Secretary of State for Business, Energy and Industrial Strategy v Parry & Anor

The Claimant Rhyan Parry presented a claim form to an employment tribunal (“the ET1”) on 25 January 2016 against the Respondent school, then known as Haberdashers’ Monmouth College. She claimed unfair dismissal and arrears of wages. Time for bringing her unfair dismissal claim expired on 26 January 2016. With one exception, the relevant boxes on the ET1 were completed. In section 5, the box for the date when the employment ended is not filled in, but the box “Is your employment continuing?” is ticked. (The explanation, not given on the ET1, was that the Claimant had been dismissed and immediately re-engaged on less favourable terms: the case was thus potentially of a type exemplified by Hogg v Dover College[1990] ICR 39.) Section 6 (about earnings and benefits) is blank. Section 8 is headed “Type and details of claim”. The box “I was unfairly dismissed” is ticked, as are the boxes “I am owed” and “arrears of pay”.

Box 8.2 is headed:

On 27 January 2016 the tribunal staff referred the ET1 to Employment Judge Cadney. On 28 January 2016 he decided not to reject the claim.

On 29 January 2016 the employment tribunal (“ET”) sent out notice of a claim. This said the ET had accepted a claim but did not indicate that any judicial decision to accept the claim had been made. The Respondent employers (“the school”) received the Claimant’s ET1 on 3 February 2016 without the enclosed particulars. On 4 February 2016 the school rang the ET. The ET said that it had no particulars of the claim. The school’s solicitors wrote to the ET on the same day, asking the ET to reject the claim pursuant to rule 12 of the Employment Tribunals Rules of Procedure 2013 (“the 2013 Rules”). They argued that since the claim did not “meet the minimum requirements of a valid claim”, it should be referred to an Employment Judge (“EJ”) as being in a form “which cannot sensibly be responded to”, and should be rejected.

Also on 4 February 2016, the Claimant’s solicitors, having been contacted by the ET, sent details of her claim – the intended enclosure referred to in box 8.2 - to the ET. They resisted the school’s application. There were further exchanges between the parties and the ET. On 2 March 2016 the Claimant’s solicitors wrote to the ET to say that they would be applying at a preliminary hearing listed for 8 March to amend her claim, by reference to the details of the claim that were sent to the ET on 4 February 2016. This amounted, as Elisabeth Laing J later observed in the Employment Appeal Tribunal (“EAT”), to a tacit acceptance that the correct details had not been submitted with the ET1 on 26 January 2016.

The school’s solicitor’s notes of the hearing of 8 March before Employment Judge Harper indicate that the judge observed that the ET1 had been referred on 28 January to Employment Judge Cadney, who had made a judicial decision to accept the claim. Counsel for the school argued that the letter of 4 February was an application on behalf of the school to reconsider that decision, and asked Employment Judge Harper to accept it as such. Employment Judge Harper held that under rule 13 of the 2013 Rules an application for reconsideration was only available to a Claimant (if the ET1 was rejected), not to a Respondent. Counsel for the school also argued that rules 70-73, dealing with reconsideration of judgments, applied: Employment Judge Harper said that they only applied to judgments, and the decision was not a judgment.

Employment Judge Harper held that Employment Judge Cadney’s decision was not a “judgment” as defined in rule 1(3)(b) of the 2013 Rules. He said: “The decision to accept was not a judgment because it did not finally determine the claim. Quite the reverse. It enabled the claim to proceed.” Employment Judge Harper held that he had no power to reconsider the decision to accept the claim.

The school’s solicitors also wrote to the tribunal applying for Employment Judge Cadney’s reasons for not rejecting the ET1. On 30 March the ET replied that the judge had directed them to write on his behalf:

Rule 8(1) of the 2013 Rules provides:

Among other things, the prescribed claim form requires the claimant to set out details of the claimant(s) and respondent(s), an ACAS early conciliation certificate number (or a legitimate reason for not having such a number), ‘details of your claim’, and details of what remedy the claimant is seeking. The Presidential Practice Direction – Presentation of Claims (2013) sets out the methods by which such claims must be presented, but adds no further requirements about their content.

