Title: 96_891
Author: Julia Evans
Last saved by: vmartzou
Company: BAILLI

Appeal No.	 EAT/891/96

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 29 November 1996

Before
THE HONOURABLE MR JUSTICE MORISON (P)
MR D J HODGKINS CB
BARONESS SYMONS OF VERNHAM DEAN

T J SNOW (BUILDER) LTD	APPELLANT

MR P A SNOW	RESPONDENT

Transcript of Proceedings

JUDGMENT

PRELIMINARY HEARING

Revised

	APPEARANCES

For the Appellant | APPELLANT IN PERSON

		MR JUSTICE MORISON (PRESIDENT):   The purpose of this hearing is to determine whether Mr T J Snow on behalf of T J Snow (Builder) Ltd., has an arguable point of law in his potential appeal against a decision of an Industrial Tribunal which was given in February 1996, again in May 1996, and lastly in July 1996. 

	The three points which he wishes to argue relate to sick pay, travelling time, and holiday pay.  Very shortly, the background to this appeal is as follows: T J Snow (Builder) Ltd is a building company but has, like many other building firms, found life much more difficult more recently.  A very small business, T J Snow employed Mr Peter Alan Snow, Mr T J Snow’s younger brother, as really the only employee of the business.  Between them they got the thing going and set it up and were successful as I have indicated.  

	Because, no doubt, of that family relationship, the arrangement between them both as to the terms on which Mr Peter Alan Snow was employed, was dealt with extremely informally.  When times were good, payments well in excess of the minimum union rate were paid.  As the going got tougher, Mr T J Snow perhaps very understandably, decided that he could not afford to continue to pay his brother on such generous terms, and believed that, what was necessary, was for him to take a cut in his remuneration, just as, no doubt, Mr T J Snow himself was doing by virtue of the reduced profits of the business.

	The reduction in remuneration was not agreed by Mr Peter Snow, who despite the family arrangements and the informality with which they had been doing business together, made complaint to an Industrial Tribunal under the Wages Act saying that he had not agreed to a reduction in his remuneration and accordingly there were unlawful deductions being made.  Those claims inevitably were going to succeed in the absence of agreement between the parties, because an employer is not entitled unilaterally to reduce the employee’s remuneration, whether it be his brother or not.  Accordingly the decision of the Industrial Tribunal was that there had been unlawful deductions from Mr Peter Alan Snow’s wages.  

	The question at issue raised on this Notice of Appeal relates as I say to just three points of the remuneration package.  I will deal with each of them in turn.  The Industrial Tribunal had to decide what the terms and conditions of employment were in relation to sick pay.  As part of the reasoning process which they adopted, they had regard to what sick pay had been paid throughout the contract.  There was evidence before the Industrial Tribunal that Mr Peter Snow had been off sick for a period of four weeks and had been paid in full.  On that basis, partly, and no doubt using the Chairman’s general experience of how sick pay is organised, he came to the conclusion that that was a term of the contract, limited to a four-week period.  Mr T J Snow says “well that is unfair, if my brother had never been sick, presumably the Industrial Tribunal would have determined that there was no period of sick pay, other than the statutory sick pay scheme.”

	It seems to us that that argument is not correct as a matter of law.  The Tribunal were obliged to have regard to what had taken place between the parties during the course of the employment relationship, in construing the terms and conditions of employment.  The fact that Mr Peter Snow had had a period off work of at least that length and been paid in full, was a factor they were entitled to take into account.  But it does not follow logically or as a matter of law, that if he had had no sickness during that period the decision would have been any different.  The Tribunal would still have had to have asked itself what were the terms agreed, expressly or impliedly between the parties, having regard to all the circumstances.  They would have been entitled to take into account in arriving at that decision, not just what had happened, but for example the national agreements, which govern sickness in the building industry and their knowledge of sickness provisions in other small businesses.

	Accordingly we do not think it arguable that the Tribunal had gone wrong in law in arriving at their conclusion in relation to sick pay.  

	In relation to travelling time, the position is this: the Industrial Tribunal found that there was an agreement between the two brothers that the Applicant would be paid for one extra hour per day for bringing the sub-contractor to work and that that arrangement persisted from the time when the first originating application was presented on 27 September 1995 until 16 November 1995 when the sub-contractor was dismissed.  Mr T J Snow has done some work since the Industrial Tribunal decision was sent to him in this respect, and has discovered that in fact during no time in that period was the sub-contractor given a lift by the Applicant.  Accordingly he says that this is new material which shows that the Industrial Tribunal had erred.  Again we regret that we cannot agree with that submission.  The question at issue before the Industrial Tribunal was: what were the contractual terms and conditions.  If the term and condition was that he would be paid for one extra hour per day, whether or not he brought the sub-contractor to work, but on the basis that he held himself out as available to carry the sub-contractor to work, then the fact that he did not take the sub-contractor to work, would not have affected the entitlement to the extra money.  He told us during the course of argument as I understand it, that for quite some time this payment had been claimed and paid, although Mr T J Snow says, and we have no reason to disbelieve him, that he was actually unaware of precisely the circumstances in which the claim had been made.  Whether it was by way of an earlier start at work or by way of taking the sub-contractor to work, does not seem to have been clearly established.  

	It seems to us on the basis of the material before the Industrial Tribunal, and having regard to the new material provided to us, that there is no arguable point of law in relation to travelling time.  This was a payment which was regularly made to Mr Peter Snow and was not conditional upon him actually giving a lift to the sub-contractor on any particular occasion.  

	In relation to holiday pay, I think the position is this.  What really is being said is that three weeks holiday pay is excessive, having regard to the state of play of the business.  We do not consider that the Industrial Tribunal has erred in law in relation to holiday pay.  They had to apply their minds to the question as to what was agreed between the parties, and on that basis they were entitled, I think, to arrive at the conclusion that three weeks holiday pay should be made to the employee.  

	That deals with the three points.  Nonetheless, it seems to us a most unfortunate dispute and we feel considerable sympathy with Mr T J Snow for what has happened in this case.  It is a case, possibly, where his younger brother has taken advantage of the fact that there had been no written terms and conditions of contract between the two of them, at the time when he was first employed in the business.  

	Be that as it may, our jurisdiction is limited to dealing with points of law only, and we are not satisfied that any point of law has been shown in this case.

© Copyright 1997

EAT/891/96

EAT/891/96
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