Mr P Baiano and Others v Complete Restaurant Group Ltd: 3303015/2024 and Others Mr P Baiano and Others v Complete Restaurant Group Ltd: 3303015/2024 and Others
JUDGMENT
[1]Under section 163 Employment Rights Act 1996 it is determined that claimants 1, 3, 4, 5, 6, 7, 8 and 9 are entitled to a redundancy payment in the amounts specified in column C of Table 1 below, which the respondent shall pay those claimants.[2]The complaints of breach of contract in relation to notice pay, made by each claimant, are well-founded. The respondent must pay each claimant the amount specified in column D of Table 1 below as damages for breach of contract. Those figures have been calculated using gross pay to reflect the likelihood that the claimants will have to pay tax on them as Post Employment Notice Pay.[3]The complaint of breach of contract in relation to repayment for expenses, made by claimants 7, 9 and 10, is well-founded. The respondent must pay those claimants the amounts specified column H of Table 1 below as damages for breach of contract. Those figures have been calculated net.[4]The complaints of unauthorised deductions from wages regarding wages for December 2023, made by claimants 2, 5, 6, 7, 8, 9 and 10, are well-founded. The respondent shall pay the claimants the amounts specified in column E of Table 1 below, which are the gross sums deducted.[5]The complaints of unauthorised deductions from wages regarding wages for January 2024, made by each claimant, are well-founded. The respondent shall pay each claimant the amount specified in column F of Table 1 below, which are the gross sums deducted.[6]The complaints of unauthorised deductions from wages regarding “tronc” payments, made by claimants 1, 2, 4, 5, 6, 7, 8, 9 and 10, are well-founded. The respondent shall pay the claimants the amounts specified in column G of Table 1 below, which are the gross sums deducted.[7]The third claimant’s complaint of unfair dismissal is dismissed upon withdrawal. TABLE 1 – AMOUNTS TO BE PAID BY THE RESPONDENT TO THE CLAIMANTS A B C D E F G H Notice Claimant Redundancy Pay Dec pay Jan Pay Tronc Expenses # Name payment (gross) (gross) (gross) (gross) (net)[1]Mr P Baiano £5,787.00 £4,615.38 - £3,333.33 £980.00 -[2]Mrs S Ibrahimi - £345 £1,050.78 £1,725.00 £175.00 - Mr V Marek £1,730.79 £1,153.85 - £1,666.67 - -[4]Mr P Simko £3,858.00 £4,500.00 - £3,250.00 £600.00 -[5]Mr S Nixon £2,461.54 £1,846.16 £307.65 £2,666.67 £80.00 -[6]Miss Z Gryllaki £1,500.00 £1,500.00 £255.96 £2,166.67 £80.00 -[7]Mr S Bedford £1,500.00 £1,500.00 £365.57 £2,166.67 £80.00 £52.60[8]Mr J Finnis £1,500.00 £1,500.00 £251.06 £2,166.67 £80.00 -[9]Mr A Rae £3,215.00 £4,326.92 £562.50 £3,750.00 £80.00 £105.20[10]Miss J Blythe - £500 £203.16 £2,166.67 £80.00 £120.00REASONS
[1]These claims, had previously been consolidated into one case. Claimants 1 to 4 had brought their cases individually (i.e. on separate forms) whereas claimants 5 to 10 had brought their claim on one “multiple” claim form. The original claim numbers assigned to each appear in the header above. For reasons which were unclear, Mr Nixon’s claim(s) had been assigned two claim numbers, although there appeared only to be one claim form. For the avoidance of doubt I ordered that both Mr Nixon’s claims be consolidated. Having checked at the hearing it appeared to me that, taking into account where necessary the relevant periods of early conciliation, all of the claims had been presented in time. This included the claim of Mr Simko – his claim was originally rejected but it was accepted upon reconsideration under what was then rule 13(1)(b), being deemed to have been presented on 22 May 2024 by operation of rule 13(4) (rule 13 is now rule 14).[2]In its response to the claims the respondent indicated that no parts of the claims were contested. I had therefore previously made orders (by letter of 18 October 2024) that under what was then rule 21 (now rule 22) this hearing should be fixed in order to determine the claims. I had made some orders for the provision by the claimants of further information in writing (e.g. figures for gross and net pay) which would allow me to determine the claims. I also gave leave for the respondent to participate in the hearing if it so wished. On 9 January 2025 the Tribunal received an email from the respondent, explaining that the respondent would not be attending; it was in a difficult financial position. According to the Companies House website there is an active proposal to strike the company off. The claimant Mr Baiano told me that that process had been suspended upon his application until May of this year. In all the circumstances I decided it was appropriate to determine the claims at today’s hearing.