Rules 10 to 12 of the 2013 Rules make provision for the ‘rejection’ of a claim form by the ET in certain circumstances. Rule 10 provides:-

It is not made on a prescribed form;

It does not contain all of the following information –

Each claimant’s name;

Each claimant’s address;

Each respondent’s name;

Each respondent’s address; or

It does not contain all of the following information –

An early conciliation number;

Confirmation that the claim does not institute any relevant proceedings; or

Confirmation that one of the early conciliation exemptions applies.

The form shall be returned to the claimant with a notice of rejection explaining why it has been rejected. The notice shall contain information about how to apply for a reconsideration of the rejection.”

For present purposes, the key rule is rule 12, which provides:

The staff of the tribunal office shall refer a claim form to an Employment Judge if they consider that the claim, or part of it, may be –

one which the Tribunal has no jurisdiction to consider;

in a form which cannot sensibly be responded to or is otherwise an abuse of the process;

one which institutes relevant proceedings [i.e. proceedings to which the early conciliation regime applies] and is made on a claim form that does not contain either an early conciliation number or confirmation that one of the early conciliation exemptions applies;

one which institutes relevant proceedings, is made on a claim form which contains confirmation that one of the early conciliation exemptions applies, and an early conciliation exemption does not apply;

one which institutes relevant proceedings and the name of the claimant on the claim form is not the same as the name of the prospective claimant on the early conciliation certificate to which the early conciliation number relates; or

one which institutes relevant proceedings and the name of the respondent on the claim form is not the same as the name of the prospective respondent on the early conciliation certificate to which the early conciliation number relates.

The claim, or part of it, shall be rejected if the Judge considers that the claim, or part of it, is of a kind described in sub-paragraphs (a), (b), (c) or (d) of paragraph (1).

If the claim is rejected, the form shall be returned to the claimant together with a notice of rejection giving the judge’s reasons for rejecting the claim, or part of it. The notice shall contain information about how to apply for a reconsideration of the rejection.’

Rule 13 provides for the reconsideration of any such rejections, and makes provision for a hearing if the claimant wants one:

A claimant whose claim has been rejected (in whole or in part) under rule 10 or 12 may apply for a reconsideration on the basis that either –

the decision to reject was wrong; or

the notified defect can be rectified.

The application shall be in writing and presented to the Tribunal within 14 days of the date that the notice of rejection was sent. It shall explain why the decision is said to have been wrong or rectify the defect and if the claimant wishes to request a hearing this shall be requested in the application.

If the claimant does not request a hearing, or an Employment Judge decides, on considering the application, that the claim shall be accepted in full, the Judge shall determine the application without a hearing. Otherwise the application shall be considered at a hearing attended only by the claimant.

If the Judge decides that the original rejection was correct but that the defect has been rectified, the claim shall be treated as presented on the date that the defect was rectified.”

Rejection of a claim to an employment tribunal was a term first used in the 2013 Rules, but it is very similar to what was described in the 2004 Employment Tribunals Rules of Procedure as a decision not to accept a claim. Rule 3(2)-(3) of the 2004 Rules provided that:

The 2004 Rules used the term “not accepted” rather than “rejected”, but both wordings connote the same idea – the claim form is being returned to the sender without the proceedings ever properly starting.

The 2013 Regulations, including the Rules of Procedure as Schedule 1, were made under powers conferred on the Secretary of State by the Employment Tribunals Act 1996 (“the 1996 Act”). It is convenient to refer at this stage to sections 7 and 41 of the 1996 Act, as amended.

Section 7, so far as material, provides:

Section 41 of the 1996 Act states that the power to make such regulations is exercisable by statutory instrument and subject to the negative resolution procedure. Section 41(4) provides that:-

The school appealed to the EAT against both the decision of Employment Judge Cadney on 28 January 2016 not to reject the ET1 and the decision of Employment Judge Harper at the preliminary hearing of 8 March 2016 not to reconsider Employment Judge Cadney’s decision. The appeals were listed together and came on before Elisabeth Laing J sitting alone on 21 July 2016. By a reserved judgment handed down on 2 August 2016 she dismissed the school’s appeal against Employment Judge Cadney’s decision. (This rendered the appeal against Employment Judge Harper’s decision academic since there could be no purpose in requiring the ET to reconsider a decision which was, in Elisabeth Laing J’s words, “uncontestably right”.) But her reasons for dismissing the appeal and thus allowing the ET1 to stand were wholly different from those of the ET.

Elisabeth Laing J took a different view from Employment Judge Cadney as to whether the ET1 presented on 25 January 2016 (the day before expiry of the time limit) was in a form to which the school could sensibly respond. She held:

If the judge had stopped there she would have allowed the appeal and the case before us would only be about the proper construction of Rule 12(1)(b). But that was not what happened. Two days before the date of the hearing in the EAT her clerk had emailed both counsel as follows:-

It is a serious step to declare a statutory instrument such as a court or tribunal rule invalid (especially when neither party is arguing that it is) without requiring notice to be given to the Attorney General or the appropriate Secretary of State through the Government Legal Service, so that the relevant department has the opportunity to apply to intervene, or at least to make written submissions, in defence of the validity of the statutory instrument. If the judge had had the advantage of hearing the submissions which Mr Purchase deployed before us, I doubt whether she would have reached the conclusion which she did about the vires issue.

However, as often happens when judges raise points themselves, Elisabeth Laing J found the vires point to be decisive. She held:-

The formal order of the EAT was simply that the appeal be dismissed; but the judgment plainly included by implication a declaration that rule 12(1)(b) was ultra vires.

When it came to the attention of the Department for Business, Energy and Industrial Strategy that the EAT had held rule 12(1)(b) to be ultra vires, this naturally caused concern; augmented, no doubt, by the fact that the school were not seeking permission to appeal to this court. So on 31 August 2016 the Secretary of State lodged an Appellant’s Notice in this court seeking permission to appeal. It is unusual for a non-party to be granted permission to appeal against a decision, but the jurisdiction plainly exists: see for example George Wimpey UK Ltd v Tewkesbury Borough Council [2008] 1 WLR 1649, CA.

On 31 May 2017, after considering the application on the papers, Longmore LJ granted the Secretary of State permission “to appeal the reasons given by Laing J for rejecting the school’s appeal against the decision of the ET not to reject Ms Parry’s claim for unfair dismissal and arrears of wages. The permission is (a) conditional on the Secretary of State not seeking to recover any part of his costs against either Respondent and (b) without prejudice to any submission which either Respondent might make as to the jurisdiction of this court to entertain the appeal. But any such submission will have to explain why no steps were taken to join the Secretary of State to the proceedings in the EAT when the ultra vires point was first raised.”

On 31 July 2017 Underhill LJ gave the school permission to appeal against the order of the EAT, on terms that neither the Claimant nor the school would be entitled to recover costs from each other.

In her Respondent’s Notice on behalf of Ms Parry, Ms Newbegin contended that this court had no jurisdiction to hear the appeal by the Secretary of State. She argued that the order of the EAT should be upheld because rule 12(1)(b) is ultra vires and also on the basis that the ET1 was neither in a form which could not sensibly be responded to nor an abuse of process. In their Respondent’s Notice drafted by Mr Leach the school supported and relied on the grounds of appeal advanced by the Secretary of State on the ultra vires issue while supporting the finding by Elisabeth Laing J (“the judge”) that the ET1, for the reasons she gave, was not in a form to which the school could sensibly respond.

After some initial skirmishing the objections to the Secretary of State bringing an appeal to this court have not been pursued. We were therefore able to deal with the issues on their merits. These were:-

Whether the form ET1 in this case was (as Employment Judge Cadney held) in a form which could sensibly be responded to. Mr Leach argued that it was not; Ms Newbegin and Ms Stanley argued that it was. Mr Purchase, for the Secretary of State, did not seek to address us on this issue.

Whether rule 12(1)(b) is (as Elisabeth Laing J held) ultra vires. Mr Purchase, supported by Mr Leach, argued that it was not. Ms Newbegin and Ms Stanley argued that it was.

The judge, as already noted, held that an EJ looking at this ET1 could only have concluded that the Respondent school “would have had no idea of the basis on which the Claimant was making either of her claims”. With respect, I entirely disagree. The school knew perfectly well that, as the ET1 states, she had been employed by them as Director of Dance from 1 September 1996 onwards. They also knew, although the ET1 did not state this, that her employment in that capacity had been terminated on 31 August 2015 and that she had been re-engaged as Head of Dance the next day. Their case was that the dismissal was a genuine redundancy. Her case was that it was not. (No separate argument was advanced before us relating to the claim for arrears of wages.)

The school could and in my view should have filed an ET3 stating something on these lines: “The Claimant was dismissed on 31 August 2015 on the grounds of redundancy, which in the circumstances the Respondent acted reasonably in treating as a sufficient reason for dismissal.” Either side could then have been directed to give further details of their case. But at least proceedings would have been properly launched. Employment tribunals should do their best not to place artificial barriers in the way of genuine claims.

I should add that in holding that a sensible response could have been given to this claim I am not laying down a general rule that the respondent to a claim in an employment tribunal must always be treated, for the purposes of rule 12(1)(b), as having detailed knowledge of everything that has occurred between the parties. If, for example, a claimant brings a claim for sex or race or disability discrimination without giving any particulars at all, or attaching the particulars from someone else’s case, that ET1 might well be held to be in a form to which the employer could not sensibly respond and thus properly rejected under rule 12(1)(b). But in many unfair dismissal cases there will be a single determinative issue well known to both parties, so that even if particulars are omitted from the ET1 the employer can sensibly respond, for example: (a) “the Claimant was not dismissed; she resigned on [date X]”; or (b) “the Claimant was dismissed on [date X] on the grounds of gross misconduct, which in the circumstances the Respondent acted reasonably in treating as a sufficient reason for dismissal”.

The judge was, therefore, right to dismiss the appeal from the decisions of Employment Judge Cadney and Employment Judge Harper. But it is now necessary to deal with the Secretary of State’s appeal from the implied declaration that rule 12(1)(b) is ultra vires.

For the Claimant Ms Newbegin submits that a tribunal claim is instituted simply by being presented, and that any provision in secondary legislation such as rule 12 which provides for the summary rejection of a claim, particularly without any hearing, is objectionable on the grounds that it curtails the right of access to the tribunal.

It is common ground between Ms Newbegin and Mr Purchase and was accepted by Elisabeth Laing J that a claimant is entitled to the benefit of the doubt: an employment judge should only reject a claim if he is sure that it cannot be sensibly responded to. I agree that rule 12(1)(b) should be interpreted, and its validity considered, on that basis. Any other approach would be, both at common law and under Article 6 of the ECHR, a disproportionate interference with the right of access to the tribunal.

With that interpretation accepted, the basic answer to the constitutional argument about access to the tribunal is that the right can be curtailed or made subject to conditions, but only insofar as primary legislation so authorises.

The Secretary of State (supported on this issue by the school) contends that the EAT erred in holding that rule 12(1)(b) was ultra vires for the following reasons:-

Mr Purchase submits that that a ‘rejection’ is not a disposal of existing ‘proceedings’. Rather, it is a recognition of the fact, or has the effect, that no valid proceedings have ever been commenced. Rule 12 of the 2013 Rules has to be read with rule 8, the two rules being essentially two sides of the same coin concerned with the institution of proceedings. Rule 8(1) provides that a claim is only started when a ‘completed claim form (using a prescribed form)’ is presented. The prescribed form requires the details of the claim to be set out. Mr Purchase argues that a claim form cannot be said to have been ‘completed’ within the meaning of rule 8(1) if the material in it is so defective or incomplete that it cannot sensibly be responded to. Rule 12 is the means by which the ET identifies this and notifies the claimant that, in such a case, her claim has not got off the ground.

This is consistent with the language used in rule 12: the claim is ‘rejected’, rather than (for example) ‘dismissed’ or ‘determined’. It is also consistent with rule 13(4), which deems the claim form to have been presented on the date on which the defect was rectified: that only makes sense if the claim form would not otherwise have been treated as presented at all. It is true that, in Burns International Security Services v Butt [1983] ICR 547, the EAT held that most of the requirements of rule 1(1) of the then Employment Tribunals Rules of Procedure were ‘not imperative but directory’, such that a failure to give particulars of a claim as required by rule 1(1)(c) did not render the claim a ‘nullity’. However, Mr Purchase argues that rule 12 of the 2013 Rules is, at least to some extent, a reversal of that decision.

Mr Purchase further argues that a ‘rejection’ under rule 12 is not a ‘determination’ within the meaning of section 7 of the 1996 Act. Rather, it is a judicial act of a different quality. In particular, it is submitted that: a rejection does not go to the substance of the claim or involve a resolution of issues; it is a response to the fact that a claim has not properly been made. It is clear that rule 12(2) rejections are not intended to give rise to cause of action or issue estoppels. As Langstaff P observed in Software Box Limited v Gannon [2016] ICR 148, EAT, at [41], “the fact that a complaint was made within time and then rejected does not, and should not, as a matter of principle, preclude the consideration of whether a second claim traversing the same ground is one in which the tribunal should have jurisdiction”.

