Appeal No. 643/90

	EMPLOYMENT APPEAL TRIBUNAL
	4 ST. JAMES'S SQUARE, LONDON, SW1 4JU

		At the Tribunal
		On 12 November 1991
	Judgment delivered on 5 December 1991

	Before

	THE HONOURABLE MR JUSTICE WOOD MC

	MS S R CORBY

	MISS A P VALE

MR W B LIVINGSTONE	APPELLANT

HEPWORTH REFRACTORIES PLC	RESPONDENTS

	Transcript of Proceedings

	JUDGMENT

Revised

	APPEARANCES

For the Appellant	MR J McMULLEN
	          (of Counsel)
Messrs Robin Thompson &
          Partners
Solicitors
Bainbridge House
Bainbridge Street
London WC1A 1HT

For the Respondents	MR J CAVANAGH
	          (of Counsel)
Messrs Irwin Mitchell
Solicitors
St Peter's House
Hartshead
Sheffield S1 2EL

	MR JUSTICE WOOD (PRESIDENT):  Mr Livingstone started employment with Hepworth Refractories Ltd (Hepworth) on the 26th October 1951.  He ceased active work on the 7th February 1990.  His employment officially terminated on the 30th April.  Negotiations in connection with that termination took place and on the 9th April a Conciliation Officer from ACAS drew up a COT 3 form in his own handwriting which was signed by both sides.  On the 17th May the European Court of Justice gave its judgment in the case of Barber v. Guardian Royal Exchange Assurance Group [1990] ICR 616.

	On the 11th July Mr Livingstone presented an Originating Application alleging that he had suffered sex discrimination in the operation of the Hepworth Pension Fund (discounting of his pension which discounting would not take place in the case of a woman in similar circumstances) contrary to Section 6 of the Sex Discrimination Act 1975 (the 1975 Act) Article 119 of the Treaty of Rome and many other directives.  (Community Law).

	The matter came before an Industrial Tribunal sitting at Sheffield on the 16th October 1990 who dismissed his applications "for want of jurisdiction".  Mr Livingstone appeals.  This is a difficult case.

	The Tribunal considered that they did not have jurisdiction because of the agreement of the 9th April contained in the COT 3.  That agreement is as follows:
"AGREEMENT IN RESPECT OF A REQUEST FOR CONCILIATION MADE TO THE ADVISORY CONCILIATION & ARBITRATION SERVICE (NO APPLICATION MADE TO TRIBUNAL AT TIME OF AGREEMENT)

	Applicant		Respondent	
Barry Livingstone	Hepworth Refractories	

Settlement reached as a result of conciliation action.

We the undersigned have agreed:  That the Respondent pays to the Applicant the sum of £20,402.76 in full and final settlement of all claims which the Applicant may have against the Respondent arising from his employment with the Respondent or out of its termination, except for any benefits due to the Applicant under the rules of the Company's Pension Scheme or any claim that may arise in the future resulting from industrial injury or disease contracted during the Applicant's employment with the Respondent.

Applicant:(Signed) 	Date 9.4.90

Respondent:(Signed)	Date 09.04.90"
	The Tribunal examined the provisions of the Employment Protection (Consolidation) Act (1978 Act) relating to conciliation by ACAS Officers and then emphasised the two exceptions in the agreement.  The latter refers to unknown events which may occur in the future.  This they emphasise.  They then deal with the relevant wording of the exception to be examined in paragraph 6 of the Decision.
"6.  The next matter, which are the words of the agreement which we have been particularly concerned with, is the exception for any

`benefits due to the applicant under the rules of the company's pension scheme.'

In order to seek to get the tribunal to say that that enables the proceedings that we are now considering, Mr Johnson has argued on behalf of the applicant that that excludes pension benefits or issues connected with pensions.  If that was the intention of the parties and if that is the intention of the agreement why does it not say so?  But that is not what it says.  The agreement is very specific.  It refers to benefits under the rules of the scheme and therefore it does not seem to us that he is complaining about the benefits under the rules of the scheme.  His complaint is that the benefits under the rules of the scheme are not the benefits he maintains he should get and that this is as a result of sexual discrimination.  That is a wholly separate matter and we fail to see how with hindsight it can be acceptable for an applicant to come to the tribunal to try to raise a matter which was specifically excluded by a solemn agreement entered into by him in April.  What on earth is the purpose of agreements if they are not binding on the people that enter into them?  And how is one to say what an agreement means unless you look at what it says?"