[3]The respondent company operated a restaurant at which all of the claimants worked, in various roles. All of the claimants were dismissed without notice by a letter of 31 January 2024, which explained that the respondent was in significant financial difficulties. Presumably, the respondent might argue that there was a good reason for the lack of proper notice. That, however, is not relevant to the decisions I had to make. All of the claimants had well-founded claims for statutory notice pay and also for, in the case of the claimants who had been employed for more than two years, redundancy payments. None of the claimants were paid any wages for January 2024 and so each also had a well-founded claim for the unauthorised deduction of one month’s wages. Some claimants had also been paid less than they should have been (the precise amount of the shortfall varying as between the claimants) for their work in December, so each of those claimants had a well-founded claim for the unauthorised deduction of part of their December wages.[4]The particular complaints brought by each individual claimant will be clear from the judgment above. Each complaint was raised on the relevant claim form, with the exception of some of the complaints relating to tronc payments and expenses, which were raised in the responses to my orders of 18 October 2024 and/or at today’s hearing. Where such complaints had not been raised on the claim form, I took the view that it was in the interests of justice to allow the claim to be amended, on the basis that this would cause the respondent no material prejudice since tronc and expenses complaints had been raised on the claim forms of some claimants, so that the respondent had had the opportunity to respond to the issues generally. In contrast, in his response to my orders of 18 October the claimant Mr Rae had sought to claim for accrued holiday pay. I treated that as an application to amend the claim, but refused it on the basis that the respondent had not had notice of the application and had not had the opportunity to address the issue generally, since none of the other claimants had made a claim for holiday pay.[5]The claimant Mr Marek had indicated on his claim form that he made a complaint of unfair dismissal. However I was able to clarify with him at the hearing that he in fact he was only seeking notice pay, redundancy pay and arrears of pay. By agreement I therefore dismissed the complaint of unfair dismissal upon withdrawal.[6]I explained to the claimant Mr Baiano that I did not have the power to make an award for the amounts which he said were deducted from his wages in order to make pension payments but were not, on his case, paid to the pension provider. This is a matter that would have to be taken up with the pensions regulator. I also explained that on the basis of the complaints that were before the Tribunal I had no power to order compensation for wages that would have been paid after January had the claimants not been dismissed (save of course that the judgments for notice pay and redundancy pay offer some compensation for that). Mr Simko was able to clarify that he was not seeking compensation for the loss of his company car.[7]As I have said, some of the claimants also complained that they had not been paid their share of the “tronc” between November 2023 and January 2024. I heard evidence on oath from the claimant Mr Baiano, who had been the restaurant manager, about this. He told me the following, which I accept. Tips were collected by the respondent in a tronc and distributed each month amongst the employees. Each employee would receive the same proportion of the “pot” each month; the figure for the proportion received depended on what sort of work the employee did (for example, kitchen staff all received the same proportion as each other, though that proportion was different to the proportion received by the waiting staff). Each employee’s share was paid monthly by the respondent, accompanied by a separate payslip (i.e. separate from the employee’s main payslip). Mr Baiano believed tax was taken off at source (i.e. PAYE). On this basis I concluded that the money actually collected by the respondent in November and December but not paid to the claimants amounted to an unauthorised deduction from wages. It was, taking account of the EAT’s decision in Saavedra v Aceground Ltd t/a Terrazza Est 1995 IRLR 198, “properly payable” under the contract or otherwise in connection with employment (i.e. within the meaning of ss 13 and s 27 Employment Rights Act 1996). It seemed to me, on the basis of what Mr Baiano told me, that there was a contractual right under the employment contract (even if it was not in the written contracts) to the payments, but that even if that were wrong the money must have been payable otherwise in connection with employment. In contrast, since, as Mr Baiano had told me, the restaurant had not opened in January and therefore no tips had been collected, there was no question in my judgment of their having been an unauthorised deduction by virtue of the failure to make payments for January.