Camden Primary Care Trust v Atchoe [2007] EWCA Civ 714

Case No A2/2006/1997[2007] EWCA Civ 714
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM EMPLOYMENT APPEAL TRIBUNAL
Venue Royal Courts of JusticeDate Wednesday, 9 May 2007
Strand
London, WC2
B E F O R E:
PRESIDENT OF THE QUEEN'S BENCH DIVISION
(Sir Igor Judge)
LORD JUSTICE MOORE-BICK
SIR PETER GIBSON
Between
CAMDEN PRIMARY CARE TRUSTRespondent-v-
Between
ATCHOEAppellant
(Computer-Aided Transcript of the Stenograph Notes ofWordWave International LimitedA Merrill Communications Company190 Fleet Street, London EC4A 2AGTel No: 020 7404 1400 Fax No: 020 7831 8838
The Appellant appeared in person for in personMiss Katherine Newton (instructed by Beachcroft Wansbroughs) appeared for Respondent
J U D G M E N T

SIR PETER GIBSON: Section 13 of the Employment Rights Act 1996 confers on an employee the right not to suffer unauthorised deductions from his wages. There is no unauthorised deduction if the deduction is required or authorised by statute or a relevant provision, as defined, of a contract or that the employee has previously signified in writing his consent to the making of a deduction. By section 13 (2), "relevant provision" means - "a provision of a 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 making the deduction in question, or (b) in one or more terms of the contract ..... the existence and effect ..... of which in relation to the worker the employer has notified to the worker in writing on such an occasion." By Section 13 (3) - "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 wages properly payable by him to the worker on that occasion (after deductions), 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."

[2]This is an appeal by Mr Atchoe from the order made by the Employment Appeal Tribunal ("the EAT"), His Honour Judge McMullen QC presiding, on 22 August 2006. Thereby the EAT allowed the appeal of Mr Atchoe's employer, Camden Primary Care Trust ("Camden"), from the decision of an Employment Tribunal ("ET") sitting in London Central that Camden had made an unauthorised deduction from his wages in contravention of Section 13. The EAT substituted a finding that Mr Atchoe's complaint that there had been such a deduction was not well founded.[3]The facts are these. Camden is an NHS Primary Care Trust in North London. Mr Atchoe has been employed by Camden, or its predecessor organisation, since 5 November 1990. Originally he was employed as a maintenance fitter but was promoted on 22 December 1996 to a Craftsman Technician Estates Officer Grade 1 in the Maintenance Department of Camden.[4]His terms and conditions of employment are set out in a written statement of the main terms and conditions and in a written job description. By clause 1 of the written statement the Whitley Council terms and conditions are incorporated into his contract. Clause 1.1 of his written statement states that his job was subject to local policies and agreements appropriate to his post. His normal working hours are 37 hours per week, but in his job description his main duties and responsibilities include that he should - "contribute to an out-of-hours manager emergency on-call system." His required qualifications included, as the ET found, City and Guilds technical qualifications. The ET found that at the time of his initial employment and on subsequent promotion he produced his original trade qualification certificates which were inspected and copied by Camden and/or its predecessor on two occasions, and those certificates included various City and Guilds qualifications.[5]Mr Atchoe today showed us a document headed On-call Technician Daily Duties which he described as a local agreement and said that it superseded the Whitley Council terms. There is no evidence before us that it was such a local agreement but, in any event, no provision of that document has been shown to be inconsistent with the relevant Whitley Council terms.[6]To operate the on-call system there were six technicians including Mr Atchoe. Each technician was on call about once every seventh week. To be on call duty, as the Whitley Council terms provide, the technician undertakes a specific roster commitment to be continuously and immediately available at home. A call occurs if the technician attends a hospital or other place of work outside normal working hours in response to a request to perform urgent work. He receives a payment, in the form of a daily allowance, for being on call. I shall call this "the stand-by payment". If called out, he receives a further payment for the time spent on the call out, calculated on a basis akin to overtime.[7]On 28 October 2003 Mr Atchoe was suspended while an investigation was carried out in respect of an unrelated matter. The suspension was not a disciplinary act and had no disciplinary consequences. On 4 February 2004 he returned to work, but, as result of the investigation, Camden decided to review his training needs. By a letter dated 26 February 2004 his line manager asked Mr Atchoe to submit all his current trade qualifications and any other qualifications he had gained, including one-day seminars.[8]By an undated letter written at the end of February 2004 to the line manager Mr Atchoe listed certain qualifications but did not send any certificates or copies. By letter dated 2 March 2004, his line manager wrote to Mr Atchoe to say that his handwritten confirmation of his trade qualifications was not acceptable and asked him to submit the original certificates or copies of his qualifications.[9]By letter dated 5 March 2004, Mr Simms, the Manager Estates and Facilities, wrote to Mr Atchoe informing him that he had been taken off the on-call roster for safety reasons. He was told that he would receive the stand-by payments which he would have received if he participated in the on-call roster. He was also told that he would not be paid the equivalent overtime carried out by his replacement. The statement that he would receive the stand-by payments was subsequently said by Camden, but only at the hearing before the EAT, to be incorrect. Mr Simms, in his letter, referred to Camden's request for copies of Mr Atchoe's core trade qualifications which had not been forthcoming.[10]By letter dated 5 March 2004 Mr Atchoe expressed his disappointment that Camden did not have records of his training and development and added that it was not his responsibility to educate the office in bookkeeping. Mr Simms replied on 9 March 2004, regretting that Mr Atchoe's records were not to hand but said that Camden was trying to remedy the situation by requesting copies of his technical qualifications. He added that Camden would reimburse any costs on proof of payments made in obtaining copies and gave a three-week deadline.[11]Mr Atchoe then estimated that production of the copy certificates would cost him more than £2,000 and would take more than a year, and said that if Mr Simms could arrange an advance of £1,000 and sufficient time, he would start the process.[12]To resolve the dispute Mr Atchoe and Mr Simms met on 12 April 2004. Mr Atchoe told Mr Simms to check Camden's personnel files or contact his previous employer for copies of his trade qualifications. Mr Simms told Mr Atchoe that Camden's files had been checked and that no record of his qualifications had been found there or in the previous employer's files. Mr Atchoe was asked if he had the trade qualifications but replied, "No comment". When asked if he was prepared to supply the copies requested, Mr Atchoe told Mr Simms to read the reply he had sent. When the question was repeated, Mr Atchoe replied, "No comment". Mr Simms asked why it would cost £2,000 to obtain copies, to which Mr Atchoe replied, "No comment". When Mr Simms said that Mr Atchoe was not helping himself, Mr Atchoe replied that no one could help him. The matter remained unresolved.[13]Camden then excluded Mr Atchoe from the on-call roster. Further attempts were made by Camden to get Mr Atchoe to arrange for his qualification documents to be obtained. When Mr Atchoe was not paid in respect of the on-call roster Mr Atchoe complained. On 16 June 2004 the Maintenance Manager wrote to Mr Atchoe suggesting that he send to Camden a letter giving it permission to approach the relevant colleges to obtain copies of his trade qualifications, but there was no response.[14]I pause there to make this comment. One can readily understand the cause of Mr Atchoe's discontent. Arising out of an unrelated incident that has no disciplinary consequences there has been an investigation as a result of which he had been asked to provide to Camden his trade qualifications, the certificates for which he had already provided twice and, although under a contractual obligation to contribute to the on-call system, he had been removed from the on-call roster so that he no longer received the payments which he would have received had he remained on that roster. As the ET was to accept, he had genuine difficulties obtaining his certificates which he had sent to his father in Ghana. Further Camden reneged on its promise made in the letter of 5 March 2004 that he would receive the stand-by payments. Unwisely Mr Atchoe allowed his indignation to lead him into total non-co-operation over the production of copy qualification certificates and that has led to this unfortunate litigation which so easily might have been avoided.[15]On 4 January 2005 Mr Atchoe commenced proceedings before the ET. One claim was for breach of contract. He claimed a loss of earnings which he put at a minimum sum of some £7,000, including "charges" for "capital growth, bank charges, inconvenience, costs, stress and strain etc".[16]On 25 February 2005 the ET chairman directed Mr Atchoe to produce his qualification certificates and that direction was complied with by him after his brother brought the certificates from Ghana. As Mr Atchoe was still employed by Camden, the claim for breach of contract was struck out.[17]The remaining claim was for unlawful deductions from wages. That was heard by the ET on 10 May 2005 when Mr Atchoe appeared in person. Camden was represented by Miss Newton, who also appeared at the EAT and appears before us today.[18]The ET recorded Mr Atchoe's case as being that he was entitled, as of right, to carry out on-call roster duties, and that preventing him from being on roster duty and not paying him the amounts he would have earned had he been on duty amounted to an unlawful deduction of wages. Camden denied this and maintained that it had a contractual right to remove him from the on-call roster duties on health and safety grounds and that consequently he had no right to be paid for work he did not carry out.[19]The ET in its judgment addressed as the first question what wages were properly payable to Mr Atchoe and considered the contract of employment. It noted that under the contract Mr Atchoe was entitled and under a duty to contribute to the on-call system and said that the amounts properly payable to him were the amounts he would earn by being on the on-call roster, and that the amount not paid as a result of him being removed from the roster was to be treated as a deduction of wages. It then considered whether the deduction was authorised by a relevant contractual provision. It referred to several express terms of the contract and found an implied term that Camden would take all reasonable steps to safeguard the health and safety of all persons to whom it owed a duty of care ("the implied term").[20]The ET said that two issues fell for determination on the question whether the deduction was authorised.(1) Was Camden entitled to remove Mr Atchoe from on-call roster duties?(2) Was Camden entitled to make deductions from his wages?[21]On the first issue it found that Camden was authorised under Mr Atchoe's contract of employment to remove him from the on-call roster on health and safety grounds. In the absence of the production of proof of his trade qualifications, Camden was not only entitled but would have been under a legal duty to take steps to safeguard the health and safety of all relevant persons and such steps included, at its reasonable discretion, the removal of Mr Atchoe from the on-call roster until the matter was satisfactorily cleared up.[22]However, on the second issue, the ET found that Camden was not entitled to make deductions from Mr Atchoe's wages. The mere fact that Camden was entitled to remove him from roster duties did not mean that it was entitled to make deductions from his wages. The ET found similarity with a suspension case and two other authorities, in each of which the employer had been found not to be entitled to withhold payments of pay. The ET found that Mr Atchoe was willing and able to perform his on-call roster duties, and that the implied term did not confer a right on Camden to make a deduction from his wages; nor was Camden contractually entitled to do so on the ground that Mr Atchoe had failed to produce his qualification certificates. Accordingly, the ET found for Mr Atchoe.[23]Camden appealed on the grounds that(1) the ET had erred in its interpretation of Section 13 (3) in holding that a reduction in Mr Atchoe's pay resulting from his removal from the on-call roster, which the ET found Camden entitled to do, amounted to an unlawful deduction of wages;(2) the ET erred in relying on the three cases on which Camden had not been given an opportunity to comment and which cases provided no true analogy;(3) the ET erred in its application of Section 13 (2) (b) because there was an implied term that if Mr Atchoe was removed from the roster on health and safety grounds he would not have been paid for work carried out by his replacement, and the effect was notified to Mr Atchoe in Mr Simms' letter of 5 March 2004, and(4) the ET's conclusion was perverse.[24]Mr Atchoe, in his respondent's answer, indicated that he would resist Camden's appeal on a number of grounds. He said that he found no error in any part of the ET's decision. It is to be noted that no attempt was made by him to challenge the ET's conclusion that Camden was entitled and under a duty to safeguard the health and safety of all to whom it owed a duty of care and so to remove Mr Atchoe from the on-call roster until his qualifications were established.[25]The EAT upheld Camden's arguments on grounds (1) and (2). It found that the first legal principle to be applied emerged from two authorities: White v Reflecting Roadstuds Ltd [1991] IRLR 331 and Hussman Manufacturing Ltd v Weir [1998] IRLR 288. That principle was that where an employer acts within the contract of employment, the fact that thereby there is caused a loss of income to the employee does not render that loss an unauthorised deduction from the employee's wages. It found as a second applicable legal principle the proposition stated in Albion Hotel (Freshwater) Ltd v Maia Silva [2002] IRLR 200, that where reliance is to be placed by an ET on a legal proposition or on legal authorities, an opportunity must be given to the parties to make submissions on them; otherwise there is a material irregularity in the proceedings.[26]On the first ground Judge McMullen, giving the judgment of the EAT, said that the ET did not directly address Section 13 (3) in the first place to determine what the proper amount to be paid was. He said at paragraph 18:
"Since the tribunal expressly found that the claimant could be removed from the rota for health and safety reasons, the only issue in the case is whether or not there were such reasons. The tribunal has found that there were and has attributed to the respondent a reasonable discretion to remove him until the matter, which was his certification, was satisfactorily resolved. That being the primary finding of the tribunal, it must follow that it was not a deduction unlawfully made from the claimant's contract for him to be removed from the rota. Removal from the rota takes with it removal from the right to be paid. Put simply, if he was not liable to be sent out and did not actually do any work, he could not claim the payments akin to overtime; and similarly if he did not make himself available in his spare time to be called upon, if so required, then that payment would not be made. The logical conclusion from that simple finding by the tribunal is at the heart of this case and means that there was no breach of the claimant's contract."
[27]On the second ground the EAT held that the ET's reliance on the three authorities was directly relevant to the ET's thinking. The EAT would have remitted the case to the ET for submissions to be made on those cases but for the conclusion in favour of Camden on the first ground. In any event, it said, the analogy which the ET drew from the three cases was inapt. It found it unnecessary to decide the third ground and noted that Miss Newton did not press the fourth ground.[28]In granting permission to appeal, Lady Justice Smith said that it was arguable that the decision of the ET was right and that of the EAT was wrong.[29]Mr Atchoe originally filed grounds of appeal drafted by himself. Counsel was then instructed on his behalf. New grounds of appeal and a skeleton argument were prepared by counsel. There are three grounds of appeal:(1) the reasoning of the EAT was based on the non sequitur that if Camden had an implied contractual right to suspend Mr Atchoe on health and safety grounds from on-call duties, which he was under an express contractual duty to perform, then it must follow that Camden is under no contractual obligation to pay Mr Atchoe the stand-by payments regardless of the circumstances in which it suspended Mr Atchoe from the on-call roster;(2) the EAT was wrong to substitute its own judgment in regard to the true meaning and effect of the implied term and to ignore the ET's comment that, Mr Atchoe having provided his certificates twice to Camden and its predecessor, Camden was not entitled to make a deduction from his wages on the ground that he had failed to produce his certificates;(3) the EAT failed to give consideration to the operation of the implied duty on the employer to maintain a relationship of trust and confidence with the employee.[30]Counsel is no longer instructed, and Mr Atchoe appears in person. He has indicated that he relies on the amended grounds of appeal and the skeleton argument. He has added some oral observations before us today. The jurisdiction of this court, as of the EAT below, is limited to points of law. There are obvious difficulties facing someone like Mr Atchoe, who is not a lawyer, in confining his submissions to legal, as distinct from factual, points and to points properly open to him in view of the limited points taken by him below. For example, his attempted reliance on the implied duty on the employer not to breach the implied term of trust and confidence was misplaced because the point had not been taken below. Nevertheless I would pay tribute to Mr Atchoe for the courteous and restrained manner in which he addressed us on matters on which he plainly felt strongly.[31]Mr Atchoe submits that the ET was entirely correct in its judgment. He has emphasised the contractual duty on him to contribute to the on-call system. He has also stressed the conclusions which the ET reached in paragraphs 29 and 30 of its judgment to the effect that as a matter of construction the implied term as to health and safety did not confer a contractual right on Camden to make a deduction from his wages for a failure to provide additional copies of his technical qualifications and that Camden was clearly not entitled to make a deduction from his wages on the ground that he had failed to produce his original certificates or a copy of them.[32]Miss Newton submits that the Employment Appeal Tribunal was correct in its conclusions. She says that there was no non sequitur in the EAT's judgment, that the correct approach is to consider first what was properly payable for the purposes of Section 13 (3) by having regard to all the provisions of the contract, including the implied term, and to the consequent removal of Mr Atchoe from the roster as being authorised under the contract, that just as Mr Justice Neuberger in McClory v Post Office [1993] IRLR 159 found that a term in the contract of employment of an employee that the employee was liable to work overtime was not matched by an implied obligation on the employer to provide work for such overtime, so here there was no contractual obligation on Camden to maintain Mr Atchoe on the on-call roster; and, even if that was wrong, that such obligation was subject to the implied term which, the ET found, authorised and required Camden to remove Mr Atchoe from the on-call roster. She further submits that there was no contractual obligation on Camden to pay Mr Atchoe payments relating to the on-call roster, particularly having regard to the provisions in the Whitley Council terms which make plain that the stand-by payment was conditional on the technician being on the on-call roster and liable to be called out as being on call.[33]As the ET rightly said, the correct starting point must be to consider what wages were properly payable to Mr Atchoe within Section 13 (3), and this requires consideration of all the relevant terms of his contract of employment. However, that requires consideration also of any implied terms. The ET wrongly, in my judgment, at that stage ignored the implied term and the fact that such terms entitled and indeed required Camden to remove Mr Atchoe from the on-call roster. Without proper analysis of the contract, the ET found that the amounts properly payable under Mr Atchoe's contract would include the amounts he would have earned by being on the on-call roster. It did not consider the specific Whitley Council terms which govern payment.[34]Mr Atchoe properly conceded before us that he was not paid in respect of his obligation to contribute to the on-call system except when he was on the on-call roster. That accords with the Whitley Council terms defining on-call duty and defining when the technician is on call. It accords also with the statement in the Whitley Council terms of the payments appropriate thereto. Those payments are entirely separate from the ordinary salary to which the technician is contractually entitled. Unless the technician is on the on-call roster there can be no entitlement to payments in respect of being obliged to contribute to the on-call system. In the present case the ET found that Camden was entitled and bound to remove Mr Atchoe from the on-call roster pending clarification of his qualifications, and that is a finding which Mr Atchoe did not and now does not challenge.[35]I would go further. Mr Atchoe's contact of employment expressly imposes on him the obligation to contribute to the on-call system but is silent as to any obligation on Camden to maintain the technician on the on-call roster. In my opinion there is some similarity with the position in law as regards overtime which the employee is required by his contract to work and the absence of any obligation on the employer to provide work for overtime. Having regard to that and to what the ET found in relation to the implied term, I am not persuaded that in Mr Atchoe's contract there is any obligation on Camden to maintain a technician on the on-call roster notwithstanding the obligation on the technician to contribute to the on-call system. If that is wrong, and there is such an obligation, that obligation can be overridden by the implied term which, as the ET found, authorised and required Camden to remove Mr Atchoe from the on-call roster pending clarification of his qualifications.[36]For these reasons, which are in substance what Miss Newton submitted to us, I respectfully agree with the EAT's conclusion that the ET erred in finding that in this case there was an unauthorised deduction from Mr Atchoe's wages. That conclusion, if my Lords agree with me, would be sufficient to dispose of this appeal.[37]But I would add a few words on the EAT's adoption of what was said to be the legal principle emerging from Albion Hotel. The EAT's remarks in that case have been qualified by this court in Stanley Cole Wainflete Ltd v Sheridan [2003] IRLR 885. In short, it is not in every case that an error of law occurs when an ET fails to give the parties the opportunity to comment on an authority relied on by the ET. Substantial unfairness or material injustice must be seen to have resulted if an appeal is to be allowed on this ground. There is no absolute rule on procedural unfairness. To be fair to His Honour Judge Serota QC giving the judgment in Albion Hotel, he said at paragraph 35 of that case no more than that failure to invite submissions from the parties "may amount to a breach of natural justice and of the right to a fair hearing". It is unnecessary to decide whether the EAT's views in relation to that point in the circumstances of this case were correct.[38]I would dismiss this appeal.

LORD JUSTICE MOORE-BICK: I agree.

SIR IGOR JUDGE: I also agree.

Order

Appeal dismissed with costs assessed at £10,000.

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