Williams v Real Care Agency Ltd

A tribunal may exercise its strike-out power during a hearing, but a strike-out for no reasonable prospect of success is principally a pre-hearing remedy. It will be exceptionally rare for that ground to justify ending a case part way through the evidence.

The tribunal must exercise the power consistently with reason, relevance, principle and justice. It should not decide credibility issues, or conclude that further evidence cannot affect them, before hearing material evidence that may bear on the opposing party’s account. Whether an employee actively participated in an illegal performance of an employment contract is a fact-sensitive issue and should not be determined on incomplete evidence.

The claimant appealed from the Glasgow Employment Tribunal’s dismissal of her unfair-dismissal claim. During a part-heard merits hearing, before the claimant’s cross-examination had concluded and before she had called her witnesses, the respondent sought to strike out the claim.

The Tribunal accepted three grounds: that the employment contract had been performed illegally; that the claimant lacked credibility; and that no compensatory award could be made. The claimant contended that the employer knew of, encouraged or required the timesheet practices relied on in dismissing her, and that further witnesses would support that account.

The central issue was whether the Tribunal could properly strike out the claim for having no reasonable prospect of success on incomplete evidence.

1. Appeal allowed. The Tribunal erred in law by entertaining and granting a strike-out application in the middle of a part-heard evidential hearing. Although Employment Tribunals (Constitution and Rules of Procedure) Regulations rule 18(7) permits an order at a hearing, the rule is principally designed for pre-hearing use and the discretion must be exercised consistently with reason, relevance, principle and justice.

2. A strike-out for no reasonable prospect of success is draconian because it prevents the evidence from being heard out. It is normally suitable where pleaded facts cannot, even if proved, establish the relief claimed. In contrast, a mid-hearing application based solely on the perceived strength of incomplete evidence will very exceptionally justify strike-out. It diverts the Tribunal from its principal task of determining the facts on the whole evidence and risks wrongly excluding a party from presenting the case.

3. The credibility ground could not stand. A tribunal may form provisional and even strong views of a witness, but it erred in deciding in absolute terms that no further evidence could change its view. The central credibility issue included the respondent’s evidence. Witnesses yet to be called by the claimant might materially affect the assessment of that evidence.

4. The compensation ground was also unsustainable. If dismissal were found unfair because the employer knew of the practice and treated the claimant inconsistently with others, it could not be said that a substantial compensatory award under section 123 of the Employment Rights Act 1996 was impossible.

5. Illegality was not plainly and obviously established on the incomplete material. Illegal performance defeats an employment claim only where, in addition to knowledge, the employee actively participated in that performance. The degree of participation is a question of fact. The claimant’s case that the practice was systematic and insisted upon by the employer required determination after all relevant evidence had been heard.

6. The matter was remitted to a differently constituted Tribunal for rehearing. The original Tribunal’s statement that nothing further could change its view gave rise to apparent bias. The remitted Tribunal could consider a pre-hearing review, a costs warning or a deposit order.

• Employment Appeal Tribunal: Allowed the claimant’s appeal and remitted the unfair-dismissal claim to a different Tribunal for rehearing.
• Employment Tribunal, Glasgow: In reasons delivered on 17 August 2011, struck out the claimant’s unfair-dismissal claim during a part-heard hearing and rejected the claim.