	Their final conclusion is in paragraph 9 as follows:-
"9.	Accordingly we are driven to conclude that the tribunal has no jurisdiction to entertain this complaint.  It does seem to us that the applicant's complaint is not that he is not receiving the benefits due under the rules of the company's pension scheme which is what the exclusion of the agreement was.  It seems to us that his complaint is that the scheme as administered by the trustees is discriminatory.  Of course the trustees were not his employers and therefore he would not have any cause of action against them in this particular forum.  Whether he would have a cause of action against them elsewhere of course is another matter entirely.  Accordingly this application must be dismissed."

	The present claim is brought under the Sex Discrimination Act 1975 and/or Community Law.  Let us first examine the position under domestic law.  The earliest reference to conciliation officers in the relevant industrial legislation is that contained in Section 2(4) of the Employment Protection Act 1975.  This reads:
"2(4)	The Service shall designate officers of the Service to perform the functions of conciliation officers under any enactment (including any provision of this Act or any Act passed after this Act) in respect of matters which are or could be the subject of proceedings before an industrial tribunal, and accordingly any reference in any such enactment to a conciliation officer is a reference to a officer designated under this subsection."

	We next turn to Section 140 of the 1978 Act dealing with restrictions on contracting out.
"140.  Restrictions on contracting out

(1)	Except as provided by the following provisions of this section, any provision in an agreement (whether a contract of employment or not) shall be void in so far as it purports -

(a)	to exclude or limit the operation of any provision of this Act or;

(b)	to preclude any person from presenting a complaint to, or bringing any proceedings under this Act before, an industrial tribunal.

(2)	Subsection (1) shall not apply -

(a)	......
(b)	......
(c)	......

(d)	to any agreement to refrain from presenting a complaint under section 67, where in compliance with a request under section 134(3) a conciliation officer has taken action in accordance with that subsection;

(e)	.......

(f)	.......

(g)	to any agreement to refrain from instituting or continuing any proceedings before an industrial tribunal where a conciliation officer has taken action in accordance with section 133(2) or (3);"

Section 134 deals with the functions and the approach of conciliation officers in seeking to promote settlements and Section 133(1) with those statutory provisions with which they are entitled to deal.  Unless expressly authorised they do not include the 1975 Act or the Equal Pay Act 1970.

	Mr Cavanagh for Hepworths sought to argue that the COT 3 agreement covered any proceedings in which an industrial tribunal had jurisdiction.  He referred to the word "any" in Section 140(2)(g).  We do not read the statutory provisions in that way and that sub-subsection has a direct reference to Section 133 where in sub-section (1) there is set out what has been called the "shopping list".

	In our judgment therefore in the absence of express authority a COT 3 agreement made under the provisions of the 1978 Act does not apply to the 1975 Act claims.

	We are reinforced in our view by an examination of that Act.

"77.  Validity and revision of contracts

........................................
(3)A term in a contract which purports to exclude or limit any provision of this Act or the Equal Pay Act 1970 applies where the contract is made with the assistance of a conciliation officer;

(4)Subsection (3) does not apply -

(a)to a contract settling a complaint to which section 63(1) of this Act or section 2 of the Equal Pay Act 1970 applies where the contract is made with the assistance of a conciliation officer;

(b)to a contract settling a claim to which section 66 applies.

63.Jurisdiction of industrial tribunals

(1)A complaint by any person ("the complainant") that another person ("the respondent") -

(a)has committed an act of discrimination against the complainant which is unlawful by virtue of Part II, or

(b)is by virtue of section 41 or 42 to be treated as having committed such an act of discrimination against the complainant,

may be presented to an industrial tribunal."

These statutory provisions when considered with Section 64(1)(2)(3), which are very similar in wording to Section 134 of the 1978 Act, seem to us to form a separate code under the umbrella of the 1975 Act and the Equal Pay Act 1970 for the protection of employees against bad agreements or settlements.

	 The provisions, tend to support our view that a COT 3 agreement under the 1978 Act does not cover a claim under the 1975 Act or the 1970 Act unless expressly stated so to do.  We cannot say, as Mr Cavanagh would have us say, that a conciliation officer when acting under the 1978 Act is wearing "any number of hats" and dealing with all other matters which could possibly arise.  It is of course helpful for parties to be able to "wipe the slate clean", but the agreement must relate to those matters which are within their presumed contemplation at the time.  We therefore hold that the agreement of the 9th April 1990 is no bar to Mr Livingstone's claim under the Sex Discrimination Act and that an industrial tribunal is entitled to hear his claim.  Whether the claim has any merits or whether there are other defences is not a matter for us.

	As this Industrial Tribunal did not consider the provisions of the 1975 Act it follows that we must hold that it erred in law.

	A point is taken that the Tribunal was really striking out the claim and therefore as this present point was not taken below it ought not to be taken before us.  These are difficult areas of the law and we would not have been minded to take too strict a view, but we are satisfied that in the present case the Tribunal did look upon this as a question of jurisdiction and so stated.  They probably had in mind the words of Section 140(1)(b) of the 1978 Act which read:
"(b)to preclude any person from presenting a complaint to, or bringing any proceedings under this Act before, an industrial tribunal."

We also have in mind the Decision of Knox J in Russell v. Elmdon Freight Terminal Ltd [1989] ICR 629.

	We turn to the Community claim.  This is a free standing right see:
	Stevens v Bexley Health Authority [1989] ICR 224
	Secretary of State for Scotland & Greater Glasgow Health Board v. Wright & 	Hannah [1991] IRLR 187
	McKechnie v. UBM Building Supplies (Southern) Ltd [1991] IRLR 283
The question of procedures to deal with direct Community claims has for some time been perplexing those practising within these industrial jurisdictions.  We are grateful to Counsel for their assistance.  We do not need to consider those proceedings which may or indeed could be brought in other courts than industrial tribunals.  The issue therefore is - what are the procedural rules to be brought to bear on proceedings in an industrial tribunal in which direct Community claims are made?  They are of course often linked with claims under domestic law. 

	We have faced this problem in the past, but have been persuaded by Mr McMullen to take a fresh look because of the recent case of Emmott v. Minister for Social Welfare and Attorney General [1991] IRLR 387.  This was an Appeal from a Court in Dublin.  By Irish law there are provisions which cover procedure not only for domestic claims but also for direct Community claims.  The issue which arose was whether, where the Member State was the respondent to proceedings, it could rely on periods of limitation where that State had not properly transposed the effect of a Directive into its domestic legal system.  That question was answered in paragraph 24 of the Judgment of the European Court of Justice which read:
"The answer to the question referred to the Court must therefore be that Community law precludes the competent authorities of a Member State from relying, in proceedings brought against them by an individual before the national courts in order to protect rights directly conferred upon him by Article 4(1) of Directive 79/7/EEC, on national procedural rules relating to time limits for bringing proceedings so long as that Member State has not properly transposed that Directive into its domestic legal system."

	Mr Cavanagh argues that Emmott is not precisely in point because in that case there existed domestic procedural rules.  We agree that it is not precisely in point, but we accept the submission of Mr McMullen that where there are no domestic procedural rules governing direct claims, Emmott is of some assistance.  We would in particular refer to paragraph 17 of the opinion of the Advocate General which reads: page 392 of Decision - para 17 
"Among the numerous judgment which have been cited in the present proceedings it is probably the judgment in Case 33/76, Rewe-Zentralfinanz eG and Rewe-Zentral AG v Landwirtschaftskammer fur das Saarland, which expresses most clearly the relevant principles laid down by the Court.  Allow me to cite a lengthy extract from paragraph 5 of that judgement:

`Applying the principle of co-operation laid down in Article 5 of the Treaty, it is the national courts which are entrusted with ensuring the legal protection which citizens derive from the direct effect of the provisions of Community law.

