323

I.C.R. Reg. v. Jones (C.A.)

LORD WIDGERY C.J. delivered the judgment of the court, in which he
stated the court's reasons for holding that there was no point of law of
general public importance. The application was therefore dismissed.

Solicitors: Walker, Smith & Way, Chester; Casson & Co., Salford;
Director of Public Prosecutions.
L. N. W.
B

[COURT OF APPEAL]

C
ABERNETHY v. MOTT, HAY AND ANDERSON

[Ref. No. 3500/72]

1974 Feb. 5, 6 Lord Denning M.R., Cairns and James L.JJ.

n Industrial Relations—Unfair dismissal—Redundancy—Employers

dismissing engineer, alleging redundancy—No redundancy
situation—Employee's claim for compensation for unfair dis-
missal resisted by employers on alternative ground that dis~
missal was fair—Industrial tribunal findings of no redundancy
but that employee dismissed for reason related to his
" capability "—Whether employer entitled to justify dismissal
on ground other than that originally given to employee—
E Industrial Relations Act 1971 (c. 72), s. 24 (1) (2) (a) ( 6 ) 1
From 1950 the applicant, a well qualified civil engineer,
was employed by the defendant firm on large scale projects
and from 1964 worked from their head office. At the end of
1971 the employers suggested that the applicant be seconded
to the Greater London Council on a project which involved
working and living on the site. He declined the offer, saying
that he preferred to work from head office. On February 25,
F 1972, the employers gave him notice to terminate his employ-
ment on March 31 on the ground of "redundancy." They
offered him redundancy payment of £850 and a further ex
gratia payment of £750. He declined those payments and began
1
Industrial Relations Act 1971, s. 24: "(1) In determining for the purposes of
this Act whether the dismissal of an employee was fair or unfair, it shall be for the
employer to show—(a) what was the reason (or; if there was more than one,
G the principal reason) for the dismissal, and (b) that it was a reason falling within the
next following subsection, or some other substantial reason of a kind such as to
justify the dismissal of an employee holding the position which that employee held.
(2) In subsection (1) (b) of this section the reference to a reason falling within this
subsection is a reference to a reason which—(a) related to the capability or qualifica-
tions of the employee for performing work of the kind which he was employed by
the employer to do, . . . (6) Subject to subsections (4) and (5) of this section, the
determination of the question whether the dismissal was fair or unfair, having regard
to the reason shown by the employer, shall depend on whether in the circumstances
H he acted reasonably or unreasonably in treating it as a sufficient reason for dismissing
the employee; and that question shall be determined in accordance with equity and
the substantial merits of the case. (7) In this section, in relation to an employee,—
(a) 'capability' means capability assessed by reference to skill, aptitude, health or
any other physical or mental quality; . . . "
324
Abernethy v. Mott, Hay & Anderson (C.A.) [1974]
proceedings for compensation for unfair dismissal under
the Industrial Relations Act 1971. The employers resisted the A
claim on the ground (a) of "redundancy"; and/or (b) the
incapability of the employee " for performing work of the kind
which he was employed by the employer to do " within section
24 (2) (a) of the Act. The industrial tribunal found that there
was no redundancy situation but also found on the evidence
that the employers had discharged the burden on them of
establishing a reason for the dismissal relating to the applicant's
capability for performing work of the kind which he was B
employed to do, within section 24 (2) (a) and (7) (a) of the Act,
so that his dismissal was not unfair; and they dismissed his
claim for compensation. His appeal to the National Industrial
Relations Court was dismissed.
On appeal by the applicant: —
Held, dismissing the appeal, (1) that though the employers
had erred in law in telling the applicant that his dismissal was _
by reason of redundancy, the wrong legal label did not matter ^
so long as there was a set of facts (per Lord Denning M.R.,
made known to the employee before or when he was given
notice) which the tribunal could find was the principal reason
for the dismissal.
(2) That on the evidence of the custom and practice in civil
engineering and the applicant's contract of employment the
tribunal was entitled to find that the applicant's unwillingness _
to work other than from head office " related to " his capability "
for doing work of the kind he was employed to do within
section 24 (2) (a) of the Act of 1971 and was the principal
reason for his dismissal. Therefore the dismissal was " fair "
within section 24 (6) and the applicant was not entitled to any
compensation.
Decision of National Industrial Relations Court affirmed.
E
No cases are referred to in the judgments.
The following case was cited in argument:
Hindle v. Percival Boats Ltd. [1969] 1 W.L.R. 174; [1969] 1 All E.R.
836, C.A.

