Philip Hodges & Co v Crush [1996] UKEAT 1061_95_1202

EAT

Philip Hodges & Co v Crush

[1996] UKEAT 1061_95_1202 · 1996-02-12

JUDGE CLARK:

Miss Crush took employment with the Appellant firm of solicitors on 12 September 1994 as a Legal Secretary, working to the Senior Partner, Mr Hodges. Her starting salary was £17,500 per annum, subject to review. The Appellants found her performance disappointing and following an interview with Mr Hodges held on 7 December 1994, her salary was reduced to £16,000 per annum.

There was a dispute between the parties as to whether or not that reduction was agreed. The Appellants say it was. She disputes this. The Industrial Tribunal found that she did agree, with the greatest reluctance, faced with the alternative of dismissal. The pay reduction was not implemented until January 1995. On 26 January she received her payslip showing the reduced earnings. On 13 February she consulted a Law Centre, which drafted a letter on her behalf asserting a claim for unlawful deduction from her wages, contrary to the Wages Act 1986 . She also drafted a letter herself and mentioned her dissatisfaction with the position to a fellow member of staff. This came to the notice of Mr Hodges who spoke to Miss Crush on 15 February. The Tribunal's findings about that conversation are recorded in paragraph 11 of their reasons in these terms:

11. ... According to the Applicant, Mr Hodges called her into his office and told her that he had heard that the Applicant was seeking legal advice. The Applicant said that Mr Hodges asked her why she was doing so, and found out the identity of the member of staff who had told Mr Hodges the position. According to the Applicant, she said to Mr Hodges that she had some friends who were solicitors and he said that he was surprised to hear that what he had done was against the law. The Applicant said that she told Mr Hodges that she was protected. He said that if she had not been happy with the reduction in her pay, she had the chance to leave the company at the time. The Applicant said that she told Mr Hodges that she could not afford to do that. According to the Applicant, Mr Hodges said that she had accepted her pay drop. The Applicant then suggested that Mr Hodges should speak to the person whom she had consulted at the law centre."

Later that day, as she was preparing to go home, she was handed a letter of dismissal to take effect on 17 March. That letter specifically refers to her having taken outside advice. She then went off sick and never returned to work for the Appellants. She commenced Industrial Tribunal proceedings raising a number of complaints. We are concerned with her complaint under Section 60(A) of the Employment Protection (Consolidation) Act 1978 , as inserted by the Trade Union Reform and Employment Rights Act 1993 .

The matter came before the Stratford Industrial Tribunal, Chairman Mr Andrew Bano on 10 July 1995. The Appellant chose not to attend the hearing. The Tribunal upheld her complaint of automatic unfair dismissal under Section 60(A) and awarded her compensation totalling £1,105.28. Extended reasons for that decision are dated 18 August 1995. Having set out the facts which we have summarised above, the Tribunal directed themselves as to the provisions of Section 60(A) and express their conclusions in paragraphs 14 and 15 in this way:

"14. There is no dispute that the rights conferred by the Wages Act 1986 are relevant rights for the purposes of Section 60A. The Applicant asserted her right after taking legal advice, both from a law centre and from a legally qualified friend, and we are satisfied that the Applicant's claim that a relevant right had been infringed was made in good faith.

15. The question which we have had to consider is whether the reason, or principal reason, for the Applicant's dismissal was that the Applicant alleged that the employer had infringed the relevant right. As we have observed, our task in this regard has been made considerably more difficult by the decision of the Respondents not to attend the hearing. However, the conclusion which we have reached is that it was the Applicant's allegation that the Respondents had acted in breach of Section 1 of the Wages Act 1986 which was the reason for the Applicant's dismissal. We have borne in mind that, even on the Applicant's evidence, she was told at the meeting on 7 December that she would be dismissed if she did not accept the reduction in wages which the Respondents sought to impose. We have therefore had to consider whether the Respondents' actions in March 1995 [we think that should be February] did not merely consist of a reaffirmation of their earlier position. On the other hand, it seems to us that the Respondents were in a position where they could, in effect, do what they liked with regard to the Applicant's salary until she decided to assert her rights under the Wages Act 1986. The Applicant's allegation that the Respondents had contravened her rights under that Act immediately preceded her dismissal and the conclusion which we have reached is that it was that allegation which was the reason for the Applicant's dismissal. It is perhaps significant that the Respondents' dismissal letter of 15 February 1995 refers to the fact that the Applicant had taken outside advice, and that seems to us to show that the Respondents had in mind the advice which the Applicant had received with regard to her legal rights."

Mr Harrison in support of this appeal brought by the employers, argues that the Industrial Tribunal misdirected itself in law and/or reached a perverse conclusion in holding that the principle reason for dismissal was that the Respondent had alleged that the Appellant had infringed a relevant statutory right. We cannot accept that submission. It is clear to us, as the Tribunal found, Miss Crush was claiming that the reduction in salary amounted to an unlawful deduction under the Wages Act , and that this was the reason for dismissal. That is a finding of fact with which we cannot interfere. That the Tribunal found that there was in fact no unlawful deduction is nothing to the point, given the Tribunal's finding that the claim was made in good faith. (See Section 60A(2).) Accordingly we reject that submission.

Mr Harrison complains that in assessing compensation for the unfair dismissal, the Tribunal failed to take into account the fact that there had been an overpayment of wages in February 1995. It is said that the Respondent was sick for the last half of that month, but received her full salary. The difference between full salary and statutory sick pay for the two-week period was calculated by the Appellant at £375.35. This alleged over-payment is referred to in the Notice of Appearance. In paragraph 13 of their reasons, the Tribunal accepted that an over-payment had been made, but make no reference to it in their calculation of the compensatory award. For the purposes of this Preliminary Hearing we think it arguable that the employer was entitled to credit for this sum against the gross compensatory award calculation; alternatively, by way of counter-claim under Section 131 of the Act.

In these circumstances we shall dismiss that part of the appeal which challenges the finding of unfair dismissal but will permit the appeal against the financial award made by the Industrial Tribunal to proceed to a full hearing.