Mr D Denton and others v Govdata Ltd: 2405186/2016 and others

EMPLOYMENT TRIBUNALS

Case No 2405186/2016

Between

Mr D Denton and othersClaimant

Govdata LtdRespondent

Before

Employment Judge T

Date 21 December 2018

JUDGMENT

The judgment of the Tribunal is that an extension of time is permitted for the respondent’s presentation of its ET3 response to the claimant's claims received on 17 January 2017; the response is accepted. JUDGMENT ON PRELIMINARY HEARING having been sent to the parties on 6 July 2017 and written reasons having been requested in accordance with Rule 62(3) of the Employment Tribunals Rules of Procedure 2013, the following reasons are provided:

REASONS

[1]The Issues The issue to be determined was whether an extension of time ought to be permitted for the presentation of the respondent’s response to the Employment Tribunal to the claimants’ claims and so whether that response, or those responses, ought to be accepted.

[2]Chronology The following chronology is evident from the Tribunal’s file of papers and is consistent with the respondent’s submissions in support of its application for an extension of time for the presentation of its response:2.1 22/11/2016 – The claimants presented their claims to the Tribunal having completed the early conciliation procedure.

2.2 24/11/2016 – The Employment Tribunal issued a Notice of Claim requiring a response by 22 December 2016 and notifying the parties that the matter was listed for hearing on 17 January 2017.

2.3 20/12/2016 – The respondent applied for an extension of time for the presentation of its response from a date no later than 22 December 2016 to at earliest 20 January 2016 [sic] “or later if possible”. The reason for the application for an extension of time was a combination of the respondent’s Christmas closure from 23 December 2016 to 4 January 2017 and subsequent holidays to be taken by directors of the respondent company.

2.4 23/12/2016 – The Tribunal notified the respondent that an extension of time for the presentation of the response had been granted but only to 13 January 2017 (Friday).

2.5 17/01/2017 (Tuesday) – The final hearing set for this date was postponed.

2.6 17/01/2017 (Tuesday) – The respondent presented its ET3 response form.

2.7 24/01/2017 – The Tribunal wrote to the parties confirming that the respondent’s response had been rejected on the ground that it was received after the end of the extension of time previously given and it was not accompanied by and did not include a further application to extend time.

2.8 26/01/2017 – On advice the respondent wrote to the Tribunal with a retrospective application for an extension of time for the presentation of its response to the date of actual presentation, being 17 January 2017.

2.9 30/01/2017 – The claimants wrote to the Tribunal objecting to the respondent’s application.

2.10 01/02/2017-26/06/2017 – During this period the Tribunal raised questions of the respondent concerning the delay in presentation of the ET3 response and there was both inter party and party to Tribunal correspondence with the respondent’s explanations and submissions and the claimants’ responses and objections to any reconsideration of the decision to reject the respondent’s ET3.

2.11 26/06/2017 – Preliminary hearing on the respondent’s application for acceptance of its ET3 response.

[3]The respondent’s application at the preliminary hearing (confirming earlier correspondence)3.1 The respondent’s directors were absent from work during the Christmas closure and a subsequent holiday abroad without direct and automatic access via their smart phones to email related to work. The tribunal’s confirmation of extension of time will have been received at the respondent’s offices during the shut down period. There was then a period of illness on the directors’ return from holiday such that they did not attend their offices immediately upon return and were unaware that the Tribunal had extended the time for the presentation of the response only to 13 January 2017 and not in accordance with the application that had been made (to a date no sooner than 20 January 2017 but later if possible).

3.2 The respondent then contacted a member of their staff to check the date when they were required to do something for the Tribunal and the staff member informed them that the correspondence showed 17 January 2017 as being the key date. This was said to have been a misunderstanding in that the staff member had misunderstood the enquiry or misread Tribunal documentation giving 17 January 2017 as the key date, being the date of the listed final hearing. The enquiry had been about the date of the extension of time. The directors erroneously worked towards presentation of the respondent’s ET3 by no later than midnight on 17 January 2017. The ET3 was presented by that time on 17 January 2017. The respondent indicated an intention to defend the claimants’ claims and set out facts upon which it intended to rely in order to defend the claims.

3.3 The directors were unaware that presentation was later than the granted extension of time until they received from the Tribunal rejection of the response by a letter dated 24 January 2017. In the light of that the respondent applied for a retrospective extension of time and corresponded with the Tribunal in preparation for this preliminary hearing and in response to the claimant's objections.

3.4 If the respondent had presented its ET3 response at 23:59 on Friday 13 January 2017 this problem would not have arisen and the claimant could not have objected; nothing further would have taken place with regard to the processing of the response form until Monday 16 January 2017 whereupon it would have been processed by the Tribunal and a copy sent to the claimants. It follows that presentation on 17 January 2017, therefore, meant at most a one day delay in the processing of the response and no prejudice whatsoever to the claimants. The default was due to an error by a member of staff which was not deliberate and from the moment the error was detected the respondent has diligently pursued correspondence in an attempt to rectify the situation.

[4]Claimants’ objections to the acceptance of late ET3 response form The claimants have objected consistently to the respondent’s applications and wish the decision to reject the response to stand for the following reasons:4.1 The ET3 presented by the respondent is brief and should not have taken two months to prepare.

4.2 The respondent’s directors could have checked emails and prepared the ET3 from home via remote access and in time.

4.3 It is noted that although the directors say they were ill following their holiday they were clearly well enough to instruct legal advisers on the presentation of an ET3.

4.4 The respondent has failed to provide evidence of ill health.

4.5 It was “improbable” that the directors did not check their emails for a four week period in December 2016/January 2017.

4.6 Allowing the late presentation of the ET3 would cause undue prejudice to the claimant.

4.7 Rejection of the ET3 response would be in accordance with the overriding objective of the Tribunal.

[5]The Law5.1 The applicable law is contained in the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 and the Employment Tribunals set out in Schedule 1 to those Regulations. All further references to rules are references to these Rules.

5.2 Rules 15-22 concern the response to a claim.

5.3 Rule 15 provides that, otherwise than in a situation where the claim is rejected, the tribunal shall send a copy of the claim form, together with a prescribed response form, to a respondent with information which amongst other things explains how to submit a response and the time limit for doing so, together with confirmation of what would happen if a response is not received within that time limit. The notice sets out the date for compliance.

5.4 Rule 16 concerns the response form and the requirement to use the prescribed form which shall be presented to the Tribunal Office within 28 days of the date that the copy of the claim form was sent to a respondent by the Tribunal.

5.5 Rules 17 and 18 concern rejection of a response, where rule 17 relates to the failure to use the prescribed form or to supply minimum information, and rule 18 relates to late presentation. Rule 18 provides that a response “shall be rejected” if received outside the time limit in rule 16, “or any extension of that limit granted within the original limit unless an application for extension has already been made under rule 20 or the response includes or is accompanied by such an application (in which case the response shall not be rejected pending the outcome of the application)”. If a claim is rejected under rule 18 the respondent will receive a notice of rejection explaining that the response was presented late, and how the respondent can apply for an extension of time and how to apply for reconsideration.

5.6 Rule 19, reconsideration of rejection, states a respondent whose response has been rejected under rules 17 or 18 may apply for reconsideration but only on the basis that the decision to reject was wrong or, in the case of a rejection under rule 17 (which is not relevant to this case) on the basis that the notified defect can be rectified. Rule 19 sets out the requirements for an application for reconsideration and the procedure.

5.7 Rule 20, application for extension of time for presenting response, states a reasoned application for an extension must be presented in writing and copied to the claimant. If the time limit for presentation of the response has expired then it must be accompanied by a draft of the response but otherwise it need not be so accompanied. The claimant has seven days within which to oppose the application if applicable.

5.8 Rules 21 and 22 concern the effect of non-presentation or rejection of a response or where the case is not contested, and the issuing of notification of acceptance.

5.9 Rule 5, extending or shortening time, states that the Tribunal may on its own initiative or on the application of a party extend or shorten any time limit specified in these Rules or in any decision whether or not (in the case of an extension) it has expired.

5.10 Rule 6, irregularities and non compliance, states that subject to four stated exceptions in respect of provisions in the Rules, and two stated exceptions in respect of a Tribunal order, a failure to comply or an irregularity in compliance will not of itself render void the proceedings or any step taken in the proceedings. The Tribunal may take such action as it considers just where there has been non-compliance save in those excepted instances, such as by waiving or varying the requirement or by way of strike out, barring, restricting or awarding costs in specified circumstances. The excepted rules include for our purposes rule 16(1), which provides as above that the response shall be presented within 28 days of the date that the copy of the claim was sent to the Tribunal. The other exceptions set out in rule 6 do not apply to these circumstances under consideration.

