News - Burden of proof in detrimental treatment related to TU activities: Court of Appeal clarifies

Employment & Discrimination - Mark Sutton QC, Louise Chudleigh

Dahou v Serco Ltd [2016] EWCA Civ 832, CA

The Court of Appeal clarifies the operation of the burden of proof in cases of detrimental treatment related to trade union activities, contrary to s.146 TULR(C)A 1992.

Facts

Mr Dahou was employed by Serco as a team leader mechanic, working on the London Cycle Hire Scheme (LCHS), otherwise known as the “Boris bikes”. He was also the local trade union representative for the National Union of Rail, Maritime and Transport workers (RMT). Serco had a recognition agreement with another union, Community, and did recognise the RMT within LCHS. The material events took place in the run up to the London Olympics, during which RMT were threatening to strike at the premises of the LCHS.

In July 2012 Mr Dahou was alleged to have sworn at his manager and behaved in an aggressive and intimidating manner. He was suspended. Serco said that the reason for his suspension was so that a misconduct investigation could take place. However, Mr Dahou said that this was a pretext and that the real reason for suspending him was to remove him from the workforce at a time when strike action was contemplated to coincide with the Olympics. In December 2012, following the completion of the misconduct investigation, Mr Dahou was summarily dismissed for gross misconduct.

Mr Dahou brought a complaint, inter alia, under s146 TULR(C)A 1992 of detrimental treatment related to trade union activities. S148(1) makes specific provision with regard to the burden of proof: “on a complaint under section 146 it shall be for the employer to show what was the sole or main purpose for which he acted or failed to act” [emphasis added].

Employment Tribunal Decision

In relation to s148(1) and the burden of proof, the Employment Tribunal  referred to Yewdall v Secretary of State for Work and Pensions UKEAT/0071/05/TM where the EAT set out what it referred to as a ‘very sensible” approach to the statute. In relation to Yewdall, the Tribunal observed (at paragraph 17 of its judgment) that “the Employment Appeal Tribunal stated that the burden of proof operated in the same way as in the anti-discrimination legislation such as s.63A SDA . The burden of proof only passes to the employer after the employee has established a prima facie or arguable case of unfavourable treatment on the prohibited grounds which requires to be explained”.

On this basis, the Tribunal held that Serco had failed to discharge the burden of proof and thus upheld Mr Dahou’s complaint relating to his suspension and the misconduct investigation.

Employment Appeal Tribunal Decision

Serco appealed on the ground that the Employment Tribunal had misapplied the law relating to burden of proof and thus failed to examine the genuineness of Serco’s witnesses’ explanations for the decision to suspend and investigate Mr Dahou.

Simler J, sitting alone in the EAT, agreed and allowed the appeal.

She held that the ET had “overstated” the guidance from Yewdall and thus incorrectly treated the burden of proof as operating as it would in a discrimination case (where prohibited treatment can be inferred unless the respondent demonstrates otherwise). She cited Kuzel v Roche Products Ltd [2008] ICR 799, not referred to below, where, in relation to the protected disclosure provisions (s.103A ERA 1996 – agreed to operate in the same way as the trade union activities provisions), the Court of Appeal held, at paragraph 48: “there simply is no need to resort to the discrimination legislation in order to ascertain the operation of the burden of proof in unfair dismissal cases.”

Rather, the identification of the “sole or main purpose” of Serco depended on the findings of fact and inferences drawn from those facts. However, it did not follow “as a matter of law or logic” that if the tribunal rejected Serco’s purported purpose for the suspension (“misconduct investigation”), it must necessarily find that the purpose was the one asserted by the Mr Dahou (“strike action contemplated”).  Depending on its findings, following Kuzel, it was open to the tribunal to conclude that the real reason was not one advanced by either side.

The Court of Appeal

The Court of Appeal concluded that Simler J in the EAT had “reached the right result for the right reasons” and dismissed the appeal.

The key point of legal interest in Dahou is the Court of Appeal’s confirmation that an employer’s failure to prove its asserted reason for the detriment does not necessitate a finding that the reason was that put forward by the employee. Nevertheless, the Court acknowledged that, in practice, “usually no doubt it will” [paragraph 40].

In Kuzel the Court of Appeal had held that in a case of unfair dismissal it was open to the tribunal to conclude that the real reason for dismissal was a reason not given by either party. The court in Dahou considered that “as a proposition of logic, this applies no less to detriment cases.”

Dahou is also interesting for its emphasis on the need for “a descent into the detail” of Serco’s case. The Court held that the tribunal was obliged to do this “in particular” as a result of the allegation of bad faith made by Mr Dahou against Serco. On this point, the Court in Dahou cited with approval the observations of Underhill LJ in The Co-Operative Group Ltd v Baddeley [2014] EWCA Civ 658, at paragraphs 48 and 50.

In Baddeley, Underhill LJ observed that allegations that essentially are tantamount to bad faith and collusion demand “careful consideration of the decision makers’ mental processes”. Where circumstantial evidence is relied upon to support serious findings, it is important that Tribunals make it clear what the circumstances are that justify such findings.

Mark Sutton QC appeared for Serco Ltd, instructed by Cater Leydon Millard Ltd. Louise Chudleigh appeared for Mr Dahou, instructed by Thompsons Solicitors. Both are members of Old Square Chambers.

To read the full judgment, please click here.

 

Mark Greaves

8th November 2016

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