Appeal No. EAT/828/95

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 18 October 1996

Before
THE HONOURABLE MRS JUSTICE SMITH
MR J R CROSBY
MR W MORRIS

MRS T WILLIAMS	APPELLANT

LEEDS CITY COUNCIL	RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised

	APPEARANCES

For the Appellant	MR G CLAYTON
Solicitor
Hamilton House
Mabledon Place
London
WC1H 9BD	
For the Respondents	MR M G KURREIN
(of Counsel)
Mr A Davenport
Leeds City Counsel
Legal Services
Civic Hall
Leeds
LS1 1UR	

	MRS JUSTICE SMITH:	This is an appeal from the decision of an Industrial Tribunal sitting at Leeds which was sent to the parties on 27 June 1995.  The Tribunal dismissed the Appellant’s claim that she had been unfairly dismissed and that the Respondents had discriminated against her indirectly in the manner in which they had chosen her to be selected for redundancy, or for non-renewal of her fixed term contract.

	The Appellant had been employed at Fearnville Special School, Leeds for several years prior to 1988 and by that year she had become the Head of the Lower School.  She then resigned to look after her young family.  She took up supply teaching and in September 1992 she returned to full-time work at Fearnville School on a fixed term contract for one year.  At that time Fearnville needed another teacher, but were not sure for how long the extra need would last.  In September 1993 the Appellant’s contract was renewed for another year.  In June 1994 she was informed that her contract would not be renewed but would lapse at the end of August 1994.  

	The Tribunal found that the reason why the Respondents took this decision was that they anticipated a reduction in the school roll in September 1994, and considered that they should reduce the staff by one.  The Appellant was the one to go.  She made a claim to the Industrial Tribunal alleging that she had been unfairly dismissed and that the method by which she had been selected for redundancy was indirectly discriminatory against women.

	The Respondents agreed that she had either been dismissed for redundancy, or that her contract had been allowed to lapse because its purpose had come to an end.

	The Industrial Tribunal dealt first with the claim in relation to indirect discrimination on the ground of sex.  Section 1(1) of the Sex Discrimination Act 1975 provides:

“A person discriminates against a woman in any circumstances relevant for the purposes of any provision of this Act if -
(b)  he applies to her a requirement or condition which he applies or would apply equally to a man but -
(i)  which is such that the proportion of women who can comply with it is considerably smaller than the proportion of men who can comply with it, and
(ii)  which he cannot show to be justifiable irrespective of the sex of the person to whom it is applied, and
(iii)  which is to her detriment because she cannot comply with it.”

	The Appellant claimed that the Respondents had discriminated against her because it had applied a condition or requirement which was such that the proportion of women who could comply with it was considerably smaller than the proportion of men who could comply with it.

	The Respondents had a policy for selecting who should leave whenever it was necessary to reduce the number of teachers.  The policy depended upon the status of the contract under which the teacher was employed.  Most teachers employed by the Respondents were employed on ordinary contracts of employment which continued in the usual way until terminated by resignation or dismissal.  Those contracts we will refer to as ‘permanent contracts’.  A small proportion of the total number of teachers (including the Appellant) were employed on fixed term contracts running from the beginning to the end of the school year, 1 September to 31 August.  Fixed term contracts were used by the Respondents for two main purposes.  First, they were used to provide cover for permanent staff who were to be absent for example on sickness or secondment.  Second, they were used in schools where an increase in staff was needed, but where it was unclear whether that increase would be justified for a long or short period.  Such contracts were often taken by staff who were returning to work after a break in their careers.  It was open to a teacher, who was on a fixed term contract, to apply for a permanent post.  However, whether it was easy to obtain such a post, or indeed possible to apply for one, unless one was advertised as available, is less clear.  

	The Respondents’ policy of selecting staff for redundancy was to choose those who were on fixed term contracts.  Thus, teachers on fixed term contracts were vulnerable to dismissal in a redundancy situation.  It was not disputed that this policy was applied to men in just the same way as women.  It was also agreed that the employers could be said to have applied a condition or requirement upon the Appellant, which at the material time at any rate, she could not fulfil.  The requirement was that she should be on a permanent contract if she were to avoid vulnerability to redundancy.  The Appellant sought to show that the proportion of women who could comply with the requirement or condition of being on an open contract was considerably smaller than the proportion of men who could comply with that requirement or condition.  To do this she had to establish the numbers of men and women on fixed term contracts and the numbers of men and women in a comparable group of permanent contract holders.