[6]My considerations6.1 I considered all of the above, the chronology of events, the applicable rules, the respondent’s submission and application, and the claimant's objections to it. I bore in mind the overriding objective of the Tribunal to deal with cases fairly and justly, and doing so insofar as practicable in line with the factors set out in rule 2. I considered the reason for the respondent’s delay, its actions generally, the extent of the delay and likely effect thereof, if any, and in the light of all of that the relative prejudice or lack thereof visited upon the claimant and/or the respondent depending on which way I decided the respondent’s application to extend time.

6.2 I concluded that there was, on the respondent’s part, an unfortunate coincidence of an extension of time for the presentation of the response that was one week shorter than the minimum time for which it had applied in circumstances where notification of that decision will have been received by the respondent during the Christmas shut down period, holidays within the respondent’s business and thereafter of the directors who were to take action with regard to the Tribunal proceedings, illness of at least one of the two directors who were instrumental in responding to the claimants’ claims, and erroneous information mistakenly given to the directors on an appropriate enquiry when they were told that the key date for action in the Tribunal was 17 January 2017 when in fact that was the date of the listed final hearing which had been postponed. The respondent had made an effort initially to apply to the Tribunal for an extension of time to present its response and appeared to be acting in good faith and in accordance with the Rules in giving itself an opportunity to respond appropriately; similarly the directors checked on the information and upon being told (erroneously) that the ET3 response was to be submitted to the Tribunal by 17 January 2017, the directors ensured that they did so.

6.3 The delay for practical purposes was minimal in that in effect probably only Monday 16 January 2017 could have been considered a wasted day or a day on which there was no action taken had the respondent complied with the requirement to present by no later than Friday 13 January 2017. The reason for the delay was understandable and can reasonably be excusable. The claimants were not prejudiced by the delay between 13 and 17 January 2017 other than they have been deprived of a windfall by way of a technical victory. The claimants can still argue their cases as they had always intended to, and the strength of their evidence is not diminished by the want of the Tribunal having the capacity to deal with the ET3 response on Monday 16 January 2017. The respondent, on the other hand, would have to face judgment in respect of multiple claimants in the event that the extension of time is not granted to 17 January 2017.

[7]Conclusion7.1 I consider that the overriding objective of the Tribunal, in the light of all of the above, is served by my acting justly in permitting an extension of time for the presentation of the respondent’s ET3 response to 17 January 2017 and allowing the respondent’s application for reconsideration and acceptance of its response.

7.2 I am granting an extension of time in respect of the date set and decision made under rule 20 to grant an extension of time for the presentation of the response. The respondent’s initial application for an extension was within the original time limit and therefore any response presented before the extended time limit of 13 January 2017 would have been accepted and not rejected by virtue of rule 18. The rule 20 application for extension was granted thus dis-applying the rule 16 requirement for presentation within 28 days of the date that the copy of the claim was sent by the Tribunal.

7.3 Rule 5 allows me to extend or shorten any time limit specified in any decision whether or not (in the case of an extension) it has expired and the expression “in any decision” may relate to a decision upon an application for an extension of time for presenting a response made under rule 20. Following that reasoning I may make any decision that I consider to be just (rule 6).

7.4 Whereas the power to extend time and to allow flexibility with regard to irregularities and non-compliances provided for by rules 5 and 6 do not apply to a situation where a respondent fails to present a response on the prescribed form within 28 days of the date of the copy of the claim was sent to it (rule 16(1)), I am not prevented from retrospectively granting an extension of time in respect of a decision under rule 20, providing I consider such extension to be just.

7.5 I consider it to be just to extend the time granted to the respondent to present its ET3 response to the claimants’ claims from 13 January 2017 to the date of actual presentation on 17 January 2017 and to accept the respondent’s response.

[1]The claimant suffered an unlawful deduction of wages for the period 1 July 2016 to 22 July 2016 inclusive in the agreed sum of £2,324.00 net, and the respondent is ordered to pay to the claimant compensation in the sum of £2324.00.

[2]The claimant suffered an unlawful deduction of wages in respect of childcare vouchers for the month of June 2016 in the agreed sum of £124.00 and the respondent is ordered to pay to the claimant compensation in the sum of £124.00.

[3]The claimant's claim for accrued unpaid expenses during his employment in the sum of £1,020.50 is well-founded, and the respondent is ordered to pay to the claimant £1,020.50.

[4]The claimant's wrongful dismissal claim for notice pay is dismissed upon withdrawal.

[5]The claimant's claim for childcare vouchers payable in the month of July 2016 is dismissed upon withdrawal.

[6]The claimant's claim for unpaid pension contributions in the month of July is well-founded, and the respondent is ordered to pay to the claimant employer contributions in the agreed sum of £22. Mr A Gilligan – Case No: 2405189/2016

[7]The claimant's claim for wrongful dismissal is well-founded, and the respondent is ordered to pay to the claimant one week’s contractual pay in the sum of £338.14 net.

[8]The claimant’s claim for unpaid expenses is well-founded, and the respondent is ordered to pay to the claimant unpaid expenses in the sum of £25.01.

[9]The claimant’s claim for holiday pay is dismissed upon withdrawal. Miss M Toolan – Case No: 2405191/2016

[10]The claimant's claim for wrongful dismissal is well-founded, and by consent the respondent is ordered to pay to the claimant £518.60 by way of unpaid notice.

[11]The claimant’s claim for accrued unpaid holiday pay is well-founded, and the respondent is ordered to pay to the claimant the agreed sum of £518.60 net.

[12]The claimant's claim for pension contributions is not well-founded and is dismissed.

[13]The claimant was provided with a statement of terms and conditions of employment in accordance with section 1 of the Employment Rights Act 1996 as amended.

[1]By a claim form received 22 November 2016 (ACAS early conciliation certificate dated 22 September 2016) the first claimant, David Denton (DOB 19 May 1969, whose continuous employment was 1 December 2015 to 19 August 2016) brought claims for notice pay, holiday pay, arrears of pay and other payments. In addition, five claimants also brought similar claims, including Mr Gilligan and Miss Toolan.

[2]In the particulars of claim at paragraph 3 it was pleaded that each claimant, with the exception of the first claimant, being David Denton, was given a staff handbook on commencing their employment with the respondent. The claimants rely on the staff handbook as a contractual document. It was therefore pleaded that Maria Toolan was given a staff handbook.

[3]The respondent disputed the claimants’ claims and having been granted an extension of time to submit the ET3 it was finally submitted on 17 January 2017, the original date of submission being 22 December 2016. In short, the respondent had time to prepare its defence, and it is notable that the following was pleaded –(1) With reference to David Denton, it was maintained his expenses were fabricated and he was not entitled to claim wages. It was denied David Denton had worked the hours he claimed, and alleged he “purposely” took business from the respondent whilst employed and paid by the respondent, with the intention to put the respondent out of business.

(2) With reference to Andrew Gilligan, it was maintained he had been “fired” for gross misconduct and “under the legal principle ex tupi causa non oritur centric” was entitled to no money as he was working against the respondent and under criminal investigation for fraud concerning apprenticeship claims from ex employees. It was also alleged that after his employment finished Andrew Gilligan fraudulently signed into business bank accounts.

(3) With reference to Marie Toolan, it was denied she was entitled to her claim. Gross misconduct was alleged and involvement to cause harm and loss to the respondent with the intention of putting it out of business.

[4]During the course of this action the claimants submitted Schedules of Loss. In respect of Marie Toolan’s Schedule of Loss it is notable in respect of pension contributions they were described them as “negligible,” Marie Toolan maintaining the respondent had failed to pay into employer contributions for two months seeking zero damages. There is no claim that the respondent failed to provide her with a statement of terms and conditions of employment in accordance with section 1 of the Employment Rights Act 1996.

[5]This is a liability hearing which followed the preliminary hearing held on 6 December 2017 when various judgments were made. At the preliminary hearing the issues concerning the individual claimants were clarified as follows – Mr Denton(1) Whether or not the respondent was entitled contractually not to pay Mr Denton his notice pay i.e. was he in fundamental breach of contract as a result of act(s) of gross misconduct..

(2) With reference to the claim for expenses, were they incurred during the course of the claimant’s business dealings on behalf of the respondent? If so, were they properly incurred? If so, is Mr Denton contractually entitled to reimbursement of some or all the expenses he is claiming?

(3) The childcare voucher claim was resolved during the course of the parties giving evidence, and there is no need for the Tribunal to address the issues in relation to the childcare vouchers salary sacrifice scheme.

