Introduction
The number of recent appeals to the Employment Appeal Tribunal (“EAT”) about unless orders has been such that in Minnoch and others v Interservefm Ltd and others [2023] EAT 35 the EAT observed that they were ‘…too large a part of the diet of the EAT ‘. In allowing the appeal the EAT reviewed the law relating to unless orders and set out a number of key points in respect of them.
Background
Mr Minnoch and 36 other claimants brought claims pursuant to section 8 of the Employment Rights Act 1996, alleging that their employer had withheld pay for those days when those employees were on strike and had failed to identify those deductions in their pay slips. At a case management hearing the employment tribunal directed the claimant to serve on the respondent:
(a) A schedule of loss and damage for each Claimant, to include any compensatory or mitigating sums received by the Claimant from the union, and;
(b) A list of all relevant documents in the case which were in the Claimants’ possession or control, and;
(c ) Copies of those documents;
The respondent was directed to serve (three weeks later) on the Claimant:
(d) Counter schedules for each claimant;
(e) A list of all relevant documents in the respondent’s possession or control and copies of those documents which were not included in the claimants’ disclosure.
The claimants failed to comply with their directions. A list of documents was subsequently supplied by the claimants but without all the copies of those documents, nor were any any schedules of loss provided. The respondent’s representative applied for a strike out or, in the alternative, an unless order. The employment judge made an unless order for the claimants to serve all of the documents that they had been previously directed to in the earlier case management order.
Almost three hours before the unless order deadline the claimants’ solicitors emailed the tribunal. Attached to that email was a spreadsheet setting out, in four columns, the ‘hourly rates’, ‘daily rates’, ‘pay lost to strike’ and ‘strike pay from union’, along with documents of items that were in the claimants possession at that time. A few minutes later the employment judge emailed the claimants’ solicitor to point out that no list of documents had been sent, which the solicitor immediately rectified.
The employment judge subsequently struck all of the claims out. His reasons included:
(a) That the claimants had been directed to serve individual schedules of loss each and not one document for all claimants;
(b) The spreadsheet that was sent did not resemble a reasonable schedule of loss understood in professional employment tribunal practice;
(c ) The spreadsheet set out a column for ‘pay lost to strike’ but the claims were not for lost pay but for unnotified deductions, therefore the spreadsheet did not clearly communicate what sums were being claimed;
(d) The spreadsheet did not include sums received from the respondents in relation to the strike period. Despite that not having been specified by the case management order the schedule of loss must contain all the basic relevant financial information pertinent to the quantum of the claim. The employment judge was in no doubt that the reason why that information was absent was because the claimants’ solicitor had failed to obtain it in time;
(e) The list of documents was very short, obviously inadequate and appeared to have been cobbled together at the last minute;
(f) There was no explanation why the claimants did not disclose most of the relevant documents that the respondent’s solicitor had been asking for weeks and that it was obvious that there had still not been proper disclosure.
Grounds of appeal
The claimants’ three grounds of appeal were that the employment judge: failed to consider whether there was material non-compliance with the unless order; he failed to adopt a qualitative test, with a facilitative rather than punitive approach, and; he read the original case management order expansively against the party who had to comply with it.
Legal framework
In its review of the applicable legal framework, the EAT set out the key points applicable to the three distinct stages of the life of an unless order:
Stage 1 – Making an unless order
1. Care should be taken in making an unless order because of the draconian consequence of material non-compliance – unless orders are not just another type of workaday case management order.
2. It is rarely a good idea to convert a good idea a previous general case management order into an unless order – careful consideration should be given to whether it will be fit for purpose as an unless order.
3. An unless order should be drafted so that it will be easy to determine whether there has, or has not, been material compliance;
4. An unless order should be drafted so that the consequence of material non-compliance is clear – it need not necessarily result in the strike out of the entire claim – an unless order can be drafted so that failure to comply with it, or part of it, results in part of the claim being struck out.
5. Although not specifically provided for by Rule 38 ET Rules, an order could provide for a lesser sanction than strike out on non-compliance, such as a claimant being limited to reliance on the material set out in the claim form if additional information is not provided.
6. If a party is required to do more than one thing by an unless order, careful thought should be given to the consequence of partial compliance – particular care should be taken before making an order that will result in the dismissal of all claims if there is anything that falls short of full material compliance with all parts of the order.
Stage 2 – Giving notice of non-compliance
7. At this stage the employment tribunal is giving notice of whether there has been compliance – it is not concerned with revisiting the terms of the order.
8. Particularly if there has been some asserted attempt at compliance, careful thought should be given to whether an opportunity should be given for submissions, in writing or at a hearing, before the decision is taken.
9. The question is whether there has been material compliance.
10. The test is qualitative rather than quantitative.
11. The approach should be facilitative rather than punitive.
12. Any ambiguity in the drafting of the order should be resolved in favour of the party who was required to comply.
Stage 3 – Relief from sanction
13. This involves a broad assessment of what is in the interests of justice.
14. The factors which may be material to the assessment will vary considerably according to the circumstances of the case.
15. They generally include:
15.1 The reason for the default – in particular whether it was deliberate
15.2 The seriousness of the default
15.3 Prejudice to the other party
15.4 Whether a fair trial remains possible
16. Each case will depend on its own facts.
Decision
At the outset of the judgement the EAT observed that ‘A pedantic approach should not be adopted to construing everyday case management orders. The parties should just get on and comply, focusing on the purpose of the order. The parties should cooperate with each other and agree a constructive way forward if there is any doubt about the meaning of the order, to achieve the most efficient manner of compliance.’
In respect of the stage 2 decision at hand, the EAT held that:
(a) The employment judge had not directed himself to the law, in particular whether there had been material non-compliance;
(b) The original case management order was not will suited to conversion to an unless order;
(c ) The order was ambiguous about whether a single schedule for all the claimants was sufficient or whether a separate schedule for each was required.
(d) The importance given to the information being set out in separate schedules was putting form over substance, including the requirement for the schedules of loss to have been set out in a way understood by professional employment tribunal practice. The sums claimed by the claimants totalled just over £15,000, which did not call for highly polished schedules of loss as might be appropriate for high value personal injury or commercial claims;
(e) It was not obvious that the ex gratia payments made by the First Respondent were required to be deducted from the claimants’ claim, therefore the claimants were not required to guess what sums the respondent would seek to set off and set them out in their schedules of loss which, if so, would give little purpose remaining to the counter-schedules;
(f) There was no assessment of which documents each claimant had in his or her possession or control that was relevant to the dispute and that they had failed to disclose;
(g) The employment judge’s approach was punitive rather than facilitative;
(h) The employment judge read the order expansively against the parties that had to comply.
Jonathan Heard acted for the First Respondent.
You can find a copy of the judgment here.