I accept these submissions by Mr Purchase. I conclude that an employment tribunal’s rejection of a claim pursuant to rule 12 is not a ‘determination of proceedings’. Accordingly there is nothing in section 7(3A)-(3C) of the 1996 Act which renders any of rule 12(1)-(2) ultra vires. The Secretary of State’s appeal from the implied declaration by the judge that rule 12(1)(b)-(f) was ultra vires, or her reasoning to that effect, must therefore be allowed.

This is sufficient to dispose of the Secretary of State’s appeal, but I will consider Mr Purchase’s alternative grounds of appeal briefly.

Section 7(3A) (which dates from 1998 and was amended to its current form in 2004) allows regulations to be made which “authorise the determination of proceedings without any hearing in such circumstances as the regulations may prescribe”. This general power was, however, restricted in 2008 by the insertion of Section 7(3AA). As already noted, this provides so far as material that “regulations under subsection (3A) may only authorise the determination of proceedings without any hearing in circumstances where ……the person…… against whom the proceedings are brought – (i) has presented no response in the proceedings; or (ii) does not contest the case”.

Mr Purchase submits, in effect, that this provision means exactly what it says. When the employment judge is deciding whether or not to reject a claim under rule 12, the respondent will by definition have presented no response in the proceedings, because the proceedings have not yet been served. The case can therefore be rejected without a hearing if the terms of the rule are satisfied.

In view of my conclusion on the “determination of proceedings” issue it is strictly unnecessary to resolve this point. But I would (if it were necessary) accept Mr Purchase’s submissions on this, his third ground of appeal. I see no reason why Parliament should have intended to allow a claim to be determined without any hearing where the respondent has been served with a claim but has not (or not yet) presented a response, but to prohibit such a procedure at the earlier stage where the respondent has not yet been served.

I can deal even more briefly with the second ground of appeal on behalf of the Secretary of State. That relies on the power under section 7(3B) to make regulations to authorise the determination of proceedings without hearing anyone other than the claimant. The rule 12(2) power provides for rejection of the claim without any hearing at all. It is true that rule 13 allows the claimant to apply for reconsideration of that decision, but I do not agree that rejection of a claim under rule 12(2) coupled with an opportunity for the claimant to apply for reconsideration under rule 13 could amount (if a rejection were indeed a determination of proceedings) to a determination at a hearing attended by the claimant so as to satisfy section 7(3B).

None of these procedural niceties would matter much were it not for the three month time limit for the presentation of unfair dismissal claims; the stringent nature of the “not reasonably practicable” escape clause set out by Parliament (Employment Rights Act 1996, s 111(2)(b)); and rule 13(4) of the 2013 Rules, which states that, on reconsideration of a rejection under rule 12, “if the Judge decides that the original rejection was correct but that the defect has been rectified, the claim shall be treated as presented on the date that the defect was rectified”. Human nature being what it is, many employment tribunal claims are presented only shortly – sometimes very shortly – before the expiry of the time limit. By the time any defect has been rectified it may be too late. Although it does not affect the present case, I wish to record my view that the vires of rule 13(4) may at least arguably be open to question.

I would dismiss the school’s appeal from the formal order of the EAT, though for entirely different reasons from those of the judge. I would allow the Secretary of State’s appeal from the implied declaration that rule 12(1)(b)-(f) of the 2013 Rules is ultra vires.

I would myself prefer not to express any view on the Secretary of State’s third ground of appeal (viz. that a hearing was not required even if the rejection of the ET1 was a “determination of proceedings”) or on whether rule 13(4) of the 2013 Rules could be ultra vires. On the other issues, however, I entirely agree with Bean LJ’s conclusions. Like him, therefore, I consider that the Secretary of State’s appeal should be allowed, but that the order of Laing J should be upheld on different grounds.

I agree with the order proposed by Bean LJ for the reasons he gives, but likewise express no view on the third ground of appeal (paragraph 45 above), which may require further discussion in the light of the facts of a particular case, or on the vires of Rule 13(4) (paragraph 47 above), which was not argued on this appeal.