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Jersey Unreported Judgments |
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You are here: BAILII >> Databases >> Jersey Unreported Judgments >> Wood -v- JT [2016] JRC 089B (26 April 2016) URL: http://www.bailii.org/je/cases/UR/2016/2016_089B.html Cite as: [2016] JRC 089B, [2016] JRC 89B |
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Before : |
W. J. Bailhache, Esq.,Bailiff, sitting alone |
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Between |
Mark Wood |
Appellant |
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And |
JT (Jersey) Limited |
Respondent |
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Advocate H. J. Heath for the Appellant.
Advocate W. Austin-Vautier and Advocate E. B. Drummond for the Respondent.
judgment
the bailiff:
1. This is an application, heard on 4th August, 2015, for leave to appeal against a decision of the Employment Tribunal delivered by a judgment handed down on 23rd February, 2015. The judgment runs to 12 pages and contains 55 paragraphs. The appellant had been dismissed on the grounds of capability and in the alternative on the grounds that there was disharmony within the team of fellow employees with whom he worked. The Tribunal rejected the appellant's claim that he had been unfairly dismissed by reason of redundancy rather than capability, and it also held that the procedures adopted were not so irregular as to be unfair.
2. By Article 94(1) of the Employment (Jersey) Law 2003 (the "Law"), appeals from decisions of the Tribunal shall only lie on a question of law and shall only be brought with leave. The application for leave was entered timeously, and the application raises points which ought to be addressed. Accordingly, I give leave.
3. The Appellant had been employed by the Respondent since 1979. He was originally taken on as a Core Network engineer, and the job title in 2010 became that of Transmission and Access Engineer and subsequently became Transmission Engineer. There was no dispute that the role involved managing the operation and maintenance of the transmission networks and services used to transfer voice data, SMS data and internet data. Much of the Respondent's system has been updated over the years by the introduction of Internet Protocol technology.
4. In 2005, the Appellant had been offered voluntary redundancy with a payment of £53,783. In 2010 the Respondent discussed a further round of redundancies but confirmed that the Applicant would not be made redundant. In late 2011, the Respondent raised issues with the Appellant over his Performance and Appraisal Record (the "PRA"). There was a good deal of evidence before the Tribunal about this, both from the Appellant and employee witnesses called by him, on the one hand, and from Mrs Tostevin, the human resources manager of the Respondent, Mr Irwin, the Chief Engineer, and from Mr Summerfield, the director of the Respondent responsible for actually determining the dismissal of the Appellant. However, the immediate line managers of the Appellant were not called as witnesses by either side, and it is they who might have been expected to provide the most direct evidence. Before leaving the PRA, it is right to record two issues. The first is that the employee is responsible for maintaining the PRA record. He is required to indicate on it whether he accepts the criticisms made of him, if any, and this is then signed off by him electronically. There seems little doubt that someone signed off the Appellant's PRA for him. He understandably is concerned about that, and he confirms that in fact he never accepted the criticisms made by his line managers. The Respondent does not dispute that he did not accept those criticisms. The second is that the PRA is not solely concerned with capability although it does cover that subject. As Mrs Tostevin said in evidence, it is:-
"a very broad look at somebody's contribution over the year and the PRA documentation covers not only the technical aspects of the work that has been allocated whether that is business as usual work or project work, but it also covers all behavioural competencies. So it's a very broad piece of work that individuals, if they want to do well and see it as a vehicle by which they can increase their chances of a good bonus and a good pay rise, then they need to address that sensibly and seriously and make it as comprehensive a document as possible..." [Transcript p 66]
5. The Appellant's PRA scores for 2011 and 2012 were low. In his view, they were low because he had been set tasks which were "unachievable and ... deliberately given to make [me] fail". (See the Appellant's letter to the Respondent of 14th March, 2013). On 16th May, 2013, the Respondent started a formal capability process. This is a procedure for assessing the competence or capabilities of the employee. The first meeting took place on 17th May, and the outcome was summarised in a letter from Mrs Tostevin to the Appellant on 20th May, 2013:-
"Key issues are:
Inability to adapt in order to achieve role requirements, both the knowledge and skills of the current role and regarding future (IP) expectations.
Your behaviours is [sic] compounding the problem, by being isolated from the team and not coming 'on board' or up to speed.
There is little evidence that you have the will or capability to improve."
6. A second capability meeting took place on 17th June, 2013, and the same day Mrs Tostevin wrote to the Appellant to offer him the sum of £23,067.22 as compensation for dismissal. The Appellant indicated he would accept £50,000.
7. A third capability meeting took place on 22nd July, 2013, and a fourth capability meeting took place on 24th September, 2013. On this latter occasion, there were general discussions regarding proactive communication and it was decided that there was enough concern on the part of the Respondent to extend the capability process to stage 2 for a further three months for the purposes of establishing and improving two way communication between the Appellant and his managers and colleagues. On 14th October, 2013, at a team meeting, the team were informed that the Respondent was cutting the budget for the Appellant's section by a certain amount for the coming year and that manpower costs and levels were under constant review. On 7th November, 2013, the Appellant was offered £12,000 plus notice to leave and on 14th November, 2013, the Appellant was told he would be dismissed and offered a lump sum. The Respondent wrote to the Appellant on 15th November, 2013, terminating his employment as of that date, informing him that he was entitled to a payment of £15,469.57, subject to deductions for tax, and offering a tax free lump sum of £18,000. The Appellant issued proceedings before the Tribunal on 19th December, 2013.
8. The Tribunal found as a matter of fact that the Appellant was dismissed on the ground of capability rather than by reason of redundancy. It considered that, applying Taylor v Alidair Limited [1978] IRLR 82, the Respondent had only to show that it had reasonable grounds to support its honest belief in the incapability of the Appellant, and that those grounds existed as was evidenced by the PRAs and by the meetings which took place during the capability process. As to that, the process followed in relation to the capability review was not a sham but a genuine attempt to address persistent and serious failings over an extended period by the Appellant. The Tribunal noted that in Shook v London Borough of Ealing [1986] IRLR 45, a dismissal for capability may still be fair, even where the employee can perform some of his contractual duties. It endorsed Cresswell v Board of Inland Revenue [1984] IRLR 190, which found that there was an implied term in every employment contract that the employee must adapt to changes in working methods.
9. As to the question of redundancy, the Tribunal found that there was no underlying redundancy and no cessation of the business or the requirements of the business for the Appellant to carry out work of a particular kind. In particular the work that the Appellant was required to perform had not ceased or diminished, and it had been performed since the Appellant's dismissal by a replacement recruited full time. The Tribunal found there had been a reasonable investigation by the Respondent of the Appellant's performance; the Appellant had been put on notice that his performance was being investigated and he had had every opportunity to improve over a reasonable period. Applying Polkey v AE Dayton Services Ltd [1987] 3 All ER 974, a failure to follow performance improvement procedures is not unfair if following them would be futile or useless, and that was the position here. It accepted the evidence of Mr Summerfield that there was little to suggest the capability review would lead to achieving the required competencies and that the process would be played out painfully and slowly to the detriment of the Respondent and all members of the employee team which included the Appellant.
10. The Appellant had four principal grounds of Appeal:-
(i) The Tribunal misdirected itself on what constitutes a redundancy.
(ii) The Tribunal misapplied Polkey v AE Dayton Services Limited.
(iii) The decision was perverse and the Tribunal ignored the relevant evidence.
(iv) The decision of the Tribunal was not Meek compliant because its reasoning is unclear.
11. The Respondent accepted that the test in Jersey is the same as in England and that it is for the employer to prove that the reasons proffered for the dismissal were the real reasons. However, it contended that the employer had satisfied the Tribunal on the evidence that the reason proffered was accurate. On Polkey, it was said that in the present circumstances, the employer could be regarded as having dismissed the employee fairly notwithstanding its failure to take certain procedural steps. The perversity arguments were denied; and as to Meek compliance, it was said that Meek has not been applied in the two cases in the Royal Court in which it has been cited, and that in any event the Tribunal decision is adequately reasoned.
12. I take first the argument that the Tribunal's decision is not Meek compliant. This argument arises out of the decision of the English Court of Appeal in Meek v City of Birmingham District Council [1987] IRLR 250. Advocate Heath submitted that the Tribunal decision does not set out clearly the findings of fact and apply the law to the facts. She asserts that the Tribunal did not deal properly with the Appellant's factual or legal case and did not explain why the evidence of some witnesses was preferred to that of others. The reasoning should have set out why it resolved the disputed issues as it did.
13. Meek was referred to in Voisins Department Store Limited v Soares [2014] JRC 004, but it was unnecessary in the event for the Court to express a view on it because the appeal was decided on different grounds. At paragraph 37 of the Court's judgment, Clyde-Smith, Commissioner, cited this extract from the English Court's decision:-
14. In my judgment, this Court always starts from the position that both it and any inferior tribunal must give reasons for the decision which are sufficient to enable the parties to decide why they have won or lost as the case may be. That is their basic entitlement - it is part of having a fair hearing. Furthermore, it enables the parties to reflect on whether any appeal is sensible, and assess their chances of success. It enables them to take a realistic view on those chances with the consequent possibility of compromise of the appeal. These are all good public policy reasons why the lower tribunal should give adequate reasons.
15. However, the judgment in Meek is not long and there are counterpoints to these statements of principle which explain the English Court's approach. The Court also endorsed as in no way inconsistent with its summary set out at paragraph 13 above the comment of Lord Justice Donaldson in UCATT v Brain [1981] ICR 542 when he said:-
16. And later Bingham LJ added in a similar vein:-
17. Having made these comments, Bingham LJ then concluded that in that particular case the Tribunal fell far short of what it needed to do to explain its decision.
18. It seems to me that there is some warning in the Meek decision that the essential work of the Industrial Tribunal must not be undermined by requiring it to act as the High Court. It has to deliver what in our jurisdiction we would describe as bonne et briéve justice. This is a counterpoint to ensure that the law does not develop in such a way as to prevent the Employment Tribunal, in our case, from dealing with employment matters efficiently and with the least formality consistent with ensuring a just outcome. It is intended to be a tribunal to which ordinary employees and employers must be able to have access without the seemingly unavoidable exposure to legal fees which arises in this Court, albeit many litigants before that tribunal are legally represented as indeed were the parties to this appeal. I conclude that the Meek decision as a whole is a good precedent which the Royal Court ought to follow, and I construe it as requiring a review of the reasoning provided by the Employment Tribunal which reasoning must make sufficient sense that the parties and the Court knows the basis of the decision - but not requiring the Tribunal to deliver the detailed judgments of the kind which led the English Court of Appeal in a family case where the judgment under appeal ran to 484 paragraphs to say that:-
19. In my judgment, the Tribunal in the present case gave a perfectly adequate explanation of its reasoning. I did not find it difficult to follow, even if from time to time the contentions of one of the parties were elided with the views of the Tribunal. The fact that I find myself able to follow the reasoning does not mean I have agreed with it. As indicated later, I think it would have been helpful if other matters were addressed. Nonetheless, the fourth ground of appeal fails.
20. I turn next to the question of redundancy. The Tribunal found that the Appellant was dismissed on the grounds of capability rather than redundancy (paragraph 5 of the decision) and that accordingly there was no need to consider the question of redundancy. The Tribunal referred to Article 2(1) of the Law, and gave its reasons for the dismissal in these terms:-
"46. The Tribunal finds as a matter of fact that the reason for the dismissal in this case was the Respondent's belief that the [Appellant] was incapable. The Respondent honestly believed that the [Appellant] was intransigent and inflexible and that his attitude had been, and would continue to be, damaging to its business in the sense that it gave rise to disharmony. There was also evidence that the Respondent considered the resources devoted to the issue to be disproportionate. It had reasonable grounds upon which to base its belief on capability, as was evidenced by the PRAs and the meetings that took place during the capability process.
47. It was alleged on behalf of the [Appellant] that the Respondent acted in bad faith and created a sham capability process so as to save itself the cost of paying the [Appellant] a substantial redundancy payment. The Tribunal saw no evidence of such bad faith and considered that the Respondent behaved as a reasonable employer throughout. The Tribunal found the evidence of [Mrs Tostevin] to be credible and she firmly rejected any suggestion of such behaviour. The Tribunal also had the unchallenged evidence of [Mr Summerfield], which was consistent with that of this colleague.
48. It follows that the Tribunal finds that the reason for the dismissal in this case was not redundancy. There is no need in the circumstances to examine the issue of redundancy in any great detail notwithstanding the fact that it listened carefully to all the evidence adduced and the submissions made in that regard.
49. For there to have been a redundancy in accordance with Article 2(1) of the Law, the dismissal would have to have been wholly or mainly attributed to a cessation of business or a reduction in the Respondent's requirements for employees to carry out work as set out above at paragraph 43. Rather than being wholly or mainly attributable to such matters, the Tribunal finds that this dismissal was not attributable to such matters at all.
50. It was the view of the Tribunal that the [Appellant] did not want to move with the times and that he perhaps regretted not having taken the opportunity to take an earlier redundancy offer. The Tribunal could not help but feel sympathy for the [Appellant] but the evolution of the business within which he worked did not amount to a redundancy situation. It was an implied term of his contract that he should adapt to changes in working methods ..."
21. The Tribunal's reasoning, reflecting the decisions of the English courts referred to at paragraph 8 of this judgment, had been that it was not for the Tribunal to take the employer's decision for it, substituting its own standards for those of the employer, provided that the employer had reached a conclusion which falls within the band of reasonable responses. The Tribunal considered that if it found, as it did, that the employer had an honest belief that the employee was unsuitable for the job or incompetent, and had reasonable grounds for that belief, that was a sufficient defence for the employer to have raised in opposition to a claim for unfair dismissal. The employer did not have to prove that the employee was in fact incapable or incompetent.