Accordingly, in the absence of Community rules on this subject, it is for the domestic legal system of each Member State to designate the courts having jurisdiction and to determine the procedural conditions governing actions at law intended to ensure the protection of the rights which citizens have from the direct effect of Community law, it being understood that such conditions cannot be less favourable than those relating to similar actions of a domestic nature.

Where necessary, Articles 100 to 102 and 235 of the Treaty enable appropriate measures to be taken to remedy differences between the provisions laid down by law, regulation or administrative action in Member States if they are likely to distort or harm the functioning of the Common Market.

In the absence of such measures of harmonisation, the right conferred by Community law must be exercised before the national courts in accordance with the conditions laid down by national rules.

The position would be different only if the conditions and time limits made it impossible in practice to exercise the rights which the national courts are obliged to protect.

This is not the case where reasonable period of limitation of such actions are fixed.

The laying down of such time limits with regard to actions of a fiscal nature is an application of the fundamental principles of legal certainty protecting both the tax-payer and the administration concerned.'"

	That same part of the opinion is referred to in the Judgment of the Court itself in paragraph 16 and 17:
"16. As the Court has consistently held (see, in particular, the judgments in Case 33/76 Rewe-Zentralfinanz eG and Rewe-Zentral AG v Landwirtschaftskammer fur das Saarland [1976] ECR 189 and Case 199/82 Amministrazione delle Finanze dello Stato v San Giorgio SpA [1983] ECR 3595), in the absence of Community rules on the subject, it is for the domestic legal system of each Member State to determine the procedural conditions governing actions at law intended to ensure the protection of the rights which individuals derive from the direct effect of Community law, provided that such conditions are not less favourable than those relating to similar actions of a domestic nature nor framed so as to render virtually impossible the exercise of rights conferred by Community law.

17. Whilst the laying down of reasonable time limits which, if unobserved, bar proceedings, in principle satisfies the two conditions mentioned above, account must nevertheless be taken of the particular nature of Directives."

	The guidance that we gain from that Decision is that where no domestic provisions are in being covering the direct claims under Community law, then the Courts of the Member State should adopt procedures, as Community law, which are not less favourable than those similar provisions of the domestic law and provided, secondly that they are not so unreasonable as to render "virtually impossible the exercise of rights conferred by Community law".

	Mr McMullen submits, - and we agree with him - that the proper approach therefore is to apply the procedures of the Sex Discrimination Act to direct claims of sexual discrimination under Community law.  These procedures would cover not only time limits but also that code which is intended to protect employees against bad bargains.  In taking this view we cannot ourselves think that there is any detriment to one side or the other.  Both know where they stand under domestic law and it seems to us that the procedural provisions of domestic law comply with those conditions indicated by the European Court of Justice in Emmott.

	Directing ourselves therefore on this basis we have already found that the agreement of the 9th April was not such as to satisfy the provisions of the Sex Discrimination Act 1975 and therefore is no bar to an industrial tribunal hearing the direct claim under Community law.

	From what we have said above it is unnecessary for us to construe the actual wording of the agreement itself.  However lest we be held to be in error on our interpretation of the law, we have addressed ourselves to the phrase "benefits due to the applicant under the rules of the Company's Pension Scheme".  The two industrial Members sitting with me find no difficulty in understanding that phrase as meaning "under the rules of the Company's Pension Scheme as legally applicable" and therefore that the exception applies to the present claim and that even on the face of the agreement itself there is no bar to Mr Livingstone bringing his further claim.

	Looking at the words on the face of the document I do not have the same confidence in that interpretation and would be inclined to take the contrary view, but in the circumstances I do not feel it necessary to argue the point at any length.

	It follows from the above that this appeal is allowed and the matter is remitted to an industrial tribunal.

	Leave to appeal.