APPEAL from National Industrial Relations Court. F

The applicant, Ian Abernethy, a civil engineer, applied to the industrial
tribunal sitting in London for a decision whether or not he had been
unfairly dismissed under section 22 of the Industrial Relations Act 1971.
He claimed in answer to the printed question on the form:
" If you were dismissed, what in your opinion was the real reason for
your dismissal? " G
" I can think of no reason for my dismissal unless my former
employers have resented the fact that I have sought to advance myself
within the company and in the past have declined posts which would
have the reverse effect."
In further written remarks he expressed the strong belief that there was „
work available for him within the company and that he was not redundant;
and he claimed in the alternative compensation under the Redundancy
Payments Act 1965.
 325
I.C.R. Abernethy v. Molt, Hay & Anderson (C.A.)
The employers, Mott, Hay and Anderson, resisted the claim, and gave
"• as the reason for the dismissal of the applicant (a) redundancy; and/or (b)
the incapability of the employee for performing work of the kind which he
was employed by the employer to do. They gave as the grounds for resist-
ing the applicant's claim that when the applicant refused the offer of a
resident engineering post whereby he was to be seconded to the Greater
London Council on work to raise the banks of the River Thames:
B " (a) . . . there was no other work of a restricted responsibility nature
which the respondents could offer. Accordingly he was dismissed by
reason of redundancy, (b) The respondents contend in the alternative
that the applicant was fairly dismissed within the meaning of section
24 (2) (a) of the Act of 1971."
* »
The tribunal made findings adverse to the applicant. He appealed to
C the National Industrial Relations Court (Sir John Donaldson (President),
Mr. A. G. Brooks and Sir Reginald Griffiths) which on February 28, 1973,
dismissed his appeal.
The applicant appealed on the grounds (1) that inasmuch as (a) the
employers had purported to dismiss him for redundancy and (b) the tribunal
held that he was not redundant, the court failed to hold that he was un-
j) fairly dismissed; (2) that in considering whether the reason for his dismissal
related to his capability the court failed to confine itself to his capability
for "performing work of the kind which he was employed to d o " but
considered his capability for a superior job to which he could be promoted;
(3) that the court wrongly held that it was a term of his contract of employ-
ment that he could be required to work " on site"; (4) that the court
wrongly held or accepted that once the reason or the principal reason given
E by the employers for the dismissal, namely, redundancy, had been rejected
by the tribunal, some other reason, namely, lack of capability, on which
the employers did not rely at the time of dismissal could be treated as a
"sufficient reason" for dismissing him; alternatively that the employer
could act " reasonably " in treating such other reason as a sufficient reason
under section 24 (6) of the Industrial Relations Act 1971; (5) that the court
p wrongly introduced a false concept of " quasi-redundancy" or, if there
were such a concept, the court wrongly held that it could constitute " some
other substantial reason of a kind such as to justify the dismissal" under
section 24 (1) (b) of the Act of 1971.
The facts are stated in the judgment of Lord Denning M.R.

