M Hilton v Power Networks Group & Manila General Services (Dissolved): 2200803/2024

EMPLOYMENT TRIBUNALS

Case No 2200803/2024

Between

M HiltonClaimant

Power Networks Group & Manila General Services (Dissolved)Respondent

Before

Employment Judge Anthony

In person for claimant

Not represented for respondent

Date 7 August 2024

JUDGMENT

The Tribunal’s judgment is that the claim for unauthorised deduction from wages is not well founded and is dismissed.

REASONS

[1]The claimant makes a claim in relation to unauthorised deduction from wages. The claimant states these relate to unpaid wages from November 2019 to present in the sum of £85,500.00.

Background

[2]The respondent has not responded to the claim.

[3]At the case management hearing on 10 May 2024, the claimant was directed to inform the Tribunal by no later than 24 May 2024 whether the claimant still wished to pursue the breach of contract claim pertaining to unpaid loans amounting to £242,000 or whether the claimant wished to withdraw the breach of contract claim with a view to pursuing the breach of contract claim in the county court where the jurisdiction limit of £25,000 does not apply.

[4]On 23 May 2024, the claimant informed the Tribunal that he wished to withdraw the breach of contract claim with a view to pursuing the breach of contract claim in the county court.

[5]On 11 June 2024, the Tribunal acknowledged the claimant’s correspondence stating that the exception to issuing a judgment dismissing the claim applied in this instance (rule 52 of The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013). Thus, the claimant's claim for breach of contract is withdrawn but not dismissed. This is because the claimant had expressed at the time of withdrawal a wish to reserve the right to bring such a further claim and the Tribunal is satisfied that there would be legitimate reason for doing so.

The Evidence

[6]The claimant gave evidence on his own behalf and no one attended on behalf of the respondent.

[7]The Tribunal was provided with: a) ET1 claim form and correspondence on the Tribunal digital file; b) Correspondence between claimant and respondent totalling 105 items; c) HSBC bank statements; d) Royal Bank of Scotland bank statements.

The Issues

[8]The issues before the Tribunal are as follows: Contract of Employment/ Contract of Service a) Who is the claimant’s contract of employment/ contract of service with? Unauthorised Deduction from Wages a) Was the claimant a worker? b) Is the unauthorised deduction from wages claim in respect of wages? c) Has the respondent paid the claimant an amount of wages less than the total amount of wages properly payable? Relevant Law Contract of Employment

Relevant Law

[9]A “contract of employment” is defined in section 230(2) of the Employment Rights Act 1996: “In this Act “contract of employment” means a contract of service or apprenticeship, whether express or implied, and (if it is express) whether oral or in writing.”

[10]A contract of employment need not be in writing and can be an oral agreement. The Tribunal will generally begin its consideration of any written terms for an indication of the intentions of the parties. Where the true intent of the parties is in dispute, it is necessary to consider all the circumstances of the case which may cast light on whether the written terms truly reflect the agreement and to do so applying the broad approach which Autoclenz Ltd v Belcher and Others

[2011] UKSC 41

describes, rather than the stricter approach that conventional contractual principles would allow. Contract of Service

[11]A contract of service exists if the following three conditions are fulfilled:(a) an obligation on a person to work personally and be paid for it;

(b) sufficiency of control for there to be an employer and employee relationship;

(c) other factors being consistent with the employer/employee relationship (see Ready Mixed Concrete (SE) Ltd v Minister of Pensions and National Insurance

[1968] 1 All ER 433

per McKenna J). Worker status

[12]A “worker” is defined in section 230(3) of the Employment Rights Act 1996: “In this Act “worker” (except in the phrases “shop worker” and “betting worker”) means an individual who has entered into or works under (or, where the employment has ceased, worked under)—(a) a contract of employment, or

(b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual; and any reference to a worker's contract shall be construed accordingly.” Findings of fact Who is the claimant’s contract of employment with?

Findings of fact

[13]The first issue for determination is with whom does the claimant have a contract of employment. Power Networks Group & Manila General Services

[14]I find from the ACAS certificate that the claimant commenced ACAS early conciliation and named Power Networks Group & Manila General Services as the prospective respondent on the ACAS certificate.