(4) With reference to the claim for pension contributions, the claimant’s unlawful deduction of wages claim for July’s salary having been conceded towards the end of the evidence given on behalf of the respondent, there is no need to deal with the unlawful deduction of wages issue, pension contribution and the childcare voucher salary sacrifice for the month of July. Andrew Gilligan

(5) With reference to Andrew Gilligan’s claim for expenses in the sum of £50, the issues are identical to those set out in relation to David Denton’s claim for expenses as above.

(6) With reference to the wrongful dismissal claim, the issues are identical to those set out above in relation to David Denton. The key issue is whether the respondent was entitled to dismiss Andrew Gilligan without notice by reason of his alleged fraudulent behaviour.

(7) Finally, with reference to the bank charges, the issue is whether or not those charges were a result of the respondent’s failure to pay Andrew Gilligan and whether the losses are attributable to the action taken by the respondent. Marie Toolan

(8) With reference to Marie Toolan there is no need for the Tribunal to deal with the unpaid holiday due, given the respondent’s concession that Miss Toolan was owed £518.60 net. There was also no requirement for the Tribunal to deal with the wrongful dismissal claim, given the respondent’s concession that the claimant was owed £518.60 net by way of unpaid notice.

(9) With reference to the pension claim, the issue appears to be whether or not the claimant applied to take part in the respondent’s pension scheme and if so, is there outstanding pension contributions payable by the respondent?

(10) With reference to the respondent’s alleged failure to provide Marie Toolan with a statement of terms and conditions of employment, the issue is a straightforward one – was she provided with a statement of terms and conditions of employment or not? Evidence

[6]The Tribunal heard oral evidence from the claimants on their own account, and considered the written witness statements. With reference to Marie Toolan it noted at paragraph 3 of the written statement that she confirmed a staff handbook had been provided, but not a contract of employment. The Tribunal did not find Marie Toolan a credible witness on the issue as to whether or not a statement of terms and conditions of employment had been provided. The contemporaneous documentation did not assist the Tribunal who accepted Miss Toolan was not a signatory to the form allegedly comprising the last page of a statement of terms and conditions of employment. The Tribunal did however accept the witness evidence of Marie Toolan that she had been sent an email with a PDF document which she took to include details of company benefits, but did not read. On the balance of probabilities, the Tribunal found in favour of the respondent that a statement of terms and conditions of employment had been provided to Marie Toolan which she did not read and thus did not appreciate that they had been sent.

[7]With reference to the evidence of David Denton, the Tribunal preferred his evidence to that of Christian Hugo when it came to the conflicts in the evidence as to whether or not the expenses claimed had been incurred. Mr Denton relied upon evidence which linked his individual expenses claim with his diary, calendar entries, emails and receipts. On the question of expenses Mr Hugo was contradictory and disingenuous. He gave oral evidence that the respondent had a company handbook that dealt with expenses, stating they were “slap bang” in the middle of the Company Handbook, but when he was taken to them by Mr Searle, acting on behalf of Mr Denton, the policy was nowhere to be seen. When this was pointed out to him his reaction was “let’s move on”. Mr Hugo maintained that Mr Gilligan dealt with “every bit of train travel” booking and yet this was never put to Mr Gilligan or David Denton in cross examination. There was no dispute by the respondent that David Denton’s expenses mathematical calculation was totalled correctly; the issue lay with the individual amounts claimed, which Mr huge argued, were unjustifiable.

[8]Turning to the individual expenses, Mr Hugo did not dispute the mathematics of the total claimed, and he accepted that he had attended meetings with the claimant and others i.e. the meeting in Solihull which gave rise to the train ticket claim of £202.10 and the mileage of £35.

[9]In response to expenses claims being put to him, Mr Hugo’s answer was had the claimant “bothered following the procedure I’d have paid out train tickets and petrol. Duplicitous, play fair, you’d have got paid”. He alleged the claimant had a “façade of honesty, was deeply Machiavellian and very calculating”.

[10]It appears that Mr Hugo disputed the amounts claimed i.e. the payment to the notary public was properly incurred, but Mr Hugo could have got it cheaper elsewhere in a different part of the country. He would have paid £50 travel, not £200. He would not have paid for a taxi, he would have arranged for the claimant to have been picked up. In relation to the issue of the taxi, during cross examination by Mr Searle Mr Hugo referred to counsel as a “barmpot”, maintaining it would have been cheaper to “pick up the claimant” than for him to get a taxi. In short, Mr Hugo’s evidence was most unsatisfactory, and the Tribunal preferred on the balance of probabilities that of David Denton, to the effect that the expenses had been properly and reasonably incurred, and were payable by the respondent.

[11]Turning to Andrew Gilligan, the Tribunal found Mr Gilligan to be a credible witness and preferred his evidence to that of Mr Hugo on the question of gross misconduct. The Tribunal has dealt with this below in its findings of fact. With reference to the claim for expenses, the Tribunal accepted on the balance of probabilities the claimant’s evidence that he had incurred a cost on behalf of the respondent when he purchased a cable from Maplin, and the invoice together with his expenses claim was with the company. On the balance of probabilities the Tribunal preferred the evidence of Kelly Hugo as to whether the claimant was owed £25 cash or not, accepting that she had paid him £30 cash after he had placed a personal item advertising a housekeeper. Kelly Hugo’s evidence on this issue, which was that she had paid £30 as opposed to £28, was believable, and it may be that Mr Gilligan had forgotten when the repayment was made. The Tribunal also accepted, on the balance of probabilities, Andrew Gilligan, incurred overdraft bank charges supported by his bank statements, directly as a result of not being paid salary due and owing from 1 to 28 September 2016.

[12]The Tribunal was referred to two bundles of documents, together with the witness statements. It also took into account oral submissions presented by the parties, which the Tribunal does not intend to repeat, but has attempted to incorporate the points made within the body of this Judgment with Reasons.

[13]With reference to those witnesses who were not called but who provided witness statements, namely Christine Gilligan and Adam Hobson on behalf of Andrew Gilligan, as their evidence could not be tested on cross examination and had little relevance to the issues to be decided by the Tribunal, it was given no weight.

The Facts

[14]The respondent is a company providing market intelligence reporting services to public sector business. Christian Hugo is the Managing Director and CEO, and Kelly Hugo, his wife, the Commercial Director.

[15]David Denton worked for the respondent as an employee between 1 December 2015 and 19 August 2016 in the role of Director of Operations and Service Delivery. Contrary to Mr Hugo’s oral evidence, Mr Denton did not start work in June 2016. Christian Hugo maintained “he didn’t start in December, he started in June 2016, and he was a consultant for six months” further undermining his credibility.

[16]David Denton had previously worked for the respondent under a contract through his own company, Denton IT Consultancy Limited, from June 2015 to November 2015, and it was whilst working under that contract Christian Hugo offered him a full-time position that commenced on 1 December 2015. Christian Hugo was well aware that the claimant did not commence his employment in June 2016, and the Tribunal found he was an inaccurate historian in relation to this and other evidence given during the liability hearing.

[17]David Denton was based from home, and this gave rise to Kelly Hugo’s belief from 1 December 2015 (she conceded that David Denton was an employee as of this date) that he did not work a sufficient number of hours. David Denton’s evidence is to the contrary. He referenced working late into the evening. There were no timesheets or any agreement that he work a set number of hours during the working day. This is by the way, save for Kelly Hugo’s evidence which resulted in the respondent conceding an unlawful deduction of wages had taken place, in that it was her belief David Denton worked an insufficient number of hours from December 2015 and that is why he was not paid in June 2016, because he was claiming wages to which he was not entitled due to the fact that he had been overpaid from December.

[18]It was conceded the respondent should have paid David Denton £2,324.00 net, employer’s pension contributions of £22 and childcare vouchers for June 2016 in the sum of £124.00. The Tribunal gave judgment accordingly, noting that the concession concerning the unlawful deduction of wages was made late in the afternoon. It would have been clear to the respondent, had they addressed their minds properly to the issues in this case, and that there was no defence to the unlawful deduction of wages.

[19]Andrew Gilligan commenced his employment with the respondent as Senior Administrator on 1 December 2015, and then Finance Manager from 1 May 2016 until his resignation on 28 September 2016. Andrew Gilligan assisted David Denton, and he was responsible for a number of matters, including HR, finance, recruitment and had access to the respondent’s bank account as part of his duties. The Tribunal did not find Andrew Gilligan’s accessing the respondent’s accounts/computer during this notice period, could reasonably have amount to gross misconduct as maintained by Mr Hugo.

