In Secretary of State for Business, Energy and Industrial Strategy v Parry and anor, the Court of Appeal has overturned the EAT’s decision that rule 12(1)(b) of the Employment Tribunal Rules 2013, which requires an employment judge to reject a claim without a hearing if he or she considers that it is in a form that cannot ‘sensibly be responded to’, is ultra vires – i.e. outside the scope of the primary legislation under which the Rules were made. The EAT was wrong to treat a rejection under rule 12(1)(b) as a ‘determination of the proceedings’, which would be subject to the restrictions contained in S.7 of the Employment Tribunals Act 1996.
P, a former employee of a school, presented a claim form to an employment tribunal on 25 January 2016, claiming unfair dismissal and unpaid wages. Although the form indicated that the background and details of the claim were in an attachment, P’s solicitors submitted the wrong attachment and so no details were supplied. This meant that the claim was in a form which could not ‘sensibly be responded to’ and therefore went before an employment judge, as required by rule 12(1)(b) of the Employment Tribunal Rules 2013. The judge decided not to reject the claim despite the irregularity and the claim form was sent to the school without any attachment. The school unsuccessfully applied for a reconsideration of the employment judge’s decision. It then went on to appeal against the decision to accept the claim and the refusal of reconsideration.
The EAT held that, on a straightforward application of rule 12(1)(b), the employment judge ought to have rejected the claim. In the EAT’s view, the school would have had no idea of the basis on which P was making either of her claims, and no reasonable employment judge could have concluded that this ET1 could sensibly be responded to. However, the EAT went on to dismiss the appeal on a ground not raised by the parties but identified by the EAT judge herself. The EAT pointed out that rule 12(1)(b) was outside the scope of the provisions of the ETA that authorise the making of the Tribunal Rules. S.7(3A) ETA, when read with S.7(3AA), allows for the rules to permit employment tribunals to determine proceedings without a hearing only in very limited circumstances. These sections set out an exhaustive statement of such circumstances and, in the EAT’s view, the rule in 12(1)(b) did not come within them. Nor did rule 12(1)(b) come within S.7(3B) ETA, which provides for the determination of a case when the tribunal has only heard from the claimant. In the EAT’s view, the wording of S.7 showed that Parliament appreciated that provisions curtailing the right to a hearing are unusual and wished to provide specific but limited authority for such procedures in the employment tribunal. The EAT accordingly concluded that rule 12(1)(b) was ultra vires and so could not be relied on. The employment judge had therefore made the right decision but for the wrong reason.
Although the school did not intend to appeal against the EAT’s decision, the Secretary of State was concerned at the ruling that rule 12(1)(b) was ultra vires. It therefore sought, and was granted, permission to appeal as a non-party. The appeal proceeded on two grounds: (1) whether the ET1 in the present case was one that could sensibly be responded to, and (2) whether rule 12(1)(b) was ultra vires.
On the first issue, the Court of Appeal disagreed with the EAT’s assessment that the school would have had ‘no idea’ of the basis on which P was making either of her claims. Lord Justice Bean, giving the only full judgment, observed that the school knew perfectly well that there was a dispute over whether P’s dismissal was a genuine redundancy. In Bean LJ’s view, the school could and should have filed an ET3 stating simply that it had dismissed P for redundancy and that it had acted reasonably in doing so. Either side could then have been directed to give further details of their case. Bean LJ emphasised that he was not laying down a general rule that the respondent must always be treated, for the purpose of rule 12(1)(b), as having detailed knowledge of everything that has occurred between the parties. If, for example, a claimant brings a discrimination claim without giving any particulars at all then the claim might properly be rejected under rule 12(1)(b). However, in many unfair dismissal cases there will be a single determinative issue well known to both parties, so that the employer can sensibly respond even in the absence of particulars. The Court accordingly held that the employment judge was right to allow the claim to proceed.
As for the ultra vires question, Bean LJ accepted the Secretary of State’s argument that the rejection of a claim under rule 12(1)(b) is not a ‘determination of proceedings’ within S.7 ETA. A rejection does not dispose of existing proceedings; rather, it recognises that no valid proceedings have ever been commenced. Rule 12 has to be read with rule 8, which states that proceedings only commence when a completed claim form is presented. A form cannot be said to have been ‘completed’ within the meaning of rule 8 if the material in it is so defective or incomplete that it cannot sensibly be responded to, and rule 12 is the means by which the ET identifies this and notifies the claimant that the claim cannot get off the ground. Bean LJ accepted further that the rejection is not a ‘determination’ – it is a judicial act of a different quality. A rejection does not go to the substance of the claim or involve a resolution of issues, and is not intended to give rise to cause of action or issue estoppels. The Court therefore allowed the Secretary of State’s appeal from the EAT’s declaration that rule 12(1)(b) was ultra vires.
Link to transcript: http://www.bailii.org/ew/cases/EWCA/Civ/2018/672.html
© 2018 THOMSON REUTERS (this news alert may not be reproduced without prior permission of IDS).
Follow @IDS_team on Twitter