Mrs S Walker v South Lanarkshire Council: 4106023/2024
JUDGMENT
[1]The Claimant’s claim for unlawful deduction of wages succeeds.[2]The Respondent made an unlawful deduction from the Claimant’s salary in the sum of £345.65, which must be paid to the Claimant.REASONS
[1]This is a claim under s.13 Employment Rights Act 1996 for unlawful deduction of wages. The Claimant asserts that she is owed money due to the miscalculation by the Respondent of her entitlement to sick pay. The Claimant asserts that a deduction has been made which was not authorised and which the Respondent should not have made.[2]The Tribunal was provided with an agreed bundle of document and heard evidence from the Claimant and Mr Stephen Sloey, payroll manager for the Respondent. Findings in fact[3]The Tribunal made the following findings in fact: 3.1. The Claimant worked for the Respondent as a teacher at Mount Cameron School. Her terms and conditions of employment, including sick pay provisions were contained within the SNCT Handbook, which are nationally agreed terms and conditions. 3.2. The Respondent is one of few councils which pay their employees on a lunar calendar basis. Employees are paid every 28 days, thus there are 13 payments made each calendar year. 3.3. The terms of the SNCT Handbook in relation to sick pay states at 11.1; “Sick pay for teachers and associated professional will be based on a daily rate of 1/365th for each ay they qualify for sick pay…. An employee in receipt of 6 month full pay and 6 months half pay will receive 183 days’ full pay and 182 days’ half pay.” 3.4. According to paragraph 11.2: “This is a precise calculation for sick pay but could cause potential issues as there will be carry forward of amounts or months where the sick pay amount is less than the 1/12th being paid. This is overcome by having offsetting amounts so as not to confuse employees. The main issue will be when an employee moves to half or no pay as shown in 11.3 below”. 3.5. It was agreed between the parties that the Claimant was entitled to 6 months full pay and 6 months half pay as set out above. 3.6. The Claimant went off sick from work on 23 October 2023. She received full sick pay up to 3 April 2024, when she moved to half pay. At this point the Respondent sought to recoup what they considered to be an overpayment as the Claimant had been paid at the 1/365 rate during her sickness absence. 3.7. In the Claimant’s April payslip dated 11 April 2024, the Respondent made a deduction of £345.65 which they considered to be the ‘offset’ amount between the two different payment basis. 3.8. Mr Sloey the Respondent’s payroll manager stated that sick pay is not paid on 365 days, as it is not paid at weekends. He asserted that the spreadsheet which he had completed and shown to the Tribunal was accurate. He asserted that each payslip was overpaying the Claimant by paying her the 1/365 amount, but making the payments every 28 days. This is the amount which the Respondent recouped from the Claimant at the point where her pay moved to half pay.Law
[4]S.13 Employment Rights Act 1996 states: “Right not to suffer unauthorised deductions.(1) An employer shall not make a deduction from wages of a worker employed by him unless— (a) the deduction is required or authorised to be made by virtue of a statutory provision or a relevant provision of the worker’s contract, or (b) the worker has previously signified in writing his agreement or consent to the making of the deduction.(2) In this section “relevant provision”, in relation to a worker’s contract, means a provision of the contract comprised— (a) in one or more written terms of the contract of which the employer has given the worker a copy on an occasion prior to the employer making the deduction in question, or (b) in one or more terms of the contract (whether express or implied and, if express, whether oral or in writing) the existence and effect, or combined effect, of which in relation to the worker the employer has notified to the worker in writing on such an occasion.” 4.1. The Tribunal must consider the contract between the parties to decide the amount of wages which was properly payable to the Claimant. If the Tribunal decides that the contract allows for a deduction because there has been an agreed variation of contract, then the wages ‘properly payable’ will be the reduced wages due under the terms agreed. 4.2. Determining what wages are properly payable requires consideration of all the relevant terms of the contract, including any implied terms — Camden Primary Care Trust v Atchoe 2007 EWCA Civ 714, CA[5]The claim for unlawful deduction relates to an amount recouped from the Claimant’s salary in April 2024, when an overpayment to her salary was deducted. The Respondent asserted that this was the difference between salary calculated on a 1/365 basis (sick pay) and her usual pay on a 1/260 basis.[6]The Claimant’s contract includes the SNCT terms for calculation of sick pay. This entitles her to 183 days of full pay and 182 days of half pay. This amounts to 365 days (i.e a year of 7 days per week). Mr Sloey’s evidence that employees are not paid for weekends when off sick is clearly incorrect when one considers the Respondent’s policy.[7]When considering the Respondent’s calculations, the concept of there being an overpayment becomes illogical. The Respondent asserted that the Claimant was paid 1/365 per day for sick pay. This was paid every 28 days( lunar calendar payments). In order to ensure that the Claimant was paid for a whole year, the Respondent would have to make 13 payments, but would still require to pay the Claimant 1 day of salary. As 28 x 13 = 364. This is not accounted for in Mr Sloey’s spreadsheet.[8]The calculations of the relevant payslips in February and March 2024 are considered as follows.[9]The local payment arrangement is that the Claimant is paid every 28 days (i.e 13 payments per annum). Each of those payments amounts to 20/260 of her annual salary.