22. The findings of the Tribunal in this respect are in at least one sense surprising. There is no doubt that the business of the Respondent was moving away from the employment of transmission engineers and towards IP engineers. There is equally no doubt on the evidence that once the Appellant had been dismissed, his job was filled by a former apprentice on the basis that the new employee would spend part of his time on transmission work and the rest on IP work. The Respondent did not see this as a redundancy because on a headcount basis, the apprentice did not figure in the previous jobs count because he was an apprentice, and therefore the overall headcount did not drop as a consequence of the Appellant's dismissal. He was replaced, ergo there could be no redundancy. However, this was not the reasoning of the Tribunal. Before it, Advocate Heath had argued that the Respondent acted in bad faith in relation to the capability review - in other words this was a sham process whose only object was to ease the Appellant out of his job without leaving the Respondent exposed to a claim for unfair dismissal. Before me, Advocate Heath abandoned the bad faith argument, but the Tribunal heard it and rejected it. The Tribunal then held (at paragraph 48) that it followed the reason for dismissal was not redundancy. It seems to me this was a non sequitur and in argument Advocate Austin-Vautier conceded as much. The reason the Tribunal's reasoning fails is that the bad faith argument went to process and not necessarily to the reason for the dismissal. It was logically open to the Tribunal to have concluded that the Respondent acted in good faith despite closing down the capability review early, and yet also that the real motivation for the dismissal was that the previous job - that of a transmission engineer - was substantially not one to be maintained. Such a conclusion would be consistent with Article 2(1)(b) of the Law:-
23. Although questions of capability and of redundancy are quite separate, the Tribunal's approach seems to have been to treat them as different sides of the same coin. In other words, the Tribunal found that because the Appellant was dismissed for lack of capability, it followed that his position was not being made redundant. In my view it does not follow at all. Very capable people may be made redundant if the business no longer has a demand for their skills. Furthermore, if one inverted the proposition, it may well be the case that somebody is dismissed because they are neither being made redundant nor found to be lacking in capability, but are simply unfairly dismissed. Similarly, it is entirely possible that a person who has a lack of capability to do the job he is actually doing is dismissed because the employer recognises his lack of capability and wishes to take the opportunity of making the job redundant. The two things are capable of being quite separate.
24. In the evidence before the Tribunal, it seems clear that the Respondent's view was that there was no redundancy because the headcount did not reduce. This is demonstrated by the evidence of Mrs Tostevin at pages 71/72 of her evidence while being cross-examined by Advocate Heath:-
"Advocate Heath: ... and then, just finally, I think, just, Mrs Tostevin, the fact is that the day that ... the day after Mr Wood left, the whole of his work was distributed between other members of the team wasn't it?
Witness 1: Again I have no knowledge of it. I would, I would think that a fair assumption.
Advocate Heath: And, Mr Wood's position was never advertised internally or externally was it?
Witness 1: Again, no.
Advocate Heath: And it was never replaced?
Witness 1: Yes it was replaced.
Advocate Heath: It was, you say it was replaced by an apprentice, but that apprentice is an IP engineer isn't he?
Witness 1: He ... that is misleading. Not that the title, itself is misleading, but it's misleading to think of tasks as being the same as headcount. Now from Mr Wood's own submissions, evidence, witness statement, he implies that we were trying to reduce the headcount and in JT terms that is what we mean by redundancy, that we drop headcount. In fact we can't call somebody leaving a redundancy if there is no drop in headcount. Now that's just background but in this instance, Mark leaving meant that we replaced with a person. The fact that that person is not called 'Transmission Engineer' is neither here nor there in the company's view, because it is still sharing that work and the work that Mark did on the day he left and prior to the day he left as ongoing and is being done by colleagues.
Advocate Heath: The fact is that individual was working at JT at the same time as Mr Wood wasn't he?
Witness 1: Yes he was.
Advocate Heath: And he is, it's this new appointment, so that of IP engineer, is not the same as that of a transmission engineer?
Witness 1: The role title is not the same I agree and he was working as an apprentice which is not part of headcount. So, apprentices do not ... because they are effectively not guaranteed employment at the end of their apprenticeship they do not count as a permanent member of staff ...
Advocate Heath: And a transmission engineer is a particular type of work isn't it?
Witness 1: It is.
Advocate Heath: And an IP engineer is a particular type of work isn't it?
Witness 1: It is.
Advocate Heath: And the work and the requirement for work of transmission engineers had decreased over the years hasn't it?
Witness 1: It is decreasing yes.
Advocate Heath: And it continues to decrease doesn't it?
Witness 1: It will continue to decrease, yes.
Advocate Heath: Such that there was, as of the date of Mr Wood's dismissal, the day after, the rest of the team were able to pick up the whole of Mr Wood's work weren't they?
Witness 1: Yes because they were previously and materially still transmission engineers. So that skill set is still with them in the same way that it was with Mark and they were part of the team that was called transmission and access before the merge.
Advocate Heath: So the remaining transmission engineers in Mr Wood's team took up his work the day after he left?
Witness 1: Yes."
25. In my judgment this extract makes it plain that the Respondent's approach to redundancy was driven by its own internal methodology for calculating headcount. The Respondent's view was that there was no redundancy because the headcount did not reduce. To agree that that is conclusive would in my judgment be wrong. The fact that there has been no reduction in headcount may well be relevant to a conclusion that there has been no redundancy, but it is one factor only. The true assessment depends on the nature of the job which the dismissed employee did, and whether anyone was recruited to do it. If no one was recruited, then the dismissed employee has been made redundant applying the definition in Article 2(1) of the Law. The problem arises where the recruited employee is doing some of the same job, but is also doing another job as is the position here. Having reviewed the evidence given before the Tribunal, but especially the evidence of Mrs Tostevin set out above, I think that there is no doubt that the job of the Appellant had already diminished in scope and was expected to diminish further. That is why the Respondent was anxious that the Appellant should retrain as an IP engineer, a job he did not want. Accordingly, subject to the assessment of capability, the natural conclusion on the evidence might well be that the Appellant was in fact dismissed by reason of redundancy - on the basis that his dismissal was at least in part attributable to the fact that the requirements of the business to carry out work of a particular kind had ceased or diminished, or were expected to cease or diminish. The only relevance of the capability assessment in this respect seems to me to arise if it goes to the question of whether the Appellant showed such a lack of capability that he would not have retained his job even if the job had continued to exist in its previous form - in other words, was the dismissal "wholly or mainly" down to capability or redundancy. The Tribunal misdirected itself in not considering this question.
26. This naturally leads to the next argument on appeal which concerns the application of the decision in Polkey. The Tribunal covered this at paragraphs 42/43 and 52/53 of the judgment:-
27. The issue for the Tribunal was the reasonableness of the dismissal at the time of the dismissal. The Tribunal is not to enter into a land of imagination and fantasy and guess at what might have been the outcome. That is the real thrust of Polkey. It is right to note immediately that the Polkey decision in the House of Lords turned upon the proper construction of Section 57(3) of the Employment Protection (Consolidation) Act 1978, which is in very similar terms to Article 64(4) of the Law. Polkey is therefore an authority of the highest persuasion as far as this Court is concerned. Lord Mackay at page 354 of the judgment paragraph H says this:-
28. It is apparent that the Respondent took the view that the Appellant would not change and that the process was a waste of time. In my judgment, that was simply not good enough. If this were the appropriate test, an employer would never have to go through the capability process. It would be all too easy to say that the employee would not be capable of change. The whole purpose of the process is to give the employee a chance of showing he or she can change. That is what makes for fairness. It is apparent that the Tribunal reached the view that because the PRA process had thrown up perceived issues in the Appellant's performance, the capability review was bound to lead to the outcome that the Appellant would fail and be dismissed. In my judgment this too was a non sequitur. First of all, the PRA review was not agreed and there is no evidence from either party that its conclusions were reasonable - indeed the evidence seemed to point the other way, and neither of the appraisers was called. Secondly, the Appellant had at least said that he was engaging with the process. The truth seems to be that the Respondent did not believe him. That is not a basis for saying that the process was futile. A review process of this kind requires that both employer and employee try to make it work. Furthermore, the Appellant had been working for the Respondent in broadly the same job for 33 years or more. If there were really a view that he were incapable, one might have expected action to be taken by the Respondent considerably earlier. It appears to me that the difficulties perceived by the Respondent were that:-
(i) The Appellant's face did not fit because he did not embrace the new ethos of JT;
(ii) The writing was essentially on the wall for transmission engineers and the Appellant had not shown himself willing to change; and
(iii) The Respondent was imposing budgetary pressures on the Appellant's team.
It seems doubtful to me that such factors could reasonably lead to the Appellant failing a capability review.
29. In my judgment the Tribunal did approach the capability review question from the wrong perspective. The issue was not whether the Appellant would have improved sufficiently to have kept his job. The issue was whether he showed such lack of capability that he could not keep his job, and he was entitled to a fair crack at that question. Polkey accepts that the failure to keep to the established procedures does not necessarily mean the dismissal was unfair, but the test is too greatly watered down if formulated as the Tribunal did.
30. The final ground of complaint by Advocate Heath was that the decision of the Tribunal was perverse having regard to the evidence. When I first reviewed the arguments in this case, I had not considered that it was necessary to deal with this argument because I had resolved the appeal in favour of the Appellant on the ground that the Tribunal misdirected itself in considering the issue of redundancy, and failed to apply correctly the decision in Polkey. A draft judgment was prepared on that basis ready to be handed down on 13th January. At that time, the parties both urged me to deal with the outstanding ground of complaint, and accordingly the draft judgment was not handed down in that form and, regrettably for reasons beyond my control, there has been a further delay. I have also had to review rather more directly the entirety of the transcripts of the proceedings before the Tribunal, which were extensive. However, I accept that it would have been better had I dealt with this ground of appeal in the first instance, not least because the Tribunal needs to know what task lies before it when I remit the issue of the proper amount of compensation for unfair dismissal to it. I regret that this position has arisen, and in particular the continuing delay in the delivery of judgment.
31. I have set out at paragraphs 8 and 9 above the primary findings of the Tribunal which are now under enquiry, and at paragraph 20 the detailed provisions of the Tribunal's decision.
32. The Tribunal indicated at paragraph 46 of its decision that it accepted the reason for the dismissal was the Respondent's belief that the Appellant was incapable. The Tribunal found that that was an honest belief, accepting the evidence in particular of Mrs Tostevin as credible. That comment was made in relation to the suggestion by Advocate Heath that the Respondent had acted in bad faith and created a sham capability process, a contention which the Tribunal rejected. Having read the transcripts of evidence in detail, I am completely satisfied that there was evidence before the Tribunal on which it could properly reach such a conclusion. No doubt that was the reason why, before me, Advocate Heath withdrew the contention that there had been bad faith on behalf of the Tribunal and that the capability process was a sham, intended to save the cost of paying the Appellant a substantial redundancy payment. However, the second part of substantive fairness, as set out in Taylor v Alidair Limited [supra] is that there must have been reasonable grounds on which the employer could honestly have come to that conclusion. The Tribunal considered that the reasonable grounds available to the Respondent were two-fold: (i) the performance and appraisal record ("PRA") and (ii) the meetings that took place during the capability process. In particular the Tribunal considered (at paragraph 50) that the Respondent acted reasonably in regarding the Appellant's failure to embrace change in his working methods as sufficient evidence of his intransigence in dealing with colleagues so as to render him incapable of doing his job.
33. It is important to recognise as I do that the Tribunal had the advantage of seeing and hearing the witnesses give evidence, an advantage I have not had. Nonetheless, having regard to the evidence about the capability meetings, I do not think that the Tribunal was entitled to reach the conclusion that these provided reasonable grounds to the Respondent to terminate the Appellant's employment. From paragraphs 53 - 63 of Mrs Tostevin's witness statement regarding the initial capability hearing, there emerges the evidence that it was an amicable meeting where the Appellant's line manager wanted the Appellant to integrate himself into the wider IP team. That therefore begs the question of whether the IP engineer is doing a different job from the transmission engineer. However, this part of Mrs Tostevin's evidence confirms that the Appellant said he was prepared to try to improve. At paragraphs 64 - 69, she gives evidence of the first capability review meeting. It is clear that line management agreed there was an improvement in the Appellant's efforts although there was an objection that the Appellant preferred e-mail to oral communication. The second capability review meeting, dealt with at paragraphs 70 - 80 of Mrs Tostevin's witness statement was unproductive. In her view, line managers were weary and the Appellant was obstructive. From that moment, relations between management and Appellant went downhill further. The witness statement of Mr Richard Summerfield, the group HR director is more directly in point. He saw a window of opportunity before the financial year end to obtain a quick outcome. He had in mind a severance payment of up to £20,000 - the relevance of which coupled with the financial year end suggesting that this is a question of budget being available - and noted that the capability process was taking up a good deal of IP and HR resources. Bringing it to an end would release both the Appellant's line manager - described by Mrs Tostevin as 'weary' - and Mrs Tostevin to focus on other matters relating to driving productivity in the business. Mr Summerfield took the view that if the Appellant did not accept the severance pay, then he would pay any compensation arising out of subsequent litigation for incapability dismissal. He said "I further resolved to terminate his employment anyway".
34. Mr Summerfield was not cross-examined before the Tribunal. Mrs Tostevin was. It is to be noted that in cross-examination at page 53 of the transcript, there appears this passage in connection with one of the early capability meetings:-
"Advocate Heath: And there was acceptance during that meeting, wasn't there, that there'd been improvement in Mr Wood's technical skills?
Witness: Yes that he'd made an approach to improving.
Advocate Heath: And ultimately the only criticism that was made of Mr Wood was this poor, alleged poor communication, alleged by Mr Bray and Mr Van de Ven neither of whom have given evidence, that's the case isn't it?
Witness: Yes
Advocate Heath: But the fact is, if other members of Mr Wood's team had been called upon by JT to speak to the communication in the work that Mr Wood did, they would have said he was more than competent, wouldn't they?
Witness: I can't answer for what they might have said."
35. At that point, one might be tempted to conclude that the evidence was that the capability meetings, of themselves, were not causing difficulty. However, when pressed upon the issue of why the capability process did not invite comments from other members of staff where the allegation was one of lack of communication, Mrs Tostevin said this:-
"No, I disagree. I can only disagree, it is not how we would run the formal capability process. It is not about, um, asking for consensus. It is about a manager's requirement of an employee who is being paid to do a job."
36. If the criticism is, as here, that the employee would not communicate properly with the team of employees in his section, including his manager, then it seems to me to be the case that it might have been thought reasonable on the part of the employer to identify whether the manager's complaints of lack of communication were borne out by the reaction of other members of staff. In my judgment it was unreasonable, in the limited circumstance of this complaint, not to invite any further information, and to rely solely on the line manager. This is particularly so when, at page 57, Mrs Tostevin says that "The issue was not purely the communication between Mr Wood and Mr Bray, it was Mr Wood's communication with the wider team, his own team and his colleagues in operations and his other line manager and that was Ronald."
37. Reviewing this evidence and the evidence given by the Appellant and his witnesses, it does not seem to me to be possible to reach the conclusion that there were reasonable grounds for the employer to terminate the Appellant's contract on the basis of the capability process.
38. As against the evidence of the PRAs and the capability process, the Tribunal also heard evidence not only from the Appellant but also from other employees that the Appellant was not a difficult man to deal with and that he was quite able to communicate with his colleagues. The Tribunal also heard evidence that he had been employed by the Respondent since 1979, and as a transmission engineer since 2001. Furthermore, almost up until the date of dismissal, the Respondent trusted the capability of the Appellant sufficiently to leave him in sole charge, on an emergency basis, of maintaining the Respondent's transmission network. The difficult position facing the Tribunal was that it had to make an evaluation or judgment on the reasonableness of the Respondent's decision based on the evidence which it heard, namely direct evidence from the Appellant and other employees compared with second-hand evidence referred to in the PRAs, where the Respondent could have adduced the evidence directly before the Tribunal had it chosen to do so. However, the Respondent chose not to do so and as a result, the Tribunal heard no evidence from any of the Appellant's line managers, who might have been cross-examined as to the basis upon which the views which were attributed to them in the PRAs were reasonable. I have read those PRAs myself, and it is obvious to me that there are substantial areas where cross-examination might prove fruitful as far as the Appellant is concerned.
39. The consequence of this for the Appellant is that in the context of his application for a decision from the Tribunal that he had been unfairly dismissed, he was, as it were, boxing with shadows. He was faced with criticisms of his performance which were second or third hand, and with which it was almost impossible to deal. In my judgment, an approach of that kind by an employer ought not to have been supported. It would be different if the PRAs conclusively demonstrated the complaints made against the Appellant. It might well have been different if the capability process had run its full course. However, it seems to me to be quite difficult to assert that the employer acted reasonably in dismissing the employee when it bases its reasonable grounds for belief on capability without giving the employee a fair chance to justify his position, contrary to the decision in Polkey. Having reached the conclusion that the decision to dismiss was Polkey unreasonable, it seems to me to be a very small step to concluding that the employer's belief on capability was unreasonable. Mr Summerfield's evidence in chief that he resolved to terminate the Appellant's employment "anyway" demonstrates that the decision was taken in the overall interests of the employer without regard to the Appellant's rights - the employer had money in the budget to pay compensation if ordered but not agreed.
40. In my judgment the second reason that the decision of the Tribunal was perverse lies in the approach to the question of the Appellant's attitude to change the way he did his work. The Tribunal rightly noted that it was an implied term of the contract that the Appellant should adapt to changes in his working methods. The Tribunal also noted that the Appellant had said in his statement that "IP was not what I wanted to do with my life" and this demonstrated a defiant attitude. The difficulty is that the Tribunal did not address itself to whether or not the Appellant was entitled to take the view that IP was not what he wanted to do with his life, because if he was entitled to take that view, then his refusal to adapt to changes in working methods which would require him to adopt that view would not be unreasonable; and by contrast the employer's requirement that he do change working methods would be unreasonable.
