THE INDUSTRIAL TRIBUNALS 
 
CASE REF:    248/13 

CLAIMANT:		Geralyn Mary McFeely 

RESPONDENTS:		1.	Declan Corry
		2.	Musgrave Retail Partners Ltd NI
		3.	DNA Retail Limited
		4.	Post Office

DECISION

The unanimous decision of the tribunal is that the claimant was fairly dismissed, the respondent in breach of contract has failed to pay the claimant one week’s net holiday pay for the 2011 holiday year and a payment arising from overtime worked between 10 April 2010 and 14 January 2012.  The tribunal is not satisfied that the claimant is entitled to any other statutory or contractual entitlement and dismisses these and the claimant’s unfair dismissal complaint.  The respondent shall pay the claimant £705.04.

Constitution of Tribunal:

Chairman:	Ms M Bell

Members:	Mrs K Elliott 
	Mr J Welsh

Appearances:

The claimant was self-represented assisted by her partner Mr W McDonald as her McKenzie friend.

The third and fourth named respondents were represented by Mr John Rafferty, Barrister-at-Law, instructed by Logan & Corry Solicitors.

1.	The claimant complained in her claim that she was unfairly dismissed in that her dismissal was ‘substantially and procedurally unfair’ and that she had not been paid all contractual or statutory entitlements due to the date of termination of her employment and was owed money in respect of notice pay, holiday pay, arrears of pay and breach of contract. 

2.	Following a conciliated settlement being entered into the claim against the second named respondent was dismissed on 23 May 2013. The second named respondent in its response had resisted the claimant’s claims on the basis that it was not the claimant’s employer at the time of her dismissal but understood the claimant, following a series of TUPE transfers and subsequent incorporation of the first named respondent’s business, was employed by the third named respondent.  The second named respondent stated that to accord the claimant a right of appeal to an independent person at the request of the first named respondent it provided Mr Geoff Johnston, its Regional Manager to conduct the claimant’s appeal against her dismissal for gross misconduct by the third named respondent.  The third named respondent in its response, which it also entered on behalf of the first, second and fourth respondents, accepted that it employed the claimant and contended that the first, second and fourth respondents were not employers of the claimant and should be released from the proceedings.  The third respondent disputed the claimant’s complaints and contended that a thorough and fair investigation was carried out; it believed that the negligence of the claimant’s duties was so serious as to amount to gross misconduct and dismissal an appropriate sanction.  The third named respondent denied non-payment of any contractual or statutory entitlements but awaited details of same as these were not provided in the originating claim. 

3.	The tribunal based on the facts hereinafter set out is satisfied on balance that the third named respondent was the claimant’s employer at the date of dismissal and dismisses the proceedings against the other respondents; the third named respondent is accordingly hereafter referred to as the respondent.

4.	At hearing the claimant, on being asked to clarify what claims for unpaid contractual and statutory entitlement she was pursuing, confirmed that she was seeking payment for overtime worked by her in excess of 40 hours per week due at the rate of time and a half.  It was agreed by the respondent at hearing that the claimant was outstanding one week’s holiday pay for the 2011 holiday year but contended that the claimant’s full entitlement to holiday pay for 2012 had been paid.  No other claim was quantified or pursued at hearing by the claimant in respect of notice pay or breach of contract.

ISSUES 

5.	Who is the correct respondent?

6.	Was the claimant unfairly dismissed by the respondent? 

a.	Was the dismissal automatically unfair for failure to follow the statutory disciplinary and dismissal procedures?

Otherwise, 

b.	Has the respondent shown the reason for dismissal?

c.	Was it for a reason relating to the conduct of the claimant?

d.	Did the respondent act reasonably in treating the conduct as a sufficient reason for the dismissal?  That is:-

•	Did the respondent have a reasonable suspicion amounting to a belief in the misconduct of the claimant and reasonable grounds upon which to sustain the belief?

•	Did the respondent carry out as much investigation into the matter as was reasonable in all the circumstances?

•	Was the misconduct in question a sufficient reason for dismissing the employee?

7.	Has the respondent failed to pay the claimant statutory or contractual entitlements in respect of:-

a.	Notice? 

b.	Holidays?

c.	Overtime?

8.	At hearing the parties provided a list of factual issues as submitted by the claimant and factual and legal issues as submitted by the respondent. The tribunal’s findings relating only to relevant matters are set out hereafter.

EVIDENCE

9.	The tribunal considered the claim, responses, two agreed bundles of documents and additional loose documentation produced during the hearing which included appeal meeting minutes, claimant’s list of dates relating to overtime and holiday leave, a statement produced by the claimant of Mr Christopher Cunningham a former employee of the respondent, and the claimant’s schedule of loss.  Oral evidence was heard from Mr Declan Corry sole director of the respondent company, Mr Geoffrey Johnston Regional Manager of Musgrave Retail Partners Ltd NI and from the claimant.

FINDINGS OF FACT RELEVANT TO LIABILITY

10.	The claimant commenced employment as a counter assistant on 20 March 2000 with Derry Northside Development Trust based at Shantallow Post Office, which is situated within a grocery store. 

11.	A series of transfers of the grocery business and post office franchise took place following commencement of the claimant’s employment, firstly about August 2007 to John and Mary Gormley.  Around that time the claimant was made post office manager on the departure of the current manager, which on the claimant’s evidence was because she was then the employee in the business with the longest length of employment and most experience.  On her change of role the claimant received three days formal managerial training.

12.	The claimant signed on 20 September 2007 a contract with John and Mary Gormley setting out her main terms and conditions of employment as Post Office manager including Disciplinary Rules and Procedure.  The contract provided for overtime hours to be paid at time and a half and the employer under notice entitlements reserved the right, in the case of gross misconduct, to dismiss summarily without notice and without payment in lieu of notice.  Examples of Gross Misconduct listed in the disciplinary rules included ‘Failure or Refusal to carry out a reasonable work instruction.’

13.	On 17 August 2008 a further transfer of the post office and grocery business took place to Musgrave Retail NI.

14.	On 2 August 2009 Mr Declan Corry became sub postmaster when he took over the post office franchise along with the grocery business from Musgrave Retail NI.  When Mr Corry took over the businesses he inherited under TUPE the staff already there including the claimant who had by then been employed as manager of the post office for two years, a role in which she was responsible for the day to day running of the post office and its staff, ensuring the provision of the Post Office’s day to day services and compliance with all rules and regulations set out by the Post Office Ltd.  