[20]Marie Toolan worked for the respondent from 16 May 2016 as marketing Manager until she was dismissed on 28 July 2016 without notice or holiday pay.

[21]Marie Toolan was sent a letter dated 26 April 2016 by Kelly Pendrill, Commercial Director, confirming the offer, setting out the remuneration package and working hours. The letter referred to “terms and conditions of your employment will be provided in the formal employment contract that you will be asked to sign upon taking up your duties”.

[22]The Tribunal were taken to a document on page 35B alleging signed by Marie Toolan, which she denied. There is an undistinguishable signature made on 17 May 2016 above that of Andrew Gilligan, who cannot recall the claimant signing the document. On the balance of probabilities, having considered other signatures made by Marie Toolan set out within the bundle, the Tribunal accepted her evidence that the signature was not hers. However, this did not assist Marie Toolan on the issue as to whether or not she was provided with a statement of terms and conditions of employment given her evidence that she was emailed a Company Handbook, which the claimants all accept had contractual effect.

[23]The Tribunal finds it is sufficient for the respondent to have emailed Marie Toolan with the Company Handbook in a PDF format, and the fact that Miss Toolan decided not to read the document is irrelevant. She had been provided with what was essentially a statement of terms and conditions of employment.

[24]Some time after she commenced her employment, Marie Toolan discussed with Christian Hugo the possibility of joining the respondent’s pension. She did not make a formal application, nothing was put in place. Marie Toolan did not make pension contributions herself, and nor did the respondent. Accordingly, there is no evidence on which the Tribunal could find in Marie Toolan’s favour, the burden being on her to establish that the respondent’s pension contributions were due and owing, and she has failed to discharge that burden.

[25]The Staff Handbook on the first page states as follows: “This document forms a major part of your contract of employment and as such you should be fully aware of the contents and their relevance to your employment by Govdata Limited. By signing the statement of main terms of employment you are undertaking to be bound by the terms contained within…”

[26]The staff handbook does not provide a procedure for claiming expenses. It does, however, provide a disciplinary and grievance procedure which appears to comply with the ACAS Code of Practice. For example, at paragraph 4.2 it is stated, “No disciplinary action shall be taken against an employee until a careful investigation has been made”, and at paragraph 5 there is a right to appeal. At paragraph 3, disciplinary procedure notes for guidance, there is reference to gross misconduct being “serious acts of insubordination”. At 2.4 there is a reference to “at every stage in the procedure the employee will be informed of the complaint against him/her and will be given the opportunity to state his/her case before any decision is made”. This procedure is relevant as there was a total lack of process when it came to the disciplinary allegations raised as set out below.

[27]During his employment with the respondent David Denton incurred a number of work related expenses set out within a spreadsheet in the agreed bundle, which the Tribunal does not intend to repeat. The Tribunal found on the balance of probabilities that it preferred David Denton’s evidence compared to that of Christian Hugo, to the effect that Christian Hugo had confirmed he would reimburse the claimant and his wife for his travel costs in attending the office Christmas party on 18 and 19 December 2015. It is undisputed the Christmas party took place, and the claimant travelled to it (although Christian Hugo has attempted to argue that the claimant should not be paid as he went to see relatives in Liverpool). The receipt reveals a journey, Basingstoke to Manchester Piccadilly, at the cost of £207.20. The train cost was properly payable by the respondent incurred during the course of business (albeit to a Christmas party) and is legitimate given that only half of the expense has been claimed, that relating to David Denton’s wife’s travel.

[28]On 21 January 2016 David Denton incurred car mileage travel costs at 40 pence per mile, incurred when he met a prospective G-Cloud collaborator with Christian Hugo.

[29]The claimant's claims for travel to Warrington Head Office for three days including three taxi fares to and from stations and a train fare, all evidenced by receipts, were incurred. There is no dispute that the claimant travelled to Head Office from Basingstoke train station from 1 to 3 February 2016. The same point applies to the claimant travelling on 4 February 2016 by train for a meeting with Christian Hugo at the Adam Smith Institute, evidencing a taxi receipt and train journey receipt for this trip. It is not disputed that the meeting took place, attended by the claimant, and thus he would have had to travel.

[30]On 23 March 2016 the claimant incurred notary public fees, postage fees and car mileage. It is not disputed a certificate was sent to America by the claimant: the dispute is the cost of the notary public fees and the postage. The claimant clarified that the postage was high owing to the need to expedite the sending of the documentation. The notary public fees amounted to £95 with postage of £52. The notary public fees, postage fees and car mileage were properly and reasonably incurred by David Denton during the course of his employment and so the Tribunal found.

[31]The claimant attended the respondent’s Head Office for three days between 4 and 6 April 2016, incurring train travel and taxi fares evidenced in receipts set out within the bundle. The train fare cost £202.10 and it is not credible that the claimant could have travelled at £50 as alleged by Christian Hugo, and no proof of this was adduced Christian Hugo relying on his less than credible evidence..

[32]The claimant travelled by train on 29 April 2016 for a client meeting that undisputedly took place. The train receipt and taxi receipt of £202.10 and £12 respectively were incurred during the proper course of business.

[33]On 17 May 2016 the claimant drove to a client meeting in Farnborough, a 38 mile return journey at a cost of 40 pence per mile. It was not disputed that this meeting took place.

[34]Finally, between 24 and 26 May 2016 David Denton travelled by train and taxi to Warrington Office and then on to the Cheshire Wirral Partnership NHS Foundation Trust, staying at Christian Hugo’s property during the visit, to which he travelled by taxi. It is not disputed that the meeting took place, and nor is it disputed David Denton stayed at Mr and Mrs Hugo’s home, What is in dispute is the amounts claimed, and there was no evidence before the Tribunal to show that these were unreasonable. In short, the respondent’s issue with David Denton claiming his expenses is with the fact that he never submitted them before his resignation. In his written statement Christian Hugo confirmed that had be submitted the expenses, they would have been rejected in contrast to his oral evidence in which he stated that they would have been paid, albeit different amounts i.e. a £50 train fare instead of £202.

[35]It is not disputed the claimant had a number of conversations with Christian Hugo and Andrew Gilligan about his expenses, and the Tribunal prefers David Denton’s evidence to that of Christian Hugo in that he was told in March and April 2016 “cash flow was tight” and he agreed to hold off submitting the expenses until things improved”. It is also not disputed that Andrew Gilligan, as Finance Manager, advised David Denton to put the claim in straightaway and he would action it, and yet no claim was in place. The Tribunal accepts David Denton’s evidence that he was busy, then he was ill, and it was not financially pressing for him to submit the expenses claim.

[36]David Denton was provided with a contract of employment six months after starting as a full-time employee on 15 June 2016.

[37]For a number of reasons, which the Tribunal does not intend to go into, David Denton spoke with Christian Hugo on 21 July 2016 concerning his resignation. David Denton had a difficult relationship with Christian Hugo, who he found to be aggressive, and he resigned in writing on 22 July 2016 offering to work his notice until 19 August. David Denton was not paid his final salary, and there were allegations of alleged misconduct including theft and criminal activity.

[38]Andrew Gilligan was aware that Marie Toolan and David Denton had left the respondent’s employment and the fact that their salary/notice pay was outstanding. He was unhappy with the treatment of staff, a number of who had left or was in the process of leaving the business, the experience being that once an employee resigned they were asked to leave immediately and notice pay was not paid. Andrew Gilligan decided to resign due to Christian Hugo’s “overly aggressive nature” which he had previously raised with Kelly Hugo.

[39]The BT bill for telephone and internet had been outstanding from July 2016 which was the responsibility of Mr Hugo to pay. On behalf of the respondent it was argued that Andrew Gilligan had been responsible for bringing the outstanding payment to Christian Hugo’s attention, and he had failed to do so which was an act of gross misconduct enabling it to summarily dismiss. It was not disputed by the respondent that BT had sent nine reminders and Andrew Gilligan had included the BT bills within a weekly report. The Tribunal accepted Andrew Gilligan’s evidence that it was not his responsibility to pay the bill, it was common for outstanding payments to remain on the weekly report for a substantial period of time. When Christian Hugo found that BT had disconnected the telephone and internet, he swore aggressively at Andrew Gilligan and informed his co-workers that it was Andrew Gilligan’s fault. As a result of Christian Hugo’s behaviour, on 28 September 2016 Andrew Gilligan approached Kelly Hugo who in oral evidence conceded Andrew Gilligan had resigned and offered to work his notice. Matters were left that Kelly Hugo would speak to her husband, who was away. Andrew Gilligan was concerned that his work environment was not safe during the notice period, and whilst he was waiting to hear from Kelly Hugo regarding working his notice a number of text communications were received from Christian Hugo. On 27 September 2016 Andrew Gilligan emailed Kelly Hugo: “He’s [a reference to Christian Hugo] in with delivery. He wants to kill me he said. Trying my best.”

