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	United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Merseyrail Electrics 2002 Ltd v Taylor [2007] UKEAT 0162_07_1805 (18 May 2007) URL: http://www.bailii.org/uk/cases/UKEAT/2007/0162_07_1805.html Cite as: [2007] UKEAT 162_7_1805, [2007] UKEAT 0162_07_1805

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APPEARANCES

 

For the Appellant	MR T PITT-PAYNE (of Counsel) Instructed by: Messrs Mace & Jones Solicitors Drury House 19 Water Street Liverpool L2 0RP
For the Respondent	MR C BOURNE (of Counsel) Instructed by: Bridge McFarland Solicitors 3-9 Tentercroft Street Lincoln LN5 7DB


 


SUMMARY

Unlawful deduction from wages

Contract of employment – Sick pay and holiday pay

Contractual term permitted employer to withhold sick pay if there is any doubt that employee's absence is for reasons other than health. On the facts, any doubt removed by sick certificates submitted by employee, in the absence of any contrary medical opinion being obtained by employer.


 


HIS HONOUR JUDGE PETER CLARK

1. This is a narrow point of construction in the contractual term as to sick pay. The parties are Ms Nicola Taylor, Claimant, and her employer Merseyrail Electrics 2002 Ltd, Respondent.
2. The appeal is brought by the Respondent against the judgment of a Chairman, Mr M D Homfray-Davies, sitting along at Liverpool Employment Tribunal, promulgated with reasons on 17 January 2007, upholding the Claimant's complaint of unlawful deduction from her wages. The Chairman found that she had not been paid seven weeks sick pay to which she was contractually entitled.


The contractual term

3. The relevant express term provides, so far as is material:

"Payment [of sick pay] may also be withheld if there is any doubt that the absence is due to reasons other than health or personal accident which prevents the employee from undertaking any duty for which they are competent to perform".


The facts

4. The Chairman made the following finding of fact in his reasons.
   

"3.1, On 20 May 2006, part way through her shift, the Claimant left work stating that she was sick. She remained off work for about seven weeks, until about 10 July 2006.

3.2, The problem arose in this way: the Claimant was employed as a penalty fares inspector working on the Wirral line. She lives in Wallasey. At the material time the Liverpool Loop was closed, her tour of duty finished at Moorfields, where she had to account for her daily penalty fares and takings. Her shift finished some time after 2300 hrs which which when the trains are running around the Loop, enabled her to catch the last train home from Moorfields. However, if she had to walk to James Street after clocking off, firstly she would not get the last train; secondly she was frightened of walking from Moorfields to James Street at that time of night.

3.3, From Monday 22 May 2006, the Claimant was rosterred to work lates. So, on 20 May 2006 she asked Mr Robinson, a manager, for assistance to get from Moorfields to James Street to catch the train home. He informed her that it was her responsibility to get herself to and from work. Subsequently she left her shift on sick leave. Thereafter she was informed that she would not be paid contractual sick pay.

3.4, It is to be noted that on 9 May 2006 another manager, Mr Free, had suggested that she could ask a colleague to accompany her to James Street or get a lift or wait for the inspector later on, by which time she would have missed her train home.

3.6, On 22 June 2006, Mr Hanley, at the behest of Mr Newcomb, held an investigatory interview with the Claimant to consider the issue of whether the Claimant should be paid contractual sick pay. He declined to authorise contractual sick pay.

3.7, On 4 July 2006, the Claimant raised a grievance which was heard by Miss Seller on 27 July 2006. She reasonably concluded, having interviewed Mr Robinson, that he had informed the Claimant on 20 May 2006, that she could be accompanied from Moorfields to James Street by a colleague or get a lift. What she did not do was consider whether the Claimant's contention that she had left work on 20 May 2006 due to stress was genuine, rather than the fit of pique by the Claimant at not getting what she wanted from Mr Robinson. Miss Seller rejected the grievance by letter dated 3 August 2006.

3.8, At the appeal heard on 4 October 2006, it was contended by the Claimant's representative that the Claimant had left work due to the stress of the situation and that she had had a previous absence due to stress, and thus the real issue was for the Respondent to consider whether the Claimant's contention that she was stressed, not whether her refusal of the assistance offered is unreasonable. The appeal was rejected by letter dated 6 October 2006. Based on the findings of fact, the Chairman concluded.

He concluded:

5, The wording of clause 13.1, the relevant provision, does not give the Respondent an absolute discretion, which itself must not be exercised in bad faith or capriciously. The clause requires the Respondent to consider whether there are reasonable grounds for doubting that the reason for the Claimant's absence was stress. In this case, there could not be reasonable grounds to doubt at least some medical investigation. There was none.

6., Although the Respondent carried at a three-stage investigation into the matter and was clearly not acting in bad faith or capriciously, it never asked itself the correct question, namely whether there were reasonable grounds to doubt the Claimant's contention that she was stressed, not whether her refusal of the assistance offered was unreasonable. In these circumstances the discretion not to pay contractual sick pay was not unreasonable. So, the Respondent has made an unauthorised deduction of wages in the sum claimed."