15.	Mr Corry temporarily traded personally as Supervalue Shantallow until DNA Retail Ltd, the respondent company, of which he became managing director, was incorporated in September 2009 and the businesses transferred to it.  Mr Corry verbally informed staff that their employment would transfer to DNA Retail Ltd at this time but no written confirmation was provided to the claimant.  Since incorporation all payments and payslips issued to the claimant were from the respondent company. The tribunal is on balance persuaded that ultimately the claimant was employed by the respondent company following a series of transfers of the business in which she was employed, her employment having been protected under the Transfer of Undertakings (Protection of Employment) Regulations 2006.

16.	Shantallow post office employs six full and part time employees, the grocery store which has fresh fruit, bakery, butchery, and delicatessen counters employs fifty seven staff.  Mr Corry attributes around fifty per cent of the grocery store’s footfall to post office customers as he finds the grocery store to trade at about fifty per cent on days when the post office is closed.  Mr Cory considers the post office business crucial to the sustainability of the grocery store bringing in customers for grocery sales and that closure of the post office would have a major impact on the grocery business.

17.	The Post Office Ltd provided Shantallow post office on-going sales training throughout the claimant’s employment.  A sales support manager visited every three to four  weeks to ensure the franchise was focusing on the sales and services it was to provide to customers.  The Post Office Ltd’s sales support manager Mr Eddie Devine, in addition to phone calls, conducted fifteen training visits to Shantallow Post Office in the year 2011/12.  The claimant attended a manager’s coaching course on 18 January 2011 and manager’s skill’s course on 8 February 2011, a sales manager workshop on 10 January 2012, Speaking To Every Person (STEP) training days on 28 January and 4 February, and a sales workshop on 13 February 2012.

18.	The claimant as manager was required to participate in the Post Office Ltd’s STEP programme which:-

•	Informed the claimant of her sales responsibilities in the post office.

•	Provided training to the claimant to train and manage her staff to deliver sales.

•	Incorporated a coaching system called Horizon though which the Post Office Ltd sent new procedures to branches for all staff when its products and services changed.  Staff were given individual user names and passwords for the Horizon computer system which they were required to log on to, complete interactive training and record their training using correct procedures so as to ensure they were kept properly informed and advised of up to date changes in operational systems and procedure.

•	Through regular on-going conference calls advised post offices throughout Northern Ireland of products to be sold in the coming week.

19.	The Post Office Ltd carries out spot checks to assess standards in the branch using mystery shoppers and unannounced audits.  The claimant confirmed in her evidence that during her employment the Post Office Ltd had carried out an unannounced audit at least once each year.  Where minor issues are discovered the Post Office Ltd can issue a warning to the branch to sort out the matters, however a major issue could lead to suspension of the sub postmaster and closure of the post office branch. 

20.	Mr Corry met with the claimant on 12 May 2011 to discuss problems with process management in relation to branch standards and delivery of the STEP programme.  When Mr Corry asked the claimant why she was not taking staff to task to carry out duties she referred to having no management training but then acknowledged that she had received managerial training in preparation for the introduction of the STEP programme.  Following the meeting with the claimant, Mr Corry wrote to her on the 13 May 2011 confirming a number of areas of management identified by him that needed to be addressed within the Post Office, centred on a lack of management of both staff and processes.  Under ‘Process Management’ Mr Corry identified for the claimant actions that he believed would improve issues with process management and deliver standards expected by the Post Office Ltd including that ,‘Correct and compliant Point of Sale information should be on view and updated when required.  Manager should delegate this responsibility to one member of staff while also checking to ensure that it has been correctly implemented.’

21.	Mr Devine in an email to Mr Corry on 6 June 2012 set out that, 

‘on a visit to the branch on Saturday 2 June I observed the ‘‘deal of the day’’ notices on display hadn’t been changed since Tuesday 29 May.

On my previous visit on Monday 28 May I observed the same notices hadn’t been changed from the previous week.

I raised the issue with Geralyn.  She stated it hadn’t been changed because Ellis [sic] was on leave and normally it was a task delegated to her.

I asked Geralyn to ensure that it was completed by her or another member of staff in Ellis [sic] absence and emphasised the importance in doing so.

I’m bringing it to your attention as it is a serious breach of compliance which can result in the branch losing the right to carry out the transaction. 

If a mystery shopper visit has taken place in between times it will be reported if noticed.’

22.	On 21 June 2012 Mr Corry met and spoke with the claimant about non-compliance issues raised by Mr Devine in his email and Mr Corry noted that he advised the claimant that it was her responsibility to ensure all information displayed was compliant at all times.

23.	A P250 check is a security check to ensure that a person is appropriate to work in a post office dealing with large quantities of cash and handling personal details of customers.  In a meeting on 27 June 2012 Mr Corry asked the claimant to ensure P250 security checks for Ms Emma McGinley and Mr Christopher Cunningham were put in the post that day.  Mr Corry noted in his record of the meeting, ‘Security Checks for Emma + Chris  Geralyn hadn’t sent checks away as previously asked.  Asked her to ensure they were in post today.’

24.	On Thursday 13 September 2012 Post Office Ltd conducted an unannounced audit of the Shantallow Post Office branch to verify financial assets due to Post Office Ltd and confirm that the branch was in compliance with a range of business processes procedures and regulatory requirements that it is required to follow.  Stock balances of items including stamps and tax discs were checked.  A number of issues were identified as a result of which the branch was closed for the remainder of the day.  Mr Corry was outside the jurisdiction at the time.  On 14 September 2012 after consultation with the Post Office Head Office permission was given for the branch to re-open. 

25.	On Monday 17 September 2012 Mr Corry returned to the store and was informed by an assistant manager on the grocery side of the business that the audit had taken place.  Mr Corry telephoned and spoke with Mr Sean McCaughey, one of Post Office Ltd’s field support officers who informed Mr Corry of the issues identified.  Mr Corry met with the claimant following his conversation with Mr McCaughey, and informed the claimant of the serious issues that had been brought to his attention as a result of the audit, in his note of his meeting with her he recorded that the claimant was able to offer no explanation of missing tax discs and Mr Corry informed her that he had no choice but to place her on precautionary suspension on full pay.