[40]In a later text message Andrew Gilligan wrote: “I’m always stressed coming in everyday. I work my bollocks off. I’m not sleeping. Always stressed and getting emotional as well. Not good for you, is it? Especially when called a dozy cunt and told he wants to kill me.”

[41]Kelly Hugo responded: “Once this sorted it be fine. Just think get it back on like now.” This was a reference to the BT disconnection.

[42]On 28 September 2016 Christian Hugo texted Andrew Gilligan as follows: “You wanna shit stir with my wife and try and deflect the blame from yourself u little shit. William Hill haven’t paid the money back yet, eh. You fucking smart arse. Really…forgot to mention that it was only because they hadn’t had my documents u little shit. You’re not a man you’re a backstabbing little shit.”

[43]The messages followed in a similar vein. One sent 16:42 on 28 September 2016, Christian Hugo texting: “Answer your phone u spineless little bastard. How dare you lump your fuck ups on Kelly.”

[44]At 20:20 he texted: “Either answer your phone or I will knock on your door…”

[45]Later on 28 September Christian Hugo texted Andrew Gilligan alleging that he had stolen financial data and would up in “lots of trouble”.

[46]On Friday 30 September Kelly Hugo texted the claimant, stating: “We just going through Xero on an have screenshots of your logging on Wednesday an yesterday Andy. You need to ring the office and explain what and why you was doing this when you no longer work for Govdata and this is personal financial information… Christian is very serious about contacting police today…Here is no reason for it, no-one told you to use Xero or outbanking information especially as you left employment Wednesday…You need to ring Christian now.”

[47]The claimant was sent a letter dated 30 September 2016 from Christian Hugo stating the following: “As from 28 September your employment with Govdata has been terminated. The reason for the termination is gross misconduct due to the following –(1) Walking out of office in middle of day without informing anyone…

(2) After receiving notice and overdue letters for payment from BT from June 2016 no payment was made to them…

(3) For then paying the bill without checking that the lines would go straight back on…

(4) Causing loss of business on income as customers and sales teams were unable to carry on their duties without huge disturbances…

(5) Logging onto Xero at 9.07pm, 10.05pm and 10.48pm on Tuesday 27th. There had been no permission whatsoever for you to access out of working hours and also logging into Xero on Thursday 29th at 8.21am and 8.45am and the potential theft of financial data which can be proved by screenshots.

(6) By not contacting the CEO to explain what was happening and why you left the office in such disarray and lied about the date it could be coming back on and then not contacting anyone else about you walking out apart from Kelly Hugo, who is currently off sick…

(7) When questioned about theft of financial data you lied about the reason you: went on for a password from Emily although this is a blatant lie…

(8) Putting the personal interests of your relatives ahead of the company and your employer’s commercial interests and attempting the cause [sic] the company damage in doing so. As your reason for termination is gross misconduct then no notice is needed.”

[48]The Tribunal finds as a matter of fact that Andrew Gilligan resigned on 28 September 2016 with a view to working one months notice. His employment was terminated during the notice period by a letter dated 30 September 2016 which took effect when Andrew Gilligan received it on 1 October 2016. The effective date of termination was 1 October 2016. Andrew Gilligan was not paid salary for the month of September 2016, which he had worked, and on 12 December 2016 judgment was entered in his favour for £913.01, promulgated 3 January 2018. Andrew Gilligan was also not paid his notice pay, in the sum of £338.14 net as set out in this judgment. Cumulatively, it is a substantial amount of money and the Tribunal accepted, taking into account the contemporaneous bank statements, that Andrew Gilligan had incurrence overdraft bank charges amounting to £459.00 directly as a result of the non-payment of wages from 30 September 2016 to 29 June 2017.

[49]In direct contrast to the respondent’s disciplinary procedure which provided for investigation, a hearing and the right to appeal, Andrew Gilligan was dismissed without any of this taking place. The Tribunal accepted on the balance of probabilities Andrew Gilligan’s explanation that the Xero log in, the Kelly Hugo password and the other allegations set out within the 30 September 2016 aimed at avoiding any payments to be made post termination.

[50]Andrew Gilligan was cross examined on the allegation concerning putting family interests before that of the respondent in the relevant documents in the bundle. From those documents it appears that on 12 April 2016 Christine Sherlock (who became Christine Gilligan when she married Andrew Gilligan) emailed Andrew Gilligan: “Can you do me a favour and send me an email with proof that Chloe (an employee in the respondent business) has left the business due to poor attendance. Can you say she left the business end of February? I know she left Jan but this is when we terminated her apprenticeship after not being able to get hold of her for a few weeks. We just need evidence up to February to satisfy the STA.”

[51]Andrew Gilligan responded almost immediately: “I can do but it won’t add up with the RTI records as our accountant would have noted her and date when we did end it with them.”

[52]There was no evidence that Andrew Gilligan had changed the dates requested, and the Tribunal accepts that he had not, and accordingly there could not have been an act of gross misconduct. Having considered all of the evidence, the Tribunal took the view that Andrew Gilligan was not in breach of contract and he was entitled to be paid his notice pay in the agreed sum.

[53]There was no argument raised by the respondent as to whether, after a certain point, the claimant’s over draft losses become too remote from the original underpayment for the respondent to continue to remain liable i.e. the chain of causation has been broken, and the Tribunal in any event, was not provided with any evidence to this effect by any party. From the bank statements, it appeared the £459.00 over draft fees were directly caused by the non-payment of wages and notice pay; accordingly, it is just and equitable to order the re-payment of overdraft fees.

[54]In conclusion: David Denton – Case No: 2405186/201614. The claimant suffered an unlawful deduction of wages for the period 1 July 2016 to 22 July 2016 inclusive in the agreed sum of £2,324.00 net, and the respondent is ordered to pay to the claimant compensation in the sum of £2324.00.

15. The claimant suffered an unlawful deduction of wages in respect of childcare vouchers for the month of June 2016 in the agreed sum of £124.00 and the respondent is ordered to pay to the claimant compensation in the sum of £124.00.

16. The claimant's claim for accrued unpaid expenses during his employment in the sum of £1,020.50 is well-founded, and the respondent is ordered to pay to the claimant £1,020.50.

17. The claimant's wrongful dismissal claim for notice pay is dismissed upon withdrawal.

18. The claimant's claim for childcare vouchers payable in the month of July 2016 is dismissed upon withdrawal.

19. The claimant's claim for unpaid pension contributions in the month of July is well-founded, and the respondent is ordered to pay to the claimant employer contributions in the agreed sum of £22. Mr A Gilligan – Case No: 2405189/2016

20. The claimant's claim for wrongful dismissal is well-founded, and the respondent is ordered to pay to the claimant one week’s contractual pay in the sum of £338.14 net.

21. The claimant’s claim for unpaid expenses is well-founded, and the respondent is ordered to pay to the claimant unpaid expenses in the sum of £25.01.

22. The claimant’s claim for overdraft fees is well founded, and the respondent is ordered to pay £459.00 to the claimant.

23. The claimant’s claim for holiday pay is dismissed upon withdrawal. Miss M Toolan – Case No: 2405191/2016

24. The claimant's claim for wrongful dismissal is well-founded, and by consent the respondent is ordered to pay to the claimant £518.60 by way of unpaid notice.

25. The claimant’s claim for accrued unpaid holiday pay is well-founded, and the respondent is ordered to pay to the claimant the agreed sum of £518.60 net.

26. The claimant's claim for pension contributions is not well-founded and is dismissed.

27. The claimant was provided with a statement of terms and conditions of employment in accordance with section 1 of the Employment Rights Act 1996 as amended. 16.3.18 Employment Judge Shotter

The Facts

[1]This is a Reconsideration to consider the claimant’s application set out in an email sent 4 April 2018 and the respondent’s response to it sent 25 May 2018.

[2]Paragraph 36 of the 22 March 2018 promulgated judgment confirmed the claimant was provided with a contract of employment six-months after starting as a full-time employee on 15 June 2016. The Judgment does not make it clear that the claimant was issued with a statement of terms and conditions of employment before this date; he was not and the earliest date when the respondent complied with Section 1 of the Employment Rights Act 1996 (“the ERA”) was 15 June 2016.

[3]Section 1 ERA provides that, not later than two months after the beginning of an employee’s employment, the employer must give him or her a written statement of his or her employment particulars. The particulars that must be included in that statement are set out in S.1(3) (particulars of employment), S.1(4) (particular terms of employment) and S.3(1) (disciplinary procedures and pensions). The claimant was not provided with this information until 15 June 2016.

[4]Section 38 of the Employment Act 2002 states that tribunals must award compensation to an employee where, upon a successful claim being made under any of the tribunal jurisdictions listed in Schedule 5, it becomes evident that the employer was in breach of its duty to provide full and accurate written particulars under S.1 ERA – Ss.38(1)–(3). No compensation was awarded to the claimant, when it should have been.

[5]Under rule 70 schedule 1 of the Employment Tribunals Rules of Procedure a Tribunal may reconsider any Judgment where it is necessary in the interests of justice to do so. In this case the Tribunal found it is in the interests of justice to reconsider the decision in accordance with the claimant’s application as set out in the email of 4 May 2018. The Tribunal’s discretion must be exercised judicially and with regard not just to the interests of the parties seeking the reconsideration, but also to the other parties, and the requirement for finality to the litigation and giving effect to the overriding objective.

[6]Section 38 of the Employment Act 2002 states that Tribunals must award compensation to an employee where, upon a successful claim being made under any of the tribunal jurisdictions listed in Schedule 5, it becomes evident that the employer was in breach of its duty to provide full and accurate written particulars under S.1 ERA – Ss.38(1)–(3).

[7]Compensation under S.38 is available only where ‘the employment Tribunal finds in favour of the employee’. The Tribunal found in favour of the claimant.

[8]The Tribunal must award the ‘minimum amount’ of two weeks’ pay and may, if it considers it just and equitable in the circumstances, award the ‘higher amount’ of four weeks’ pay – S.38(2), (3) and (4). The Tribunal does not have to make any award under S.38 if there are exceptional circumstances which would make an award or increase unjust or inequitable – S.38(5). As the respondent had provided a statement of terms in accordance with Section 1 outside the two-month period it is not just and equitable to order 4-weeks pay as the respondent had made some attempt to comply with its statutory obligations. It is just and equitable to award the minimum 2-weeks gross pay, there being no exceptional circumstances such an award unjust and inequitable.

[9]A ‘week’s pay’ is calculated in accordance with Ss.220–229 ERA and is limited to the maximum under S.227 (£479 in 2016) – S.38(6). The date of calculation is the effective date of termination of employment – S.38(7). The claimant was in receipt of salary amounting to £5000 gross per annum and the statutory cap of £479 must be applied.

[10]In conclusion, the Judgment promulgated on 22 March 2018 is varied to include compensation for failure by the respondent to provide a statement of terms and conditions of employment under Section1 of the Employment Rights Act 1996 as amended. In accordance with Section 38 the respondent is ordered to pay to the claimant compensation in the sum of £958.00 (£479 statutory cap x 2). Employment Judge Shotter 29.5.18 15 June 2018 NOTICE THE EMPLOYMENT TRIBUNALS (INTEREST) ORDER 1990 Tribunal case number(s): 2405186/2016 Name of Mr D Denton v Govdata Limited case(s): The Employment Tribunals (Interest) Order 1990 provides that sums of money payable as a result of a judgment of an Employment Tribunal (excluding sums representing costs or expenses), shall carry interest where the full amount is not paid within 14 days after the day that the document containing the tribunal’s written judgment is recorded as having been sent to parties. That day is known as “the relevant decision day”. The date from which interest starts to accrue is called “the calculation day” and is the day immediately following the relevant decision day. The rate of interest payable is that specified in section 17 of the Judgments Act 1838 on the relevant decision day. This is known as "the stipulated rate of interest" and the rate applicable in your case is set out below. The following information in respect of this case is provided by the Secretary of the Tribunals in accordance with the requirements of Article 12 of the Order:- "the relevant decision day" is: 15 June 2018 "the calculation day" is: 16 June 2018 "the stipulated rate of interest" is: 8% MRS L WHITE For the Employment Tribunal Office

The Facts

[1]This is a hearing to consider the application made on behalf of the claimant’s set out above for a cost and preparation time order following promulgation of the Judgment and Reasons (“the promulgated judgment”) on 22 March 2018 in respect of the first, second and third claimant. With reference to the fourth claimant the judgment was promulgated on 10 October 2017 with an order that her application for costs would be dealt with at a later hearing.

[2]On 18 April 2018 the claimants applied for costs and a preparation time order pursuant to Regulation 75 of the Employment Tribunal Rules of Procedure 2013 (“the 2013 Regulations”) in respect of costs incurred by the first claimant since 2016 and preparation time orders in respect of the second and third claimant for the period leading up to and including the postponed hearing of 6 December 2017 and final hearing of 5 March 2018. The basis of the costs and time preparation application lies in Regulation 76(1)(a), (b), 76(2) and 76(4) of the 2013 Regulations. In short, it is maintained the respondent has acted vexatiously, abusively or otherwise unreasonably in the way it has conducted the proceedings.

[3]In a letter dated 9 July 2018 the respondent resisted the costs application setting out its grounds for doing so, in short submitting it had a reasonable prospect of success and postponements were sought on medical grounds, or were due to the claimants being uncooperative. It made the valid point that the costs sought were “an exceptionally high amount of money claimed for the nature and complexity of the claim” and there was no guarantee this would be recovered. It was further alleged the claimants were uncooperative in relation to the bundle, and it was the “claimants who sought to delay and make the process of litigation more difficult than it needed to be, and it was “unlikely” the first respondent had paid £23,021.76 personally.

[4]The claimant’s claims are for unlawful deduction of wages, breach of contract, accrued holiday pay and failure to provide a statement of terms and conditions of employment in accordance with the Employment Rights Act 1996 as amended. They were relatively straightforward claims and listed fast track, but following the delayed filing of the ET3 and an extension of time application heard at a preliminary hearing, the matter became more complex. The respondent maintained the first claimant had fabricated his claim for wages and expenses, it was denied he worked the hours claimed and alleged he had “purposely” taken business from the respondent during his employment and he had resigned. With reference to the second respondent it was alleged he had been dismissed for “gross misconduct” and under the legal principle “ex turpi causa non orilur centric” was not entitled to money; he was under criminal investigation, he had made fraudulent claims and “fraudulently signed in and business bank accounts.” With reference to the third claimant gross misconduct was also alleged.

[5]There have been numerous occasions when the respondent had failed to comply with case management orders, final hearings have been adjourned as a result of applications made by the respondent and this has extended the litigation from the first listing of the trial on 17 January 2017 to the hearing on 14 March 2018, some 17 months later and the Tribunal accepts this has resulted in additional costs being incurred by the claimants. The Tribunal does not intend to repeat the chronology in any detail, it is noted from the file despite an extension of time being granted, the respondent failed to lodge the ET3 and given the claimants’ objection to a further extension and the exchange of a substantial amount of correspondence between the parties and the Tribunal, a reconsideration hearing took place. During this period, in an email dated 9 March 2016, the respondent confirmed civil actions had been prepared and there was a current criminal investigation by the police into “obtaining property by deception, conspiracy to defraud and Computer Misuse Act.” Other similar correspondence followed, and given the serious allegations there was much acrimony between the parties. It became apparent at the liability hearing that there was evidence on the part of Mr Hugo, of some spite or desire to harass the claimants by these allegations. Mr Hugo was improperly motivated, and it was not simply the case of him being misguided when he represented the respondent without seemingly having initially taken legal advice. It also became apparent, contrary to the respondent’s written submissions set out in the 9 July 2018 letter, the grounds set out in the Response had little or no discernible basis in law and its effect was intended to frighten away the claimants from the litigation, and subject them inconvenience, harassment and expense out of all proportion of the real issues in the case. The fact that all the claims were dealt with at the same time, and the other claimants relied to a great extent on the legal advice received by the first claimant, resulted in an increase in the amount of costs. The Tribunal has factored this fact into its assessment on costs and preparation time.

[6]Coupled with Mr Hugo’s less than truthful evidence, the Tribunal was satisfied the respondent’s defence and the manner in which it conducted its defence, involved an abuse of the process of the Tribunal. Objectively, Mr Hugo should have known the respondent’s defence was groundless and his intention was simply to harass by the highly personal and damaging nature of the allegations that were entirely without substance. Mr Hugo’s demeanour before the Tribunal gave the impression that he had no belief in the genuineness of the defence, and indeed he was found to have been” an inaccurate historian” who made serious and unsubstantiated allegations that amounted to unreasonable conduct, and there is a direct correlation with the manner in which this litigation was dealt with by Mr Hugo and the substantial costs incurred by the first claimant.