Additional facts

5. It was and is common ground that during her absence from work the Claimant submitted sick notes from her general practitioner, Dr Sedgwick. These are before me. On 26 May, the Claimant self-certified, giving us the reason for her absence: work related stress. On the same day, Dr Sedgwick issued the first of three sick notes which covered the remainder of the period of absence. He said that the Claimant should refrain from work for two weeks. Then this: "Diagnosis of your disorder causing absence from work: acute stress reaction". The later two certificates dated respectively 9 June and 23 June, were in similar terms save that that of 9 June referred to work related stress; that of 23 June acute stress reaction.
6. It also appears, and this is touched on in paragraph 3.8 of the Chairman's reasons, that the Claimant missed a total of 11 weeks work during 2005 due to stress. The absence record is again in the bundle placed before me.


The appeal

7. Mr Pitt-Payne's primary submission is that the relevant clause was subject only to an obligation on the employer not to act in bad faith or capriciously, to which one might add unreasonably in the sense of perversely. He refers to a line of authority, the most recent case being Commerzbank AG v Keen [2007] IRLR 132 court of appeal, in which the court referred to earlier first instance decisions, for example Clark v BET Plc [1997] IRLR 348 and Clark v Nomura International Plc [2000] IRLR 766. Those were all cases concerning wholly discretionary bonus payments. The particular term in the Keen case provided that the employee was eligible to participate in the bank's discretion bonus scheme:

"The decision as to whether or not to award a bonus and the amount of any award and the timing and form of the award are at the discretion of the bank".

8. Those cases, in my view, do not directly assist in construing the relevant provision in this case. There is a qualification to any absolute discretion to pay sick pay; that is that sick pay may be withheld if there is any doubt that the absence is due to reasons other than health or personal accident preventing the employee from undertaking any duty for which they are competent to perform.
9. I reject Mr Pitt-Payne's submission that that provision is subject only to the obligation not to act in bad faith or capriciously. The question, it seems to me, is what effect the words, "If there is any doubt", have on the undoubted discretion to pay sick pay.
10. Mr Pitt-Payne submits that the Chairman was wrong to accept the submission made on behalf of the Claimant, that that clause was subject to an obligation on the Respondent to show reasonable grounds for the doubt. During the course of argument I raised with counsel an alternative formulation, namely whether there was any real doubt. I accept Mr Pitt-Payne's submission that any such gloss is inappropriate. The question is whether, on the facts of this case, the Respondent was, as it contended and contends, in doubt as to whether the absence was due to reasons other than health.
11. Returning to the factual matrix: Mr Bourne conceded below, as he does before me, that at the initial stage Mr Newcomb was entitled to express doubt as to the reason for the Claimant's initial absence; was it due to sickness in the form of stress or was it, as the Chairman put it, in pique as a result of not getting her own way and getting what she wanted from Mr Robinson?
12. However, that is not the end of the matter. I reject Mr Pitt-Payne's contention that it was enough for the Respondent, having formed a doubt at the outset, that that covered the whole of the period of absence. It seems to me that the critical intervention was first of all the Claimant's self-certificate and then the sick certificates signed by her general practitioner. I return to the literal wording of the relevant clause: "Whether the Respondent had any doubt that the absence was due to reasons other than health". Initially, that doubt existed. However, once the general practitioner had certified not only that the Claimant was suffering from acute stress reaction, but also that that was the cause of her absence from work, the initial doubt, it seems to me on a proper construction of the provision, was removed. Unless and until there was medical evidence to put that opinion in doubt, it was pellucidly clear.
13. Where the Respondent, it seems to me, went wrong was to disregard the medical certificates and instead focus, in their subsequent investigation, on the Claimant's apparent reason for leaving the workplace in the first instance. Even if she was feeling piqued at not getting her own way, if that led to stress which in turn caused her absence, then she was entitled to sick pay, provided there was no doubt about that causative link. From the general practitioner's certificate there was none.
14. Where I respectfully agree with the approach of the Chairman, is his observation at paragraph 5 of his reasons, that there should at least be some medical investigation. Had there been a medical investigation undertaken by the Respondent, which put in doubt the opinion of the general practitioner, then the power to withhold sick pay under the relevant provision would have been made out.
15. During the course of argument I referred counsel to the court of appeal decision in Teinaz v London Borough of Wandsworth [2002] IRLR 721. That is, as Mr Pitt-Payne points out, a different case on its facts. The question there was whether an employment tribunal had erred, in refusing an adjournment to a party who did not attend the tribunal on the date fixed for the hearing, but instead put in a medical note advising him not to work nor attend court for the relevant period.
16. The Court of Appeal made observations on the significance of a medical certificate, but in the absence of any contradictory medical evidence, the thrust of the decision is that in that case a tribunal should not go behind what appears on the face of the medical certificate. In my view, that principle applies equally in construing this contractual terms. It was not open, once that medical certificate had come in, for the Respondent to maintain any doubt as to the reason for absence in the absence of any contradictory medical evidence. Accordingly, for these reasons, I shall dismiss this appeal.