ON APPEAL FROM EMPLOYMENT APPEAL TRIBUNAL
MR JUSTICE SILBER
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE KITCHIN
LORD JUSTICE UNDERHILL
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Lord Justice Underhill :
(1) Section 28, which is headed "Right to Guarantee Payment", enacts the substantive right. It reads (so far as material) as follows:
"(1) Where throughout a day during any part of which an employee would normally be required to work in accordance with his contract of employment the employee is not provided with work by his employer by reason of—
(a) a diminution in the requirements of the employer's business for work of the kind which the employee is employed to do, or
(b) any other occurrence affecting the normal working of the employer's business in relation to work of the kind which the employee is employed to do,
the employee is entitled to be paid by his employer an amount in respect of that day.
(2) In this Act a payment to which an employee is entitled under subsection (1) is referred to as a guarantee payment.
(3) In this Part—
(a) a day falling within subsection (1) is referred to as a "workless day", and
(b) "workless period" has a corresponding meaning.
(2) Section 29 provides for certain exclusions from the right. I need only set out sub-section (4), which deals with the situation where the employer offers the employee alternative work. It reads:
"(4) An employee is not entitled to a guarantee payment in respect of a workless day if—
(a) his employer has offered to provide alternative work for that day which is suitable in all the circumstances (whether or not it is work which the employee is under his contract employed to perform), and
(b) the employee has unreasonably refused that offer."
(3) Section 30 provides for how the guarantee payment is to be calculated. The principal operative provisions are sub-sections (2) and (3). No issue arises as to them for present purposes, but I should set out the terms of sub-section (5) because it is relevant to one of the issues which we have to consider. It reads:
"If in any case an employee's contract has been varied, or a new contract has been entered into, in connection with a period of short-time working, subsections (2) and (3) have effect as if for the references to the day in respect of which the guarantee payment is payable there were substituted references to the last day on which the original contract was in force."
(4) Section 31 provides for various limits on the entitlement under section 28, including (by sub-section (1)) a cap, which was at the time material to the present claims set at £21.20. Sub-section (6) contains a similar provision to section 30 (5), covering the case where "an employee's contract has been varied, or a new contract has been entered into, in connection with a period of short-time working".
(5) Section 34 confers jurisdiction on the employment tribunal to determine claims for guarantee payments: it also provides for a three-month limitation period. It reads, so far as material, as follows:
"(1) An employee may present a complaint to an employment tribunal that his employer has failed to pay the whole or any part of a guarantee payment to which the employee is entitled.
(2) An employment tribunal shall not consider a complaint relating to a guarantee payment in respect of any day unless the complaint is presented to the tribunal—
(a) before the end of the period of three months beginning with that day, or
(b) within such further period as the tribunal considers reasonable in a case where it is satisfied that it was not reasonably practicable for the complaint to be presented before the end of that period of three months.
(3) Where an employment tribunal finds a complaint under this section well-founded, the tribunal shall order the employer to pay to the employee the amount of guarantee payment which it finds is due to him."
THE FACTS IN OUTLINE
THE CLAIMS AND THE PROCEDURAL HISTORY
(1) Section 13 creates the basic right not to suffer unauthorised deductions from wages.
(2) "Wages" are defined in section 27. Sub-section (1) (d) expressly brings guarantee payments under section 28 within the definition.
(3) Section 23 confers jurisdiction on the Employment Tribunal to determine complaints of unauthorised deductions and also provides for the time in which such claims must be brought. It reads (so far as material) as follows:
"(1) A worker may present a complaint to an employment tribunal—
(a) that his employer has made a deduction from his wages in contravention of section 13 ...;
(b)-(d) ... .
(2) Subject to subsection (4), an employment tribunal shall not consider a complaint under this section unless it is presented before the end of the period of three months beginning with—
(a) in the case of a complaint relating to a deduction by the employer, the date of payment of the wages from which the deduction was made, or
(b) ... .
(3) Where a complaint is brought under this section in respect of—
(a) a series of deductions or payments, or
the references in subsection (2) to the deduction ... are to the last deduction ... in the series ... .
(4) Where the employment tribunal is satisfied that it was not reasonably practicable for a complaint under this section to be presented before the end of the relevant period of three months, the tribunal may consider the complaint if it is presented within such further period as the tribunal considers reasonable.
(5) ... ."
