Appeal No. UKEAT/0098/04

EMPLOYMENT APPEAL TRIBUNAL
52 MELVILLE STREET, EDINBURGH EH3 7HF

	At the Tribunal
	On 19 May 2005

Before
THE HONOURABLE LADY SMITH
(SITTING ALONE)

CHIEF CONSTABLE OF STRATHCLYDE POLICE	APPELLANT

MR HUGH LAVERY	RESPONDENT

Transcript of Proceedings

JUDGMENT

APPEARANCES

 
For the Appellant	Mr P Grant-Hutchison, Advocate
Instructed by-
Legal Services Manager
Strathclyde Police
173 Pitt Street
GLASGOW   G2 4JS

 	

For the Respondent

 	

Mr A Hardman, Advocate
Instructed by-
Messrs Levy & McRae
Solicitors
266 St Vincent Street
GLASGOW   G2 5RL

 

	

SUMMARY

PRACTICE AND PROCEDURE

Postponement or stay

WORKING TIME REGULATIONS

Holiday pay

Wages. Holiday pay during sickness absence. Whether claimant entitled to a week’s pay in terms of the Working Time Regulations 1998.

THE HONOURABLE LADY SMITH:

1.	I am now able to give a decision in this appeal, which is the appeal of the Chief Constable of Strathclyde Police v Hugh Lavery.  As instituted, this was a case about deductions from wages, and I am going to refer to parties as claimant and respondent as I go through my decision.

2.	This is an appeal by the respondent, against a decision of the Employment Tribunal sitting at Glasgow, Chairman, Mr H J Murphy, who sat alone.  That decision was registered with reasons on 24 November 2004.  The claimant was represented there by Ms Anne Bennie, solicitor and, here, by Mr A Hardman, advocate and the respondent was represented there by Mr Duncan Campbell, solicitor and, here, by Mr Grant-Hutchison, advocate.

3.	The claimant claimed he had suffered an unauthorised deduction from his wages, contrary to s.13 of the Employment Rights Act 1996 and the respondent contended that he had not.  The issue identified by the Employment Tribunal was that of whether for the purposes of calculating pay due during annual leave, a week’s pay was to be taken to be full or half pay.

4.	The decision of the Employment Tribunal was that they determined that the claimant’s contention, which was that he should have received full pay, was correct.

5.	The respondent has appealed against the decision of the Employment Tribunal.

6.	Turning firstly, to the relevant legislation, the relevant provisions are those contained, firstly, in Regulation 16 and 13 of the Working Time Regulations 1998, which insofar as applicable to the present case, provide:

“16  (1)	A worker is entitled to be paid in respect of any period of annual leave to which he is entitled under regulation 13, at the rate of a week’s pay in respect of each week of leave.

(2)	Sections 221 to 224 of the 1996 Act shall apply for the purpose of determining the amount of a week’s pay for the purposes of this regulation …

13  (1)	… a worker is entitled to four weeks’ annual leave in each leave year.”

and secondly, in s.13 of the Employment Rights Act 1996, which 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 a 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.”

Finally s.221 was of relevance to the Tribunal’s considerations, that being the section contained in Chapter II, regarding a week’s pay, which provides:-

“(1)	This section and sections 222 and 223 apply where there are normal working hours for the employee when employed under the contract of employment in force on the calculation date.

(2)	Subject to section 222, if the employee’s remuneration for employment in normal working hours (whether by the hour or week or other period) does not vary with the amount of work done in the period, the amount of a week’s pay is the amount which is payable by the employer under the contract of employment in force on the calculation date if the employee works throughout his normal working hours in a week.”

7.	It was conceded before the Employment Tribunal that the claimant was a person to whom the Working Time Regulations applied.  Section 221 was, on that basis, relevant.

8.	The facts can be shortly stated. 

9.	The claimant, who was a police sergeant, was injured at work on 22 June 2002 and has been absent from work on sick leave ever since.  As from 12 January 2004, he was accordingly on half pay.  Between 28 April 2004 and 12 May, the claimant took, what has been referred to, as two weeks’ annual leave.  It was thought that he was entitled to do so because of the terms of the relevant provisions of the Working Time Regulations.  It was also thought that he was entitled to be paid whilst on such leave, again because of those provisions.

10.	The respondent’ contention was that whilst on annual leave the claimant’s pay should be paid at the same rate as during the prior 12 week period, namely, at half pay rate.  The claimant contended he was entitled to full pay during his period of annual leave.

11.	Looking at the question of the legal principles that had to be applied by the Employment Tribunal, the issue that was before them, was one of statutory interpretation.  Parties were agreed before the Employment Tribunal that, notwithstanding the fact that the claimant was absent from work due to sickness, he was entitled to annual leave and, that that meant that he was entitled in terms of the provisions of the Working Time Regulations, to which reference has been made, to 4 weeks of such leave each year and, to be paid for each such week, a week’s pay, the amount of which fell to be determined in accordance with s.221 of the Employment Rights Act 1996.

12.	Subsection (2) of that section applied to the claimant’s case.  That was agreed since in terms of his contract of employment, his remuneration did not vary with the amount of work done, that is, he was not paid on a piecework basis but on a time basis.

13.	Section 221(2) then provides, as can be seen, that a week’s pay is the amount that is payable if the employee works throughout the normal working hours in a week.  It does not require that the employee, in fact, worked any hours in any week, whether the week prior to the calculation date or at any other time.  The use of the word “if” makes that clear.  In short, where the Working Time Regulations apply, it seems clear that the amount of a week’s pay is to be assessed on the basis of the assumption that the employee has worked for the normal working hours of a week at the time the calculation is made.  That is the result that was produced by the Chairman of the Employment Tribunal and I would not take issue with it.

14.	I note the argument advanced today by Mr Grant-Hutchison, against such a construction, which was broadly in line with that which was put before the Employment Appeal Tribunal, but I do not agree with it and do not see that his construction is one which one is driven to by any consideration of the authorities relied on.  Indeed, those authorities would appear rather to support the claimant since they repeatedly confirm that the wording of statutes are to be given their plain meaning except in very restricted circumstances.  The fact that one would be driven on Mr Grant-Hutchison’s interpretation to the conclusion that no calculation of a week’s pay could be made at all, indicates that the provisions do not fall into those circumstances.  For completeness I would add that the authorities to which I was referred, were the cases of Stock v Frank Jones (Tipton) Ltd [1978], Anderson v Gibb [1993] SLT, Lawrie v Banknock Coal Co Ltd [1912] and The Lord Advocate v Earl of Moray’s Trustees [1905].

15.	Such a result does, though, seem somewhat anomalous, in respect that the claimant would have doubled his pay on that basis during the two weeks that he was away on holiday with his family.  That anomaly would have flown from the fact of it being accepted that someone who is absent on sick leave is nonetheless entitled to annual leave, something which does seem to be a contradiction in terms.  It is hard to see how an employee, who is already on sick leave, can obtain leave from work that he is not carrying out.

16.	That is a view which has now been taken by the Court of Appeal in the case of The Commissioners of Inland Revenue v Ainsworth & Others [2005] EWCA Civ.  Whilst I do not determine the case at this stage, I would be inclined to agree with the approach adopted in Ainsworth and hold that the claimant was not entitled to annual leave under the Working Time Regulations and, so no question of the interpretation of s.221 of the Employment Rights Act would arise in a case such as the present.

17.	Leave to appeal to the House of Lords has, however, been granted in Ainsworth so the final word on this vexed matter is yet to be spoken.  It was accordingly submitted by Mr Grant-Hutchison, that I should remit the case to the Employment Tribunal with a direction to stay or sist pending the outcome of that appeal.

18.	Mr Hardman, for the claimant, sought to resist that by arguing that the respondent was here seeking to withdraw a concession of fact not one of law and that he should not be entitled to do so.  Clearly, unless he is allowed to withdraw that concession, he cannot advance any argument under Ainsworth.

19.	Mr Grant-Hutchison submitted that whilst he did seek to withdraw a concession, it was clearly a concession on a matter of law and, therefore, he should be allowed to withdraw it.  There would be no prejudice, he submitted, to the claimant were he allowed to do so.  He referred me to what was said by Lord McCluskey in the case of Connelly v Simpson [1994] SLTR 1096, towards the end of his opinion, Lord McCluskey said:

“For completeness, however, I should have been disposed to allow the concession to be withdrawn, partly because it seems to me to relate to a matter of law rather than of mixed fact and law (the facts were not in dispute), partly because I cannot see what prejudice the pursuer and respondent would suffer from the withdrawal of such a concession, and partly because there may have been some misunderstanding at the proof as to exactly what it was that was conceded in this regard.  When a concession is wholly or even largely related to a matter of law, and when that matter of law can be considered on the agreed or proven facts, then it is unsatisfactory to hold a party to a concession which he seeks to withdraw if it is plain that no material prejudice will result to the other party if the concession is allowed to be withdrawn.”

20.	On the matter of prejudice, Mr Hardman suggested that the claimant might have been able to approach the case by reference to normal practice had the claimant been aware that the respondent was not making the concession that was made at the Tribunal stage.  He did not, however, assert that, as a matter of fact, there had been any such case available to the claimant nor, indeed, did he assert how it was that the making of such a case would not have been considered before now.

21.	I, like Lord McCluskey, do not see that there would be any prejudice to the claimant in allowing this concession to be withdrawn at this stage and, that leaves me to determine whether the concession was on a matter of law or on a matter of fact.  It seems plain to me that the concession was one of law.  The respondent accepted that the Working Time Regulations applied to this claimant, as is evident from paragraph 12 on page 2 of the Employment Tribunal’s reasons and the entirety of the Employment Tribunal’s determination of the case thereafter flowed from that concession.  Accordingly it was not only a concession of law but it was a very important concession so far as the disposal of the case is concerned.

22.	It is entirely understandable in the light of Ainsworth, why the respondent now seeks to withdraw that concession, just as it is entirely understandable, given the state of the law at the time of the Tribunal hearing, as set out in the case of Kigass Aero Components Ltd v Brown [2002] ICR 697, why the concession was made at the time that it was.  I will, accordingly, allow that concession to be withdrawn.

23.	I note separately, that an argument was briefly advanced on behalf of the respondent, regarding competency.  It was submitted that it was not open to the claimant to proceed under s.13 of the 1996 Act when the Working Time Regulations themselves contained provisions whereby rights under those Regulations can be asserted.

24.	I note that the Court of Appeal had, in Ainsworth, expressed the view, albeit obiter that it is not open to a claimant to proceed under the 1996 Act where, what in truth, is being asserted is a right under the Working Time Regulations.  No doubt this is a matter which will also be aired at the forthcoming appeal before their Lordships in the House of Lords and so, at this stage, I say no more about it.

25.	In all the circumstances, I am persuaded that I should remit this case back to the same Employment Tribunal but that will be with a direction to stay the proceedings (or sist, to use Scottish language), pending the outcome to the appeal to the House of Lords in the Ainsworth case.

26.	I simply add that I am much obliged to Counsel for their assistance, both in writing and, by way of provision of appropriate materials and, with their oral submissions today.  They have been of great assistance in assisting me in disposing of this matter.