MR STEPHEN MCBRIDE STEIN v VAN LAUREN LIMITED [2002] UKEAT 1340_01_2002

EMPLOYMENT APPEAL TRIBUNAL

BAILII case number: [2002] UKEAT 1340_01_2002

Case No Appeal No. EAT/1340/01

Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

Between

MR STEPHEN MCBRIDE STEINAPPELLANT

VAN LAUREN LIMITEDRESPONDENT

Before

Mr Recorder Burke

Date 20 February 2002

[1]APPEARANCES For the Appellant MR TATTON-BROWN (of Counsel) Appearing under the Employment Law Appeal Advice Scheme MR RECORDER BURKE QC This is the preliminary hearing of an appeal by Mr Stein against the Decision of the Employment Tribunal at Stratford, chaired by Mrs Goldman, and sent to the parties with Extended Reasons on 12 September of last year.

[2]Mr Stein brought proceedings against his employers, Van Lauren Ltd, who we now see are in administration, claiming that he had been made redundant, that he had not been paid adequate redundancy pay and that he was owed holiday pay and pay in lieu of notice.

[3]At the hearing on 3 September, the employers were not represented. Mr Stein and a colleague gave evidence; for the purpose of the investigation of his claims, it was necessary for him to explain what his remuneration, to use a neutral word, was, and how it was made up.

[4]We are told, and whether this is precisely what happened may have to be investigated hereafter, that the Tribunal retired to consider its Decision, and that it came back and indicated that on the contractual claims, it was in favour of Mr Stein, but Mr Stein's claim must fail because of illegality and that is, indeed, the reason in the Extended Reasons given by the Tribunal for dismissing Mr Stein's claims.

[5]The Tribunal found that Mr Stein was receiving £120 in cash on a monthly basis, said to be for expenses, but which he was not required to present receipts, and therefore he was receiving what was in fact pay which was untaxed and that this constituted an illegality. If Mr Stein's account of what happened be right, then this point came out of the blue when the Tribunal gave its Decision, and he was not given any opportunity to argue about it or to seek to adduce evidence about it and there is some indication that he may have been able to provide evidence from the Company Secretary and Director of Operations to demonstrate the genuineness of these expenses payments.

[6]Mr Tatton-Brown, appearing on Mr Stein's behalf under the ELAAS scheme, draws our attention to the relatively recent decision of the Court of Appeal on the illegality issues that arise in such claims as these in Hall -v- Woolston Hall Leisure Ltd

[2000] IRLR 578

. He draws our attention to the fact that, in that case, the Court of Appeal appear to have decided that the mere presence of illegal performance in the manner described in that case, which may or may not be similar to that in this case, is not enough for illegality; there must be on the part of the employee, it is submitted, both knowledge and participation for the illegality to be a defence. See paragraph 32 in the judgment of Lord Justice Gibson.

[7]Mr Tatton-Brown points out that the Tribunal who, of course, did not have the benefit of this authority or any other authority, did not make any finding as to knowledge or participation on Mr Stein's part. It appears to us to be arguable that further findings were required from the Tribunal before they were able to reach the decision as to illegality that they reached, on the basis of that authority.

[8]Secondly, it is submitted that Mr Stein did not ever say that he did not have to produce receipts, although the Tribunal found that he did not have to produce receipts. He says the Tribunal made an error in that finding, and it is clear that that finding was regarded by the Tribunal as of some substance in their Decision. We, of course, at this stage, do not know what evidence was given, but if Mr Stein is right about that, then there is there an arguable ground of appeal as well.

[9]Thirdly, the way in which the illegality point arose, only, so it is said, in the Decision of the Tribunal, without Mr Stein being given any chance to appreciate in advance what point he needed to meet, and to decide whether he needed to ask, for instance, for an adjournment to call evidence to deal with it, arguably, also gives rise to a ground of appeal.

[10]For those reasons we think that this is an appeal which should go through to a full hearing. We will put it in Category C, time, two hours.