosen to do so, of candidate number 4.

1. It is open, of course, in general terms to a Tribunal to come to the conclusion that a reason, apparently credible, advanced by members of a promotion board may not be in fact credible and that it may be influenced by discrimination. If that discrimination is to be direct and if, as here, the focus was upon the decision of the members of the board and not a wider decision by the service itself, which we are satisfied having heard both submissions to us it was, then that requires a focus upon those reasons of those people on that day on the particular occasion in question. The Tribunal, as it seems to us, decided that the members of the promotion board had given too great a weight to the reports, but it had recognised that the professional judgment necessarily played a part.

1. The question it had to ask was whether, taking into account all the reasons given, there was evidence that, in relying centrally upon the material provided by the commanding officers without discrimination, the members of the board were, nonetheless, themselves influenced consciously or subconsciously by the gender of the applicant. This is a case, therefore, which cried out for an analysis which is singularly absent. It may be that the Tribunal was misled by its focus upon the moving of the burden of proof. Having set out reasons which caused it to have concern about the process by which promotion was decided, and on that basis perhaps to reverse the burden of proof, paragraph 37 begins, "For the reasons set out above," and it is not entirely clear, and indeed was argued before us, to which parts of the earlier judgment that necessarily related. It would certainly be the seven matters that we have mentioned; it may be other matters beyond those.

1. The Tribunal then looked for explanation but, as we have observed, the explanation it sought was not an explanation of the decision which, in our view, appropriately it should have been, it was an explanation as to the system of promotion and why that was adopted which had no obvious direct relevance to the issue in the case (that is, to the issue of direct discrimination). Accordingly, as it seems to us, this part of the decision cannot stand. What should happen to it will depend in part upon the parties' reflection upon what we have yet to say about the remaining grounds.

Indirect Discrimination

1. When we come to the argument as to indirect discrimination, Mr Coleman's argument was that it was not open to the Tribunal to come to the conclusion that there was any provision, criterion or practice. He argued that the Navy had made it clear in the official statements it had made that it did not tolerate any form of discrimination on the grounds of sex and that those who were non seagoing were not to be disadvantaged for that reason. Statements to that effect were made in the documents put before the Tribunal and there was evidence that they had been in the possession of those in the promotion board before the members of the board reached their decision. Accordingly, says Mr Coleman, there was no basis for saying that there was here any provision, or criterion or practice which was applied and which rendered the Claimant at a disadvantage.

1. Mr Korn has drawn our attention to the words the Tribunal used which we have already cited.

1. It is for us to remember that the Tribunal is the primary judge of fact. Whether there is a provision, criterion or practice will sometimes be clear. It may be stated and its implications as between the sexes may be clear. Thus, for instance, a requirement as to the height which it is necessary for a candidate to have will, if it is sufficiently high, tend to exclude more women than it does men and, therefore, necessarily be indirectly discriminatory and require justification if it is to be applied.

1. Sometimes it is less clear-cut, but whether it exists is a matter for the Tribunal. Here the Tribunal could not decide that there was a provision which discriminated because there was plainly a provision to the contrary effect. However, if discrimination is going to mean something real to those who have claimed to have suffered from it, "criterion or practice" is to be identified not by what may be said by an employer or stated in his paperwork but by what actually happens, and whether the practice within an organisation is consistent with the high ideals which the organisation may well set itself. Further, if, for instance, it is said that an officer must not be disadvantaged because they are non seagoing, then even though those words are meant it is open, as it seems to us, to a Tribunal to consider the evidence put before it by the parties and see whether in the reality of modern day life in the organisation concerned that is borne out in the event.

1. The question for us, given the argument which we have already reflected and given the conclusion to which the Tribunal came which we have reported, was whether the Tribunal was entitled to come to the conclusion of fact that here there was a practice - or it may be criterion, but either would suffice - which at least gave preference to those who were seagoing as opposed to those who were not. Although it is argued that the Tribunal took what was to any observer an overstated view at paragraph 41 "that sea time was a necessary pre requisite" and at paragraph 42 "that seagoing was an essential criterion and condition for promotion" that is, in our view, beside the point if in fact there was a preference for such.

1. It was pointed out by Mr Coleman that on the evidence before the Tribunal it could not properly have come to the view that it was necessary in the sense of a necessary precondition without which there would never be an appointment, or an essential criterion in the same sense because, as a matter of fact, the evidence before the Tribunal was unchallenged that female non sea goers had been promoted to the rank of Warrant Officer ahead of worthy male seagoing candidates, to the extent that two had been appointed in 2004, two in 2006 and one in 2007 - a statistic of which he reminded the Tribunal at paragraph 18 of his closing submissions.