41. At paragraph 50 of its decision, the Tribunal, having noted the statement of the Appellant that "IP was not want I want to do with my life" went on to find that the Respondent wanted the Appellant to change the way he did his work and the way in which he interacted with colleagues. It was considered that the Respondent was reasonable in regarding the Appellant's failure to change adequately or at all combined with issues regarding communication with colleagues as sufficient to render him incapable. In my judgment, the linking of communication issues with a change from being a transmission engineer to an IP engineer was unfortunate, because it has diverted the Tribunal from making any finding as to whether an IP engineer's job is materially different from a transmission engineer's job. That seems to me to be critical. There is no doubt that an employee should adapt to changes in his working methods, but this is a question of degree, and what he is not required to do is to change his skill set. To take an absurd example, a person who is qualified as an advocate could not reasonably be required by his employer to change his job to that of an accountant. If the employer in that example no longer had a need for an in-house advocate but did have a need for an in-house accountant, the reality is that the advocate would have been made redundant, and that there was a vacancy for a new job, namely that of accountant. A great deal of evidence was advanced before the Tribunal as to whether the job of transmission engineer was in truth the same job as that of an IP engineer, and therefore whether moving from one to the other amounted to a change in working methods. The Tribunal has not addressed that point, and therefore in my judgment has reached a perverse decision in concluding that the employer had reasonable grounds to conclude that the Appellant's attitude to change the way he did his work was unreasonable. I have not had the advantage of hearing all the evidence on this particular point, and therefore it is a matter which the Tribunal needs to resolve because it will be seen immediately that there is a connection between the conclusion on this point and any final conclusion on whether the Appellant has in fact been made redundant - as indicated at paragraph 25 above, what may be a natural conclusion on the evidence that the Appellant was in fact dismissed by reason of redundancy is subject to the assessment of his capability - in other words subject to his ability to change, but against a background that it would be unreasonable to require him to change if in effect it was not a change of working method but a change of job.
42. I have noted that I did not consider that the PRAs conclusively demonstrated that complaints made against the Appellant could be treated as credible in the absence of direct evidence from his line managers. By way of illustration I take the PRA for 2011. The key objectives for the year, or measurable targets, are in the left hand column of this document, with the comments of both employee and employer in the right hand column. An analysis seems to show that five of the seven targets were completed on schedule. It is true that in some cases there was an implication that the Appellant had not gone the extra mile by going further than the targets which had been set down, but if so, that would seem to justify a PRA score in the middle of the range and not at the bottom of it.
43. There is no doubt that the PRA for 2011 contains material that goes both ways in so far as the Appellant's performance was concerned. What in my judgment it does not do is to demonstrate a lack of capability. In those circumstances it was in my judgment perverse for the Tribunal to have relied on the PRA score of 1, because the underlying material did not reasonably justify that result. Thus the PRAs did not provide reasonable grounds for the Respondent's honest belief in the reason given for the dismissal, namely lack of capability.
44. For these reasons, I find that the Tribunal did reach a perverse conclusion in determining that the Respondent was entitled to dismiss the Appellant on the grounds of capability.
45. For the reasons given the Appellant therefore succeeds on this appeal with three out of the four grounds of appeal taken before me, and I remit the matter to the Tribunal for reconsideration and assessment of the claim. In order to make that assessment, the Tribunal should consider and determine:-
(i) Whether the nature of the job of an IP engineer was sufficiently different from that of a transmission engineer in the skills required and/or in the terms and conditions of work that it would be unreasonable for the Respondent to require the Appellant to retrain from the latter to the former.
(ii) Whether, having regard to (i) above, all evidence adduced and this judgment, whether the Appellant was unfairly dismissed because the Respondent did not have reasonable grounds to consider the Appellant's employment should be terminated on capability grounds.
(iii) Whether, even if the answer to sub-paragraph (ii) above is answered affirmatively, the Appellant's employment, on a proper analysis of the evidence and having regard to the answer to sub-paragraph (i) above and this judgment, was terminated on the ground of redundancy.
(iv) Whether having regard to the answers to the questions raised by sub-paragraphs (i) to (iii) above, the contents of this judgment generally and the true application of the Polkey test, the Appellant was unfairly dismissed.
(v) If the question in sub-paragraph (iv) is answered affirmatively, the amount of compensation payable to the Appellant having regard to the basis on which the unfair dismissal has been found to be established.