[10]The Claimant’s gross salary of £48,516 equates to a sick pay amount of £79.75 per day calculated on a 1/365 basis.[11]When calculated on a 1/260 basis the Claimant would be paid £111.96 per day, every 28 days.[12]The Claimant was paid 28 x 79.75 = £2233 per payslip.[13]Had this continued for all 13 payments in the year, the Claimant would have been unpaid for one day in the year.[14]The Claimant therefore ought to have been paid £6.13 per payslip more in order to account for the additional day over the course of the year.[15]The Claimant’s payslips for February and March 2024 show that she was paid an additional £6.13 on each payslip as ‘basic pay’. This was the balancing amount.[16]There was therefore no further adjustment of pay required for these months.[17]In relation to the January payslip, the Claimant’s rate of pay increased on 1 January 2024.In December, her pay on the basis of the 1/260 calculation would have been £2226.03. The Claimant was paid occupational sick pay calculated on the 1/365 basis as £2217.43. The difference between the two calculations was provided as ‘basic pay’ of £8.60. This too, was a correct, balancing amount.[18]There was therefore no further adjustment of pay required for these months.[19]The Respondent’s spreadsheet cannot be reconciled with the payslips as they do not account for the same number of days.[20]Whilst I have not been shown all the payslips referred to in the period 9 January 2023 to 14 March 2024, I accept that the calculations made by the Claimant in her evidence and set out above are correct and thus the calculations by the Respondent are mistaken.[21]I conclude that the Claimant was paid the correct amount of sick pay (including small adjustment sums in January – March 2024). It was therefore inappropriate and an unlawful deduction of wages to remove £345.65 from the Claimant in April 2024. This was not an overpayment and the Respondent should not have made this deduction. This money is owed by the Respondent to the Claimant. S CowenLaw
[1]Firstly, this judgment comes with apologies for the long delay in providing an outcome to the parties. This has been in part due to a backlog of work and in part due to some sickness absence. Unfortunately this has led to a significant delay and therefore this judgment comes with regret for any inconvenience or difficulty caused to either party.[2]The Tribunal have considered the written submissions of the Respondent made on 20 December 2024 and by the Claimant on 21 January 2025.[3]The Respondent’s first comment that the Claimant did not provide a breakdown of her calculation, did not interfere with the ability of either party to deal with the claim or result in the hearing being delayed or postponed. The Respondent did not request any postponement. The Respondent’s witness Mr Sloey was allowed to hear the Claimant’s evidence prior to giving his evidence and therefore he was not placed at any disadvantage. The Respondent’s counsel was able to take instructions as required.[4]The Tribunal therefore considers that the Claimant, represented by her Trade Union representative, did her best to explain complex mathematics to the Tribunal and the Respondent. Meetings had taken place between the Claimant and Mr Sloey on prior occasions, where the same calculation had been explained to him. The evidence was not therefore new to him, nor surprising.[5]The Respondent’s submission for reconsideration (paragraph 9) says that “It remains of considerable concern to the Respondent following her evidence, that the logic and methodology of the Claimant’s position has still not clearly been demonstrated”. The Tribunal was clear on the Claimant’s position and her calculation and set it out in the Judgment. The Tribunal’s decision was based on that clear understanding and therefore the fact that the Respondent continues to decline to appreciate the Claimant’s explanation does not lead to an incorrect finding by the Tribunal.[6]The Respondent challenges the Tribunal’s finding of fact that Mr Sloey said that weekends are not counted when calculating sick pay and that this contradicts the policy. Having checked the Tribunal’s notes of the evidence in chief, it was noted that when asked “why was C not paid weekends in 1/365?” Mr Sloey responded “ because C was sick during the week”. This was not a question which was prefaced with a time period, as is now suggested in the Respondent’s submissions. However, the Tribunal has considered the evidence in relation to the calculation once again.[7]Nevertheless, the calculation by the Respondent on their spreadsheet, sets out payment to the Claimant on a 1/260 basis only on weekdays. Whereas, the Respondent’s policy stipulates that payment should be made on a 1/365 basis, i.e that the employee is also paid for weekends. This is the fundamental difference between payment on 1/260 and 1/365 basis. The rate takes account of this difference in payment in order to ensure that the same salary figure is achieved across the year.[8]The Respondent’s submission about the one day moving into the next tax year makes no difference to the Claimant’s claim. No part of the claim was dependent on the tax period, nor was the claim said to be altered due to this. The Tribunal therefore did not consider the Respondent’s submission on this to be relevant or justified.[9]As the Tribunal found in the original Judgment, the Claimant was to be paid 183 days at full salary and 182 days at half salary. The period over which she was paid the first 183 days, was carried out as payments of 30.4/365, but provided at 28 day intervals. The difference was set out as basic pay on the payslips. The Tribunal noted that Mr Sloey did not given explanation for the basic pay amount on each pay slip, which the Tribunal considered to be the correcting payment.[10]The Tribunal therefore did not accept the Respondent’s application for reconsideration and the Judgment of the Tribunal remains.