A Javed v National Campaigns International Ltd T/a Oceanic Group: 4105566/2024
EMPLOYMENT TRIBUNALS (SCOTLAND)
Case No 4105566/2024Venue GlasgowHearing 15 November 2024
Between
A JavedClaimantNational Campaigns International LimitedRespondent
Before
Employment Judge P McMahonDate 6 January 2025
REASONS
[1]This case was heard on 15 November 2024. The claimant had presented a claim of unfair dismissal and unlawful deduction from wages. The respondent in the case did not submit a response. The claimant’s claim of unfair dismissal was struck out on the grounds that it had no reasonable prospect of success in the circumstances that the claimant lacked sufficient qualifying service to make such a claim and the case proceeded to the hearing to determine the claimant’s remaining unlawful deduction from wages claim. At the hearing the claimant represented herself and the respondent was neither present nor represented.[2]The claimant’s claim for unlawful deduction from wages consisted of a claim that the respondent failed to pay the claimant the sum of £1,100 in respect of the month of November 2023 and failed to pay the claimant the sum of £1,375 in respect of the month of December 2023.[3]The claimant confirmed at the hearing that the total sum she was seeking was under deduction of £450 the respondent had paid to the claimant on or around 12 January 2024.[4]Evidence was heard on affirmation from the claimant. The claimant was the only witness. There was no documentary evidence before the tribunal from either the claimant or respondent.
Issues
[5]The key issues to be determined by the tribunal were as follows: 5.1. Was the claimant’s claim presented in time and, if not, was it not reasonably practicable for it to be presented in time and was it presented within such further period as the tribunal considers reasonable, in accordance with section 23 of the ERA. 5.2. Did the claimant have the status of “worker” as defined in section 230(3) of the ERA at the relevant time. 5.3. Had there been an unlawful deduction from the claimant’s wages contrary to section 13(1) of the ERA. 5.4. If so, should the respondent be ordered to pay the claimant the amount of any such deduction in accordance with section 24(1) of the ERA. Findings In Fact[6]The tribunal considered the following facts to be established:[7]The claimant commenced work with the respondent on or around 8 August 2023 in the role of “brand partnership executive” which terminated on or around the end of January 2024. This was a social media marketing role.[8]The claimant considered that she was employed by the respondent in this role rather than being a self-employed person.[9]On or around the commencement of her work with the respondent the claimant received an email from the respondent offering her the job of brand partnership executive stating “you will be employed as a part-time contractor”.[10]The claimant had at least two line managers in the period that she worked with the respondent and had a set amount of hours every week, a set amount of hours that she would work every month and she was given tasks and responsibilities.[11]The claimant was paid based on an agreed hourly rate for the hours she worked each month. The method by which the respondent paid the claimant for work done was that the claimant required to submit an “invoice” or claim for payment to the respondent setting out the hours the claimant worked in each month and the respondent then paid her. The respondent did not deduct tax and/or national insurance from payments made to the claimant. The claimant did not know why this was the case and thought it might be because of her earnings.[12]The email the claimant received offering her the role did not mention anything about when she would be paid. The claimant was told by the respondent (by the claimant’s line manager) that she would receive payment of her invoices within seven to 14 days after submitting them. All invoices submitted by the claimant except possibly the first, in respect of the month of August 2023, were consistently paid late (or not at all).[13]The claimant submitted an invoice to the respondent on 6 December 2023 claiming payment of £1,100 in respect of work she did in the month of November 2023 (the “November Wage”). This was due to be paid by the end of the period of 14 days after the claimant submitted the invoice but it was not paid.[14]The claimant submitted an invoice to the respondent on 8 January 2024 claiming payment of £1,375 in respect of the work she did in the month of December 2023 (the “December Wage”). This was due to be paid by the end of the period of 14 days after the claimant submitted the invoice but it was not paid.[15]The non-payment of the November Wage and the December Wage amounted to a series of deductions.[16]On or around 12 January 2024 the respondent paid to the claimant the sum of £450 without any explanation.[17]The claimant raised a grievance with the respondent in relation to the nonpayment of the November Wage and the December Wage. The respondent and claimant exchanged a number of emails as part of this process. During the course of the grievance process the respondent initially apologised for the delay in payment being made, advising the claimant that they would come back to the claimant with a payment date. Subsequently, after the claimant had received no further communication or payment and upon following this up with the respondent, the respondent advised the claimant that they would aim to make payment by 15 March 2024. The claimant did not receive payment and subsequently raised tribunal proceedings. At no time during the grievance process or otherwise did the respondent advise the claimant that the respondent disputed that payment was due.[18]The tribunal found that the claimant worked under a contract with the respondent to do or perform personally the work they carried out for the respondent in circumstances where the respondent was not by virtue of the contract a client or customer of any profession or business undertaking carried on by the claimant and, accordingly, found that the claimant had the status of worker as defined in section 230(3)(b) of the ERA.[19]The claimant initiated ACAS Early Conciliation on 20 April 2024 and the ACAS Early Conciliation Certificate was issued on 1 June 2024. The claimant submitted her Employment Tribunal Claim on 18 June 2024. Observations On The Evidence[20]In reaching the findings in fact referred to at the Findings In Fact section above and at the Discussion and Decision section below, the tribunal applied the civil standard of proof, being “on the balance of probabilities” as noted below under the Relevant Law section, and considered whether the evidence was such that it could say “we think it more probable than not” in respect of each key factual issue it required to determine.[21]The tribunal’s findings in fact were based on the claimant’s oral evidence. Generally speaking, the tribunal considered that in her evidence the claimant was giving an honest account of events as she remembered and understood them, that her evidence was consistent or not inconsistent as to material matters and the tribunal accepted this evidence as being sufficiently credible and reliable.[22]The tribunal noted that there was no suggestion in the evidence that there was any right of substitution (i.e. that the claimant could arrange for the work she did for the respondent to be done by someone other than her) nor was there any suggest in the evidence that the respondent was a client or customer of any profession or business undertaking carried on by the claimant.
Relevant Law
[23]In dealing with this case the tribunal had regard to the overriding objective set out in Rule 2 of Schedule 1 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 (the “Tribunal Rules”).[24]It is the tribunal’s task to determine the case ‘on the balance of probabilities’, which is the civil standard of proof applied in employment tribunal cases. Lord Denning (then Mr. Justice Denning) in Miller v Minister of Pensions 1947 2 All ER 372, KBD, explained the civil standard of proof in these terms: “[The degree of cogency] is well settled. It must carry a reasonable degree of probability, but not so high as is required in a criminal case. If the evidence is such that the tribunal can say “we think it more probable than not”, the burden is discharged, but if the probabilities are equal, it is not.’[25]Part II of the ERA sets out the statutory prohibition on deductions from wages.[26]Section 13(1) contains the general prohibition as follows: “(1) An employer shall not make a deduction from wages of a worker employed by him…”[27]Section 27(1) of the ERA provides: “(1) In this Part “wages”, in relation to a worker, means any sums payable to the worker in connection with his employment, including - (a) any fee, bonus, commission, holiday pay or other emolument referable to his employment, whether payable under his contract or otherwise.”[28]Section 13(3) of the ERA provides that a deduction from wages occurs where: “…the total amount of wages paid on any occasion by an employer to a worker employed by him is less than the total amount of the wages properly payable by him to the worker on that occasion...”[29]Section 13(3) of the ERA also makes clear that: “…the amount of the deficiency shall be treated for the purposes of this Part as a deduction made by the employer from the worker's wages on that occasion.”[30]Guidance for tribunals on the question of time limits for unlawful deduction from wages claims was provided by the EAT in Taylorplan Services Ltd v Jackson and ors 1996 IRLR 184, EAT. The correct approach, said the EAT, was for the tribunal to ask itself the following questions: Is this a complaint relating to one deduction or a series of deductions by the employer? If a single deduction, what was the date of the payment of wages from which the deduction was made? If a series of deductions, what was the date of the last deduction? Was the relevant deduction under (2) or (3) above within the period of three months prior to the presentation of the complaint? If the answer to question (4) is in the negative, was it reasonably practicable for the complaint to be presented within the relevant threemonth period? If the answer to question (5) is in the negative, was the complaint nevertheless presented within a reasonable time?[31]In respect of time limits for submitting a claim, section 23(2) of the ERA provides: “2) Subject to subsection (4), an employment tribunal shall not consider a complaint under this section unless it is presented before the end of the period of three months beginning with - (a) in the case of a complaint relating to a deduction by the employer, the date of payment of the wages from which the deduction was made...”[32]A failure to pay at all can amount to a deduction under section 13 (3) of the ERA as, if an employee is due to be paid and receives nothing, non-payment is to be treated as a deduction from their wages on that occasion (see Delaney v Staples [1991] ICR 331 at 340).[33]In Group 4 Nightspeed Ltd v Gilbert 1997 IRLR 398, EAT, the EAT held that in such cases (non-payment), time begins to run when the contractual obligation to make a payment arises. In that case commission could be paid at any time until the last day of the month following the end of the relevant quarter. The EAT held that a claim for an unlawful deduction from wages arises when an employer fails to pay a sum due by way of remuneration at the appropriate date — i.e. the date on which payment is due under the contract. Under the terms of the employee’s contract, payment could be made at any time up to midnight on the last day of the relevant month (January in that case). It was only once that date had passed that it could be said that the company was refusing to pay money allegedly due under the contract and so it was only then (i.e. on 1 February) that there could be said to be an unlawful deduction from which the time limit for presenting a claim began to run.[34]Further, in respect of time limits for submitting a claim, section 23(3) of the ERA provides: “(3) Where a complaint is brought under this section in respect of— (a) a series of deductions or payments….. the references in subsection (2) to the deduction or payment are to the last deduction or payment in the series or to the last of the payments so received.”[35]In Bear Scotland Ltd v Fulton and anor; Hertel (UK) Ltd and anor v Woods and ors (Secretary of State for Business, Innovation and Skills intervening) 2015 ICR 221, EAT, the EAT held that whether there is a ‘series’ of deductions is a question of fact, requiring a sufficient factual and temporal link between the underpayments. This meant that there must be a sufficient similarity of subject matter, so that each event is factually linked, and a sufficient frequency of repetition. This was approved by the Supreme Court in Chief Constable of the Police Service of Northern Ireland and anor v Agnew and ors 2023 UKSC 33, SC.