"It follows that by application of section 29 (4) ERA any right to a guarantee payment ceased thereafter (either because the employee had refused to undertake the work which refusal would be unreasonable or because, in relation to those who did work, they were remunerated for that work and can have no subsequent entitlement to a guarantee payment …)."
I have set out the terms of section 29 (4) at para. 2 (2) above: in short, it removes the entitlement of the employee to a guarantee payment where he has unreasonably refused an offer of alternative work. It is then pleaded, at para. 19, that "in the premises" the claims are out of time having regard to the fact that the proceedings were not lodged until 15 February 2010.
(1) In the case of the returners the Respondent would have a defence which was in part substantive and in part based on limitation. It would be substantive as from the time that they resumed working a five-day week, because self-evidently they could not claim in respect of days when they had worked; but it would depend on limitation as regards any workless days up to mid-November, because those occurred more than three months before the commencement of proceedings (and were not part of a series ending within the three-month period). To anticipate, both points are obviously correct, as was in due course conceded (see para. 25 (1) below); and we are now only concerned with the non-returners. But neither point has anything to do with section 29 (4), as averred at para. 18 of the pleading, and the reference to it in the case of the returners is a red herring.
(2) In the case of the non-returners also it is, to put it no higher, debatable whether any defence based on the September invitation has anything to do with section 29 (4), but this is for a different reason. As noted below (see para. 59), Silber J in the EAT took the view that the effect of the invitation was that the Claimants could not thereafter assert that they had not been "provided with" their normal contractual work, within the meaning of section 28 (1), and that section 29 (4) was inapplicable because it was concerned with alternative work. But even if he was wrong about that the pleading is still inaccurate, since the point on section 29 (4) is a substantive one and has nothing to do with "jurisdiction", as averred at paras. 17 and 19.
As will appear, the undiscriminating reference to the Respondent's case based on the September invitation as "the section 29 (4) point" and/or as being a time/jurisdiction point led to some confusion at later stages of the proceedings.
"(1) This section applies to the jurisdictions listed in Schedule 4.
(2) An employee shall not present a complaint to an employment tribunal under a jurisdiction to which this section applies if—
(a) it concerns a matter in relation to which the requirement in paragraph 6 or 9 of Schedule 2 applies, and
(b) the requirement has not been complied with.
(6) An employment tribunal shall be prevented from considering a complaint presented in breach of subsections (2) to (4), but only if—
(a) the breach is apparent to the tribunal from the information supplied to it by the employee in connection with the bringing of the proceedings, or
(b) the tribunal is satisfied of the breach as a result of his employer raising the issue of compliance with those provisions in accordance with regulations under section 7 of the Employment Tribunals Act 1996 (c.17) (employment tribunal procedure regulations).
(7) The Secretary of State may for the purposes of this section by regulations—
(c) make provision about circumstances in which a person is to be treated as having complied with paragraph 6 or 9 of that Schedule;
(d) … .
(8)-(10) … ."
The jurisdictions listed in Schedule 4 to the Act included claims under section 23 of the 1996 Act, although not – an important point, whose significance will become clear shortly – claims under section 34. The "requirements" in Schedule 2 referred to at sub-section (2) are the requirements to comply with the statutory grievance procedures there set out: no point arises on their details, and I need not rehearse them here. The regulations made under sub-section (7) are the Employment Act 2002 (Dispute Resolution) Regulations 2004. For present purposes I need only refer to regulation 9, which provides, in summary, that the requirements of the statutory grievance procedures will be "treated as" having been complied with if the subject-matter of the complaint has been raised by way of a collective grievance.
THE DECISION OF THE EMPLOYMENT TRIBUNAL
"1.1 The claimants' claims for unlawful deductions under s. 23 ERA 1996 in "the first claim" of 20 June 2009 are dismissed.
1.2 The claimants' application for leave to amend the first claim to include an alternative claim under section 34 ERA 1996 for failure to pay guarantee payments is refused.
1.3 The claimants failed in relation to the first claim to comply with the provisions of the statutory grievance procedure ("SGP") at Schedule 2 EA 2002. The tribunal has no jurisdiction to hear the claims.
2.1 The claimants' claims for unlawful deductions under s. 23 ERA 1996 in "the second claim" of 15 February 2010 are also dismissed.
2.2 The second claim was presented out of time and is not within the tribunal's jurisdiction.
2.3 It was reasonably practicable for the claimants to issue their claims prior to the end of their limitation period of 3 months of the last alleged unlawful deduction from wages."
"I find that on a substantive appraisal of the claimants' cases they are not entitled to recover guarantee payments as claimed. In any event there are procedural grounds on which the tribunal concludes it has no jurisdiction to hear the proceedings in both ET1s."
The paragraph containing the Judge's reasoning on the substantive issue is para. 91, which reads:
"I find that the fact of the variation was clear throughout to all parties and should reasonably have been known from the first. The circumstances of how the arrangements for reduced hours had been agreed between the GMB and the respondent had no obvious ambiguity. There had moreover been a history of requests by the workforce to reduce hours on a permanent basis. This was a logical if temporary recognition of that which suited both sides and came from the employees' side as an expedient way of avoiding job losses. The result of the temporary contractual variation was that the claimants were not during the relevant period normally required to work the hours that had been required on Fridays as part of the previous 39 hours working week."
"95. It is now acknowledged on behalf of the claimants that in relation to the first claim the grievance relied on is not compliant with the 2004 Regulations then in force. There has been an application to amend the first claim; to include a s.34 ERA 1996 claim.
96. I am refusing that amendment application. In doing so I give careful scrutiny to the principles of Selkent Bus Co. Limited v Moore  ICR 836.
97. I find that the s.34 claim is not pleaded in the ET1. I conclude that to allow this application would indeed admit a new cause of action. Such action is now out of time there has been no earlier application to amend in this respect; which could in my view been addressed with much greater expedition.
98. There is I conclude considerable force in the argument of respondent's counsel that it is not permissible to amend an ET1 which the tribunal has no jurisdiction to accept in the first place. Mr Porter has properly cited EA 2002 s.32(2) in this context.
99. In relation to the issue of non-compliance with the grievance procedures and the application of EA 2002 s.32(6)(b). There is no discretion to accept a claim form where jurisdiction does not exist.
100. Moreover, in relation to the first claim the series of deductions relied upon began on or before 5 April 2009 and continue beyond that date. In short, and having regard to the transitional provisions "the action" which forms the basis of grievance began before the said date. The claim was presented before 4 July. Thus ss. 29-33 [sc. of the 2002 Act] continue to apply as does therefore the statutory grievance procedure. Section 23 ERA is one of the jurisdictions listed in Part 2 of the Schedule to the Transitional Order 2008.
101. In relation to the jurisdictional issues on the second claim I conclude thus:
102. I have found that the tribunal has no jurisdiction in the first claim. In the context of the post-5 April 2009 period the claims in the second ET1 are out of time. The date of presentation of the second claim – of unlawful deduction of wages – was 15 February 2010. The three month period immediately preceding that date takes us back to 16 November 2009. Accordingly unlawful deductions of wages pleaded must, to be within time, have been suffered after 16 November. Events of alleged deduction before that date are out of time. To rely on the "series of deductions" provision the last of the series must have occurred less than three months before presentation of the ET1. I am with the respondent's counsel in taking the view that matters prior to 16 November are out of time.
103. There is no evidential basis on which I can conclude that it was not reasonably practicable to present within the statutorily prescribed time limits.
104. A significant number of claimants worked each Friday from 13 November 2009. In relation to those employees their claims are out of time. Their last non-working Friday was thus 6 November 2009. Wages were payable one week in arrears on a Friday. They would have been paid on Friday 13 November. That is more than three months before the submission of the ET1 on 15 February 2010. The claimant's counsel has argued that time should run from 31 December 2009 for the period October to December 2009. But that is not supported by a proper application of s.23 and also the guarantee payments provisions are to the effect that such a payment is payable for a workless day. Time starts to run under s. 34 from that workless day.
105. Only if the employees were entitled to a guarantee payment in respect of Friday 13 November because they did not work it would their claim in relation to that day be in time because the wages would have been payable on 20 November. If they could show that the deduction was the last in a series of deductions then earlier deductions would be recovered (ERA s.23(2)(a) [sic: the reference should be to section 23 (3) (a)]).
106. My finding on the December 2008 agreement however is, that it amounted to a contractual variation of terms and that no guarantee payments were due."
(1) Para. 95 records a concession made by Mr Segal that the requirements for a valid collective grievance had not been satisfied. That did not involve him conceding that the 2002 Act was fatal to his case as originally pleaded because of the two points which I have identified as (a) and (b) at para. 17 above. Point (a) is addressed by the Judge at para. 100. Point (b) is not addressed, which was a matter of complaint by Mr Segal in the EAT. But neither point is relied on before us, and I need say no more about them.
(2) Paras. 96-99 address the amendment application, which the Judge refuses for the reasons given.
(3) As already noted, para. 100 is concerned with Mr Segal's point on the transitional provisions in the 2008 Act.
(4) Accordingly, notwithstanding that he had made a finding on the substantive issue, that did not form part of the Judge's dispositive reasoning. As trailed at para. 71 and as reflected in the terms of the Judgment, he did indeed decide the 2009 claims purely on procedural/jurisdictional grounds – that is, that the claim as pleaded fell foul of the 2002 Act and that permission to amend to get round that problem should not be granted.
(1) Para. 104 is concerned with the returners. They had had, by definition, no workless days in the three-month period prior to the issue of proceedings on 15 February 2010 and thus had no claim in respect of that period. As regards their claims in respect of workless days prior to their return to work, those claims were out of time (there being, as recorded at para. 103, no basis for a "not reasonably practicable" argument). This is plainly correct, and it was common ground before us that Mr Segal had conceded it in his closing submissions in the ET, albeit that the Judge does not record the concession.
(2) Paras. 105 and 106 are concerned with the non-returners. It is necessary to take the two paragraphs in turn.
(3) At para. 105 the Judge acknowledges both (a) that the claims of the non-returners in respect of workless days after 13 November are within time and (b) that the non-returners could in principle invoke the "series of deductions" provision in respect of workless days prior to that date. That also seems plainly correct, and in fact Mr Porter told us that he had made a formal concession in the ET to that effect, subject to his "section 29 (4) case" (though again the Judge does not acknowledge that the point had been the subject of a concession).
(4) However, although the non-returners' claims were in time, at para. 106 they are dismissed on the merits because the Judge found for the Respondent on the substantive issue. That that is his reasoning is clear, both from the structure of the paragraphs and from the detailed wording (NB in particular the "however" with which para. 106 starts). Although para. 106 contains no reasoning on the substantive issue, the Judge was evidently relying on his previous "finding" at para. 91, which I have set out above.
(5) It is important to note, in view of subsequent arguments, that no part of that reasoning had anything to do with the September invitation or with section 29 (4).
As I say, that reasoning is clear enough if paras. 104-106 are read carefully. But it is not accurately reflected in the Conclusions section of the Reasons and the Judgment – or indeed in para. 71 or the second and last sentences of para. 102. It is not the case, as there stated, that all the claims in the 2010 proceedings were dismissed because they were out of time. That was (partly) true about the returners, but the claims of the non-returners were dismissed because of the conclusion which the Judge reached on the substantive issue. This mismatch between the detailed reasoning in the Reasons and the terms of the Judgment led to some confusion before the EAT.
THE APPEAL TO THE EMPLOYMENT APPEAL TRIBUNAL
(1) that the Employment Judge had simply failed to engage with the substantive issue at all and that it should have been decided in the Claimants' favour; and
(2) that the Judge was wrong to refuse permission to amend the 2009 proceedings in order to allow the Claimants to rely on section 34.
The other two grounds addressed the points which I have identified as (a) and (b) para. 17 above, which are not live before us.
"If and to the extent that the Employment Tribunal had found that the 2010 claims were out of time other [than] on the basis that [is] set out in their reasons at paragraphs 102 to 104 (namely that a number (198) of claimants had worked every Friday between 13 November 2009 and 31 December 2009), which is denied by the claimants, then the claimants contend that: -
(1) it is entirely unreasoned and unexplained;
(2) the only basis on which such a finding was sought by the respondent was by reason of the application of section 29(4), yet
(a) that issue is not referred to by the Employment Tribunal at paragraphs 102-106,
(b) there is no finding, nor even a discussion within the decision of whether s 29 (4) (b) applied (and it is unlikely on the facts that it did) namely that the claimants had unreasonably refused any offer of alternative work."
The drafting is a little clotted, which can no doubt be forgiven in the circumstances; but the basic point is clear, namely that if, as Mr Porter was asserting, the claims of the non-returners had been dismissed on the basis of a time point – whether "the section 29 (4) defence" or something else – there was no reasoning in the Reasons to support such a decision.
(1) He said that the Respondent would be prejudiced by the amendment, because if the point had been taken earlier it would have been possible to obtain clarification from the Employment Judge as to what he had meant to decide and why, in accordance with the so-called Burns/Barke procedure (see Barke v Seetec Business Technology Centre Ltd  ICR 1372), whereas that would not now be possible (see para. 75).
(2) He held that in any event the proposed amendment could not succeed (see para. 76); I will set out his detailed reasoning when I come to consider the point below.
(1) He decided the substantive issue in the Respondent's favour: see paras. 14-39 of his Judgment.
(2) That meant that the amendment issue became, strictly, academic; but he decided nevertheless that the Judge made no error of law in refusing permission to amend: see paras. 40-56.
I will, again, not set out his detailed reasoning at this stage.
THE ISSUES ON THIS APPEAL
(1) The Substantive Issue – that is, whether the effect of the Agreement was that Fridays were not days on which employees were normally required to work: this arises on any view as regards the claims in the 2009 proceedings, but there is a question whether it arises also in the 2010 proceedings (see (3) below).
If Silber J was right about the substantive issue, that disposes of the claims in both sets of proceedings. But if he was wrong there remain the separate issues as regards the 2009 and 2010 proceedings, namely:
(2) The 2009 Proceedings: the Amendment Issue – that is, whether the Claimants in the 2009 proceedings should have been permitted to amend to claim under section 34 of the 1996 Act instead of under section 23, so as to avoid the impact of the 2002 Act.
(3) The 2010 Proceedings: the broad issue is simply whether the non-returners have a viable claim, but the particular issues depend on the details of Silber J's reasoning, and I will not attempt to summarise them here.
I take those issues in turn.
(1) THE SUBSTANTIVE ISSUE
(1) The Agreement provided that, notwithstanding the reduction to a 34-hour week, the trigger for the payment of overtime rates would remain 39 hours: that showed that the parties continued to regard 39 hours (and thus also Friday working) as the norm.
(2) In a letter to employees dated 2 November 2009 setting out the Respondent's position on negotiations with the Union about working hours the responsible manager said:
"We currently have a short time working agreement in place that finishes on 31st December this year. From January 1st 2010, if not before, all employees will revert to normal full time working (39 hrs) … [emphasis supplied]."
Mr Segal said that that use of the term "normal" reflected the reality of the situation.
"Where there has been an effective variation to the contract of employment so as to reduce the days upon which the employee is required to work then it would follow the guarantee payment cannot be claimed for any of the days on which the employee is not contractually required to work."
But there are other passages which suggest that the Respondent's case was only that the effect of this particular variation, having regard to its duration and the particular circumstances of the case, was to create a new norm; and it may be debatable which version of the argument – which I will call the "hard" and the "soft" versions – the Judge was espousing when he upheld the Respondent's case on the substantive issue in para. 91 of the Reasons (see para. 21 above). Mr Porter's skeleton argument before us at least flirted with the hard version of the argument. He described the ET as having found
"… that the formal, legally effective variation of the Appellants' contracts of employment to remove Friday working for an identified and fixed period created, for the duration of that relevant period, a 'new normal' working pattern in which Friday was no longer a day on which the Appellants were normally required to work for the purposes of ERA s 28."
But in his oral submissions he advanced the soft version, accepting that in some circumstances a temporary contractual variation might not change the norm but contending that the variation in the present case did so.
(1) Section 30 (5) of the Act, which I set out at para. 2 (3) above, provides for how a guarantee payment should be calculated in cases where "an employee's contract has been varied, or a new contract has been entered into, in connection with a period of short-time working"; and, as noted at para. 2 (4), section 31 (6) is to the same effect. That necessarily envisages that the right to a guarantee payment may arise where a period of short-time working has been the subject of agreement, and I cannot see how that is compatible with the hard version of the Respondent's case. This point was made by Mr Segal before the Employment Judge (who did not however address it) and before the EAT. In the EAT Silber J apparently accepted Mr Porter's submission that section 30 was irrelevant because it was only concerned with calculation and not with liability (see paras. 30 and 31 of his judgment). But the provisions of Part III must be construed as a whole, and it is not only legitimate but necessary to look at the provisions relating to calculation to the extent that they shed light on the meaning of the provisions as to liability.
(2) It would be surprising and unsatisfactory if the position were that by giving his explicit agreement to a period of short-term working, as opposed to suffering the employer to act unilaterally, an employee lost his or her right to a guarantee payment. That would be inimical to the orderly conduct of industrial relations, which should involve agreement wherever possible, and would put a premium on intransigence.
These cases are thus broadly in line with the approach which I would take to these provisions.
(2) THE 2009 PROCEEDINGS: THE AMENDMENT ISSUE
(1) At para. 97 the Judge makes three points of a conventional discretionary character – (a) that the effect of the amendment if admitted would be to raise a new cause of action; (b) that fresh proceedings raising that cause of action would have been out of time; and (c) that the application could have been made much sooner. Those three points are evidently intended to address the three sub-heads under head (5) of the well-known guidance of Mummery J in Selkent Bus Co. Ltd. v. Moore  ICR 836, to which the Judge refers: I quote the passage in full at para. 47 below.
(2) At paras. 98-99 he addresses a submission by Mr Porter that "it is not permissible to amend an ET1 which the tribunal has no jurisdiction to accept in the first place": earlier in the Reasons, at para. 46, Mr Porter is said to have referred to this as "the fundamental objection to amendment". If it is a good point it represents an absolute, because jurisdictional, bar to the grant of permission to amend. At para. 98 the Judge only says that this submission has "considerable force"; but I read para. 99, as Silber J evidently did, as going further and accepting it.
(1) The effect of section 32 of the 2002 Act was that the Claimants' failure to comply with the terms of the applicable statutory grievance procedure (or, more precisely, their non-entitlement to be treated by virtue of reg. 9 of the 2004 Regulations as having complied with those requirements) deprived the ET of jurisdiction to hear the claims in the 2009 proceedings as originally pleaded.
(2) Accordingly the original proceedings were a nullity.
(3) It had been held by the National Industrial Relations Court (Sir John Donaldson presiding) in Cocking v Sandhurst (Stationers) Ltd  ICR 650 that in a case where the originating application failed to comply with the necessary procedural rules the industrial tribunal had no power to amend in order to change the basis of the claim. Cocking was said to have been approved by this Court in British Printing Corporation (North) Ltd v Kelly  IRLR 222.
(4) He held that in consequence the Judge "was correct to hold that he had no power to grant the application to amend".
"(4) Whenever the discretion to grant an amendment is invoked, the Tribunal should take into account all the circumstances and should balance the injustice and hardship of allowing the amendment against the injustice and hardship of refusing it.
(5) What are the relevant circumstances? It is impossible and undesirable to attempt to list them exhaustively, but the following are certainly relevant:
(a) The nature of the amendment. Applications to amend are of many different kinds, ranging, on the one hand, from the correction of clerical and typing errors, the additions of factual details to existing allegations and the addition or substitution of other labels for facts already pleaded to, on the other hand, the making of entirely new factual allegations which change the basis of the existing claim. The Tribunal have to decide whether the amendment sought is one of the minor matters or is a substantial alteration pleading a new cause of action.
(b) The applicability of time limits. If a new complaint or cause of action is proposed to be added by way of amendment, it is essential for the Tribunal to consider whether that complaint is out of time and, if so, whether the time limit should be extended under the applicable statutory provisions eg, in the case of unfair dismissal, S.67 of the 1978 Act.
(c) The timing and manner of the application. An application should not be refused solely because there has been a delay in making it. There are no time limits laid down in the Rules for the making of amendments. The amendments may be made at any time - before, at, even after the hearing of the case. Delay in making the application is, however, a discretionary factor. It is relevant to consider why the application was not made earlier and why it is now being made: for example, the discovery of new facts or new information appearing from documents disclosed on discovery. Whenever taking any factors into account, the paramount considerations are the relative injustice and hardship involved in refusing or granting an amendment. Questions of delay, as a result of adjournments, and additional costs, particularly if they are unlikely to be recovered by the successful party, are relevant in reaching a decision.
If the final sentence of point (5) (a) is taken in isolation it could be understood as an indication that the fact that a pleading introduces "a new cause of action" would of itself weigh heavily against amendment. However it is clear from the passage as a whole that Mummery J was not advocating so formalistic an approach. He refers to "the … substitution of other labels for facts already pleaded" as an example of the kind of case where (other things being equal) amendment should readily be permitted – the contrast being with "the making of entirely new factual allegations which change the basis of the existing claim". (It is perhaps worth emphasising that head (5) of Mummery J's guidance in Selkent was not intended as prescribing some kind of a tick-box exercise. As he makes clear, it is simply a discussion of the kinds of factors which are likely to be relevant in striking the balance which he identifies under head (4).)
"(1) They should ask themselves whether the unamended originating application complied with rule 1 of the Schedule to the Regulations of 1972 … . (2) If it did not, there is no power to amend and a new originating application must be presented."
The Schedule referred to contained the then industrial tribunal rules of procedure. Rule 1 set out certain basic minimum information which an application to the tribunal had to give. All that Sir John was thus saying was that if the original application was fundamentally defective as regards the formal requirements any new claim sought to be raised by amendment would be equally so. That is not the present case.
"… [a] failure to attach the correct label or all the correct labels to the facts relied on in the originating application does not deprive the employment tribunal of jurisdiction which it may have to determine a complaint."
The decision is clearly helpful to Mr Segal; but the specific point relied on by the Respondent in the present case does not appear to have been argued and I prefer to decide the issue as one of principle rather than to treat Capek as binding authority.
(3) THE 2010 PROCEEDINGS
"In September 2009 [the responsible manager] met with the GMB's employee representatives to discuss employees returning to work 39 hours a week for November and the first week of December 2009. The Union's view was that such would amount to the termination of the agreement; and the respondent could not later introduce it. The respondent's evidence is that in September production management invited any employees who wanted to return to working 39 hours per week to return to work on Fridays from 1 October. I accept that the respondent took steps to recruit as many returnees as it could by making the offer generally known, by keeping the union apprised of the respondent's need for manpower and by personal approaches to employees on the shop floor. I find that all employees could have so returned [to work] between 1 October and 31 December, since there was enough work for all. Many employees accepted the offer but others declined. The respondent despite their efforts were unable to recruit enough volunteers."
Referring to those findings, Silber J said, at para. 76 of his judgment:
"the Employment Judge found that there was no period after 1 October 2009 when the Claimants were, in the words of section 28(1) ERA, 'not provided with work'. … The true position is that the Claimants had been offered their old work times and at the old wages. The stark fact is that the Claimants could not qualify for payments under section 28 (1) ERA."
He made it clear that he did not regard this point as having anything to do with section 29 (4) of the Act, because that was concerned with the offer of "alternative work": what, on the Judge's finding, the Respondent had done was to offer the Claimants the very work that they had been doing prior to the Agreement.
(1) Their claims in respect of workless days after 6 November 2009 are self-evidently in time; and they can in principle take advantage of the "series of deductions" provision to claim also in relation to earlier workless days (subject to the point noted at para. 66 below).
(2) My conclusion above on the substantive issue means that those claims are well-founded, subject only to the effect of the September invitation.
(3) As regards the September invitation, it may be that if the point had been taken before the ET that that invitation constituted the "provision" to every Claimant of work within the meaning of section 28 (1) the Respondent might have had a defence – though a careful analysis of exactly what was communicated, when and to whom would have been required. But it was not taken, and I do not believe that it was open to Silber J to rely on it in the EAT. As I have said, Mr Porter did not seek before us to maintain his original reliance on section 29 (4) and I need not express a definitive view about it, but I am inclined to think that Silber J was right to reject it, for the reason which he gave: see para. 60 above. So the September invitation affords the Respondent no defence.
Lord Justice Kitchin :
The Chancellor of the High Court :
Note 3 Although this point is not bottomed out in the pleading, the crucial question is not in fact whether they returned to five-day working immediately following the September invitation but whether they did so before the beginning of the three-month limitation period running back from the commencement of the 2010 proceedings on 15 February 2010. That period runs back to 16 November 2009. But the Judge proceeded on the basis that, because wages were paid weekly in arrears, the last workless day in respect of which an employee could potentially claim was the preceding Friday, being 13 November – see para. 104 of the Reasons (which I set out below); and no point has been taken about the correctness of that approach. The Respondent told the ET that 198 of the Claimants had returned to five-day working before the critical date. Mr Segal told us that that figure had not been formally verified by those instructing him but that he had no reason to believe that it was wrong. On that basis the non-returners number 130 or 134 (cf. n. 1 above).
[Back] Note 6 In a passage in Smith v Cropper (1885) 26 Ch D 700 which was once much cited in interlocutory proceedings in the High Court Bowen LJ said (at p. 711):
“[I]t is a well-established principle that the object of courts is to decide the rights of the parties, and not to punish them for mistakes they make in the conduct of their cases by deciding otherwise than in accordance with their rights. … I know of no kind of error or mistake which, if not fraudulent or intended to overreach, the court ought not to correct, if it can be done without injustice to the other party. Courts do not exist for the sake of discipline, but for the sake of deciding matters in controversy, and I do not regard such amendment as a matter of favour or of grace.”
The qualifications about avoiding “injustice to the other party” and cases of “intention to overreach” (that is, abuse of procedures or pursuit of tactical advantage) are of course important, and one would nowadays add a reference to the importance of proper case management. Nevertheless Bowen LJ’s observations are a salutary warning against too schoolmasterly an approach. [Back] Note 7 Mr Porter expressly disavowed any argument that the fact that a fresh claim would have been out of time was not just a relevant consideration but an absolute bar to the grant of permission to amend: see Safeway Stores (which at para. 10 deals explicitly with this aspect of the Selkent guidance). [Back] Note 8 It is worth noting that this might arise in other circumstances apart from the 2002 Act: an obvious example is time points, which in the employment tribunal have traditionally been regarded as “going to jurisdiction”.
[Back] Note 11 This is a little obscure, but I think the meaning must be that the Union’s position was that if the Agreement was to be terminated it must be for good, so that there could not be – as was apparently envisaged – a return to four-day working for the last three weeks of December. [Back] Note 12 The Respondent had of course taken a point on section 29 (4), but that is not the same issue. And it is not clear whether the Employment Judge was in para. 89 seeking to address that issue either: as I have said, it formed no part of his dispositive reasoning. [Back]
Note 3 Although this point is not bottomed out in the pleading, the crucial question is not in fact whether they returned to five-day working immediately following the September invitation but whether they did so before the beginning of the three-month limitation period running back from the commencement of the 2010 proceedings on 15 February 2010. That period runs back to 16 November 2009. But the Judge proceeded on the basis that, because wages were paid weekly in arrears, the last workless day in respect of which an employee could potentially claim was the preceding Friday, being 13 November – see para. 104 of the Reasons (which I set out below); and no point has been taken about the correctness of that approach. The Respondent told the ET that 198 of the Claimants had returned to five-day working before the critical date. Mr Segal told us that that figure had not been formally verified by those instructing him but that he had no reason to believe that it was wrong. On that basis the non-returners number 130 or 134 (cf. n. 1 above). [Back]
Note 6 In a passage in Smith v Cropper (1885) 26 Ch D 700 which was once much cited in interlocutory proceedings in the High Court Bowen LJ said (at p. 711): “[I]t is a well-established principle that the object of courts is to decide the rights of the parties, and not to punish them for mistakes they make in the conduct of their cases by deciding otherwise than in accordance with their rights. … I know of no kind of error or mistake which, if not fraudulent or intended to overreach, the court ought not to correct, if it can be done without injustice to the other party. Courts do not exist for the sake of discipline, but for the sake of deciding matters in controversy, and I do not regard such amendment as a matter of favour or of grace.” The qualifications about avoiding “injustice to the other party” and cases of “intention to overreach” (that is, abuse of procedures or pursuit of tactical advantage) are of course important, and one would nowadays add a reference to the importance of proper case management. Nevertheless Bowen LJ’s observations are a salutary warning against too schoolmasterly an approach. [Back]
Note 7 Mr Porter expressly disavowed any argument that the fact that a fresh claim would have been out of time was not just a relevant consideration but an absolute bar to the grant of permission to amend: see Safeway Stores (which at para. 10 deals explicitly with this aspect of the Selkent guidance). [Back]
Note 8 It is worth noting that this might arise in other circumstances apart from the 2002 Act: an obvious example is time points, which in the employment tribunal have traditionally been regarded as “going to jurisdiction”. [Back]
Note 11 This is a little obscure, but I think the meaning must be that the Union’s position was that if the Agreement was to be terminated it must be for good, so that there could not be – as was apparently envisaged – a return to four-day working for the last three weeks of December. [Back]
Note 12 The Respondent had of course taken a point on section 29 (4), but that is not the same issue. And it is not clear whether the Employment Judge was in para. 89 seeking to address that issue either: as I have said, it formed no part of his dispositive reasoning. [Back]