N Wahid v Steel Fort Security Ltd (in voluntary liquidation): 2301645/2022
EMPLOYMENT TRIBUNALS
Case No 2301645/2022
Between
N WahidClaimantSteel Fort Security Ltd (in voluntary liquidation)Respondent
Before
Employment Judge HamourIn person for claimantNot represented for respondentDate 22 November 2022
JUDGMENT
The claimant’s claim of unauthorised deductions from wages succeeds. The respondent is ordered to pay the claimant the sum of £1,338.50, without any deduction from this sum in respect of CIS payments.
REASONS
[1]The Respondent was a private security company, said by the Claimant to work on construction sites. The Respondent is now insolvent.[2]The Claimant was engaged by the Respondent as a Gate Man / Door Supervisor on a construction site in Leatherhead. His exact dates of engagement are uncertain, but he commenced work around September 2021 and worked his last shift around November 2021. Respondent status[3]The Respondent company is insolvent.[4]The Tribunal received confirmation, by email of 7 July 2022, from Absolute Recovery Limited, that the respondent entered into Creditors’ Voluntary Liquidation on 16 May 2022, with Stephen Penn of Absolute Recovery Limited being appointed as Liquidator. Copies of the certificate of appointment and resolutions were provided.[5]The Secretary of State for Business, Energy & Industrial Strategy, confirmed that Steel Fort Security Limited is insolvent within the meaning of sections 166 and 183 of the Employment Rights Act 1996 (“ERA”), having gone into Creditors Voluntary Liquidation on 16 May 2022.[6]The Liquidator and the Secretary of State each confirmed that they would not attend or be represented at the hearing, and would await the Tribunal’s Judgment. As I am satisfied that they were sent notice of the hearing, I therefore decided to proceed with the hearing in their absence.
The Issues
[7]The Claimant was not paid for all shifts worked, and claims unlawful deduction from wages. The Respondent has admitted that wages are owed, but there is dispute as to the amount and calculation of the sums due, which are to be determined by the Tribunal.
The Evidence
[8]There was no hearing bundle or witness statements. I had before me the ET1, an ET3 filed by the Secretary of State, a letter of 20 April 2022 from Steel Fort, and an email of 21 December 2021 from the Claimant to the Respondent.[9]The Secretary of State confirmed that the grounds of resistance in its ET3 were to serve as its written submissions for the hearing.[10]The claimant gave oral evidence-in-chief.
The Facts
[11]The Secretary of State’s ET3 says that it has not received the information from the Insolvency Practitioner to verify the Claimant’s claim for payments from the National Insurance Fund, and has had no alternative but to reject the claim for payment on that basis.[12]The letter from the Respondent of 20 April 2022 calculates the Claimant’s unpaid wages as £898.50, based on: 145 hours @ £10.50 per hour = £1,522.50 LESS 20% CIS deductions at source – (£304.50) PLUS 12 days travel allowance at £20 per day - £240 Total payable (net) - £1,458. Balance due to claimant = £898.50[13]The Claimant, in his email to the Respondent of 21 December 2021, calculated his unpaid wages as £1,203, based on: 145 hours @ £10.50 per hour = £1,522.50 PLUS 12 days travel allowance at £20 per day - £240 Total payable - £1,762.50 Balance due to claimant - £1,203[14]It is common ground between the parties that the Claimant’s rate of pay was £10.50 per hour, that he received £559.50 in part payment of wages due, and that he was entitled to a travel allowance of £20 per day. However, in his evidence, the Claimant disputed applicability of the CIS deduction stated by the Respondent, and sought to correct the number of hours for which pay was due.[15]The Claimant was not given any written contract, but was informed verbally by Mr Drake, CEO of the Respondent, that he would be paid on a weekly basis. This did not occur.[16]The Claimant received a payment from the Respondent in the amount of £559.50 on 22 November 2021. He did not receive any pay statement of explanation of how that payment had been calculated, or to which shifts it related. The Claimant stated that he responded to this payment by sending an email to the Respondent saying that the amount was incorrect, but that email was not available to put before me.[17]With the Claimant’s email of 21 December 2021, he attached screenshots of a timetable showing shifts which he had worked. These showed shifts on: 15-17 Sep 22-24 Sep 1-5 Nov 8-9 Nov TOTAL of 13 days.[18]The Claimant gave evidence that each of his shifts was 12 hours long, from 6:30am to 6:30pm, or otherwise from 6:30pm to 6:30am. This is supported by the timings in the screenshots provided, and the totals provided next to each week, which reflect 12 hours per rota’d day.[19]The Claimant also gave evidence that there was no provision for him to take his purported one-hour lunch break away from his work station, as when he was not in the security cabin and available to unlock the gate, no one could enter or leave the site. He confirmed that his pay was calculated based on 12 hours per shift.[20]During the Claimant’s evidence, I put it to him that 13 days at 12 hours per day adds up to 156 hours and not 145 hours. The Claimant said that he calculated his total outstanding hours by adding up the totals at the side of the screenshot. These totals were 36 hours, 36 hours, 24 hours and 60 hours. When I pointed out that those totals also add up to 156 hours, and not 145 hours, the Claimant said that he must have made a mistake in his adding up when giving a figure of 145 hours.[21]The Claimant also stated that he worked a night shift on one occasion, and that he worked a shift on 25 October 2021. Neither of these shifts are shown on the screen shots provided[22]The Claimant said that he has provided the screenshots he has available, but did not screenshot details of all shifts that he worked, and once his access had been removed he was no longer able to get further screenshots. The Claimant’s evidence was that he had worked shifts for the Respondent prior to 25 October, which is the start date given in the ET1.[23]Having not been paid the full sums due to him on 22 November 2021, the Claimant repeatedly telephoned Mr Drake, and Mr Brian, the Operations Manager, who eventually blocked his number. He also went to the Respondent’s office on five occasions to ask for payment, and was told that the Respondent was waiting to be paid by its clients, and when it had been paid it would be able to pay the Claimant. The Respondent was then put into liquidation, without the payments to the Claimant being made.[24]With regard to the CIS (Construction Industry Scheme) deductions set out by the Respondent in the letter of 20 April 2022, the Claimant states that he had no knowledge of this until sight of the Respondent’s letter.[25]The Claimant gave evidence that he was not a member of CIS, is not a construction worker, and is not liable for CIS deductions. He also gave evidence that the Respondent never mentioned CIS or informed him of any such deductions to his pay at any time during his engagement with the Respondent, and that £10.50 per hour is the amount he expected to receive, without any deductions.[26]The letter from the Respondent of 20 April 2022 appears to be based on the shifts stated by the Claimant in his email of 21 December 2021. There therefore appears to be no dispute between the parties as to the shifts in respect of which monies are due.[27]I accept the Claimant’s evidence that he worked more shifts than those set out in the screenshots, but as there is no evidence before me as to the number or dates of those shifts, I limit my findings to the shifts which are before me, being those set out in para 17 of this Judgment.[28]I also accept the Claimant’s evidence that he was not a member of, or participating in, CIS, and that no CIS deductions are applicable to the monies due to him. In the alternative, if CIS deductions were applicable, then I find that £10.50 per hour is the net (of CIS) sum agreed to be paid to the Claimant per hour from the Respondent.[29]I accept that the Claimant was mistaken in his calculations, and that the correct number of hours worked in the shifts in para 17 are 156 hours, not 145 hours. I therefore calculate the Claimant’s pay as: 156 hours @ £10.50 per hour = £1,638 PLUS 13 days travel allowance at £20 per day - £260 Total payable - £1,898 Balance due to Claimant = £1,338.50
The Law
[30]S.13 of the Employment Rights Act 1996 provides, as far as is relevant: (1) An employer shall not make a deduction from wages of a worker employed by him unless— (a) the deduction is required or authorised to be made by virtue of a statutory provision or a relevant provision of the worker's contract, or (b) the worker has previously signified in writing his agreement or consent to the making of the deduction.[31]S.27 of the Employment Rights Act 1996 provides, as far as is relevant: (1) In this Part “wages”, in relation to a worker, means any sums payable to the worker in connection with his employment, including— (a) any fee, bonus, commission, holiday pay or other emolument referable to his employment, whether payable under his contract or otherwise, Analysis[32]I now apply the relevant law as I have set it out to my findings of fact.[33]The rate of £10.50 per hour due to be paid to the Claimant, and the travel allowance of £20 per day, both constituted “wages” within the meaning of S.27(1) ERA.[34]The Claimant’s wages were due to be paid to him weekly, but were not paid until 22 November 2021. The payment of 22 November 2021 was for less than the amount of £1,898 which I calculated in para 29 as due to the Claimant. The shortfall, in the amount of £1,338.50, was a deduction from the Claimant’s wages by the Respondent.[35]The Claimant had not consented, in accordance with S.13(1)(b) ERA, to the deduction from his wages. Further, there was no written contract, and therefore no “relevant provision of a contract” under S.13(1)(a) ERA, upon which the Respondent could rely as authority for its deduction.[36]S.13(1)(a) ERA also provides that a deduction may be authorised “by virtue of a statutory provision”. I accept that CIS deductions would, if applicable, fall within this exception. However, as I have found, in para 28, that either no CIS deductions are applicable to the monies due to the Claimant, or, in the alternative, that £10.50 per hour is the net (of CIS) sum agreed to be paid to the Claimant per hour from the Respondent, the deductions made from the Claimant’s wages on 22 November 2021 were not authorised under the “statutory provision” part of S.13(a) ERA.[37]For these reasons I find that the claim succeeds and that the deductions by the Respondent from the Claimant’s wages on 22 November 2021 were unlawful deductions from wages.[38]I therefore make an award in favour of the Claimant in the amount of £1,338.50.
Conclusion
[39]The Claimant’s claim for unlawful deduction from wages succeeds.