26.	A few days later Mr Corry received the Post Office Ltd’s report dated 13 September 2012 which identified areas of non-conformance and set out issues identified as including:-

•	The difference between financial assets physically verified and amount due to the post office after some reconciliation after the audit was £1250.37 short.

•	Motor Vehicle licences (MVL’s) were short by 292.  The correct reporting procedures must be followed and better accounting process should be put in place for the management of MVLs in the branch.  The process applicable to lost or stolen MVL discs was not known by staff and financial penalties could be imposed for any MVL disc deficiencies.  Staff to make sure that they are aware that lost or stolen discs must be reported to the NBSC and recorded on Horizon on line.

•	Incorrect publicity and advertising material was on display failing to comply with Financial services FSA regulations which could lead to the Post Office Ltd being fined or the removal of regulated products from the branch.  ‘Out of date leaflets and posters were removed during the audit and should be destroyed.  In future ensure that only current advertising material is displayed as per the latest copy of display instructions.’

•	Horizon on line training receipts for Mails compliance, AML, Financial Services & Data Protection training were not on hand and the branch unable to provide evidence that staff had completed and passed required compliance training.

•	Information security non-conformance in that:

o	Obsolete users had not been deleted from the Horizon system and/or employees on long term sick absence did not have their accounts disabled allowing use/access without the knowledge of the original user.

o	Pin pads were not regularly checked to ensure no tampering had taken place or fraudulent devices were attached, noncompliance with Payment Card Industry & Link Audit security standards which could result in brand damage to Post Office Ltd.

o	Scales were not tested weekly; items could be underpaid/ overpaid.

•	Branch was unaware that HR requires to be advised of any newly recruited staff using the P250 form. Documents need to be sent to HR by recorded signed for. Post office unable to demonstrate staff working in their network, which could lead to reputational damage.  P250 forms should be completed and returned for Emma McGinley and Christopher Cunningham.

27.	Mr Corry gave evidence that the Post Office Ltd could have billed him for missing tax discs and that the value of missing tax discs unaccounted for at the time of the audit initially was around £13,000.

28.	By letter of 20 September 2012 Mr Corry invited the claimant to a disciplinary meeting to take place on 15 October 2012 and advised her of her right to be accompanied, stating that , ‘At this meeting we will discuss issues arising from an audit of the Post Office on Thursday 2012 and where the question of disciplinary action for gross misconduct , in accordance with the Company’s Disciplinary Procedure , will be considered with regard to the following issues:-

1.	Unexplained cash shortage of £183.33 coming from difference of £1140.33 minus TP balancing total owed of £951.

2.	Non Conformance Issues

	(a)	Incorrect publicity and advertising material on display.

	(b)	Horizon on line training receipts for Mails compliance, AM: Financial Services & Data Protection training not on hand.

	(c)	MVL Disc reconciliation and destruction procedure not followed correctly.

3.	Security Issues

	(a)	Obsolete users not deleted from Horizon System.

	(b)	Pin pads not checked regularly.

	(c)	P250 security forms not completed for new employees.’

29.	Mr Corry commenced an investigation into issues identified in the audit report as part of which he interviewed employees, Ms Emma McGinley, Mr Christopher Cunningham, the claimant, Ms Julie McIntyre, Ms Fionnula Dobbins and Ms Eilis Cooley.  Mr Corry considered the audit report, discussions and interviews with staff, discussions with Post Office Ltd support team and observations of the current Post Office standards and procedures following which he produced an investigation report dated 12 October 2012 in which he set out:-

‘
•	Financial Audit

	[.…] Most of the £1250.37 financial shortage can be accounted for but £189.33 still remains unexplained.

•	Non-Conformance Financial Services

	On the issue of incorrect publicity and advertising material on display I spoke with Geralyn on the 03/10/2012 and she said that Eddie Devine, Post Office Sales Support Manager, had looked at the fixtures the previous week and she thought everything was ok.  From interviews with staff members I confirmed that responsibility for maintaining this material had been given to Fionnula Dobbins, but following a maternity risk assessment carried out on 23 August 2012 she informed Geralyn that she could no longer take responsibility for this material due to the stretching upwards that it involved.  I have found that no other staff members were then allocated this responsibility. […]
 
•	Horizon On line Training

	[.…] The book with training was in the cabinet but records were not up to date for all staff members.

•	P250 Security Check Forms

	In a meeting with Geralyn on 03/10/2012 I asked when the P250 forms for Emma McGinley and Chris Cunningham were sent off to the Post Office Ltd.  She replied they were sent off approx: six weeks after they started.  I interviewed both Chris and Emma on this point and they both confirmed that they had never seen a P250 form, had never produced the required ID to Geralyn, and had never signed one of these form.  The team at Post Office Farnworth confirmed that they haven’t received any forms for these two members of staff.

•	Security Issues

a)	Obsolete Users

	At meeting with Geralyn on 03/10/2012 Geralyn stated that she did not delete users from Horizon system as she didn’t know it was a security risk.[….]

b)	Pin-Pad Checking Procedure

	At meeting on 03/10/2012 Geralyn again confirmed that she was unaware of procedures for checking pin-pads each week [….]

c)	Weekly Scales Checks

	[….] no weekly scale checks were taking place.

d)	[….]

•	DVLA Tax Discs

	In meeting with Geralyn on 03/10/2012 I asked Geralyn to explain the process of tax disc reconciliation and destruction which she did.  The audit highlighted 292 discs not accounted for. I contacted the Post Office Ltd on three occasions to discuss this issue as unaccounted for discs would be charged back to the branch.  Post Office Ltd were able to reconcile a large quantity, approx: 240, of these discs and they have concluded that correct procedures were not being followed for the reconciliation and destruction and that consequently the branch was leaving itself susceptible to fraudulent activities.  When I interviewed staff members I was informed that none of them had responsibility for tax disc reconciliation and destruction.’