	The Tribunal had before them some agreed statistics showing the numbers of men and women in five categories of teachers employed by the Respondents in September 1994.  The five categories were designated by the letters A - E.  These figures showed that there were a total of 5,618 teachers employed below the rank of head teacher.  Those teachers were Group E.  Of those 32.16% were men and 68.84% were women.  Thus, the proportion was roughly 1 to 2 men to women.  

	Of those 5,618 only 423 were on fixed term contracts.  The rest had permanent contracts, 66 of the 423 on fixed term contracts were in the special category of having been employed to cover sickness and secondments.  Thus, the Appellant was one of 357 teachers on a fixed term contract not connected with sickness or secondment.  They were group B.  Of those 357, 293, that is 82.1% were women and 64, that is 17.9% were men.  Thus the ratio of women to men in group B was roughly 4 to 1.  

	The teaching profession has pay scales common throughout the country.  The grading system for all teachers excluding head teachers goes up to grade 19.  The Tribunal found that it was the policy of Leeds City Council to employ teachers on fixed term contracts only in the grades up to and including grade 9 in ordinary schools and up to and including grade 11 in special schools.  We shall refer to those grades as being ‘the lower grades’.  A teacher on a fixed term contract could not expect promotion beyond those lower grades.  It was the policy of Leeds only to award the higher grades to teachers who carried additional responsibilities, such as the headship of a department or pastoral duties.  It was also their policy, if possible, to avoid making those higher grade teachers redundant, as they had an important function in the life of the school.

	The figures before the Tribunal showed that of the 5,618 teachers employed, that is group E, 2,606 were employed in the lower grades.  They were group C.  Of those 2,606, 2,094 or 80.4% were women and 512 or 19.6% were men.  Thus, the proportion of women to men in group C was about 4 to 1.  Finally, the figures showed group D which comprised all those teachers who were on permanent contracts, but were also in the lower grades.

	In deciding with which group of teachers the Appellant’s group should be compared, the Industrial Tribunal had to apply section 5(3) of the Sex Discrimination Act.  This provides:

“A comparison of the cases of persons of different sex or marital status under section 1(1) or section 3(1) must be such that the relevant circumstances in the one case are the same, or not materially different, in the other.  ”

	The Industrial Tribunal first decided that the Appellant fell within group B.  That had not been disputed.  They then considered whether they should use group E for comparison purposes, as contended for by the Appellant, or whether they should use group C or D as contended for by the Respondents.

	The Appellant had contended that her group of 357 fixed term contract holders, group B, ought to be compared with the whole pool of teachers, including those at higher grades.  However, the Industrial Tribunal rejected that contention saying that, as a fixed term contract holder could never progress beyond the lower grades, that larger group was not truly comparable with the Appellant’s group of fixed contract holders, all of whom were on the lower grades.  The teachers in those higher grades would not, under any circumstances, be made redundant because of their role.  Therefore, said the Tribunal, the more closely comparable groups were groups C or D comprising teachers employed on the lower grades.  

	Mr Clayton, for the Appellant, has submitted that the Industrial Tribunal’s conclusion in this regard was perverse, that it was wholly wrong and that no reasonable Tribunal, properly directing itself, could have made such a decision.  He accepted that the proper approach for us was explained in Kidd v DRG (UK) Ltd, [1985] ICR 409, a decision of the Employment Appeal Tribunal.  At page 415 D Waite J, as he then was, said:

“The choice of an appropriate section of the population is in our judgment an issue of fact (or perhaps strictly a matter for discretion to be exercised in the course of discharging an exclusively fact-finding function) entrusted by Parliament to the good sense of the tribunals, whose selection will be influenced by the need to fit it as closely as possible to the varying circumstances of each case.  Of course in those exceptional cases where it can be shown that good sense has not prevailed, and the tribunal has chosen to make the proportionate comparison within an area of society so irrationally inappropriate as to put it outside the range of selection for any reasonable tribunal, then the tribunal would have fallen into an error of law which could be corrected in the appellate jurisdiction.”

	If the employers had not applied the requirement or condition under discussion, i.e. if they had not used the status of the contract as the criterion for choice, the Appellant would have been in the same position on redundancy as those in group D who were also on lower grades but who had permanent contracts.  However, she would not have enjoyed the additional protection from redundancy which was provided by the holding of a higher grade and the responsibilities which went with it.  So she would not have been in the same position as many of the teachers in group E.  Thus, we consider that the Industrial Tribunal were entitled to say that the most suitable group for comparison was either C or D and, in any event, not E.

	At one stage we were concerned that the Respondents’ policy of protecting those on a higher grade might, in itself, be discriminatory on the ground of sex.  The figures could support such an argument.  However, the point was never raised before the Industrial Tribunal and had it been, it would have been necessary for a great deal more statistical research to have been done.  We do not think that it is appropriate for us to bring this matter into consideration.

	The Industrial Tribunal then considered whether they should use group C or group D as the comparative group.  They thought, in the event, that D was the more suitable although it is not clear why.  The choice between C and D depends only upon what one considers is the correct mathematical exercise.  It seems to us that there are two possible ways of carrying out the statutory comparison.  One is to look at the Applicant’s group B as a proportion of the whole group of lower grade teachers, group C.  The other is to look at the Applicant’s group of lower grade fixed term contract holders as against the lower grade permanent contract holders, group D.  
We do not think that it matters which exercise is undertaken provided that the same test is applied to the women and the men.

	Accordingly, we do not think that it can be said that the Industrial Tribunal erred in preferring group D as a comparator to group C.  

	The Appellant submits that, at the next stage in their decision, the Industrial Tribunal fell into error.  They purported to perform the statutory comparison by saying: the proportion of women in the Applicant’s group of 357 fixed term contract holders group B was 82.1% and the proportion of women in the group of permanent contract holders group D was 80.1%.  They concluded that there was a difference of 2%.  Thus the proportion of women who could comply was not considerably smaller than the proportion of women who could not.

	It seems to us that Mr Clayton is right when he says that the Industrial Tribunal did not apply the proper statutory test.  However, the result which they obtained is not significantly different from what they would have obtained had they applied the true test.  We have the figures before us and are able to apply it.

	The true test should be a comparison between the proportion of women who can comply with the requirement or condition and the proportion of men who can comply with it.  Applying the statutory test ourselves, we find that there are 83.74% of women who can comply with the requirement, and 85.72% of men who can comply.  Thus, the difference is 2%, exactly the same as the Industrial Tribunal found by a route which was not in accordance with statute.  

	Mr Clayton has conceded that if the difference between the two pools held to be appropriate is only 2% he cannot contend that the Industrial Tribunal were wrong to find that the one proportion was not considerably smaller than the other.  We are satisfied that the difference was only 2% and it is therefore conceded that that is not a considerable difference in the context of this case.

	Mr Clayton’s argument was mainly based upon what the difference would have been had pool E, the larger pool, been used for comparative purposes.  The difference would then have been about 4%.  We wish to say nothing about whether a difference of 4% would have been properly regarded, in the context of this case, as being a considerable difference.  The Industrial Tribunal did not consider that point and it falls outside the ambit of this appeal.  

	That, in effect, disposes of this appeal.  However, for the sake of completeness, we mention briefly the second leg of section 1(1)(b) of the Act.  The Tribunal in its decision went on to consider that subsection, unnecessarily, in view of their finding under section 1(1)(b)(i).

	We propose to say very little about their approach to the question of whether the employers were able to show that their policy was justifiable, irrespective of the sex of the person to whom it applied.  We say only that this Tribunal stressed, in the course of its discussion of that issue, what they perceived to be the Appellant’s freedom to obtain a permanent post.  We think they may have misunderstood the evidence on this point, as they seem to suggest that the Appellant was on a fixed term contract as a matter of choice, and could have obtained a permanent post had she wished.  Her evidence was, we think, that a permanent post was not available to her during that two year period.  In any event, we doubt that such personal considerations were appropriate matters to be taken into account under section 1(1)(b)(ii).

	For the reasons given above this appeal must be dismissed.