Industrial Tribunals Northern Ireland Decisions

THE INDUSTRIAL TRIBUNALS

 

CASE REF: 1385/16

 

 

 

CLAIMANT: Michael Patton

 

 

RESPONDENT: Blondtrepeneur Ltd t/a Made in Belfast

 

 

DECISION

The decision of the tribunal is that:-

 

The tribunal makes a declaration that the claimant's claim that the respondent has made a deduction from his wages in contravention of Article 45 of the Employment Rights (Northern Ireland) Order 1996 is well-founded and orders the respondent to pay to the claimant the sum of £501.60, the amount of deduction made in contravention of Article 45 of the 1996 Order.

 

Constitution of Tribunal:

Employment Judge (sitting alone): Employment Judge Drennan QC

Appearances:

The claimant was represented by Mr D Magill.

The respondent was represented by Mr A Adair, HR Consultant.

 

Reasons

 

1.1 The claimant's claim was for unauthorised deduction of wages and/or, in the alternative, breach of contract.

 

At the outset of the hearing, it was agreed by the representatives that the claimant's claim was made, pursuant to Article 55 of the Employment Rights (Northern Ireland) Order 1996 ('the 1996 Order'), on the grounds that the respondent had made an unauthorised deduction from his wages, in contravention of Article 45 of the said Order. In particular, it was agreed the amount of the said deduction, the subject-matter of the said claim, was £501.60; and that, other than the said deduction, the claimant accepted that he had been paid his full wages at the termination of his employment. In the circumstances, both representatives agreed that it was not necessary for the tribunal to consider further the claimant's alternative claim of breach of contract.

 

1.2 The tribunal heard oral evidence from the claimant and Mr Alan Adair, on behalf of the respondent. Having considered the oral evidence given to the tribunal, the documents referred to by the witnesses in the course of their evidence, together with the oral submissions of the representatives at the conclusion of the hearing, the tribunal made findings of fact, as set out later in this decision, insofar as relevant for the determination of the claimant's said claim.

 

2. Relevant law

 

2.1 Article 45 of the 1996 Order 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.

 

(2) In this Article 'relevant provision', in relation to a worker's contract, means a provision of the contract comprised -”

 

(a) in one or more written terms of the contract of which the employer has given the worker a copy on an occasion prior to the employer making the deduction in question, or

 

(b) in one or more terms of the contract (whether express or implied and, if express, whether oral or in writing) the existence and effect, or combined effect, of which in relation to the worker the employer has notified to the worker in writing on such an occasion.

 

(3) Where the total amount of wages paid on any occasion by an employer to a worker employed by him is less than the total amount of the wages properly payable by him to the worker on that occasion (after deductions), the amount of the deficiency shall be treated for the purposes of this Part as a deduction made by the employer from the worker's wages on that occasion.

 

(4) Paragraph (3) does not apply in so far as the deficiency is attributable to an error of any description on the part of the employer affecting the computation by him of the gross amount of the wages properly payable by him to the worker on that occasion.

 

(5) For the purposes of this Article a relevant provision of a worker's contract having effect by virtue of a variation of the contract does not operate to authorise the making of a deduction on account of any conduct of the worker, or any other event occurring, before the variation took effect.

 

(6) For the purposes of this Article an agreement or consent signified by a worker does not operate to authorise the making of a deduction on account of any conduct of the worker, or any other event occurring, before the agreement or consent was signified.

 

(7) This Article does not affect any other statutory provision by virtue of which a sum payable to a worker by his employer but not constituting 'wages' within the meaning of this Part is not to be subject to a deduction at the instance of the employer."

 

[Tribunal's emphasis]

 

Article 55 of the 1996 Order provides:-

 

" (1) A worker may present a complaint to an industrial tribunal -”

 

(a) that his employer has made a deduction from his wages in contravention of Article 45 ... ."