In his report Mr Corry concluded,

‘that there are a number of issues which still need to be explained and that a charge of gross misconduct must be answered by the Post Office Manager Geralyn McFeely on the following issues:

(1)	Unexplained Cash Variance of £189.33

(2)	Non Conformance – Incorrect publicity and advertising material for Financial Services on display

(3)	Non Conformance – Horizon On Line training records incomplete

(4)	P250 Security Check Forms not completed for new employees

(5)	Security Issues:

	(a)	Obsolete users not removed from Horizon System

	(b)	Pin pad security checks not in place

	(c)	Weekly scales test checks not in place

(6)	DVLA Tax Disc reconciliation and destruction process not followed correctly.’

30.	The disciplinary meeting was subsequently rescheduled and took place at 11.25 am on 29 October 2012, conducted by Mr Corry accompanied by Ms Lucille Harrison as note taker, the clamant attended accompanied by her trade union representative.  Handwritten minutes were produced at hearing and are accepted as accurate.  The claimant confirmed to Mr Corry that she had had sufficient time to consider the investigation report and had no issues with the background as set out.  Mr Corry then put to and discussed with the claimant each of the issues as set out in the investigation report.  Main points made by the claimant were that in respect of:-

•	Security checks for Ms McGinley and Mr Cunningham, that she had had no input in their selection, had not seen their CV's and did not know of them until they started, but confirmed she had done a security check for Ms Cooley. 

•	DVLA tax discs, 240 of which had been reconciled, which were not being destroyed properly and rem in rem out procedure was not being followed properly, that Ms McGinley shredded tax discs, that Ms McGreanary was witness and Ms McGinley a witness once, and whilst the rem in rem out procedure was not being followed the manual book was kept up to date and there were just a few missing.

•	Out of date point of sale information, that Ms Dobbins couldn’t physically put these up. 

	The claimant put to Mr Corry that staff were not focused because they were moving on, that she gave ‘120%’, was not to be bombarding new starts with information, that time was an issue, she was doing a third of paying out (counter work) plus back room work. It was put to Mr Corry that the claimant had run the post office to the highest standards and was a very trustworthy person, that there was no fraud in respect of tax discs, previous audits had not picked up disregard of responsibility for the tax disc procedure before, that the claimant kept her own record in a book, training and support would correct matters and it was not a gross misconduct issue. 

	The meeting terminated at 12.00 noon.  No issue was raised by the claimant at the length of the meeting or time spent discussing issues.

31.	By letter dated 31 October 2012 Mr Corry confirmed to the claimant his conclusions on the issues of gross misconduct identified and his decision on disciplinary action.  Mr Corry gave in detail his findings and conclusion that there was no misconduct charge to answer in respect of three of the issues identified, namely the cash variance of £189.33, Horizon On Line training records and three security issues identified.  However Mr Corry set out in relation to:-

		‘Non Conformance – Financial Service 

		With regard to non-conformance in financial services I conclude that primary responsibility for this area lay with you as post office manager.  The responsibility had been delegated to Fionnula Dobbins but following maternity risk assessment she ceased to have this responsibility.  The tasks required to maintain this area were not redelegated or undertaken by yourself as manager.  Given that all the information required to keep this area compliant is sent to you regularly by the Post Office I conclude that you were guilty of gross misconduct.’

		‘P250 Security Check Forms 

		With regard to this security issue I have concluded that the P250 forms which you were asked to send off to Post Office Ltd were not sent.  In not carrying out this reasonable work instruction you were guilty of gross misconduct.’

		And,

		‘DVLA Tax Disc Reconciliation and Destruction Procedures

		On this issue I have found that despite you being able to explain the correct procedures for tax disc reconciliation and destruction, these procedures were not being implemented which resulted in a variance in stock figures that left the business liable to possible financial penalties.  I have concluded that on this issue you were guilty of gross misconduct.’

	In conclusion Mr Corry stated,

		‘In the above I have outlined my conclusions on each of the individual charges of gross misconduct.  In reaching my decision on disciplinary action I have taken into account all of the above issues and your length of service in this business.  I must also take into account the importance of the Post Office business and the range of important products offered to our customers.  I must also consider the importance of the Post Office to the success of the grocery retail business and the possible impact of losing some or all of the key services we now offer in the Post Office on the future of the retail business.  In reviewing all areas of the investigation I have concluded that you were not guilty of any theft, deception or fraud but you were guilty of gross misconduct on three separate issues and therefore I have decided that you are to be dismissed from your position as Post Office manager effective immediately.’

	The claimant was advised of her right of appeal.

32.	The claimant’s effective date of termination was 2 November 2012.

33.	In response the claimant wrote to Mr Corry notifying him that she disputed his findings and wished to appeal his decision. 

34.	Mr Corry by letter 28 November 2012 confirmed to the claimant that following consultation with her union representative her appeal hearing had been set for 6 December 2012 to be heard by Mr Geoff Johnston, regional manager of Musgrave Retail NI.

35.	By letter dated 4 December 2012 the claimant wrote to Mr Corry setting out her basis for appeal against termination of her employment on 1 November 2012.  The claimant referred in her letter to there being four grounds for termination by the respondent however it is noted that the respondent in fact only relied on three grounds for the decision to terminate the claimant’s employment in the letter to the claimant of 31 October 2012.  The claimant in her correspondence set out a definition for gross misconduct as being acts that are ‘intentional ,wanton ,wilful, deliberate, reckless or in deliberate indifference to an employers interests’ and contended that the incidents cited did not fall within that definition and were as a result of a number of factors not of her making.  In relation to:-

•	Non Conformance Financial Services 

	The claimant noted that no note of the information leaflets destroyed was taken and that the audit report did not specify the type of information destroyed and time it was out of date and that it could have been by no more than two weeks. 

•	P250 Security Check Forms

	The claimant stated that in the meeting of 3 October 2012 her reply that P250s were sent about 6 weeks after their start dates was ‘a general reply as my perception was that these forms should be sent six weeks after they started.  I did not state that I had completed or sent off P250s.  In fact I had no knowledge or memory of having been tasked with this duty’ and that she, ‘was excluded [from] the entire employment process and believe that Mr Corry having been responsible for all aspects of the employment process should also have taken responsibility for P250s […]’

•	DVLA Tax Discs

	That the claimant‘s written record was correct at the time of the audit while the computer records indicated a deficit of 292, which was a clerical error on her part as she had no proper training on the destruction of tax discs other than a pamphlet from the Post Office, and tax discs in the meantime had been accounted for and there was no loss. 