Peter Pain Q.C. and W. S. Getz for the applicant. The appeal raises
G two points: (1) whether an employer who has dismissed an employee for
redundancy can at a later stage justify the dismissal on the ground that he
really dismissed him for lack of capability within section 24 (2) (a) and (7)
of the Industrial Relations Act 1971; and (2) whether lack of "promota-
bility " can amount to lack of capability which in section 24 (2) (o) is
qualified as " capability . . . of the employee for performing work of the
U kind which he was employed . . . to do, . . ." The employers having given
redundancy as the reason even claimed a contribution from the Redundancy
Fund. The employers' reason for dismissal should remain the same
throughout the proceedings. Redundancy was the case which the applicant
326
Abemethy v. Mott, Hay & Anderson (C.A.) [1974]
came prepared to meet; if the reason given had been lack of capability the
A
applicant's case would have been quite different. The tribunal found in
the applicant's favour on the redundancy point but then directed its atten-
tion to the issue of lack of capability and decided that against the applicant.
Capability and redundancy are direct opposites. One of the unsatisfactory
aspects of this case is that the applicant claimed that he was not redundant
and having succeeded on that he now finds himself the subject of a worse
stigma, that of being thought to be incapable. [Reference was made to B
Hindle v. Percival Boats Ltd. [1969] 1 W.L.R. 174.]
An employer seeking to say that the dismissal was fair must discharge
the burden of showing that the reason was one of the matters specified in
section 24 (2) and the tribunal must then decide whether " in the circum-
stances [the employer] acted reasonably " in treating the reason as suffi-
cient: see section 24 (6). The purpose of the legislation on unfair
dismissal was to give the employee a right which he did not have before ^
—a right under the Act to claim compensation for unfair dismissal. It
would be surprising if an employer could call the reason for dismissal
" redundancy " and then say before the tribunal that he made a mistake in
law and produce a reason which he has had locked in his bosom and has
not made known to the applicant. An employer cannot change his mind at
the last moment and use a different set of facts to justify the substitute jj
label for dismissal. " Unfair " in the Act of 1971 is used as a term of art:
see section 116 (1) and (3) which provide a sort of parallel to contributory
negligence by providing that in considering compensation for unfair dis-
missal the tribunal can look at the employee's conduct and may reduce his
compensation accordingly. If there is to be a trial, the facts on which the
parties rely should be pleaded before the trial. Though lack of capability
was put in the alternative in the employers' written defence the main case E
which the applicant expected to meet was redundancy. The time at which
one looks at the reason for dismissal is the time of the dismissal. The
tribunal must first consider what the employer treats as the reason and if
he gives a reason which comes within the Act the tribunal then considers
whether in all the circumstances it was reasonable. If an employer fails
under section 24 (1) he never gets to section 24 (6). p
Secondly, if the employers are entitled to change their minds the ques-
tion arises whether in the present case " promotability " constitutes capa-
bility. The employers are a very progressive firm and may well expect that
an engineer employee should be capable of promotion to positions of great
responsibility. But the Act does not say that an employee should be fit
for promotion. If a man is doing the job he was employed to do compe-
tently, his unfitness for promotion is not a ground for fair dismissal. The G
Act protects him so long as he does the job he was employed to do
properly. The tribunal appear to be equating " capability " with " pro-
motability "; that is not a ground for fair dismissal under the Act.
Richard Yorke Q.C. and Anthony Grabiner for the employers were
not called upon.

LORD DENNING M.R. Mr. Ian Abernethy is a civil engineer. He read

engineering at St. Andrew's. In 1950 he took an honours degree. Since
that time he has been employed as a civil engineer with Mott, Hay and
 327
I.C.R. Abernethy v. Mott, Hay & Anderson (C.A.) Lord Denning M.R.
Anderson, a firm of the highest standing. They specialise in bridging and
" tunnelling. Mr. Abernethy is a Fellow of the Institute of Civil Engineers;
a Fellow of the Institute of Structural Engineers and a Fellow of the
Institute of Arbitrators. After 22 years' service Mr. Abernethy was given
notice to terminate his services. The notice was given on February 25,
1972, and expired on March 31, 1972. The firm stated that they dismissed
him for redundancy. On that basis the redundancy payment would amount
B to some £850. But the firm offered to increase it by making an ex gratia
payment to him of another £750. Mr. Abernethy was not at all satisfied
with the offer. He felt that he had been unfairly dismissed. So he did not
accept those payments. He went to the industrial tribunal. He alleged
that he had been unfairly dismissed and claimed compensation. The indus-
trial tribunal found that his claim had not been made out. They dismissed
the claim. On appeal, the industrial court did the same. Now he appeals
^ to this court.
It must be remembered in all these cases that the appeal from the
tribunal is only on law. There is no appeal on fact. Mr. Pain, who has
appeared for Mr. Abernethy, takes two points. The first point is that
Mr. Abernethy was told that he was dismissed for redundancy. Yet it
turns out, that when the matter is properly investigated, there was not a
D redundancy situation. He was, in truth, dismissed for other reasons. Mr.
Pain submits that the employers, having committed themselves to the reason
of redundancy, cannot afterwards go back on it and rely on another reason.
The second point made by Mr. Pain is that the real reason for his dismissal
was because the employers thought that he was not fit to be promoted to a
higher grade. That, says Mr. Pain, is not a sufficient reason for dismissing
him. It was therefore an unfair dismissal.
Now for the facts. It is quite plain that from 1950 Mr. Abernethy was
engaged on important work for the firm on various sites, such as the
Dungeness generating station, the bridge over the Tamar and a cantilever
bridge at Newport in Monmouthshire, a bridge at Newcastle-upon-Tyne,
and on the Blackwall Tunnel. But from 1964 he was not working on
distant sites. He was engaged on work which he could do from head
F office. One was the Dartford Tunnel. Another was the Cringle Dock
project. In 1971 the work at the Cringle Dock was coming to an end.
There was not much for him to do in connection with it. The partners
considered on what work they could employ him. They had no more work
which he could manage from head office. The only suitable work which
they could find for him was in a scheme for raising the banks of the River
:Q Thames. They thought that he should be seconded to the Greater London
Council for it. That meant his going to the site and working there. Mr.
Abernethy was not willing to go out from head office to work on site. He
felt that his place was head office. So he refused to accept that offer which
was made to him. In those circumstances the partners, not having any
suitable niche for him, decided that they must dismiss him. I will read two
letters which led up to his dismissal. On November 17, 1971, Mr. Bartlett
** wrote to him and said:
"Since seeing you I have discussed your position with my partners
and we have come to the conclusion that secondment to the G.L.C.
328
Lord Denning M.R. Abernethy v. Mott, Hay & Anderson (C.A.) [1974]
for their bank raising scheme is the only prospect open to you with
A
the firm. In the circumstances, unless you are willing to accept this
appointment, you should look for a post elsewhere. As discussed with
you, it is clear that you are not advancing within the firm in a manner
commensurate with your age and ability and I feel certain that a move
would be very much to your benefit. We must have your final answer
as to the G.L.C. secondment by Friday morning."
He was unwilling to go. So eventually on February 25, 1972, the
manager wrote and said to him:
" It is with regret that I have to confirm the advice given to you at the
discussions at the end of last year with Dr. Megaw, Mr. Bartlett and
myself that, following an overall review of our staff resources, we must
declare you redundant on March 31, 1972, your services to terminate
on March 31, 1972. . . . Your particular interests and experience of C
multi discipline projects make it impossible to absorb your services
into the current and anticipated work of the firm, and your present
appointment to the Cringle Dock project having now terminated."
So his employment came to an end. As I said, he refused the redund-
ancy payments. He claimed unfair dismissal. When he put his case to
the tribunal, he said:
" I can think of no reason for my dismissal unless my former em-
ployers have resented the fact that I have sought to advance myself
within the company and in the past have declined posts which would
have had the reverse effect."
In their answer, the employers, when they were asked what was the E
reason for the dismissal, said: " (a) Redundancy; and/or (b) the incapability
of the employee for performing work of the kind which he was employed
by the employer to do."
During the course of the hearing before the tribunal it became plain
that the employers were mistaken in their view of the law. He was not
redundant; there was plenty of work within the firm for people of his „
standing and ability. The firm was recruiting new staff of this very kind.
The truth was that he was unsuitable and could not be fitted in. The
employers, it seems to me, were mistaken, but quite reasonably mistaken.
Although they made a mistake in thinking he was redundant, it was quite
an honest opinion.
In order to show the real reason for his dismissal, we have read many
reports and assessments which were made every year upon him by the G
partners in the firm. These show that he had a lot of very good points.
He was hard working, conscientious, thorough, interested in new techniques.
His relations with clients were very satisfactory. He was an effective
routine engineer. All those good things are said in the reports about him.
But, on the other hand, the partners noted that he was below average; he
was of limited potential; he could only take tasks with limited responsi- JJ
bility; he was immature; not adaptable. They could not fit him in any-
where. They thought he was not as good as when he first joined them
perhaps 20 years before. The particular word which was used about him
 329
I.C.R. Abernethy v. Mott, Hay & Anderson (CA.) Lord Denning M.R.
was that he was "inflexible." He was told so. Dr. Megaw, the senior
partner, gave evidence:
" I saw [the applicant]. I had read his file. I emphasised that he was
redundant because there was no suitable work available. He persisted
there must be. His redundancy arose directly out of that assessment.
I made it clear if no partner could find a niche for him he was
redundant and I would not overrule them. He was inflexible in refus-
B ing to accept any job other than one at head office in Croydon. He
was inflexible in refusing to accept. He had shortcomings. He was
inflexible in every aspect. See his assessment. I strongly recom-
mended he seek other employment, as not making progress, for his
own good. I told him he was to be made redundant. He would do
better elsewhere. He would get a better salary. He chose to acquire
Q qualifications which were not particularly useful for [Mott, Hay and
Anderson]. He turned away from our mainstream."
Those were the principal reasons in the mind of Mott, Hay and Anderson.
I turn now to the first point of law which Mr. Pain raises. The employer
has under the Industrial Relations Act 1971 to " show " the reasons for the
dismissal. That is clear from section 24 (6). It must be a reason in
p existence at the time when he is given notice. It must be the principal
reason which operated on the employers' mind: see section 24 (1) (a). It
should, I think, be known to the man already before he is given notice, or
he must be told it at the time. But I do not think that the reason has got
to be correctly labelled at the time of dismissal. It may be that the
employer is wrong in law as labelling it as dismissal for redundancy. In
that case the wrong label can be set aside. The employer can only rely on
E the reason in fact for which he dismissed the man, if the facts are suffi-
ciently known or made known to the man. The reason in this case was—
on the facts—already known or sufficiently made known to Mr. Abernethy.
The wrong label of " redundancy " does not affect the point.
The second point is whether the reason here was such as to justify the
dismissal. Under section 24 (2) (a) a reason would be sufficient if it
p " related to the capability or qualifications of the employee for performing
work of the kind which he was employed by the employer to do." And
" capability " is stated in section 24 (7) to mean " capability assessed by
reference to skill, aptitude, health or any other physical or mental quality."
In this particular case the reason was the inflexibility of Mr. Abernethy
and his lack of adaptability. That seems to me to come within his aptitude
and mental qualities. He had not the capability for performing the work
G which he was employed to do. That was a reason sufficient to justify his
dismissal.
This morning Mr. Pain raised a further point. He submitted that the
employers were not entitled under the contract to require Mr. Abernethy
to go out on the site: and that he was entitled to say he would only work in
head office. That seems to me entirely mistaken. The tribunal found that
TJ his employment as an engineer required him to go out on site when the
work demanded it.
Mr. Pain further suggested that the reason why he was dismissed was
because he had reached the limit of his ability and was not fit to be
 330
Lord Denning M.R. Abernethy v. Mott, Hay & Anderson (C.A.) [1974]
promoted to a higher grade. That might not be sufficient to justify his
dismissal. But it is clear that that was not the real reason here. The A
principal reason was his inflexibility, his lack of adaptability and his limited
potential. At all events, the tribunal and the National Industrial Relations
Court so found. I can find no error in point of law in anything that was
done. The tribunal inquired into the case most carefully. They gave very
comprehensive grounds for the decision. I think they covered everything
very well. I would dismiss the appeal. B

CAIRNS L.J. I agree that this appeal fails. A reason for the dismissal
of^ an employee is a set of facts known to the employer, or it may be of
beliefs held by him, which cause him to dismiss the employee. If at the
time of his dismissal the employer gives a reason for it, that is no doubt
evidence, at any rate as against him, as to the real reason, but it does not _,
necessarily constitute the real reason. He may knowingly give a reason
different from the real reason out of kindness or because he might have
difficulty in proving the facts that actually led him to dismiss; or he may
describe his reasons wrongly through some mistake of language or of law.
In particular in these days, when the word " redundancy " has a specific
statutory meaning, it is very easy for an employer to think that the facts
which have led him to dismiss constitute a redundancy situation whereas D
in law they do not; and in my opinion the industrial tribunal was entitled
to take the view that that was what happened here: the employers honestly
thought that the facts constituted redundancy, but in law they did not.
So the reason for the dismissal was not redundancy but something else.
The tribunal found that the principal reason for the dismissal related to
the capability of the applicant for work of the kind which he was employed g
to do. Now what was the kind of work which he was employed to do?
It was common ground that he was employed as a civil engineer, and the
industrial tribunal found that he was employed on the terms that he could
be transferred between site and head office if the respondents so desired.
Mr. Pain contends that that finding is inconsistent with a statement a little
earlier in the decision of the industrial tribunal, where they said:
" We find, it is the custom and practice in the civil engineering industry
for a civil engineer to regard his employment as employment from job
to job."
Now if that meant that the employment as a civil engineer terminated at
the end of any particular job and that there was a fresh contract when a
fresh job was entered on, that seems to me to cut away the very foundations Q
of the applicant's case here; because there is no suggestion that he was
dismissed in the middle of a job; and therefore the question of dismissal
and of unfair dismissal would not arise at all. But in my view that is not
what the tribunal intended by that finding. It would be inconsistent with
the evidence on both sides, and inconsistent with the later findings in their
own decision. I think what they meant was simply that it was the custom „
of the trade which was applicable here that when one job came to an end
the employee could be directed to another job, in the general class of work
for which he was employed, at the option of his employer. If that is so,
 331
I.C.R. Abernethy v. Mott, Hay & Anderson (C.A.) Cairns LJ.
then the work which the applicant was employed to do was work at head
office or on site at the employers' option. On this basis there was ample
evidence to support the finding of the tribunal that the principal reason for
his dismissal related to the capability of the applicant for work of the kind
that he was employed to do. It is true that some of the criticisms of the
applicant's qualities referred to capacity for promotion. But there was
abundant material showing him to be of limited capability for his current
B work. I am quite unable to take the view that, because the partners in
the firm gave favourable reports on the applicant for the purposes of his
application for membership of professional bodies, the adverse comments
made on his capacities in internal reports and in evidence were untrue.
Now, the only work which the applicant at the material time was willing to
do was work at head office. That was work of one of the kinds which the
applicant was employed to do; and the reason why he was not given such
work was because of the limitation of his capabilities. Those circum-
stances, according to the finding of the tribunal, constituted the principal
reason for his dismissal, and in my opinion it is impossible to say that that
reason did not relate to his capability for work of the kind which he was
employed to do.
The only remaining question was whether the dismissal was fair in the
D sense defined in section 24 (6) of the Act. The tribunal found that it was
and there are no grounds on which that finding could be disturbed.
I therefore agree that the appeal should be dismissed.

JAMES L.J. I agree that the appeal should be dismissed. It is no

discourtesy to Mr. Pain's helpful argument if I say I do not think any useful
„ purpose could be served by my adding any further reasons of my own.

Appeal dismissed with costs in Court of

Appeal but not in other courts.
Leave to appeal refused.

Solicitors: Clinton Davis & Co.; Slaughter & May.

F
M. M. H.