 

Article 56 of the 1996 Order provides:-

 

" Where a tribunal finds a complaint under Article 55 well-founded, it shall make a declaration to that effect and shall order the employer -”

 

(a) in the case of a complaint under Article 55(1)(a), to pay to the worker the amount of any deduction made in contravention of Article 45,

 

... ."

 

Article 59 of the 1996 Order provides:-

 

" (1) In this Part 'wages', in relation to a worker, means any sums payable to the worker in connection with his employment, including -”

 

(a) any fee, bonus, commission, holiday pay or other emolument referable to his employment, whether payable under his contract or otherwise,

 

... ."

 

2.2 As set out above, the said provisions of the 1996 Order permit deductions to be made where the deduction is 'required or authorised' by virtue of a relevant provision of the worker's contract, which is defined in Article 45(2) of the 1996 Order.

 

A purely verbal arrangement or agreement to make a deduction is not good enough, nor is an arrangement based solely on custom and practice, unless there has been prior written notification.

 

2.3 In Harvey on Industrial Relations and Employment Law, Section B1, Paragraph 332 it is stated:-

 

"However it is not enough that the deduction should be authorised by the contract. It must also be shown that the event justifying the deduction has actually occurred. [Tribunal's emphasis] An employment tribunal may therefore become involved in a detailed enquiry in order to determine whether the deduction is justified. In Fairfield Ltd v Skinner [1993] IRLR 4, for example, the employee was a van driver employed under a contract which made him liable for insurance policy excesses resulting from damage caused while the company vehicle was being used by him for personal purposes. The contract also imposed certain limits on the amount of private mileage he was permitted to do and included a term which covered private telephone calls made from the van specifying the rate at which such calls will be charged to the employee. The employee was dismissed summarily for poor attendance and had deducted from his final wages an amount that was said to be made up of the cost of repair to a van damaged whilst he was driving it and a 'provisional deduction' for private telephone calls and private mileage in excess of the free allowance which was agreed. The amounts of these deductions were disputed but the employer argued that, since the provisions of [ERA 1996 Section 13(1)(a)] were satisfied, in that the deductions were made pursuant to a written contract, there was no breach of the Act. The employment tribunal (and in this they were upheld by EAT) approached the matter by enquiring whether the amounts deducted were in fact due as a prerequisite to determining whether they were authorised by virtue of the relevant provision in the employee's contract. They concluded that they were not due and therefore there was a breach of the Act even though in principle the contract allowed deductions of this nature to be made. As Hutchinson J put it 'as a matter of simple language it seems to us that [Section 1(1)(a)] contemplates that the employment tribunal, must, where there is a dispute as to the justification of the deduction, embark upon the resolution of the dispute."

 

The provisions of the Employment Rights Act 1996, Section 13(1)(a) are in the same terms as Article 45(2) of the 1996 Order. Although the decisions of the Employment Appeal Tribunal are not binding on this tribunal, they are highly persuasive, in circumstances where the legislation in both jurisdictions is the same or similar and there are no relevant decisions of the Northern Ireland Court of Appeal. In the circumstances, the tribunal had no hesitation in following the decision in Fairfield v Skinner.

 

Although each case must be determined on its facts, the IDS Handbook - Wages, at Page 143, provides illustrations of some first instance decisions in Great Britain where the principles set out in Fairfield v Skinner have been applied and show that the employer must show that the amount of the deduction is justified and, in particular, employment tribunals 'will not engage in a speculative exercise in the absence of concrete evidence in this regard'.

 

It was not disputed, for the purposes of these proceedings, that the claimant, who was an employee of the respondent, was a worker, for the purposes of the claim, and that the sums, the subject-matter of the claim, were wages, pursuant to Article 55 of the 1996 Order.

 

3.1 I made the following findings of fact, as set out in the following sub-paragraphs, relevant to the determination of the claimant's said claim.

 

3.2 The claimant, who was employed by the respondent as a senior Sous Chef from in or about August 2013, gave appropriate notice to the respondent that he intended to terminate his employment with the respondent, with effect from 11 April 2016. It was agreed he would work his said period of notice.

