Moon Furniture & Toy Centre v Coughlan [1998] UKEAT 306_98_2509

EAT
Moon Furniture & Toy Centre v Coughlan
[1998] UKEAT 306_98_2509 · 1998-09-25

JUDGE HICKS QC :

The respondent employee, Mr Coughlan, was employed by the appellant employers, Moon Furniture & Toy Centre, as a driver. He was dismissed and brought a complaint to the Industrial Tribunal for unpaid wages. That complaint was dealt with in the absence of the employer in circumstances to which we shall come, and a decision was promulgated with summary reasons on 17th December 1997. There was then an appeal by Notice of Appeal dated 4th February 1998 and an application for review, the application for review having been lodged a week or so earlier. The review decision, which was a rejection of the application for review, was not promulgated until 9th February 1998, after the Notice of Appeal against the substantive decision. As we understand it we are dealing only with an appeal against the substantive decision, there being no separate appeal against the refusal to review.The reasons for the tribunal's decision were, as I have said, in summary form. Normally extended reasons are required for the purposes of an appeal, but that was a matter which this Appeal Tribunal, differently constituted, dealt with at a preliminary hearing on 27th April 1998. In their judgment, given by the President, Morison J, they considered that the summary reasons were in "sufficiently comprehensive terms", as they put it, to enable them to deal with the appeal, and we take the same view so far as this substantive hearing is concerned.The claim, as I have said, was for unpaid wages. In the employer's Notice of Appearance - which was all that was before the Industrial Tribunal Chairman who dealt with this matter, because the employers did not attend and were not represented at the hearing before him, as they are not before us today - the employers set out a number of matters as follows:
"Mr Coughlan worked for us as a delivery driver, but later found out that he was banned from driving and had an invalid licence. This fact came to light when the police arrested him on our premises and took him away. From that day on Mr Coughlan was told that if he was banned from driving then he would be dismissed from work. He was also told he could continue working for the company as drivers mate helping with deliveries but not driving the van, until he pleaded guilty to the police or was found guilty at trial.
Mr Coughlan knowing that he was to be fired soon anyway concocted a plan to steal £654 from the company. Both he and the driver are solely and jointly responsible for collecting money owed to us on delivery. Both men came back one day from deliveries with a concocted story about money missing from delivery (£654). They just happened to leave it in the glove compartment of the van and left the van unlocked and somebody must have stolen it. On further questioning it was revealed that this money was in a sealed envelope together with £120 in cash, unsealed, which was from an earlier delivery. Neither man could explain why this money was still present yet the money in a sealed envelope went missing. Their only response was "Can't explain it", or "No it doesn't make sense to us why someone would take a sealed envelope containing money but not the £120 cash". Police were called in and questioned both men with same response.Regardless of whether money was stolen or went missing, both delivery men are responsible for it and must pay the money due. I ask the tribunal to award us this money and collect it from P Coughlan. I also ask the tribunal to inform the DSS of the outcome of the tribunal if in our favour and stop any benefits he is claiming if they are not due to him.Precedent of missing money deducted from wages already set and every employee informed of this. Approximately five people will sign written letters confirming this and will appear at tribunal if required, although it will be a complete and absolute waste of everybody's time and money."No such signed letters were before the tribunal. Nobody did appear to give evidence before the tribunal on behalf of the employers. It is apparent from the Notice of Appeal that that was because the employers considered it more expensive to turn up at the tribunal than to face any consequences in any award that the tribunal might make, and that was a decision which the employers were entitled to reach. But equally clearly, in our view, they must accept the consequences.The Chairman in those circumstances heard the applicant, Mr Coughlan, in person, and made the following findings of fact, as he said, on the balance of probabilities:
"(i) The applicant was employed as a delivery driver by the respondent from July 1997 until 10 October 1997.
(ii) The applicant did not have a written contract of employment nor was he given a letter of appointment when he took up his employment with the respondents.(iii) There was no express oral term of the applicant's employment contract whereby the applicant was advised that in the event of monies which he had collected from customers on his delivery rounds which was misplaced or went missing should be repaid by the applicant out of his wages. It was not appropriate in the absence of any evidence in support to imply such a term into the contract of employment.(iv) The applicant advised the proprietor of the respondent's undertaking on 10 October 1997 that a quantity of money amounting to approximately £600.00 had been removed from the delivery wagon whilst the applicant and his driver were carrying out deliveries. As a result of this matter the applicant was summarily dismissed by the proprietor on the same day. The proprietor refused to pay the applicant's outstanding wages which at that time amounted to two weeks payment.(v) The applicant at the material time was earning £110.00 gross per week. He worked "a week in hand" throughout his period of employment with the respondent thereby giving rise to a claim for two weeks wages.(vi) The applicant requested the payment of outstanding wages upon dismissal but payment was refused."On the basis of those findings of fact the tribunal expressed itself:
"5. ... satisfied on a balance of probabilities that the applicant's claim to outstanding wages was established ... The unlawful deduction is established."
The tribunal Chairman then went on to consider whether the respondent had a valid defence in law falling within the provision of Part II of the Employment Rights Act 1996 . He referred to s. 14, which sets out the grounds upon which the respondent could lawfully make a deduction, and the Chairman expressed himself satisfied that the refusal to make payment did not fall within any of those categories and that, therefore, there was no basis in law upon which the applicant should not have been paid the sums requested. The Chairman said that:
"7. In reaching its conclusions, the Tribunal considered all the contents of the Notice of Appearance which was lodged by the respondent."
The Chairman therefore concluded that:
"8. The Tribunal was satisfied on a balance of probabilities that the applicant had established his claim under the provisions of Part II of the Employment Rights Act 1996 and ordered the respondent to pay £220.00 in satisfaction of the claim."
In the absence of the appellants, and as requested by the appellants' letter, we therefore deal with this matter on the basis of the appellants' written submissions, taking into account both the Notice of Appearance to the original complaint, which I have already read, and the Notice of Appeal dated 4th February 1998 and the further letter which we received today.The Notice of Appeal sets out four numbered grounds of appeal, the first of which reads as follows:
"1. The Chairman had NOT considered that Mr P Coughlan was a BANNED driver when he applied for a job with us, produced FALSE driving license, was subsequently arrested by Police and is now being charged. Mr P Coughlan has now apparently told the Police that he was banned and did drive on a false driving license, which he denied at the time of his arrest. This is therefore new evidence that the Tribunal MUST consider. ALL the wages he was given by us was therefore obtained fraudulently as he would NOT have been given a job as a driver if he had been banned from driving. The Tribunal must NOT reward a criminal by giving him money he is not entitled to."
Clearly the Chairman did take into account the allegation that Mr Coughlan was a banned driver and the fact that at the date of dismissal he had been arrested by the Police and had been charged. That was all in the Notice of Appearance and there is absolutely no ground whatsoever for supposing that the Chairman was not being accurate in saying that he took the Notice of Appearance into consideration. At that date it was merely a charge, not a conviction. Indeed, we still do not know if there has been a conviction or not. The employers themselves, as they say in their Notice of Appearance, had not at that arrest dismissed Mr Coughlan, they had merely taken him off driving, continued to employ him as a drivers' mate and told that that would continue until, as they put it, "he pleaded guilty to the Police or was found guilty at trial". They seem to have failed to deal with the possibility that in fact he might not have been guilty. But that was their position at that time: they were continuing to employ him pending the resolution of this charge. We see absolutely no reason, as I have said, for supposing that the Chairman did not take that into account.The Notice of Appeal then, as we understand it, goes on to allege that since the hearing before the tribunal Mr Coughlan has effectively admitted the charge. That is a matter which the tribunal could not possibly have taken into account if it has happened since, and therefore there can be no error in law on that basis. Nor, in our judgment, if it is to be taken as an application for new evidence to be adduced before us, is it within the criteria which allow in rare circumstances such evidence to be adduced on appeal. Nor indeed is there any such evidence before us, simply the allegation by the appellants. So there is nothing in that ground of appeal which could justify our reversing the decision of the Industrial Tribunal.The second ground reads as follows:
"2. A grave miscarriage of justice will have taken place if Mr P Coughlan is awarded any money and it will encourage other criminals to do the same. The Police evidence and now Mr Coughlan's own admission MUST be given due weight."
That is simply a misconception of the jurisdiction of the Industrial Tribunal and of the Employment Appeal Tribunal. There is a statutory right of employees not to have sums deducted from wages. Any tribunal before which a claim under that statute comes must deal with it on the basis of the statutory provisions and cannot simply give effect to more general considerations as to whether that will mean that money will be, in a general sense, unjustly paid. More fundamentally, and beyond the question of the purely statutory provisions, this ground comes up against the fundamental fact that there was no evidence before the Industrial Tribunal and is no evidence before us in support of these serious allegations. There are simply allegations made by the appellants which the appellants, perhaps for perfectly sound and understandable commercial reasons, chose not to support by attending the tribunal or sending any witnesses to give evidence.The third ground of appeal reads:
"3. The Chairman at the tribunal is a completely utter imbecile who believed everything the crooked Mr P Coughlan told him, and NOT a single word anyone else says, including the Police, employees of the company who do NOT have false driving documents and the Employer who also does NOT have false driving documents either."
The Chairman only had Mr Coughlan as a witness. There was no policeman present to give evidence. There was no employee present to give evidence, nor any letter from any employee or from the Police, nor the employer nor any evidence on behalf of the employer except the allegations in the Notice of Appearance. We completely reject the allegation that the Chairman of the tribunal was in anyway lacking in understanding of the task before him or failed to perform it in the ways alleged in this ground of appeal.The fourth grounds reads:
"4. Mr Coughlan presented NO evidence at the tribunal, only gave a verbal statement."
I interpose that that is a misunderstanding of what evidence is. If Mr Coughlan attended before the tribunal, as he did, and gave oral evidence, that is evidence. The ground continues:
"The Chairman of the Tribunal attaches too much significance to the fact that we did not attend the Tribunal hearing. The complete and utter fool does NOT realise that it actually costs money to attend the Tribunal, MORE than any subsequent award to Mr P Coughlan could possibly be. Under such circumstances and with so much evidence against Mr P Coughlan, only an imbecile could believe him."
There is nothing fresh in that ground with which we have not already dealt. The Chairman had to deal with the matter on the evidence before him. He of course was not bound, and we are sure appreciated that he was not bound, by the strict rules of evidence of a court, and therefore for that reason, as he says, took into account what was in the Notice of Appearance, but then reached his decision.Finally in the letter written for the purposes of the hearing before us, after asking us to take into account the written submissions before the Court, the appellants continue:
"Our main reason for the appeal is that Mr Coughlan was a banned driver when he applied for the job of driver with us hence he is NOT entitled to any wages at all. Any wages paid to him are a result of his deception against the company."
That substantially covers the same ground as the four grounds of appeal with which we have already dealt.Looking at the matter more broadly and asking ourselves whether despite the failure of those specific grounds of appeal there is any reason to suppose that the Chairman of the tribunal erred in law, we have considered the terms of the statute, namely ss. 13 and 14 of the 1996 Act. S. 13(1) provides:
"(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 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."
In subsection (2) there is a provision as follows:
"(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. [ That is to say on an occasion prior to the deduction in question. ]"
In S. 14, where there are exceptions to S.13, we need not read subsections (1), (2), (3) or (5) because they deal with special circumstances which manifestly have no connection with this case. Subsection (4) provides:
"(4) Section 13 does not apply to a deduction from a worker's wages made by his employer in pursuance of any arrangements which have been established - (a) in accordance with a relevant provision of his contract to the inclusion of which in the contract the worker has signified his agreement or consent in writing, or (b) otherwise with the prior arrangement or consent of the worker signified in writing, [ That relates to deductions paid over to a third person. ]"
So that the conditions for that deduction are much the same as those in the exception in s. 13(2) itself, but relate to payments over to a third person. It is therefore convenient to take s. 13(2) and s. 14(4), as to contract terms justifiying deductions, together.The Chairman found that there was no such term, but in our view he would inevitably have concluded that even if there was any such term it had not been comprised in a written term of the contract of which a copy had been given to the employee, and that if oral there had been no written communication to Mr Coughlan of the term before this deduction. Not only was there no evidence of any such written term, but no allegation in the Notice of Appearance that that was the case. The Notice of Appearance in raising this point puts it, it says, in terms of a "precedent" or practice and does not allege any written notification. Moreover, as we have already noted, the assertion in that Notice of Appearance that "five people will sign written letters confirming this" simply did not materialise. The decision of the Chairman excluding a deduction on that basis was, in our view, not only not wrong in law but inevitable.The other subsection of s. 14 which might have some relevance is subsection (6), which provides:
"(6) Section 13 does not apply to a deduction from a worker's wages made by his employer with his prior agreement or consent signified in writing where the purpose of the deduction is the satisfaction (whether wholly or in part) of an order of a court or tribunal requiring the payment of an amount by the worker to the employer."
Now it is perfectly clear that the employer does raise an allegation, and a perfectly understandable allegation (although as we have said not supported by direct evidence) that the employer had a claim against the employee for money allegedly stolen. But that still does not of itself entitle the employer under the statute to deduct such a sum from wages. The employer must first get a judgment of the Court, which this employer had not and still the employee has to consent in writing to the deduction of the amount of that judgment debt from wages. So those criteria were not satisfied. Even if the Chairman of the tribunal had accepted in full the employer's case that there was a claim against the employee because of theft, then that would not have entitled the employer to deduct that sum under any of the exceptions under ss.13 or 14 of the 1996 Act.For those reasons, therefore, even taking into account such further matters as the employer might have advanced but does not expressly advance in the Notice of Appeal, we find no ground on which the Industrial Tribunal erred in law and for those reasons we dismiss this appeal.