[15]In oral evidence, the claimant states that given Power Networks Group & Manila General Services is now dissolved, he does not seek to bring a claim against Power Networks Group & Manila General Services. Eduardo Sese Caunca

[16]The claimant does not name Power Networks Group & Manila General Services as the respondent in his ET1 claim form. Instead, the claimant names Eduardo Sese Caunca as the respondent in his ET1 claim form. The claimant states that Mr Caunca was the executive Chairman of Power Networks Group & Manila General Services and that is why he believes Mr Caunca is the correct respondent in this claim. The claimant states on the ET1 claim form that he has been employed by Mr Caunca since 17 May 2017 and that the employment is continuing. The claimant states that the present claim is only being pursued against Mr Caunca. Power Networks (GB) Limited

[17]I find the information provided by the claimant in the ET1 claim form is contradicted by his oral evidence. In oral evidence, the claimant states that between May 2017 and November 2019, he was employed by Power Networks (GB) Limited on a salary of £1,500.00 a month. The claimant states that Power Networks Group & Manila General Services is the parent company to Power Networks (GB) Limited.

[18]I find from the claimant’s Royal Bank of Scotland bank statements that regular payments of £1,500.00 were paid into his bank account between February and August 2018. The description accompanying these payments were variously labelled as “pay”, “payment” and “loan rep”. Majority of the payments were paid by Power Networks (GB) Limited with some payments made from the account with the name of “Caunca Es". The claimant states that for the months where there were no bank transfers, he was paid in cash.

[19]Although there are various payments of £1,500.00 from Power Networks (GB) Limited and Mr Caunca, I find it is unclear what these payments relate to. I find it is unclear whether these relate to wages for work carried out under a contract of employment or whether these were for the repayment of the loan that he states he provided Mr Caunca. I find that one payment of £1,500.00 has the label “loan rep”. The other labels “pay” and “payment” does not, of itself indicate that these were for wages.

[20]The claimant states he does not have a written contract of employment. He states that the contract he has was a verbal contract with Mr Caunca to carry out work every month. Furthermore, the claimant states he was not issued with any payslips. The claimant states that he was however issued with an email every time he was paid. The claimant confirmed in oral evidence that he has not provided evidence of these emails. I find this curious given the extensive correspondence the claimant has painstakingly provided between himself and Mr Caunca. The absence of evidence relating to any payslips or emails confirming these were wages paid to him would strongly indicate that these were not wages. If these were indeed payments for wages, it would be reasonable to expect some correspondence referencing wages within the extensive documentary evidence provided to the Tribunal.

[21]I find there is nothing to indicate the claimant worked under a contract of employment for Power Networks (GB) Limited from May 2017 to November 2019. It is clear the claimant had some financial relationship with Power Networks (GB) Limited. However, without more, I am not satisfied that any work was carried out under a contract of employment or contract of service. In any event, I find the claimant has not brought a claim against Power Networks (GB) Limited. The claimant states he does not intend to. I find the claimant may have good reasons for not doing so given that Power Networks (GB) Limited went into voluntary liquidation in November 2019. Power Networks Holdings Limited

[22]It is the claimant’s oral and written evidence that post November 2019, he was asked by Mr Caunca to set up a new company, Power Networks Holdings Limited. The claimant states in oral evidence that Mr Caunca directed the claimant to set up the company so that the company could be left to Mr Caunca’s two sons. The claimant states that he continues to work for Mr Caunca but he has not been paid since November 2019.

[23]The claimant described in oral evidence the work he continues to do for Mr Caunca, in the name of the new company, Power Networks Holdings Limited. These include running an office, responding to emails and attending meetings. The claimant states that Power Networks Holdings Limited is presently involved in education projects in Guyana and energy greening project in Grenada, amongst many other international projects. The claimant states in oral evidence that at the date of the hearing, he is still working for Mr Caunca.

[24]I find from the claimant’s Royal Bank of Scotland bank statements that there were two sums of money paid from the account with the name of “Caunca Es" with the description “pay”. The sums paid were £5,000.00 on 14 January 2020 and £2,000.00 on 21 January 2020. As before, it is unclear from the description whether these relate to wages for work carried out under a contract of employment or whether these were for the repayment of the loan that he states he provided Mr Caunca.