[8]Three claimants claimed for expenses. Expenses do not come under the legal definition of wages for the purposes of a complaint of unauthorised deductions from wages. However, where there is a contractual entitlement to the payment of wages, an order for the payment of damages may be made under the Tribunal’s jurisdiction to deal with breaches of the employment contract. In this case the claimants told me, and I accept:(i) that their written contract made provision for the payment of expenses, provided that receipts were provided and(ii) that they did in fact provide the receipts to the respondent. Those claims were therefore also well-founded.[9]The basis for the calculations is as follows:a. The last day in work for each claimant was 31 January 2024.b. The calculations for the amounts in Table 1 above were based upon the figures in Table 2 below.c. Notes on the figures in Table 2 are as follows: i. Most of the claimants were able to supply me with gross and net figures for their monthly pay; if so, these are recorded in Table 2 below. Miss Blythe had not provided information about her gross pay. However I was told that the figure was the same as for Mr Finnis, so I used the figure he had provided. ii. The claimant Mrs Ibrahimi provided me with figures for gross weekly pay. For the other claimants I calculated gross and net weekly pay by multiplying the figures for gross and net monthly pay by 12 and then dividing by 52. iii. Most of the claimants provided start dates for their employment, allowing me to calculate how many years they had worked for the respondent. Mr Marek’s form did not say when he started but did say he worked for the respondent for three years.d. Statutory redundancy is calculated on the basis of a week’s gross pay (up to the statutory weekly cap, for a maximum of 30 weeks). Taking into account a maximum of 20 years, the claimants receive: 1.5 weeks’ pay for each year they were not below that age of 41 (at any point in the year); 1 week’s pay for each year they were at some point below 41 but not below 22; 0.5 weeks’ pay for any year when below 22 at any point. In the case of claimants 1, 4 and 9 their weekly pay exceeded the statutory cap, so the weekly figure used to calculate their redundancy payment was £ 643, i.e. the cap applicable at the time of their redundancy. Each claimant who sought a redundancy payment had provided their dates of birth, which allowed me to calculate the number of weeks’ pay due. The exception was Mr Nixon. I accepted his calculation that he was due a total of 4 weeks’ pay (1 week for 1 year worked aged 40 and 3 weeks for 2 years worked aged over 40).e. The notice pay due, implied into the claimants’ contracts by statute, is calculated as follows: 1 week’s pay where the claimant was employed for between 1 month and 2 years; otherwise, 1 week’s pay for each full year in employment (up to a maximum of 12).f. The shortfall in December pay was provided by claimants 2, 9 and 10 as a known gross figure. Where a claimant did not have a gross figure, they were able to provide me the net figure that they were not paid that month. I divided this by the net monthly pay, and multiplied the result by the gross monthly pay, to calculate a figure for the gross amount owed.g. The shortfall in January pay for each claimant was simply one month’s wages.h. None of the claimants were aware of the size of the tronc for November or December – clearly the amount would vary from month to month. I therefore asked each to tell me the minimum they would expect to be paid each month, and took this as the appropriate figure. With two exceptions, the claimants were entitled to two months’ worth of tronc payments. The fist exception was Mr Simko, who said he had also not been paid for October – so he was entitled to three months’. The second exception was Ms Ibrahimi. She could not provide a monthly amount. On the basis of tips she was paid for her first ten days’ employment she estimated that she would have been paid a minimum of 5 pounds per day, or £ 25 per 5-day week, in tips. Aside from those first two weeks, she worked for the respondent for a further 7 weeks, so was entitled to a payment of £ 175.[10]As I explained to the claimants at the hearing, if they believe that I have made any miscalculation or other error, they must write to the Tribunal within 14 days so that I can decide whether to reconsider the judgment under rules 68 to 70. TABLE 2 – FIGURES USED IN CALCULATIONS Claimant Full years in Age on Start date Monthly pay Weekly pay # employment 31/1/24 (i.e. to 31/1/24) Gross Net Gross Capped Net 1 09/10/2017 6 53 £3,333.33 £2,459.86 £769.23 £643.00 £567.66 2 27/11/2023 0 £345.00 No 3 3 66 £1,666.67 £1,491.00 £384.62 No £344.08 4 16/10/2017 6 38 £3,250.00 £2,436.00 £750.00 £643.00 £562.15 5 01/08/2020 3 42 £2,666.67 £2,062.96 £615.39 No £476.07 6 05/10/2020 3 41 £2,166.67 £1,743.76 £500.00 No £402.41 7 21/09/2020 3 40 £2,166.67 £1,830.92 £500.00 No £422.52 8 04/09/2020 3 41 £2,166.67 £1,742.96 £500.00 No £402.22 9 30/11/2018 5 38 £3,750.00 £2,756.16 £865.38 £643.00 £636.04 10 16/02/2022 1 £2,166.67 £1,830.92 £500.00 No £422.52 Approved by: