Appeal No. EAT/0735/02 MA

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 13 December 2002

Before
MR RECORDER LUBA QC
MS S R CORBY
MR T HAYWOOD

CARTER RETAIL EQUIPMENT LIMITED	APPELLANT

MR G S FLORA AND 11 OTHERS	RESPONDENT

Transcript of Proceedings

JUDGMENT

PRELIMINARY HEARING

Revised

	APPEARANCES

For the Appellant	MR THOMAS LINDEN
(of Counsel)
Instructed by:
EEF West Midlands
St James House
Frederick Road
Edgbaston
Birmingham B15 1JJ	

MR RECORDER LUBA QC

1	On 14 May 2002 the Employment Tribunal at Birmingham promulgated a decision that Mr G S Flora and 11 other scheduled employees of Carter Retail Equipment Ltd, were entitled to guarantee payments, pursuant to the terms of section 28 of the Employment Rights Act 1996.  Such payments were payable in respect of a number of days, not exceeding five, falling between 17 April and 13 May 2000.  Those were days on which the scheduled employees were not given work by their employer.

2	The Extended Reasons that the Tribunal has given show, in some detail, the background facts, which we can briefly summarise.  The Tribunal found that in March 2000 the employers faced a general contraction in available work.  In those circumstances days which were to be workless days were in prospect.  The employers decided, for reasons which the Tribunal has set out, to designate those days, which would otherwise have been days of no work for the employees, as holiday days and the employers paid holiday pay in respect of those days.

3	The legal effect of that process, as the Tribunal recognised, was to displace entitlement to the guarantee payment, in terms of pounds and pence, by the payment made in respect of holiday pay.  The practical effect, from the employee’s point of view, was that they lost potentially the flexibility in their choice of when to take holiday.

4	The question, therefore, for the Employment Tribunal was whether the employers were entitled to pursue that course.  That was a question which the Tribunal addressed in the context of the further provisions to be found in section 32 (2) of the Employment Rights Act 1996.

5	The Employment Tribunal had, in effect to answer two questions.  First – did the employers have the contractual freedom to designate the days which were likely to be workless days as “holidays”?  Secondly, irrespective of the answer to that question – whether any entitlement to guarantee payment should be offset by the actual “holiday pay” payments made?

6	The Employment Tribunal found against the employer on both questions and for the employees.  It accordingly held that there was the entitlement to a guarantee payment.

7	At this Preliminary Hearing, Mr Linden appearing for the employers, seeks to pursue further the two points which we have summarised as being the points which were before the Tribunal.  However, in the order in which he has presented them today, the first of his points is the “set-off” point.  As he himself recognises, that is linked to his second point, which is the point about the employers’ contractual freedom (or otherwise).  As they are linked, it seems sensible to us to first examine the contractual scenario and the Tribunal’s findings to see whether it is arguable that the Tribunal erred in law.

8	As to the matter of contract, the Employment Tribunal was labouring under the not-inconsiderable difficulty that it had neither the detailed individual contracts of employment nor any full copy of the agreement made between the employer and the employees collectively.  However, it was common ground before the Tribunal that it was a provision of the collective agreement that the holiday arrangements would be as specified in a document that the Tribunal had.  We now have that as pages numbered 4 & 5, helpfully appended to the Skeleton Argument of Mr Linden.

9	The Tribunal found that the effect of that document, and in particular the note ‘Note 1’, which is in the following terms – “For 2000 there are a further 22 days of Annual Holiday that can be taken at any time subject to agreement with your Departmental Manager” – was to operate in the sense of displacing the employer’s freedom or flexibility to designate, at its behest, the days on which employees were to take their holiday.

10	The question for us, therefore, is – whether it is arguable, as a matter of law, that the Tribunal erred in forming the construction they did of that document and of its effect.  

11	We, despite the helpful submissions of Mr Linden, are not persuaded that it is arguable.  The points were fully canvassed before the Employment Tribunal.  They had regard to the documents which were before them and which, it was common ground, represented the collective agreement provisions.  They reached, what to us seems to be, a conclusion fully open to them on the facts.  We cannot see that it is arguable that they misconstrued or misunderstood the collective agreement.

12	In those circumstances it follows that the Tribunal’s finding, that the employers were not entitled to designate the days as “holiday” days, stands.  Accordingly, the days in question were, as the Tribunal expressly found, “workless” days.

13	That brings us to Mr Linden’s first point, that notwithstanding the failure of his second point, nevertheless he should be entitled to argue that the Tribunal erred in not allowing a set off of the holiday pay against the guarantee payment.

14	His difficulty is that the Employment Tribunal expressly found that the days in question were workless days, which would attract the guarantee payments.  They were not holiday days.  The employer was not entitled to designate them as holiday days.  So what was paid to the employees was not pay in respect of a holiday day.  In our view it is not arguable that the Tribunal erred in law.  It is not arguable, therefore, that there should have been a set off, as contended for by Mr Linden on this appeal.  

15	Therefore, despite the assistance we have derived from his careful Skeleton Argument and his helpful oral submissions, we are satisfied, without hesitation, that neither of the two points advanced before us are arguable.  For those reasons this appeal will be dismissed.

16	Mr Linden, as we hope is quite plain from the terms of the judgment we have given, we are satisfied that the payments made by your clients, were not payments “in respect of” the workless days.  They were in fact payments flowing from the company’s breach of contract in attempting to require the employees to take “holiday” on days that the employers were not entitled to direct as days on which holidays were to be taken.

17	In the circumstances, having decided that the point is unarguable in this Tribunal, we do not think we can say it is arguable before the Court of Appeal.  Accordingly we would refuse permission to appeal.