 

3.3 It was a term of the claimant's contract of employment, a copy of which he was given in an e-mail dated 30 June 2015, that:-

 

"6.18.1 If you have been negligent or have caused malicious damage to company property we have the contractual right to deduct such costs from you pay." [Tribunal's emphasis]

 

It was agreed by the respondent's representative at this hearing, that the respondent was relying on negligence and not malicious damage, for the purpose of making the said deduction (see later).

 

3.4 It was not disputed that an incident occurred on the evening of 1 April 2016 in relation to the shutters at the respondent's restaurant premises and that, as a result, the shutter to the restaurant was damaged. The damage to the shutter cost £501.60 inclusive of £83.60 VAT, to repair. As set out previously, the respondent deducted this sum from the claimant's final wages, pursuant to the said term of his contract, on the termination of his employment.

 

In view of my decision, as set out later, it was not necessary for me to consider further, whether the respondent was entitled to deduct, pursuant to the said contract, the whole of the said sum and, in particular, the amount of Value Added Tax which required to be paid by the respondent for the said repair, given the ability of the respondent to recover any such Value Added Tax paid.

 

3.5 As set out previously, the claimant gave oral evidence to the tribunal and was subject to cross-examination by Mr Adair, the respondent's representative. In his evidence, the claimant maintained, that after service in the restaurant had finished on the evening of Friday 1 April 2016, he was in the restaurant near the sofa checking the numbers who had been served that evening and had his hands in his pocket when he saw the shutter go up. He strongly disputed, in the course cross-examination, he had been in the kitchen rather than near the sofa in the restaurant. Further, he thought he had accidentally operated the fob in his pocket, which operates the shutter, and so pressed the fob to close the shutter again. It started to go back up again, and still thinking it was because of the fob in his pocket, he used the fob to bring it back down. He stated it was, at that time, he first became aware that one of the Managers (M) was outside. M came in and asked the claimant had he operated the shutter which he agreed he had done. M told the claimant that a bicycle belonging to F, another employee, had become stuck under the shutters causing an obstruction. The claimant said, in evidence, he had not realised that was the problem; but, after seeing F's bike had caused an obstruction but was okay, he then went back into the kitchen.

 

It appears that both the claimant and M had a fob which operated the shutter. He accepted he had not been given any instruction to operate the shutter at the time of the incident. He also said, in evidence, it would not have been unusual to see M to go outside, at the end of an evening to bring in the restaurant sign. The claimant maintained that he was not aware, until the next time he returned to work on 4 April 2016, that damage had been caused to the shutters in the incident and also that he was being blamed by the owner of the restaurant, Ms Bricknell, for what had happened. On arrival at the restaurant, he was also told by one of the managers that he was now barred from the premises and was not required to work his notice. The claimant, in evidence, did not deny that he had had a bottle of wine in the fridge which he had brought in to take with him after work; but he insisted he had not consumed any alcohol during service and that alcohol played no part in what happened on the evening of Friday 1 April 2016 in relation to his operation of the shutter and any damage caused to it, as referred to above. In advance of any investigations, Ms Bricknell, in a text conversation with the claimant, made it clear she believed the claimant was responsible for the damage to the shutters, accusing him of acting with malicious intent and that he would be required to pay for the damage to the shutters, all of which the claimant did not accept.

 

3.6 Following this text exchange, Mr Alan Adair, Human Resources Consultant, who also gave evidence to the tribunal, was instructed by Ms Bricknell to carry out an investigation into the matter. Mr Adair obtained a statement on the telephone on 7 April 2016 from the claimant, which he subsequently typed up. The claimant had never, prior to these proceedings, been shown a copy of the statement prepared by Mr Adair, following this telephone conversation. Indeed, he only obtained it following discovery in the course of these proceedings. However, the claimant also accepted it broadly reflected what he had told Mr Adair; albeit he believed he had given greater detail about his position in the middle of the restaurant. In essence, the statement prepared by Mr Adair was consistent with the claimant's evidence to the tribunal as outlined above. In particular, the claimant insisted he had told Mr Adair in his statement that he had said:-

 

" ... He had accidentally set [the shutter] off with the fob in his pocket ... ."

 

Mr Adair acknowledged the claimant could have used the word 'accidentally' but confirmed, in evidence, that he accepted that the whole tenor of the claimant's statement was that the claimant's actions were accidental.

 

Mr Adair also obtained statements from two of the employees of the respondent present on the evening of 1 April 2016, M and C. Unlike the claimant's statement, these unsigned statements were sent to Mr Adair by e-mail on 3 April 2016 and 7 April 2016 respectively, via one of the other managers employed at the restaurant. Mr Adair also spoke to the Executive Chef but he did not obtain any statement from him by phone or in writing.

 

In essence, the statements of M and C, in particular, suggested the claimant had operated the shutters up and down trying to be funny/as some form of practical joke and had laughed at his actions. There was also a suggestion from C and, according to Mr Adair, on the basis of what he had been told by L, the Executive Chef, that some alcohol had been consumed by the claimant and may have been relevant to what happened. This has to be contrasted with the denial by the claimant, both in his statement to Mr Adair and in evidence to the tribunal, as referred to above. The claimant also pointed out, in evidence, to the tribunal there were some differences in detail between the statements obtained from M and C about his actions and, in particular, what he did after the incident; albeit he acknowledged both had suggested, which he denied, that the claimant believed what he was doing was funny/some form of practical joke. In particular, C said the claimant was in the kitchen whereas the claimant maintained, in his statement and evidence, he was in the middle of the restaurant, when he became aware of the shutter going up, as referred to previously. According to the claimant, by this time M would have been already outside the restaurant. Both M and C maintained in their witness statements the claimant was using earphones at the material time, which the claimant again denied in his statement and in evidence.

 

3.7 Mr Adair did not call any meeting with the claimant to address these differences nor did he give the claimant any opportunity to comment and/or challenge the written statements obtained by him from M and C or the statement orally given to him by L the Executive Chef, before he concluded his review. The concluded review was then sent to Ms Bricknell, on or about 13 May 2016. Again, the claimant only obtained a copy of Mr Adair's concluded review and copies of the statements of M and C, in the course of these proceedings. Mr Adair did not call to give evidence M, C or L.

 

3.8 Mr Adair, in his concluded review of the statements and information obtained by him, decided the claimant, on the balance of probabilities, was negligent when he operated the fob; but he accepted, as alleged previously by Ms Bricknell, the claimant had not acted maliciously.

 

In particular, Mr Adair reached this conclusion, on the following grounds. The claimant had, despite his denials, consumed alcohol that evening, he was in the kitchen facility and not in the middle of the restaurant at the relevant time, as he maintained, because, in the opinion of Mr Adair, if he had been there, he would have had a clear view of the customers and bicycle and would have also seen M attending to the initial commotion. He had not been given any instructions to move the shutter and did so of his own volition. He was wearing earphones, which would have limited the claimant's ability to hear the initial commotion. It was implicit in Mr Adair's conclusions, albeit significantly not expressly stated, that he did not accept that the claimant accidentally operated the fob in the circumstances outlined by him in his statement. Similarly, Mr Adair made no reference, in his conclusion, to the allegation by both M and C that the claimant had believed his actions were funny/some form of practical joke, but again, by implication, Mr Adair appears to have accepted them, without obtaining any response from the claimant, despite their potential significance in this matter. In essence, Mr Adair accepted the versions given to him by M, C and L and rejected what he was told by the claimant when concluding the claimant was negligent.

 

After reference to the terms at Paragraph 6.18.1 of the respondent's Handbook, and his conclusion the claimant was negligent, he stated the respondent had the contractual right to deduct the costs of the repairs to the shutter from the claimant's wages - which, as agreed at the hearing, amounted to £501.60.

 

3.9 Neither M or C or the Executive Chef L gave oral evidence to the tribunal and the claimant therefore had no other opportunity to challenge the contents of their statements given to Mr Adair and which were the basis, as set out above, for his said conclusions.

 

4.1 In light of the facts as found by me, and after applying the guidance set out in the legal authorities referred to previously, I reached the following conclusions, as set out in the following sub-paragraphs.

 

4.2 I was satisfied the respondent was able to deduct, pursuant to the term of the claimant's contract of employment with the respondent, as set out under Paragraph 6.18.1 the relevant cost of the repair to the shutters; provided the respondent had properly that the claimant was negligent. It was not sufficient, in itself, that such a deduction was authorised by the contract (see Fieldfield v Skinner).

 

4.3 In essence, the issue for me to determine was whether the finding of negligence, by Mr Adair, after his investigation justified, in the circumstances, the said deduction. Negligence is a difficult and complex legal concept. As set out in Clerk and Lindsell on Torts (8-04), there are four requirements:-

 

"(1) The existence in law of a duty of care situation, ie one in which the law attaches liability to carelessness ...

 

(2) Breach of the duty of care by the defendant ...

 

(3) A causal connection between the defendant's careless conduct and the damage.

 

(4) That the particular kind of damage to the particular claimant is not so unforeseeable as to be too remote.

 

... ."

 

Mr Adair in his concluded review did not address these requirements, although it is only if negligence was established that a deduction could be made.

 

4.4 However, it is clear from the investigation by Mr Adair there was a clear conflict of fact between the claimant and, in particular, his fellow employees M and C and the Executive Chef L. Certainly, on the basis of the statements of his said fellow employees, I accept there was some evidence made by them in their respective statements, which might , if correct, have supported a finding of negligence but this required to be properly tested before any such conclusion could be reached. In my judgment, that was not done and the conflict of evidence was not properly resolved by Mr Adair, before he concluded the claimant was negligent. In particular, the claimant was given no opportunity to comment upon or challenge the statements of M or C or the Executive Chef L before Mr Adair gave a copy of his concluded review, containing the said findings to Ms Bricknell and the respondent decided to make the said deduction on the basis of same. Ms Bricknell gave the claimant no opportunity to see Mr Adair's concluded review nor did she give him an opportunity to challenge same before making the said deduction. Further the claimant gave evidence to the tribunal in which he denied that he had been negligent, as alleged by the respondent. M C and L did not give evidence to the tribunal and the claimant had no opportunity to cross-examine them on their version of events, which he denied, as set out previously. The respondent decided not to call such evidence but rather to rely on the conclusions of Mr Adair following his review, that the claimant was negligent and the deduction was therefore justified in the circumstances.

 

In my judgment, the investigation, relied upon by the respondent, was a flawed investigation in the circumstances; and the concluded review by Mr Adair therefore cannot be relied upon by the respondent as justification for the said deduction by the respondent. In light of the foregoing, there was not, in the circumstances, the necessary 'concrete evidence' 'to allow me to find the said deduction was justified'. In the circumstances, for me to reach the conclusion that the claimant was negligent, as previously defined, and therefore the respondent was entitled to make the said deduction would have required me to speculate and reach conclusions in the absence of appropriately tested evidence, which was not before the tribunal. As set out in Fairfield v Skinner, it would be wrong for me to do so.

 

5.1 I therefore make a declaration that the claimant's claim that the respondent has made a deduction from his wages in contravention of Article 45 of the Employment Rights (Northern Ireland) Order 1996 is well-founded and I order the respondent to pay to the claimant the sum of £501.60, the amount of deduction made in contravention of Article 45 of the 1996 Order.

 

6.1 This is a relevant decision for the purposes of the Industrial Tribunals (Interest) Order (Northern Ireland) 1990.

 

 

 

 

 

 

 

Employment Judge

 

 

Date and place of hearing: 4 October 2016, at Belfast

 

 

Date decision recorded in register and issued to parties: