Appeal No. EAT/631/93

	EMPLOYMENT APPEAL TRIBUNAL
	58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

		At the Tribunal
		On 27 October 1994

	Before

	HIS HONOUR JUDGE J HULL QC

	MR K M HACK JP

	MR P SMITH

NEEDLERS PLC	APPELLANTS

MR J WHITTLETON	RESPONDENT

	Transcript of Proceedings

	JUDGMENT

Revised

	APPEARANCES

For the Appellants	MR DAVID LOCK
(Of Counsel)
Messrs Pinsent & Co
3 Colmore Circus
Birmingham
B4 6BH

For the Respondent	MR NICHOLAS RANDALL
(Of Counsel)
Messrs Robin Thompson & Partners
Jarratt House
10 Jarratt Street
The Maltings
Hull
HU1 3HB

	JUDGE HULL QC:   In this case Mr Whittleton was employed as a machine operator by Needlers Plc at Hull.  His employment began on 20 October 1984 and in 1987 he changed the shift which he was working.  That was a shift which went from 5.45 in the morning until 1.45 in the afternoon.  Apparently, it had started by going from 6.00 am to 2.00 pm.  

	However that may be, it appears that the employers at first required the employees to stay on for an extra quarter of an hour from 1.45 until 2 o'clock to assist with the handover and the employees, thus working more than the eight hours, were paid not at the ordinary rates but on the basis of overtime rates.  There were various ways of thinking about it; it might be regarded as overtime, but there was a difficulty about that because overtime was voluntary - in the view of the Industrial Tribunal, after they had considered the Collective Agreement.  

	This quarter of an hour was compulsory.  In due course, the employers, who were like all employers no doubt anxious to cut costs where they properly could, decided to eliminate this extra 15 minutes and having eliminated the 15 minutes they then went on to reach the conclusion, which may or may not be logically justified, that there was no need to pay for it.  

	Mr Whittleton took the view that, putting it very simply, it was part of his contract that he should work the extra one and a quarter hours per week and therefore, although the employers might very properly say to him, "you needn't work that period", nonetheless, he was entitled to say, "my pay in fact consists of two elements under one contract.  It consists of the ordinary pay in respect of the ordinary working week and this is in effect an extra part of the working week and I am entitled to be paid for that whether I am asked to work it or not".  That was the essence of the matter which had to be concluded.  

	So he applied under the Wages Act to the Industrial Tribunal which sat at Hull under the chairmanship of Mr Morris with two industrial members on 18 June 1993 and promulgated their Decision on 25 June 1993.  The parties embarked on what at first sight appears a very commonsense course.  They had a bundle of 148 pages of documents and they agreed various facts.  We are not told that there was any formal agreement of facts but it appeared that they were agreed on all the facts, as it was said.

	They were represented by counsel on the one side for the employee, and by a solicitor on the other side, Mr Goodier.  So before the Tribunal it was either agreed, or suggested, at any rate, by the Chairman and not dissented from, that they should proceed by hearing argument, looking at the documents and not receiving oral evidence unless, at any rate, either party tendered it.  

	Neither party did put forward any oral evidence at any stage.  The parties could have done and subject to any legitimate objections to it, the Industrial Tribunal would be bound to hear any material evidence which a party put forward.  It has been suggested to us that there was a good deal of evidence which could have been called and perhaps should have been called and secondly, that this is in the nature of a test case.  

	Those two observations appear to us, with great respect to Mr Lock, to be inconsistent.  If the employers take the view that it was unfortunate that they did not adduce evidence and there were matters which the Tribunal should have had its attention invited to, in other words that the hearing before the Industrial Tribunal was not as well managed as would, with hindsight, be expected, then quite clearly this case, whatever else one can say about it, is not proper to be regarded by either party as a test case.  And it may be that if a similar application is made by another employee in similar circumstances a quite different result will follow, if a different course is taken, but there it is.  We will say no more about that.

	The Tribunal proceeding in that way said they received copious argument and submissions and they then gave their reasons.  They are at page 11 of our bundle.  They said:

		"3.  The tribunal has not heard any evidence. [It is a potentially misleading way of putting it because, of course, they had the evidence of the agreed bundle and the facts which were agreed].  It has heard copious argument from Mr Randall [counsel] and Mr Goodier [solicitor].  Mr Goodier also presented the tribunal with skeleton argument on behalf of the respondent.  It has not really been necessary to hear the evidence because the relevant facts are common to both parties.

		4.  The situation was that in 1987 Mr Whittleton transferred from a day shift working 39 hours a week to a night shift where it was specified that his normal working hours were 39 hours a week but he was obliged by the company to attend 15 minutes before the [next] shift commenced to facilitate the transfer of the work  from one shift to another.  The net result of that was that he attended for work in each week in excess of the 39 hour normal working week, the extent of that extra attendance being 1 1/4 hours per week.  For that extra time he was paid at a premium rate, which was referred to in the collective agreement and the memorandum of conditions of terms of workers within those areas covered by the collective agreement which formed part of the collective agreement, as an overtime payment". 

And they referred in paragraph 5 to the provisions of the collective agreement.  We have not looked at the collective agreement but we assume that this is the material term.

		"Employees are expected to work overtime when required.  When possible employees will be given prior notice of this".

And then they said:

		"6.  It has been said on the applicant's behalf that that is not so.  What the applicant was required to do in attending 15 minutes before the start of the shift was obligatory.  This clause refers to something which is not obligatory. ...."

	They accepted that submission.  They found, and I think it was agreed indeed, that this period of 15 minutes was obligatory and that what was being referred to in the collective agreement was overtime which was voluntary.  The word "expected" was not, in the view of the Industrial Tribunal, apt to indicate contractual obligation, but merely the expectations of the parties and no doubt an employee who refused to work overtime might find that his employers thought less well of him as a result, but there it is.  They found that it was not a contractual obligation.  And they said, having found that it was voluntary: 

		"7.  That is something quite different it would appear to this situation where someone transfers from a day shift to a night shift and is obliged as part and parcel of his working on that night shift to attend 15 minutes before the official start of the shift.  

		8.  The chairman has to say that he has relied very heavily upon the experience and common sense of the lay members in determining the factual reality of those facts as they have been presented as agreed between the parties.

	So what the Chairman is saying, is that he understands and his members understand, of course, because this was a unanimous decision, that these matters were agreed between the parties.  

		"9.  It is clear that the individual contract of Mr Whittleton contains a clause which is not covered by the collective agreement in precise terms and that is an obligation of him to nightly attend 15 minutes before the shift is due to start.  The obligation on the employer is then to see that Mr Whittleton is paid for the extra time on company business that that triggers, and what it triggers, of course, is the fact that the length of time he is at work is longer than his contractual hours and that then as part of this separate agreement, is regarded as overtime and payable at the premium rate for overtime which is referred to in the collective agreement, as an easy way to agree and calculate the payment for extra hours that had been triggered".  

As a result, they say:

		"10.  .... if the employer wishes to alter the contract by taking away the requirement to attend the 15 minutes before shift which results in the end in an extra payment to the applicant, then that, of course, is a change in the contract of his employment ....".

	And they go on to discuss how that might be altered.  They say there are two possibilities.  It might be (so to speak) severable, so that it could be brought to an end by reasonable notice and they had heard no evidence of that.  It might, on the other hand, be an integral part of the contract, in effect becoming part of the regular hours worked.  So that since an employer cannot, of course, unilaterally vary the contract, the only solution for the employer would be to dismiss the worker and, no doubt, offer him the new terms which he wanted to offer him and in those circumstances, the employee might or might not be obliged, in mitigation of his loss, to accept what was being offered to him or might accept the dismissal and refuse the terms of re-engagement.  

	Those were all possibilities.  They did not need to go into all that.  They had found that the term of the agreement was, first of all that the overtime (to use a tendentious word, the extra time, if I can use that phrase) was in effect part of the contract and part of the working hours and therefore, that it should be paid for.  And it should be paid for whether it was required to be worked or not.  In the absence of some agreement with regard to laying off, the employer can perfectly well say to his employee, "I am sorry I have no work for you tomorrow or on Tuesday and I therefore cannot ask you to come in, it would not be sensible"; and the employee is entitled to say, "that is fine, as long of course as you pay me", and the employer in those circumstances is obliged to pay him in the absence of some special agreement.

	So that was the view which the Industrial Tribunal took of the facts which they understood to be agreed facts and the documents which they had read.  It goes without saying that a quite different view might have been formed.  First of all, it might be held that this "overtime" was only overtime and therefore was not strictly obligatory.  It might be held that although it was obligatory, that was the only term that was to be implied and that in fact, if it was not required, then it was not to be paid for and it had the character therefore of overtime.  That was not the decision of the Industrial Tribunal.

	It was suggested to us that there was a great deal of evidence which should have been called and that the Industrial Tribunal was wrong to proceed without it and should not have allowed the case to be conducted, as it was, without calling material evidence.  They should have invited the parties to submit evidence to it.   

	It appears to us that that is a quite mistaken submission and, indeed, when we asked exactly what the evidence was that was to be laid before the Tribunal, we were on two occasions told about matters which appeared to us to be wholly immaterial, relating to the views of the Union, and the views of the men, and the views of the employers about what the contract might amount to, and negotiations between them, and the course which was taken in fact about various matters.  

	On the face of it, none of those matters are material in construing the collective agreement and if a term is to be implied in the absence of express agreement between the parties, then actions and comments by them under the contract are not admissible for the purpose of construing it.

	No application was made to the Industrial Tribunal to adduce evidence.  To say that the Tribunal, in those circumstances, is under a duty to call for evidence or to object to the case being presented in that way and dealt with in that way, is itself a mistake in law.  A Tribunal has no such obligation.  If the parties are represented, it is for them to say how the case is to be conducted.

	The burden rests on the parties themselves to lay before the Tribunal the matters which they say are material.  So that for example, if an employer appears unrepresented and says he does not propose to call any evidence on a complaint of unfair dismissal, the burden being on him to show what the reason for the dismissal is, and when the Tribunal says, "do you want to give evidence, do you wish to lay any documents before us", says, "no, I do not", then when he has been given such assistance as he properly can by the Tribunal, that is that.  The Tribunal is not under an obligation officiously to say, "well we are going to call you ourselves.  We are going to insist that you give evidence" and that is established by authority.

	Other matters were laid before us with great patience and courtesy by Mr Lock and we want to say how grateful we are to him for his persistent and very fair advocacy.  There is a skeleton argument which we have seen for the first time this morning, but that has been of great assistance to us.  I have already dealt with certain of the arguments which Mr Lock has put forward.  I will deal with others in a moment.

	He abandoned the contention that the Tribunal should have called further evidence and should have insisted on evidence being called, but he objected to the construction put on the collective agreement by the Industrial Tribunal.  It appears to us that when one comes to construe the agreement, the construction which they put was a perfectly admissible and, indeed, the proper one to put on it, judging from the short extract which we have seen.  

	We have not read, as the Tribunal did, all the collective agreement, nor have we heard all the arguments and looked at all the facts which were agreed, and we cannot possibly differ from the Tribunal in reaching the view which they did of clause 2(6) of the collective agreement.  It was a perfectly tenable view and it appears to us to be the correct view.

	Then there is objection taken to the way in which the Tribunal then went on to find the facts.  Throughout, it seems to us, there is inclined to be a begging of the question here, by referring to this as "overtime".  The whole point in front of the Industrial Tribunal was whether this extra quarter of an hour was, on the true view, overtime or not, and I come to two particular points which were taken by the Appellants.  First of all, there is objection taken to what is said in paragraph 8 of the Decision:

		"8.  The chairman has to say that he has relied very heavily upon the experience and common sense of the lay members in determining the factual reality of those facts as they have been presented as agreed between the parties". 

	On the face of it, that statement is no more than a statement of what every legally qualified Chairman should do whether sitting in this Appeal Tribunal or sitting in an Industrial Tribunal.  The industrial members are there for that very purpose, but what Mr Lock says is that that is in essence saying "that since there was no evidence as to the implication of proper terms in the supplementary agreement to work this extra quarter of an hour, what the Chairman is saying there is that the lay members have, in effect, intervened to make good a total gap in the evidence and supply, from their own wisdom and experience, matters about which the parties should be warned and about which the parties should have been at liberty to call evidence".

	One wonders therefore, since this was quite obviously one of the important points in the case, what evidence the parties could have adduced which was material to this.  And again, Mr Lock was obliged to give us a list of matters which appeared to us to be almost a text book list of matters which are immaterial in construing a contract or in saying what an implied term of that contract ought to be.  

	It appears to us that what the Chairman has said he has done, as one member of the Tribunal, and what the lay members did in relying on their experience and common sense in determining the factual reality of what had happened, was no more than this Tribunal was entitled to do.

	Mr Lock invited our attention to McLory  v  The Post Office [1993] 1 ALL E.R. 457.  That was a case which, in many ways, was quite different from this.  It was an action for damages by employees who had been suspended.  When it came to considering their claim for damages the learned Deputy Judge in that case, Mr David Neuberger, Q.C., had to consider whether it could be said that under the written agreement which provided for compulsory overtime (that is to say the employer could insist on it) it could be said that there was a reciprocal obligation on the employer to provide overtime in a rational and fair way in accordance, I think it was said in natural justice, so that all the employees of the Post Office obtained their fair share of overtime.  

	The relevance of that was that the employees said that their claim for damages would include a claim in respect of lost overtime, because the employer was under a legal obligation to provide that for them.  There are several things to be said there.  If the contract provided, as it did, for compulsory overtime in the sense that the employee was obliged to do it, it would be a very remarkable thing that it should not deal also with the question whether it was compulsory for the employer to provide overtime.  So if it the agreement said it was compulsory for the employees, why did it not say it was compulsory for the employers?  And again, the Deputy Judge was construing, of course, a quite different agreement and saying what was to be implied in that written agreement. 

	It seems to us therefore, that we cannot gain any assistance from McLory  v  The Post Office.  Mr Lock referred us to cases in which it has been said that industrial members of an Industrial Tribunal must not, in effect, provide evidence to fill in gaps.  Of course they must not, but what they are entitled to do is precisely what the Chairman said they had done, which was to use their experience and common sense to say what was the factual reality of what had been laid before them, and that is the essential matter, whether the court is trying to construe an agreement with which it finds difficulty because it is not perfectly plain, or whether it is deciding what terms should be included in an agreement which was never formalised at all, as in this case, with regard to the 15 minutes.

	It is essential to be able to apply the "armchair principle", as it has been called.  You must put yourself, as far as you can, in the position of the parties and say what they would have understood to be the reality of the situation.  And it is for that very purpose, among many others, that the industrial members are there to say what the reality of the situation was.  
	We have considered all that has been said to us by Mr Lock.  It can be said straight away that if you start with the primary facts here, this is a conclusion which might have been different.  Of course it might have been different.   We cannot put ourselves in the position of the Industrial Tribunal and say whether we would have construed the collective agreement in the same way, whether we would have found that the reality of the situation was as this Industrial Tribunal found it.  The reality of the situation was a question of fact for them, and having looked at the reality of the situation they concluded that the true position was that the employers were, indeed, obliged to pay for this time whether they required it to be worked or not.  

	Having thought about it as carefully as we can, we think there is in reality nothing in this appeal.  We notice that, so far from dealing with the case seriously on the basis that it raised an important question of principle on which evidence should be called, these Respondents put in their Notice of Appearance that "we consider the application is frivolous and unreasonable and would strongly suggest that it would be a waste of the Tribunal's time to hear this case".  It is hardly surprising if the Tribunal proceeded in a short, straightforward and commonsensical way on the material the parties chose to put in front of it, not being told in the appearance that it raised an important question of principle or anything of that sort. 

	We cannot find any error of law in the way this Tribunal proceeded or any error of law on the face of their award and from what we have been told, although it was not persisted in, we certainly cannot find there was any evidence here which they ought to have admitted and failed to admit.  

	In all the circumstances this appeal must be dismissed.