Sema UK Ltd v Haddock

A respondent who has not entered a notice of appearance is not thereby deprived of the right to appeal. The restriction is confined to the restrictions expressly imposed by the applicable procedural rules. The Employment Appeal Tribunal should nevertheless screen the merits appeal at a preliminary stage. If there is a reasonably arguable defence, the appeal should proceed; otherwise it may be dismissed.

An employment tribunal is not required in every case to invite an unrepresented respondent present at the hearing to regularise a failure to enter an appearance. The discretion must be exercised justly and with regard to prejudice. Damages for psychiatric injury, injury to feelings and aggravated damages must be separately justified, without double counting.

Mr Haddock, an employee of Sema UK Ltd, brought disability discrimination proceedings after suffering psychiatric illness and being moved to a less prestigious role. Sema knew of the proceedings but failed to enter a notice of appearance. It attended the hearing without applying to participate, and the Employment Tribunal upheld the claim and awarded £65,000.

The Employment Tribunal later refused an application to extend time for entering an appearance. The Employment Appeal Tribunal dismissed the procedural appeal and held that it had no jurisdiction to consider the merits appeal. Sema sought permission to appeal, raising the procedural issue and challenges to the three heads of damages.

1. Procedural appeal. The Employment Tribunal had not erred in refusing an extension of time. Its assessment of Sema’s explanation as demonstrating incompetence and complacency was supported by the evidence, and its balancing exercise properly considered the substantial delay and prejudice to Mr Haddock.
2. The principle in Tull & Ors v Severin [1998] ICR 1037 should not be elevated into a rule requiring a tribunal, in every case, to invite a respondent present without a notice of appearance to apply to participate. The respondent’s status as representatives of a substantial international company, their failure to apply to be heard, and the absence of material suggesting that their participation would have affected the result justified the tribunal’s approach.
3. Merits appeal. The Employment Appeal Tribunal erred in concluding that it had no jurisdiction to consider the merits appeal. Following Charlton v Charlton Thermosystems (Romsey) Ltd [1995] ICR 56, rule 3(2) of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 1993 imposed only the restrictions expressly stated. It did not prevent an appeal by a respondent who had failed to enter an appearance. The Employment Appeal Tribunal should first determine whether there was any reasonably arguable defence, allowing a full hearing if there was one.
4. The £35,000 award for psychiatric injury was not shown to be arguably erroneous. The earlier illness was historical context; the compensable injury was caused by the later discriminatory treatment. The awards of £20,000 for injury to feelings and £10,000 aggravated damages were, however, arguably insufficiently reasoned and potentially involved double counting.
5. Permission to appeal was therefore granted only in respect of the £20,000 and £10,000 awards. The court strongly encouraged alternative dispute resolution.

• Court of Appeal (Civil Division): permission to appeal the Employment Appeal Tribunal’s decision was granted only in relation to the awards for injury to feelings and aggravated damages.
• Employment Appeal Tribunal: the procedural appeal was dismissed and the Tribunal held that it had no jurisdiction to entertain the merits appeal.
• Employment Tribunal: the disability discrimination complaint was upheld and damages of £65,000 were awarded.