[36]Special provisions have been introduced to the ERA to extend relevant time limits to facilitate ACAS early conciliation. The effect of section 207B(3) of the ERA is that, when determining whether a time limit has been complied with, the period beginning the day after the early conciliation request is received by ACAS up to and including the day when the early conciliation certificate is received or deemed to have been received by the prospective claimant is not counted. The effect of section 207B(4) of the ERA is that, if a time limit is due to expire during the period beginning with the day ACAS receives the early conciliation request and one month after the prospective claimant receives the early conciliation certificate, the time limit expires instead at the end of that period.[37]Section 230(3) of the ERA defines a ‘worker’ as follows: “(3) In this Act “worker” (except in the phrases “shop worker” and “betting worker”) means an individual who has entered into or works under (or, where the employment has ceased, worked under) -(a) a contract of employment, or(b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual;”[38]In the recent Uber BV and ors v Aslam and ors 2021 ICR 657, SC the Supreme Court confirmed that the question of whether work is performed by an individual as a worker or as an independent contractor is to be regarded as a question of fact to be determined by the employment tribunal. Further in this case the Court stressed the importance of interpreting S.230(3) of the ERA in light of the purpose of the legislation, which is to give protection to vulnerable individuals who have little or no say over their pay and working conditions because they are in a subordinate and dependent position in relation to a person or organisation that exercises control over their work.[39]In Manning v Walker Crips Investment Management Ltd 2023 ICR 1265, EAT, the EAT found that a tribunal had erred by attributing weight to the fact that the parties had characterised the relationship, and arranged their tax affairs, on the basis that the claimant was self-employed. Those factors were perfectly consistent with the claimant, who worked as an investment manager, having worker status.[40]Section 24(1) of the ERA provides that, where a complaint that an employer has made a deduction from a worker’s wages in contravention of section 13 of the ERA is well founded, it shall make a declaration to that effect and shall order that the employer pay to the worker the amount of any deduction made in contravention of section 13 of the ERA.[41]Section 25(3) of the ERA provides that, where it is determined that an unlawful deduction from wages has occurred: “(3) An employer shall not under section 24 be ordered by a tribunal to pay or repay to a worker any amount in respect of a deduction or payment, or in respect of any combination of deductions or payments, in so far as it appears to the tribunal that he has already paid or repaid any such amount to the worker.”[42]Section 25(3) of the ERA applies to payments made by an employer to a worker in respect of a deduction at any time before the date on which the tribunal makes an order against the employer (see Robertson v Blackstone Franks Investment Management Ltd 1998 IRLR 376, CA and Autonomy Systems Ltd v Cuddington EAT 0854/02). Submissions[43]The claimant made brief oral submissions. Discussion And Decision
Issues
[44]As noted above, the issues for the tribunal to determine in this case were: 44.1. Was the claimant’s claim presented in time and, if not, was it not reasonably practicable for it to be presented in time and was it presented within such further period as the tribunal considers reasonable, in accordance with section 23 of the ERA. 44.2. Did the claimant have the status of “worker” as defined in section 230(3) of the ERA at the relevant time. 44.3. Had there been an unlawful deduction from the claimant’s wages contrary to section 13(1) of the ERA. 44.4. If so, should the respondent be ordered to pay the claimant the amount of any such deduction in accordance with section 24(1) of the ERA.[45]As noted under the Relevant Law section, in dealing with this case the tribunal had regard to the overriding objective set out in Rule 2 of the Tribunal Rules and determined the case ‘on the balance of probabilities’ in accordance with the guidance found in the Miller v Minister of Pensions case. Claim presented in time[46]In considering the question of time limits in this case the tribunal noted the guidance provided by the EAT in the Taylorplan Services Ltd v Jackson and ors case referred to in the Relevant Law section and firstly considered: is this a complaint relating to one deduction or a series of deductions. In this respect the tribunal also considered the guidance in the Bear Scotland Ltd v Fulton and anor; Hertel (UK) Ltd and anor v Woods and ors cases referred to in the Relevant Law section and concluded that there was a sufficient factual and temporal link between non-payment of the November Wage in December 2023 for work done by the claimant in November 2023 and the non-payment of December Wage in January 2024 for work done by the claimant in December 2023 (i.e. a sufficient similarity of subject matter, so that each event was factually linked, and a sufficient frequency of repetition) so as to amount to a series of deductions, as noted under the Findings In Fact section.[47]Next the tribunal considered what was the date of the last deduction in the series. Given that the claimant was told by the respondent that she would receive payment of her invoices within seven to 14 days after submitting them and the invoice for the December Wage was submitted by the claimant on 8 January 2024, the tribunal concluded that this was due to be paid by the end of the period of 14 days after the claimant submitted the invoice, i.e. by midnight on 22 January 2024. Noting the guidance in the Group 4 Nightspeed Ltd v Gilbert case referred to under the Relevant Law section, the tribunal concluded that it was only once that date had passed that it could be said that the respondent was refusing to pay money allegedly due under the contract and so it was only then, i.e. on 23 January 2024, that there could be said to be an unlawful deduction from which the time limit for presenting the claim began to run.[48]The tribunal went on consider if the claimant’s claim was presented in time with reference to the date on which the last deduction in the series occurred (taking into account the special provisions introduced at section 207B(3) and 207B(4) of the ERA to extend relevant time limits to facilitate ACAS Early Conciliation, referred to under the Relevant Law section). Given that the last deduction in the series was on 23 January 2024, the claimant initiated ACAS Early Conciliation on 20 April 2024, the ACAS Early Conciliation Certificate was issued on 1 June 2024 and the claimant then submitted her tribunal claim on 18 June 2024 (which was within one month from the date on which the ACAS Early Conciliation Certificate was issued), the tribunal concluded that the claimant’s claim was presented in time and accordingly did not need to go on to consider the questions of reasonably practicality for the claim to be presented in time and/or presentation within such further period as the tribunal considered reasonable. Worker status[49]As noted at the Relevant Law section, the statutory prohibition on deductions from wages applies to workers, and so to be able to succeed in a claim for unlawful deduction from wages the claimant must have had the status of worker as defined in section 203(3) of the ERA at the relevant time.[50]The tribunal concluded that the claimant worked under a contract with the respondent to do or perform personally the work it carried out for the respondent in circumstances where the respondent was not by virtue of the contract a client or customer of any profession or business undertaking carried on by the claimant and, accordingly, found that the claimant had the status of worker as defined in section 230(3)(b) of the ERA, all as referred to under the Findings In Fact section above. The tribunal reached this conclusion on the basis of the statutory definition of worker and the guidance from the courts in interpreting that, all as referred to at the Relevant Law section above, and the other key findings in fact referred to in Findings in Fact section, in particular at paragraphs 7-12 and 17, and noting the evidential matters referred to at the Observations On The Evidence section above, in particular at paragraph 22. Whilst the payment/tax treatment arrangements referred to above were not a factor that pointed strongly towards worker status, noting the guidance in the case of Manning v Walker Crips Investment Management Ltd referred to in the Relevant Law section, the tribunal did not attach a great deal of weight to this as it considered that these factors were consistent or not inconsistent with the claimant having worker status. Unlawful deduction from wages[51]Noting that the November Wage and the December Wage were payments due in respect of work the claimant did in the months of November 2023 and December 2023 respectively, the tribunal concluded that these met the definition of “wages” contained in section 27(1) of the ERA referred to above. Having also concluded that the respondent did not pay the November Wage or the December Wage when they fell due to be paid, and that this was a series of deductions, as referred to above, the tribunal accordingly concluded that the respondent made a series of unlawful deductions from the claimant’s wages in respect of its failure to pay the November Wage and the December Wage in the gross sum of £2,475 contrary to section 13(1) of the ERA. Treatment of sums already paid by the respondent to the claimant[52]In light if the tribunal’s finding in fact in relation to the payment by the respondent to the claimant of the sum of £450 on or around 12 January 2024, the tribunal was prepared to accept that the respondent had paid to the claimant part of the deduction it had made to the claimant’s wages (and that this was more likely to be in respect of the November Wage (that being outstanding and overdue for payment as at 12 January 2024) before the date on which the tribunal makes an order against the respondent in this case and, accordingly, given the provisions of section 25(3) of the ERA and with reference to the cases of Robertson v Blackstone Franks Investment Management Ltd and Autonomy Systems Ltd v Cuddington, all as referred to under the Relevant Law section, the tribunal concluded that the sum the respondent is ordered to pay to the claimant in respect of the unlawful deduction from wages in this case should not include the £450 already paid by the respondent to the Claimant. P McMahon