[7]The respondent applied for an adjournment of the reconsideration hearing, which was granted and followed by correspondence sent on behalf of the first claimant to the effect that the respondent had deliberately misled the Tribunal in its application and costs were sought. On 26 June 2017 the extension of time in which the respondent presented its response was granted and case management orders were made. A 2-hour preliminary hearing took place on 2 October 2017, originally the date for the liability hearing, and this was followed by a number of judgments, including one in favour of the third claimant in respect of her wrongful dismissal. It became apparent the case was not ready for trial as the respondent was in default of earlier case management orders and there were issues with disclosure and the claimant’s understanding of the respondent’s defence, which it clarified as set out in the Case Management Order sent to the parties on 10 October 2017. The respondent confirmed it relied on the response set out in the ET3, and clarified its case against that second claimant was that he should not benefit from an illegal act of fraud, the first claimant had resigned and it followed there could not have been a wrongful dismissal.

[8]Confusingly, the respondent (who was legally represented at the time) also confirmed the second claimant had carried out his duties but not worked, and as a result an application was made to strike out the respondent’s defence with regards the second claimant’s unlawful deduction claim or order a deposit. The strike out application was listed for 6 December 2017; but as matters transpired the hearing did not proceed on that basis. The remedy hearing was listed for 26 January 2018.

[9]At the 6 December 2017 hearing the first claimant and respondent were legally represented, the second claimant was not but was assisted by the first claimant’s legal representative. In respect of the second claimant the respondent conceded it had unlawfully deducted the second claimant’s pay but disputing holiday pay claim based on an overpayment, a defence that had not been raised in the ET3 and an application to amend the Response was made and granted in the interests of justice with the respondent being forewarned on behalf of the claimants that should it fail in its defence costs would be sought. The issues were discussed and the respondent continued to make allegations of fraudulent behaviour and gross misconduct. Judgment by consent was issued in favour of the second claimant for unlawful deduction of wages and the pension contribution claim dismissed on withdrawal by the second claimant. A Case Management Order was sent to the parties on 3 January 2018 that reflected the discussion, and the agreed issues which included whether the respondent was entitled to dismiss the second claimant as a result of his breach of contract and whether or not the respondent was entitled contractually not to pay the first claimant’s notice pay amongst other matters. Reference was again made on behalf of the claimants to a costs application against the respondent.

[10]On the 17 January 2018 the respondent applied for an adjournment of the 26 January 2018 hearing, which the claimants refused to consent to in various emails. Nevertheless, the respondent’s application was granted and the hearing took place on 5 March 2018 following which judgment was reserved to in chambers hearing held on 13 March 2018. The reserved judgment and reasons was promulgated on 22 March 2018 and under the heading “Evidence” some of Mr Hugo’s responses to questions put to him under cross-examination were recorded. In relation to the first respondent’s claim for unpaid expenses Mr Hugo, who gave evidence on behalf of the respondent, did not dispute the mathematical calculation or the fact that the expenses had been incurred, his case was that other options would have been cheaper i.e. Mr Hugo picking up the first claimant instead of a taxi. This was not specifically pleaded in the ET3, and Mr Hugo gave the impression of giving evidence which suited him at the time, evidence that had no basis in any reality. He was not found to have been a credible witness, and the case put forward in evidence at the liability hearing was unrecognisable to the pleaded defence. For example, there is a difference to the first claimant having allegedly fabricating his claim for wages and legitimately expenses to claiming expenses, which are attacked on the basis that first claimant could have taken up other options, such as cheaper notary fees. It was denied he worked the hours claimed but there was no satisfactory evidence to this effect, and alleged he had “purposely” taken business from the respondent during his employment for which there was no satisfactory evidence the first claimant had been guilty of misconduct.

[11]The first claimant primarily contended the respondent’s defence to his claim had no reasonable prospects of success, and the 5 March 2018 Judgment supported this view at paragraphs 5(4), 7, 8, 11, 16, 17 and 18. The Tribunal, based on the evidence before it, agreed. The respondent had no defence to the first claimant’s unlawful deduction of wages claim and it would have been aware form the outset that the first claimant had worked hours for which he had not been paid. Despite the threat of costs made at various junctures throughout these proceedings, the respondent continued to press its defence putting the first claimant to a great deal of costs as a result of the protracted litigation touched upon above. The respondent late in the afternoon on the liability hearing conceded the first claimant’s claims and this late concession, given the factual matrix of the litigation, amounted to the respondent acting vexatiously, abusively or otherwise unreasonable in the way it has conducted these proceedings, especially given the content of the ET3 which resulted in the first and second claimant concerned as to the extent of disclosure necessary to defend the respondent’s allegations, and querying what documents should be included within the trial bundle.

[12]Turning to the second claimant’s claim for costs, the Tribunal repeats its observations above. It was submitted that as the respondent had conceded at the 6 December 2017 hearing an element of the unlawful deduction of wages claim, and given the amendment to the ET3 pleading the respondent had overpaid 6.5 days holiday, the second respondent incurred wholly unnecessarily preparation time and time off work. The Tribunal accepts the submission that the respondent produced little if no supporting evidence that the second claimant had committed an act of gross misconduct, or any basis why the overdraft fees he incurred should not be met by the respondent given the causal nexus between those fees and monies legitimately payable by the respondent to the second claimant. In assessing the preparation time, the Tribunal has taken into account the fact that whilst the second claimant was not legally represented, he was greatly assisted by the first claimant’s legal representation. The same point applies to third and fourth claimant.

[13]Turning to the third claimant, it was correctly submitted the respondent did not present any evidence in defence of her claim for wrongful dismissal and outstanding holiday pay, conceding late on in the litigation the third claimant was owed the money despite the defence set out in the ET3.

[14]Finally, with reference to the fourth claimant it was submitted the respondent improperly withheld sums owing to her without reason, and its defence had no reasonable prospects of success. The Tribunal agreed. Law

[15]The Employment Tribunal Regulation 2013 (“the 2013 Regulations”) set out in Rules 74-79 the provisions by which the Tribunal has a discretion to make a cost or preparation time order. Rule 76(1)(a) provides that: “A Tribunal must consider whether to make a costs order against a party where he or she has acted unreasonably in the bringing or conducting of proceedings”.

[16]Rule 76 of the Tribunal Rules 2013 imposes a two-stage exercise for a Tribunal in determining whether to award costs. First, the Tribunal must decide whether the paying party (and not the party who is seeking a costs order) has acted unreasonably, such that it has jurisdiction to make a costs order. If satisfied that there has been unreasonable conduct, the Tribunal is required to consider making a costs order and has discretion whether or not to do so. Fees for this purpose means fees, charges, disbursements or expenses incurred – rule 74(1) Tribunal Rules 2013.

[17]In Employment Tribunal proceedings costs do not ordinarily follow the event, unlike County Court and High Court actions.

Conclusion

[18]The Tribunal is aware that it is “rare” for costs orders to be appropriate in Employment Tribunal proceedings; they do not follow the event as in the ordinary course of litigation. Having regard to the nature, gravity and effect of the unreasonable conduct as identified by the Tribunal above, factors relevant to the exercise of the discretion, and bearing in mind the respondent through its managing director Mr Hugo, had also behaved unreasonably in the manner set out above, it is just and equitable to make a cost award taking into account means.

[19]The Tribunal accepts the validity of the submissions made on behalf of all the claimants that the respondent deliberately deployed delaying tactics and intentionally raised a number of serious allegations so as to de-rail these proceedings by upsetting the claimants with its references to alleged civil proceedings (which never materialised) fraud (which never materialised), police investigations (which never materialised) and so on. The Tribunal was reminded the respondent attempted to adjourn the 5 March 2018 hearing some 4-days before it was due to be heard, albeit unsuccessfully as the adjournment was refused.

[20]The Tribunal is satisfied the respondent has acted unreasonably in defending the proceedings, and in the manner in which its defence was set out within the ET3, including the serious allegations of fraud and a criminal investigation, e.g. the reference to Andrew Gillighan fraudulently “signing in and business accounts” and David Denton’s alleged gross misconduct and fabrication of expenses. As indicated in the 5 March 2018 judgment there are numerous references to Christian Hugo, the CEO, giving contradictory and disingenuous evidence. He did not give credible evidence, and late on in the day fundamentally conceded the expenses were incurred, but disputing the amount. As set out in paragraph 17 of the promulgated judgment, Kelly Hugo’s evidence resulted in a concession that an unlawful deduction of wages had taken place. Paragraph 18 made the observation that had the respondent addressed mind properly in the case, it would have realised there was no defence to the unlawful deduction of wages. It is marked a number of claims were settled sometime after proceedings were issued, and the respondent’s inability to produce any satisfactory evidence at the liability hearing of the alleged misconduct and fraud was notable.

[21]The Tribunal has considered the schedules of costs filed and notes a great deal of time and expense was spent drafting correspondence in additional to dealing with the various hearings. Mr Jagpal was persuasive in is argument that the respondent’s various applications to adjourn resulting contentious party-to-party correspondence was indicative of the distrust between the parties, and the Tribunal agreed with this analysis. However, Mr Jagpal was unfortunately not the advocate at the liability hearing, had he been so, it would have become apparent to him that there existed real issues in respect of Mr Hugo’s credibility when he attempted to unsuccessfully justify seeking an adjournment. An example of Mr Hugo’s lack of credibility was evidenced by reference to contemporaneous documentation before the Tribunal produced in support of the adjournment application from which it appeared he booked football tickets followed by flights in order that he could attend a football match and this was the reason for the adjournment. In the letter dated 9 July 2018 the submission made on behalf of the respondent that its request for postponements were sought on medical grounds was unsupported by the contemporaneous documentation.

[22]An employment tribunal also has a discretion to make a costs order or preparation time order (PTO) where it considers that a claim or response has no reasonable prospect of success — rule 76(1)(b) Tribunal Rules 2013. A two-stage test applies requiring the tribunal to consider(1) whether this ground is made out, and

(2) exercise a discretion as to whether or not to actually award costs. Whether or not the party has received legal advice or is acting completely alone may be an important consideration when deciding whether or not to make a costs order or PTO against him or her. The Tribunal took the view that Mr Hugo, when he filed the ET3 on behalf of the respondent, on an objective assessment of the evidence, should have realised there was no rational basis for him to conclude the defence had any prospect of success at any time. He had, or should have had, knowledge that there was no reasonable defence, and sought instead to muddy the waters by a raft of unmeritorious allegations that were untrue. This continued throughout the proceedings until the liability hearing, even when the respondent was represented by legal advisors, presumably acting under the instruction of Mr Hugo. In short, the Tribunal is satisfied the respondent’s defence did not have a reasonable prospect of success either at the time of conception or during the course of the litigation.

[23]Considering Mr Hugo’s behaviour and that of the respondent, it is a nigh on impossible exercise to allocate precisely those costs incurred as a result of the adjournments and the general unreasonable behaviour of Mr Hugo throughout these proceedings without carrying out a detailed assessment. An agreement was reached with the parties that the Tribunal would deal with costs taking a broad brush as to quantification, and it had done precisely this, mindful of the fact at all times a costs order is unusual, it is not a punishment for bad behaviour and given the amounts involved in this litigation, the sum of £19,000 finally awarded in the first claimant’s favour is recognised by the Tribunal to be a substantial amount of money, and not one easily ordered to be payable by the respondent. This was an exceptional case.

[24]It can be seen from the schedule of costs produced on behalf of the first respondent, a considerable proportion of the time and expense was uncured by the David Denton progressing his complaint, and the other claimants hung onto his coat tails. The majority of the costs, if not all, were incurred by David Denton and Lowri Denton, to a lesser extent. The Tribunal learnt that some of Lowri Denton’s costs were met by the insurer, and a small proportion of David Denton’s costs; £3879.57, were also covered. The Tribunal has not reimbursed the insurer for its legal costs incurred within this litigation, and the costs ordered relate to David Denton’s personal expenditure which was in excess of £20,000. Justice would not be met if the first claimant’s damages recoverable against the respondent were subsumed in their entirety, given the fact the respondent through Mr Hugo, had acted vexatiously, abusively or otherwise unreasonable in the way it has conducted the proceedings throughout, including up to the liability hearing. The Tribunal was satisfied, despite the respondent’s submissions to the contrary, the first claimant had incurred legal costs in excess of £20,000 and it was just and equitable, in all of the circumstances in this exceptional case, for the respondent to pay a contribution of £19,000 towards the first respondent’s costs. In arriving at this decision, the Tribunal did not accept the validity of all the written submissions made on behalf of the respondent. From its perusal of the Tribunal file, there was no evidence of the claimant’s being especially uncooperative given the various applications made by the respondent to adjourn, extend time limits, amend pleadings and so on. There was no evidence the claimants’ sought to delay the litigation process and liability hearing, to the contrary, it was Mr Hugo on behalf of the respondent who in the words of the respondent (aimed at the claimants’ behaviour) “sought to delay and make the process of litigation more difficult than it needed to be.”

[25]Mr Jagpal submitted that early in the litigation following the extension of time for the ET3 to be filed and the respondent’s failure to do so, the claimant’s legal advisors took an overly unnecessarily aggressive approach, and the Tribunal agreed that to a limited extent this appeared to have been the case. This accordingly has been factored in and reflected in the costs order. It revisited the copy party-to-party correspondence on file which was marked on both sides by aggression and distrust. Nevertheless, it was the respondent who had acted “vexatiously, abusively, disruptively and otherwise unreasonably (Section 26(1)(a) of the 2013 Regulations) throughout this litigation, and from the outset its Response had no reasonable prospects of success with regards the main issues in contention, ignoring peripheral claims such as pension contributions. It is the Tribunal’s view that considering the entire factual matrix of this ligation the respondent has met the threshold test for a costs order having regard to all the circumstances, even making an allowance for the fact that Mr Hugo was not legally qualified when he drafted and filed the ET3, a pleading that was unreasonable in content and inflammatory within the litigation, as were subsequent emails form Mr Hugo reinforcing the serious allegations made. This is not the case of a managing director responding to proceedings in an inexperienced and naïve fashion, Mr Hugo’s lack of objectivity went much deeper resulting in wild allegations of fraud and breach of contract. In arriving at its judgment on costs, the Tribunal took into account that the minor unsuccessful claims did not undermine the basic premise that the respondent had lodged a defence and proceeded to deal with the claims on that basis when a more reasonable respondent, acting objectively, would not have acted in such an unreasonable manner. In short, all of the first respondent’s claims succeeded and he was awarded compensation 20 months after the monies became due, and 19 months after he had served the ET1. With the exception of a £30.00 expense claim, all of the second claimant’s claims succeeded, as did the third claimant, with the exception of the pension contribution claim that had a negligible value. Finally, the fourth claimant’s claims were successful, and she was awarded monies owned to her 14 months after they became due, and 11 months after the ET1 was served.

[26]With reference to the second claimant’s application for a time preparation order, given the fact that he had benefitted by the first respondent’s handling of the litigation and the costs incurred on behalf of the first respondent, taking into account the time spent by the second claimant on a broad brush basis and reducing that time considerably, the Tribunal concluded it was just and equitable to award the second claimant a contribution in the sum of £500 reflecting the fact that he was facing a complex defence raised by the respondent involving damaging allegations of fraud and threats of criminal and civil action that never transpired.

[27]With reference to the time preparation order relating to the fourth respondent, the Tribunal agreed with the respondent and concluded the time spent was excessive given the first respondent’s input, and it did not order any contribution of costs towards the preparation of time spent. The fourth claimant’s husband, the first claimant, was represented and the Tribunal took the view she benefitted from this. A costs order can only be made in favour of a represented party (either legally represented or represented by a lay representative) and a PTO can only be made in favour of a party who has not been legally represented — i.e. an individual who is representing him or herself or a party who has a lay representative. It is not possible to make both types of order in favour of the same party in the same proceedings according to Rule 76(3).

[28]Accordingly, the respondent was not ordered to pay time preparation costs to the fourth claimant, and her application is dismissed.

[29]The Tribunal took into account the respondent’s means; there was no evidence before it that the respondent could not afford a costs order in the sums set out below. For the avoidance of doubt, when arriving at its decision to award costs and a time preparation order if favour of the claimants, it took into account the whole picture of what happened in this case, concluded that there had been unreasonable conduct on the part of the respondent in defending and conducting the case as set out above, and the fact that a costs award against a party is not a punishment.

[30]In conclusion, the respondent is ordered to pay to the first claimant, Mr David Denton, a contribution towards legal costs in the sum of £19,000. The respondent is not ordered to pay legal costs to the fourth claimant, Mrs Lowri Denton, and her application for costs is dismissed. The respondent is ordered to pay a contribution towards preparation time in respect of the second claimant. Mr Andrew Gilligan, in the sum of £500.00.

[31]The respondent is ordered to pay a contribution towards preparation time in respect of the third claimant. Miss M Toolan, in the sum of £300.