	The claimant raised that she considered that she was being treated differently to a staff member, Ms Sarah Lyttle ,who in error lodged £19,000 instead of £1900 leaving a ‘significant actual loss of £17,100’ to Shantallow post office until the claimant recovered the deficit three weeks later leaving the post office showing a substantial loss for this period but that no action had been taken against her, whereas gross misconduct for possible financial penalties was being used as grounds for termination against the claimant.  Also that Ms McGreanary had incurred a loss of £600 in the week prior to her leaving the post office which the claimant recovered three weeks later and no action was taken against her. 

	The claimant suggested that she may be guilty of inexperience and had not had management training save three days in 2007, that she was kept in the dark about new employees until they showed up, that Mr Corry would grant holiday leave to new starts as they had pre-booked holidays without informing her and leaving her with severe staff shortages in the holiday period August to early September and when raised was met by Mr Corry with, ‘you’re the manager, so manage’.  That July through to September the claimant felt constantly under pressure to maintain high standards of service while understaffed, initiating new staff and with staff leaving for further education.  The claimant also raised that in those 13 years, 5 of which she was manager, she had no blemishes to her work record, warning, or disciplinary action taken. 

36.	On 4 December 2012 the claimant wrote a further letter to Mr Corry enclosing a copy of her contract of employment entered into with John and Mary Gormley and set out, ‘No new contracts were furnished by either Musgrave or Declan Corry therefore I deem this to be my legal contract of employment.

	You will please note overtime to be paid at 1.5 times the hourly rate. I would be grateful if you would total all time owed / overtime from your taking up the Post Office 2/8/2009 to 31/10/2012 and pay at your earliest convenience.

	As you are aware I have always been paid basic 40 hours per week irrespective of the hours worked therefore, any hours over 40 constitute overtime.’
  
37.	On 2 January 2013 Mr Corry acknowledged receipt of the claimant’s letter regarding overtime payments.  On 10 January 2013 Mr Corry wrote to the claimant and confirmed that he had no clocking records prior to week commencing 10 April 2010 when he took over responsibility for the wages and stated that:-

	‘
•	For the hrs you clocked from w/e 10/04/2010 until w/e 14/01/2012 you were paid standard rate for all hours worked.

•	From w/e 21/01/2012 until your employment ended you were paid a flat week of 40 hours regardless if your hours worked were above or below this level.

	It was my understanding that the method of payment was changed to a flat 40 hrs per week because as the clocking data shows there was a lot of variance from week to week in hrs worked over and below the 40 hours. The clocking data also shows that breaks were not being clocked and this information was not being recorded.  In the three years you were employed as post office manager the issue of hours worked per week and rate were never brought to my attention and our understanding of the 40 hr flat rate week was not questioned.  I do note though that you are owed one week’s holiday pay from last year.’

	Mr Corry at hearing confirmed that the claimant was due one week’s pay for the 2011 holiday year.  On the claimant’s own evidence she verbally agreed with Mr Corry to vary her contract of employment to receive a flat rate of pay of 40 hours per week regardless of the actual hours worked, with the intention that she could take off time in lieu of extra hours worked but did not get around to doing so.  The tribunal find based on Mr Corry’s letter and pay records produced that a flat rate of pay equivalent to 40 hours per week was agreed with the claimant as from week commencing 21 January 2012.  The tribunal accept the claimant’s evidence that she frequently did not take lunch and did not take her break in the afternoon and hence none were clocked and that between 10 April 2010 and 14 January 2012 based on clocking records kept by the respondent the claimant was paid for 98 hours overtime at her normal hourly rate of £10.04 gross rather than time and a half as provided in her contract of employment prior to agreed variation of this term.  

38.	On 6 December 2012 the claimant and her union representative attended an appeal hearing conducted by Mr Geoffrey Johnston with Ms Lucille Harrison present as a note taker.  Handwritten minutes of the appeal meeting were produced at hearing and are accepted as accurate.  Points raised by and on behalf of the claimant at the appeal hearing included:-

•	After Ms Dobbins pregnancy risk assessment the claimant did not delegate the point of sale updating responsibility, they were short staffed which she put to Mr Corry but was told to manage. 

•	There was no information in the audit about the point of sale information removed.

•	Mr Devine looked at the point of sale information the previous week and said it was ok.

•	All full time staff left at once and new starts began together leaving her under pressure.

•	She had been paid seven days holidays pay and considered there to be pay outstanding.

•	She was due time and a half for overtime worked over forty hours per week. 

•	She sent a P250 security check form for Ms Cooley but was not involved in interviews for other staff, why did Mr Corry not send them himself?

•	On procedure of disposal of tax discs that both the claimant and Ms McGreanary destroyed them together and Ms McGinley was brought in when Ms McGreanary was not there.

•	She was honest and genuine at all times and went out of her way to run the post office but that half the staff were inexperienced and there was a breakdown in communication between the claimant and Mr Corry.

At the appeal hearing the claimant conceded to Mr Johnston that out of date financial information was on display to customers at the time of the audit.

39.	Following the appeal hearing Mr Johnston made further enquires as to:-

•	The tax disc reconciliation and destruction procedure from the Post Office Ltd following which Mr Johnston gave evidence that he concluded they had a specific procedure required to be carried out but that it had not been, which the tribunal find credible.

•	Support given to the claimant from Mr Devine.

•	Training provided to the claimant.  The claimant took issue at hearing with the description of training provided to her as having been managerial.  The tribunal find that Mr Johnston relied on the information supplied to him and that it was reasonable for him to do so.

•	Whether the claimant was short staffed thus contributing to operational issues by obtaining details of weekly average hours actually worked per week by post office staff for April to September 2012 for consideration.  The claimant at hearing suggested hours considered included hours paid to employees off on holidays which Mr Johnston contested stating that he obtained and considered actual hours worked, that new staff caused a spike in hours in August and after consideration of this information concluded that staffing was not an issue.  The tribunal found Mr Johnston credible in his evidence. 

•	Potential differential treatment of the claimant to two other employees through enquiries to Mr Corry, Mr Devine and the Post Office Ltd after which Mr Johnston concluded that the other two cases related to error transactions with no resulting cash loss whereas the charge made against the claimant was a failure to follow required procedures and so differential treatment was not a relevant issue.  The tribunal find that Mr Johnston had a rational basis for the distinction he made. 

40.	Mr Johnston wrote to the claimant on 19 December 2012 in respect of her appeal letter of 4 December 2012 and their meeting on 6 December 2012 in which he set out:-

‘In your letter you have stated the basis for your appeal as:

•	Gross Misconduct

	Gross misconduct was not proven on the four grounds given as reason for termination on the basis of your definition of Gross Misconduct as ‘‘Acts of gross misconduct are intentional, wanton, deliberate, reckless or in deliberate indifference to an employer’s interests’’.

	Having reviewed Declan Corry’s letter of 31st October 2012 in which he confirms his decision to terminate your employment, I find that it is clearly stated that there are 3 areas which he believes constitute Gross Misconduct (see below) and not 4 as you have stated in your letter.  Further, you go on in your appeal letter to identify 6 areas in total, 3 of which Declan found in his investigation, and are noted in his letter, as not being areas of Gross Misconduct.  The areas I will review as part of this appeal are: Non-Conformance – Financial Services, P250 Security Check forms and DVLA Tax Disc Reconciliation and Destruction Procedures.

	With regard to your definition of Gross Misconduct, I am unable in either your Contract of Employment or your Rules and Regulations book to find this definition quoted and thus I will use the definition of misconduct as stated in both these documents, that being as attached. 

•	Non- Conformance – Financial Services 

	By your own admission, as noted in your appeal letter, the Post Office Audit team removed and destroyed out of date information.  The length of time that this information was ‘‘out of date’’ as cited in your letter I find to be irrelevant.  The fact that out of date financial information was displayed, was accessible to the Post Office Audit team and you agree with such is the main issue.

•	P250 Security Check forms

	You claim in your appeal that you ‘‘have no knowledge or memory of being tasked with sending P250 security forms for E.McGinley and C. Cunningham.  However in a documented meeting held on 27 June 2012, between Declan Corry and you were asked to get the security forms for E.McGinley and C.Cunningham completed and sent to the Post Office. Further at the meeting on 3 October 2012 you confirmed that these forms were sent when they were not.

	I believe that in June 2012 you were tasked by Declan Corry, in your role as Post Office Manager, to get the P250 forms completed and sent to Post Office.  This you did not do and in your appeal letter you do not deny this. You further told Mr Corry at the investigation meeting that you had sent the forms off to the Post Office when you knew you had not.  As you are aware, in your role as Post Office Manager, it is essential for all employees of the Post Office to be security checked through the use of the P250 forms.

•	DVLA Tax Discs Reconciliation and Destruction

	With regard to this matter, in your appeal letter you state that you had no proper training from the Post Office on the system for the reconciliation and destruction of tax discs.  Having reviewed this matter with Eddie Devine, Area Sales Manager Post Ltd, I find that you have received adequate support to include 15 visits from Eddie for the year 2012 (up to Sept 2012).  Also in the investigation meeting on the 3rd October you detailed out for Mr Corry the correct process for the reconciliation and destruction of tax discs.

	You further raise the matter of lack of training and lack of resources in your appeal letter.

	On the matter of lack of training, you have been a Post Office Manager for 5 years and were initially sent on a 3 day training course in 2007.  Having contacted the Post Office, I find that you received the following training over the last 2 years as well as the support from Eddie Devine as highlighted above:

	18/1/11- Manager’s Coaching Course

	8/2/11- Manager’s Skills Course

	21/2/11 – Conversational Selling Skills Workshop

	10/1/12- Sales Manager Workshop

	13/2/12- Sales Workshop

	I have further reviewed the staff hours for Shantallow Post Office since April 2012 and find that the average hours worked in April / May were 151 rising to 221 in August and 177 in September.  Thus I cannot agree that at the time of the audit you were short staffed.

	I, therefore, conclude that your appeal against the decision to terminate your employment on the grounds of Gross Misconduct is not upheld.’ 

41.	Up to her dismissal the claimant was paid approximately £316.96 net per week by the respondent.

42.	The claimant presented her claim to the office of tribunals on the 30 January 2012.

LAW

43.	Under Article 126 of the Employment Rights (Northern Ireland) Order 1996 an employee has the right not to be unfairly dismissed by his employer.

44.	Article 130 of the 1996 Order sets out how the question of whether a dismissal is fair or unfair is to be determined.

45.	The Employment (Northern Ireland) Order 2003 at Schedule 1 sets out the statutory dismissal and disciplinary procedures to be followed as a bare minimum, where applicable, by an employer contemplating a dismissal.  Where the minimum required three steps including a statement of grounds for action and invitation to meeting, a meeting and an appeal has not been completed, and the non-completion of the procedure is wholly or mainly attributable to failure by the employer to comply with its requirements then under Article 130A(1) of the 1996 Order an employee shall be regarded unfairly dismissed automatically.  Article 130(1) of the 1996 Order  otherwise provides that in determining for the purposes of this part whether the dismissal of an employee is fair or unfair, it is for the employer to show -

(a) 	the reason (or, if more than one, the principle reason) for the dismissal, and

(b) 	that it is either a reason falling within Paragraph (2) or some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held.

Reasons falling within Paragraph (2) include at Article 130(b) if it relates to the conduct of the employee.

46.	Under Article 130(4) of the 1996 Order where the employer has fulfilled the requirements of Paragraph (1), the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer) -  

(a)	depends on whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and

(b)	shall be determined in accordance with equity and the substantial merits of the case.

47.	It is established that the approach the tribunal should take in deciding whether an employer acted reasonably in treating an employee’s conduct as a sufficient reason for dismissal is set out in the case of Iceland Frozen Foods  v  Jones [1983] ICR17, such that; 

	1.	The starting point should always be the words of Article 130(4).

	2.	In applying the Article an industrial tribunal must consider the reasonableness of the employer’s conduct, not simply whether they (the members of the industrial tribunal) consider the dismissal to be fair.

	3.	In judging the reasonableness of the employer’s conduct an industrial tribunal must not substitute its decision as to what was the right course to adopt from that of the employer.

	4.	In many, though not all cases, there is a band of reasonable responses to the employee’s conduct within which one employer might reasonably take one view and another quite reasonably take another.

	5.	The function of the industrial tribunal, as an industrial jury, is to determine whether in the particular circumstances of each case the decision to dismiss the employee fell within the band of reasonable responses which a reasonable employer might have adopted, if the dismissal falls within the band the dismissal is fair, if the dismissal falls outside the band it is unfair.

48.	In the context of a misconduct case Arnold J in British Home Stores  v  Burchell [1980] ICR303 stated “what the tribunal have to decide every time is, broadly expressed, whether the employer who discharged the employee on the grounds of the misconduct in question (usually, though not necessarily, dishonest conduct) entertained a reasonable suspicion amounting to a belief in the guilt of the employee of that misconduct at that time.  That is really stating shortly and compendiously what is in fact more than one element.  First of all, there must be established by the employer the fact of that belief; that the employer did believe it.  Secondly, that the employer had in his mind reasonable grounds upon which to sustain that belief.  And thirdly, we think, that the employer, at the stage at which he formed that belief on those grounds, at any rate at the final stage at which he formed that belief on those grounds, had carried out as much investigation into the matter as was reasonable in all the circumstances of the case.  It is the employer who manages to discharge the onus of demonstrating those three matters, we think, who must not be examined further.

	It is not relevant, as we think, that the tribunal would themselves have shared that view in those circumstances.  It is not relevant, as we think, for the tribunal to examine the quality of the material which the employer had before them, for instance, to see whether it was the sort of material, objectively considered, which would lead to a certain conclusion on the balance of probabilities, or whether it was the sort of material which would lead to the same conclusion only upon the basis of being ‘sure’, as it is now said more normally in a criminal context, or, to use the more old-fashioned term, such as to put the matter ‘beyond reasonable doubt’.  The test, and the test all the way through, is reasonableness; and certainly, as it seems to us, a conclusion on the balance of probabilities will in any surmisable circumstances be a reasonable conclusion”.

49.	Inconsistent treatment of an employee in comparison with other employees may support an argument that the misconduct in question was not sufficient to justify the employee’s dismissal and render a dismissal unfair, however cases have to be truly similar or sufficiently similar to afford a sufficient basis for argument.  As set out in Harvey on Industrial Relations and Employment Law at Division DI Unfair Dismissal/Reasonableness: General Principles, Para [1042] ‘[….] if an employer consciously distinguishes between two cases, the dismissal can be successfully challenged only if there is no rational basis for the distinction made [….]’ And, Para [1043] ‘[…] even if there is clear inconsistency, this is only a factor which may have to give way to flexibility. Accordingly if, say, an employer has been unduly lenient in the past, he will be able to dismiss fairly in future notwithstanding the inconsistent treatment [....]’

50.	Under Article 118 (b) of the 1996 Order an employer is required to give minimum notice to terminate the contract of employment of a person of not less than one weeks’ notice for each year of continuous employment if his period of continuous employment is two years or more but less than 12 years, however under Article 118 (6) this does not affect the right of either party to treat the contract as terminable without notice by reason of the conduct of the party.

51.	Under the Industrial Tribunal Extension of Jurisdiction Order (Northern Ireland) 1994 an employee may bring a claim for damages for breach of his contract of employment or for a sum due under that contract or any other contract connected with his employment before an Industrial Tribunal if the claim arises out of or is outstanding on termination of his employment.

52.	APPLICATION OF THE LAW TO THE FACTS FOUND 

	Was The Claimant Unfairly Dismissed By The Respondent? 
 
53.	The tribunal is satisfied that statutory minimum disciplinary and dismissal procedures have been complied with and that the claimant’s dismissal was not automatically unfair.

54.	It was not in dispute that the respondent’s genuine reason for the claimant’s dismissal related to conduct.  Misconduct is a potentially fair reason for dismissal.

55.	It is not the tribunal’s role to retry the allegation of misconduct against the claimant, nor to consider whether we personally think that dismissal was fair, or to substitute our decision as to what was the correct course for that of the respondent but to apply the objective standards of the hypothetical reasonable employer to all aspects of the question whether the claimant was fairly and reasonably dismissed.  The tribunal must decide whether the respondent acted reasonably in treating the conduct in question as a sufficient reason for the dismissal, considering whether the dismissal was procedurally fair and fell within a range of reasonable responses, taking into account all the circumstances including the size of administrative resources of the employer’s undertaking, and equity and substantial merits of the case.

56.	The substance of the conduct for which the claimant was dismissed was neglect to carry out her duties/specific instructions in compliance with the Post Office Ltd’s procedures.  There was no suggestion whatsoever by the respondent of any dishonesty on the part of the claimant.  The tribunal in particular note the following:- 

-	The claimant was aware of the strict requirements imposed on the Post office about keeping POS information up to date and the serious consequences of failing to do so, that this was a matter that had been previously raised with her by Mr Corry and on which she had been given specific instruction that she was to ensure that this responsibility was delegated and whilst this was initially done, when the staff member was removed from the duty the respondent’s investigations confirmed that the task was not re-delegated or otherwise attended to by the claimant. 

-	The claimant was aware of the need for P250 security checks to be carried out on new staff members having previously attended to a check in respect of another staff member.  Whilst the claimant was not involved in the recruitment of the two new staff members Ms McGinley and Mr Cunningham and sought to introduce a statement taken from Mr Cunningham on 27 May 2013 to the effect that he was advised that if successful he would need a security check ‘to be carried out by Eddie Devine’ before his employment would start to support the P250 checks not having been her responsibility.  The tribunal finds that irrespective of where initial responsibility was understood to sit for attending to the P250 checks that Mr Corry subsequently enquired with the new employees and Post Office Ltd’s Human Resources to find that there was there was no record of applications having been made, and on 27 June 2012 met with the claimant, established that she had not sent away the P250 check forms and specifically instructed that she ensure they were put in the post that day.  Whilst the claimant gave evidence that her meeting with Mr Corry would have taken place on a Wednesday which is her busiest day and that she had no recollection of his request the tribunal are satisfied that Mr Corry issued this instruction to the claimant on 27 June 2012 in the absence of the applications having previously been sent away and that Mr Corry considered the failure to attend to the checks placed the business at a significant risk.

-	The claimant was aware of the Post Office Ltd’s required procedure for the destruction of tax discs and recording of this on its computer system having on investigation described to Mr Corry the correct procedure required to be followed, but that at the time of the audit computer records were not up to date and investigation showed correct procedure was not being followed albeit that the claimant was keeping a manual record.  Mr Corry recorded in the investigation report that it was the Post Office auditor’s view that correct procedures were not being followed for reconciliation and destruction and consequently the branch was leaving itself susceptible to fraudulent activities.  The claimant at hearing referred to an incorrect stock bag having been used for destroyed tax discs and that hence an incorrect bar code was scanned and as the bag had been for some reason removed from the premises by a staff member it was not there for the audit to reveal when 292 discs could not be accounted for and the claimant claimed that correct procedures had been followed save for the error as to the stock bag, this explanation did not however form any part of the claimant’s disciplinary or appeal hearing.

In the circumstances the tribunal finds the respondent had a reasonable suspicion amounting to a belief in the misconduct of the claimant and reasonable grounds upon which to sustain that belief.

57.	The claimant raised on appeal that there was no evidence as to what POS information was removed and how out of date it was.  The tribunal note that it was however acknowledged by the claimant to Mr Johnston on appeal that the information was out of date and so removed and destroyed and the information being out of date was the issue of concern.  An employer in his investigations does not have to be satisfied to the criminal standard of beyond reasonable doubt and the tribunal consider that it was reasonable for the respondent to rely upon the information in the audit report and claimant’s acknowledgement.

58.	Whilst in ideal circumstances separate individuals would carry out the investigation of a disciplinary matter and a disciplinary hearing, in a small organisation this may not be feasible.  The tribunal note that Mr Corry was the sole director in the respondent company.  The claimant raised in the list of factual issues provided whether the respondent allowed sufficient time to discuss all six issues presented at the disciplinary meeting which lasted thirty five minutes, this point was not raised by the claimant at the disciplinary hearing or on appeal.  The tribunal is not on the evidence before it persuaded that Mr Corry was not objective or failed to deal with matters in a fair or neutral manner because he did not employ an independent person for the investigation but consider Mr Corry conducted the investigation and likewise the disciplinary hearing in a thorough, fair and open minded way following which he discounted three of the six issues originally put.  The tribunal is furthermore satisfied that the appeal process was fair and transparent, the claimant was provided with a right of appeal to an independent person, had proper opportunity to put her case, matters raised on appeal and mitigating factors put, in particular staff shortages, lack of training and different treatment were investigated further and given due consideration by Mr Johnston before reaching his decision.

59.	The list of factual issues provided raised whether the respondent deliberately withheld a copy of disciplinary procedures and the claimant had to request it, there is no evidence before the tribunal in this regard upon which it might make a finding save the tribunal notes that the applicable procedure appears to have originally been included in the contract entered into by the claimant in 2007 with Mr & Mrs Gormley.

60.	The tribunal is satisfied that the respondent carried out as much investigation into the matter as was reasonable in the circumstances, and that the investigation, disciplinary hearing and appeal hearing were overall procedurally fair.

61.	The next issue for the tribunal is not whether a lesser penalty would have been appropriate but whether for the misconduct in question the penalty of dismissal fell within the range of reasonable responses which a reasonable employer might have adopted in the circumstances. 

62.	The claimant raised differential treatment between herself and two other employees which may in truly parallel circumstances support an argument that it was not reasonable to impose dismissal for the claimant’s same conduct.  The tribunal on the evidence before it is not satisfied that the incidents referred to involving two other staff members are truly parallel to those of the claimant having arisen from transaction errors whereas there were three issues for which the claimant was dismissed relating to failure to follow required procedures and instructions and finds these cases were distinguished on a rational basis by Mr Johnston.

63.	In view of the claimant’s responsibilities in her role as manager, provision in the disciplinary procedure relating to gross misconduct,  previous specific instructions given by Mr Corry to her relating to the point of sale information, P250’s and his belief that correct procedures were not being followed relating to tax disc destruction leaving the business at considerable risk of fraud, risk of the loss of the post office franchise and service offered by it to customers and resultant detrimental effect on the grocery business, applying the objective standard of the hypothetical reasonable employer, the tribunal find that the respondent’s decision to dismiss fell within the band of reasonable responses and that the Burchell test has been met.

64.	Has the respondent failed to pay the claimant statutory or contractual entitlements in respect of:-

•	Notice?        

	The tribunal has found that the claimant was fairly dismissed summarily by reason of gross misconduct without notice or pay in lieu thereof, this was in accordance with her contract and Article 118 (6) of the 1996 Order and as such the claimant is not entitled to pay in lieu of notice.

•	Pay in lieu of holidays accrued due?

	As acknowledged by the respondent the tribunal finds that in breach of contract the claimant has not been paid and is due one week’s holiday pay for the 2011 year being £316.96 net.

•	Overtime?

	The tribunal consider on balance that from 10 April 2010 up to 14 January 2012 when the claimant agreed with Mr Corry to vary her pay to a flat rate equivalent to 40 hours per week the claimant was paid overtime for approximately 98 hours at a rate of time rather than time and a half and under the contractual term applicable at the time, accordingly has incurred a loss and is entitled to be paid the difference of £388.08 net.

CONCLUSION

65.	It is the tribunal’s unanimous finding that the reason for dismissal was misconduct, the dismissal was procedurally fair, the respondent’s decision to dismiss the claimant fell within a band of reasonable responses which a reasonable employer might have adopted and that the respondent acted reasonably in all the circumstances including the size and administrative resources of the respondent’s undertaking, in treating the claimant’s misconduct as a sufficient reason for dismissing the claimant, in accordance with equity and the substantial merits of the case.  The dismissal of the claimant by the respondent is fair under Article 130 of the 1996 Order and the unfair dismissal complaint dismissed.  The respondent in breach of contract has failed to pay the claimant one week’s net holiday pay for the 2011 holiday year of £316.96 and a payment arising from overtime worked between 10 April 2010 and 14 January 2012 of £388.08.  The tribunal is not satisfied that the claimant is entitled to any other statutory or contractual entitlement and dismisses these complaints.  The respondent shall pay the claimant in total £705.04.

66.	This is a relevant decision for the purposes of the Industrial Tribunals (Interest) Order (Northern Ireland) 1990.

Chairman:

Date and place of hearing:    28 and 29 May 2013, Belfast.

Date decision recorded in register and issued to parties: