University Of Sunderland v Drossou (Unfair Dismissal) [2017] UKEAT 0341_16_1306

EAT
University Of Sunderland v Drossou (Unfair Dismissal)
[2017] UKEAT 0341_16_1306 · 2017-06-13
[71]“ 14. It seems to us that the ordinary meaning of a “week’s pay” is the amount which an employee is entitled to receive under his contract of employment; that is, the gross amount before the deduction of tax and national insurance contributions. … Payments made by the employer to a pension fund on the applicant’s behalf should not be counted as part of the week’s pay.”18. The Employment Tribunal in Payne considering the predecessor legislation to the ERA did not refer to the relevant statutory provision in that Act. They predicated their views on whether or not a week’s pay includes pension contributions by the words “ It seems to us ”. Neither was there any reference in the passage quoted from the Employment Tribunal’s decision to any predecessor to section 13 ERA , the claim which may be brought for a deduction from wages, nor was there a reference to any definition of wages as sums payable to the employee, which, in my judgment, are relevant to this issue.19. In my judgment, a “conventional” approach cannot outweigh the statutory language when deciding whether a week’s pay for the purposes of the ERA includes pension contributions made by an employer on the employee’s behalf. In construing section 222 it is material to look at other provisions in the same Act as an aid. In my judgment, the use of the words “sums paid to the worker” in the section 27 definition of wages for the purposes of Part II of the ERA and their absence from section 221(2) in referring to a week’s pay in Part X for the purposes of the upper limit on a compensatory award for unfair dismissal is conclusive against construing a week’s pay in that provision as requiring payment to the employee. The legislature has shown by the wording of section 27 that where it has intended remuneration to be restricted to amounts paid directly to the employee the words “to the employee” have been inserted.20. In my judgment, the Employment Tribunal’s analysis at paragraph 3.10 of the second Remedy Judgment is correct. In that paragraph they say, in reference to section 221(2):
“3.10. It does not say payable “ to the employee ”, so the fact it is paid to Trustees of a pension scheme who hold it for the benefit of members of that scheme including the employee, matters not in our view. “Remuneration” is derived from the Latin “munus” meaning a “reward”
. The Oxford dictionary definition says it is especially used to apply to a reward in return for service. …” 21. Accordingly, the Employment Tribunal concluded, having regard to the absence of a requirement that remuneration be paid to the employee, that pension contributions paid by the employer in respect of the employee fall within the scope of section 221. A definition of wages as remuneration as a reward for work done is apposite to be applied to the employer’s contributions to a pension scheme in respect of the employee for his or her work. That is the basis of the Employment Tribunal’s decision. 22. With respect to the Employment Tribunal, however, I differ from them in their observations at paragraph 3.11 that it would be illogical if one would take the employee’s loss of pension contributions into account when calculating a compensatory award and irrational to omit it in calculating the cap on that award. Both matters are of governed by statute. The compensatory award under section 123 has regard to loss sustained in consequence of the dismissal insofar as it is attributable to action by the employer. That includes non-contractual loss. However, a week’s pay under section 221 on which the cap on the compensatory award in section 124(1ZA) is determined is calculated not on loss but on entitlement under the contract. Benefits included in a compensatory award do not necessarily fall to be included in a week’s pay. Pension contributions are included in both because they fall within the section 221 calculation of a week’s pay. Accordingly, I depart from the Employment Tribunal in their observations at paragraph 3.11. However, as previously explained, the Judgment of the Employment Tribunal that pension contributions should be included in a week’s pay and their reasons set out at paragraph 3.10, are, in my view, correct and unassailable. Ground 1 of the appeal is dismissed. 23. As ground 2 is not pursued. By ground 3 of the Notice of Appeal, it is contended that:
“The Tribunal failed to adequately explain its decision to make no reduction for contributory fault to the basic award and/or such decision was perverse.” 24. This ground of appeal has given me some concern, as it could be said not to comply with the Employment Appeal Tribunal Practice Direction paragraph 3.8. The Practice Direction states that an Appellant may not state as a ground of appeal simply that the Judgment or Order was one that no reasonable Tribunal could have reached and was perverse unless the Notice of Appeal also sets out full Particulars of the matters relied upon in support of those general grounds. Mr Boyd recognises that the ground of appeal in support of ground 3 does not strictly comply with the Practice Direction , and he asks me to read the Notice of Appeal with his skeleton argument, where it is said that it was perverse of the Employment Tribunal not to apply the same 35 per cent reduction to the basic award as was made to the compensatory award. Mr Boyd also refers and relies upon the case in the Court of Appeal of RSPCA v Cruden [1986] IRLR 83 in which Hutchison J and members in the Employment Appeal Tribunal held at paragraph 35, having referred to the reduction for contributory fault respectively to the compensatory award and the basic award: “35. Plainly both subsections involve the exercise of a discretion, and the wording of each, whilst sufficiently different to admit of differentiation in cases where the Tribunal finds on the facts that it is justified, is sufficiently similar to lead us to conclude that it is only exceptionally that such a differentiation will be justified. …” 25. In this case, Mr Boyd contends that such differentiation is not justified. Mr Boyd submits that the conclusion reached at paragraph 4.8 of the Liability Judgment as to contributory fault should have been read over into the decision on whether there should be a reduction in the basic award. Accordingly the Employment Tribunal erred by making no reduction in the basic award. 26. I have given anxious consideration as to whether it would be right for this Tribunal to entertain a perversity ground of appeal that has not been particularised. This is so, particularly as the Claimant is not represented at this hearing nor has she heard how this ground of appeal is being advanced. Mr Boyd says that there is nothing in the Answer that would indicate that the Claimant would have had anything to say in particular other than relying on the grounds advanced or relied upon by the Employment Tribunal. Further, Mr Boyd says that the Claimant made no reply to the skeleton argument that had been served on her solicitors. I am conscious that in accordance with the overriding objective this Tribunal must do justice between the parties. I have concluded that paragraph 7(c) of the grounds of appeal, which is a paragraph setting out what the Appellant Respondent wishes the Employment Appeal Tribunal to do, does save the ground of appeal from being objectionable on the basis it gives no particularity of perversity. At paragraph 7 it is said: “7. The Appellant invites the Employment Appeal Tribunal to substitute a conclusion … (c) that a 35% reduction for contributory fault should be made to the basic award and make a revised award accordingly.”
Accordingly, by the skin of its teeth this Notice of Appeal just about satisfies the requirements of the Employment Appeal Tribunal Practice Direction for particularity to be given of a perversity ground of appeal. Accordingly, that ground will be and is considered. 27. The statutory provisions for the deduction for contributory fault of the basic award and of the compensatory award are different. Section 123(6) ERA provides:
“(6) Where the tribunal finds that the dismissal was to any extent caused or contributed to by any action of the complainant, it shall reduce the amount of the compensatory award by such proportion as it considers just and equitable having regard to that finding.”
Section 122(2) provides: “(2) Where the tribunal considers that any conduct of the complainant before the dismissal (or, where the dismissal was with notice, before the notice was given) was such that it would be just and equitable to reduce or further reduce the amount of the basic award to any extent, the tribunal shall reduce or further reduce that amount accordingly.” 28. In making a compensatory award where there is a finding of contributory fault that contributed to the dismissal, the Employment Tribunal shall reduce or further reduce the amount of the award. Where in the case of a basic award the complainant’s conduct before the dismissal is such that the award should be reduced, the Employment Tribunal is required to reduce the award. The amount by which the awards are to be reduced is at the discretion of the Employment Tribunal. The Employment Tribunal can assess that reduction at zero if it thinks it is appropriate in all the circumstances. However, where, as here, the Employment Tribunal found that the conduct of the Claimant caused or contributed to her dismissal it is difficult to see how that is not also to be regarded as conduct falling within section 122(2) attracting a consideration of an amount or percentage by which a basic award should be reduced. As at paragraph 35 of the RSPCA case, which was considered, amongst other cases, in Charles Robertson (Developments) Ltd v White and Anor [1995] ICR 349, it is difficult to see that there is a differentiation to be made between the conduct if the same conduct is asserted in support of a reduction of the basic award as well as the compensatory award. In this case, the Employment Tribunal did not identify any differentiation in the conduct that, in their view, attracted a reduction in the compensatory award but not in the basic award. In the absence of an explanation as to why the conduct of the Claimant for the purposes of the compensatory award was regarded as blameworthy attracting a reduction but attracted no reduction to the basic award, in my judgment the challenge made to the failure to reduce the basic award by 35 per cent is well founded. Ground 3 of the Notice of Appeal succeeds. Disposal 29. Ground 1 of the Notice of Appeal does not succeed and is dismissed. Ground 2 is withdrawn and dismissed on withdrawal. Ground 3 succeeds. The original basic award shall be set aside and be substituted by an award that is to be reduced by £2,128, giving a figure that results of a basic award to be paid to the Claimant of £3,904.

Cited in 1 later judgment