1. As we have said, we do not consider that that overstatement by the Tribunal (assuming it to be such) necessarily falsifies the conclusion to which it came on the other evidence available to it. The letter of 10 July 2007 within its terms was capable of being read, and the Tribunal appear so to have read it, as suggesting to the Claimant that if she opted to become seagoing as opposed to non seagoing then her promotion opportunities would be better. The Tribunal have recited that they heard oral evidence effectively to that end. We have quoted the passage from its paragraph 39. In shore jobs it is more difficult to obtain relevant experience.

1. We looked at the criteria which were relied upon by the Navy before the Tribunal which emphasised the breadth of experience which a candidate should have, the preference for adaptability and the potential of candidates in a broad range of appointments. The references to adaptability and to breadth are capable of suggesting that the promotion system necessarily favoured those who were able to display such a breadth which, this Tribunal was entitled to conclude, therefore, tended to favour the seagoing members of the Navy who would have both the opportunity of land based and sea based service, to the disadvantage of someone whose horizons were necessarily more limited.

1. We have, therefore, come to the conclusion that the Tribunal here has addressed the relevant question and it has here set out its reasons for coming to the conclusion it did. Although the judgment as a whole is open to criticism in that it displays much drafting which is inelegant and much which does not pose centrally the relevant questions (see in particular our remarks about direct discrimination and the way it was dealt with), here these objections have much less force. We have come, therefore, to the conclusion that the Tribunal was entitled to come to the view it did applying the relevant law as it did.

1. We turn finally to the argument as to perversity which to some extent we have anticipated by giving our conclusions as to both the indirect and direct heads. We do not wish to dignify the arguments here put forward by Mr Coleman, though it was with some considerable length, with any greater description than they deserve. He took us through a considerable number of points in which he would argue that the Tribunal was simply not entitled to reach the finding that it did.

1. Essentially one must remember that an argument as to perversity is an argument which seeks to show, taken overall, that the Tribunal reached a conclusion which was not reasonably open to it on the evidence, i.e. that no reasonable Tribunal could come to the conclusion it reached on the evidence, or, put another way, that the conclusion to which it came was "wholly impermissible" - a phrase which has been used more than once amongst the several phrases used in appellate judgments to describe the test which it is appropriate to adopt.

1. Again, we do not need to engage here in the copious citation of authority although we should observe that for reasons of constitution we are particularly familiar with cases involving perversity. Was there evidence here which required the Tribunal to find in favour of the Navy? As to indirect discrimination our answer has already been given - that there was evidence upon which the Tribunal could, properly directed, come to the conclusion it did.

1. As to direct discrimination we acknowledge that there is considerable force in what the central point that Mr Coleman makes. Here he says a decision which was not unreasonable on the face of it was reached by the promotion board. He directs us to consider what was said by Elias J in The Law Society v Bahl [2003] IRLR 640 at paragraph 99 where he observed that if the way in which an alleged discriminator had acted was reasonable then the reason was likely to be non discriminatory, adding that "in general a person has good non discriminatory reasons for doing what is reasonable". This observation, it has to be noted, was made in the context of an argument that merely to show that someone had acted in a completely unreasonable way did not itself establish that that person was guilty of discrimination. It does not amount to a statement of legal principle that if one takes a decision which could be reasonable one has not discriminated in reaching it.

1. We acknowledge that it may be difficult for a Tribunal looking at a decision reached by persons in a system in which a promotions board has to rely upon the reports of commanding officers rather than interview and which has reached conclusions which are consistent with the tone of those reports, and as to which a contrary conclusion might be thought contrary to the tone of those reports, to conclude that its decision was reached as a result of discrimination. In circumstances such as the present we cannot, without hearing the evidence, conclude that it was the only decision to which a Tribunal could properly have come. It seems to us that to do so would be to substitute our own judgment for that of the Tribunal and that we simply cannot do. This is not a case where the decision it reached to hold the officers guilty of discrimination was so wholly unreasonable as to be necessarily perverse.

1. We have dealt with the perversity ground without prejudice to our conclusion that the Tribunal's approach to answering the question of direct discrimination was flawed and its decision insufficiently explained (if indeed it did approach that decision in the right way which, as we have suggested, we rather doubt).

1. It follows, therefore, that this appeal insofar as it relates to the finding of direct discrimination against the members of the panel and, therefore, against the Ministry of Defence vicariously, must be allowed. The appeal so far as it relies upon the finding of indirect discrimination must be dismissed. We see no force in the perversity grounds advanced before us.

1. This then brings us to the question of what should happen. It seems to us that having reached the conclusion we have in respect of indirect discrimination the question of compensation or other remedy will have to be left to the Employment Tribunal to deal with on that footing. That footing will, as Mr Korn suggested, involve the Tribunal in at least assessing the chance that absent the indirect discrimination, which has been found against the Navy, the Claimant might have been promoted.

1. As to the appropriate directions in respect of the case relating to direct discrimination we shall rise to allow the parties a moment or two to consider our judgment and we hope - given the hour to return to court by no later than 3.55pm to hear whatever consequential submissions they may wish to make to us.

After Further Argument

1. There is an issue between the parties, consequential on our judgment as to whether we should remit the issue of direct discrimination to the same or to a fresh Tribunal for hearing. Mr Korn argues that we should send it back to the same Tribunal; Mr Coleman to a fresh Employment Tribunal. We have considered the particular matters to which reference is made in Sinclair Roche & Temperley v Heard & Fellows [2004] IRLR 763 at paragraph 46. We bear in mind these are not the only factors but they are certainly central ones.

1. The claim is a moderately large one, therefore, the costs of sending it back to a fresh Tribunal as opposed to the present one would not necessarily be disproportionate, but certainly we think that there will be a considerable saving in cost in time and in effort in sending it back to the same Tribunal assuming, as we do, that the Tribunal would have careful regard to their own notes of the facts and to this judgment we have just delivered.

1. The passage of time is not such, it seems to us, that the Tribunal will have forgotten much of what they have heard and be liable to invent the rest. We can rely upon its professionalism. This is a case in which the nature of it is such that many of the facts, it seems to us, are not subject to great dispute. It is the analysis of them, rather, which matters. There is no question here of bias or partiality alleged against the Tribunal, Though Mr Coleman reminds us that there is a danger that if the Tribunal come to the same conclusion that is an allegation which might be in some people's minds, it is not in his submissions.

1. He argues that the decision was flawed within criterion four and that we have to be careful that a Tribunal which has already made up its mind might be inclined to take the same view again, only this time to justify it by reasoning which will pass the test of review. As against that we are reminded by Mr Korn that a Tribunal is, and is expected to be, professional.

1. Putting all that together we think that here the tribunal has not taken a view on credibility of the central witnesses. Indeed, one of our criticisms in effect is that the Tribunal did not come to a conclusion as to what was consciously or unconsciously in the mind of those members of the panel whose decision they had to consider. We note that in some respects in their judgment the Tribunal has accepted the say so of one of the Commanders on the panel thus indicating that they are prepared to give credibility to his account where necessary. The failure of the Tribunal is a concentration upon the procedure to the potential exclusion of considering the reason why it reached the decision it did, a failure in the respects we have identified, and we are confident in this case that the Tribunal, in exercise of professionalism, will not shrink from concluding that there is no sufficient evidence of direct discrimination if that is what an honest appraisal of the facts in the light of the judgment we have delivered needs it to do.

1. It will have, of course, to pay very careful regard to and will wish to consider what explanation there is for the panel reaching the decision it did. If it comes to the conclusion that that is a decision indicated by commanding officers' reports in respect of which there has been no question of discrimination, and that the decision they reached is consistent with the view that one commanding officer expressed as to two candidates, then we can see that they might need to look for very cogent reasons to conclude that the panel here were actually acting in a discriminatory way. We are confident that taking matters such as that into account and having restricted those matters which are properly matters of indirect discrimination to their proper focus this Tribunal is perfectly capable of coming to a just conclusion, whatever that conclusion may be, which is as we have said is a matter for it. It is cheaper, it is quicker for the same tribunal to hear it.

1. Having taken account of the submissions, therefore, we think that in this case it is appropriate that we should remit to the same Tribunal, providing that remains administratively convenient. I am conscious when making such an order in this Tribunal that passage of time -short though it is, relatively speaking - may make it impossible for one or other members to sit, in which case it will have to be a fresh Tribunal. This order is not to be seen as precluding that if that is what good administration and expedition require. Subject to that, the case is remitted to the same Tribunal.