[25]The claimant states that he sends a monthly email to Mr Caunca to update Mr Caunca as to how much is owed. The claimant concedes that Mr Caunca does not acknowledge or respond substantively to these emails regarding wages owed. The only email in which there is a response from Mr Caunca about the amounts claimed is the email dated 31 August 2023. In this email, I find that Mr Caunca asked for a breakdown of the claimant’s calculation. The claimant responded on 31 August 2023 stating that the wages owed were £69,000 at £1,500.00 per month and that the outstanding loan was £242,852.00. Although there was an initial response from Mr Caunca asking for a breakdown, I find Mr Caunca did not acknowledge the email, did not acknowledge the claim about the wages owed and did not accept liability for the claim.

[26]When questioned by the Tribunal as to why the claimant has not sought to bring a claim against Power Networks Holdings Limited, the claimant states that Power Networks Holdings Limited does not have any assets and that he is not in dispute with Power Networks Holdings Limited. He also states that he does not receive a salary from Power Networks Holdings Limited. He states that he continues to keep Power Networks Holdings Limited going on behalf on Mr Caunca.

[27]I find from a search of Companies House that the sole director of Power Networks Holdings Limited is the claimant. I find there is simply nothing to indicate that Mr Caunca is in any way connected to Power Networks Holdings Limited. Analysis

[28]I find the claimant’s oral evidence regarding who he had a contract of employment is plainly different to the information the claimant gave on the ACAS certificate and the ET1. The discrepancy in the claimant’s evidence causes me significant concern regarding the veracity of his claim.

[29]As stated above, Power Networks Group & Manila General Services is named as the employer on the ACAS certificate. However, the claimant accepts the company is dissolved and he cannot bring a claim against the company named on the ACAS certificate.

[30]The claimant named Mr Caunca as the respondent in his ET1 claim form and claims that he has been employed by Mr Caunca since 17 May 2017 until present. However, I find the information presented in the ET1 claim form was directly contradicted by the claimant’s own oral evidence where he stated he was employed by Power Networks (GB) Limited from May 2017 until November 2019. Although he claims that he was employed by Mr Caunca after November 2019, I find this is not supported by his ET1 claim form which does not suggest there is a break in the continuity of any employment relationship.

[31]I have considered whether there is anything to indicate the claimant worked under a contract of employment or contract of service with Mr Caunca post November 2019. I find that for a contract of service to exist, three conditions have to be fulfilled:(a) an obligation on a person to work personally and be paid for it;

(b) sufficiency of control for there to be an employer and employee relationship;

(c) other factors being consistent with the employer/employee relationship (see Ready Mixed Concrete (SE) Ltd v Minister of Pensions and National Insurance

[1968] 1 All ER 433

per McKenna J).

[32]I find from the claimant’s own evidence that he has not been paid for any work he alleges did for Mr Caunca since November 2019. Furthermore, I find there is simply nothing to indicate that Mr Caunca has sufficiency of control over the claimant for there to be an employer and employee relationship. I find the claimant simply communicates with Mr Caunca about monies owed. I find there is nothing within the correspondence before the Tribunal to suggest Mr Caunca provides work and that the claimant carries out the work at Mr Caunca’s direction. I find there is nothing to indicate from the extensive correspondence before the Tribunal that Mr Caunca has any control over the claimant for there to be an employer and employee relationship. Overall, I find there is simply nothing to indicate that the relationship between the claimant and Mr Caunca is consistent with an employer/employee relationship.

[33]More significantly, I find from the claimant’s oral evidence that the work he has carried out since November 2019 is for and on behalf of Power Networks Holdings Limited of which he is the sole director. The evidence would strongly indicate that the claimant works for Power Networks Holdings Limited, a company in which he had set up, and in which he is the sole director. As stated above, I find there is simply nothing to indicate that Mr Caunca is a director or is in any way connected to Power Networks Holdings Limited.

Conclusion

[34]I conclude that since November 2019, there is simply nothing to indicate the claimant worked under a contract of employment or contract of service whether express or implied, oral or in writing with Mr Caunca.

[35]For all the reasons set out above, the claim must fail. In light of my findings of fact and analysis, I do not need to consider whether the claimant satisfied the definition of a “worker” as set out in the Employment Rights Act 1996. Neither do I need to consider whether any deductions (authorised or otherwise) were made. The claim for unauthorised deduction from wages is not well founded and is dismissed.