United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MS SARAH HOWLETT (Representative) Messrs McGrigor Donald Solicitors 63 Queen Victoria Street London EC4N 4ST


 


MR RECORDER LANGSTAFF QC: This is an appeal from a decision of the Nottingham Employment Tribunal, a reserved decision, which was promulgated on 7th February 2000.

1. On 16th June 1997 Mr Hemlock, the potential respondent, was appointed managing director elect of the appellant. We have seen terms of engagement in a letter which was before the Employment Tribunal. That letter provided for payment of a basic salary and bonuses and various benefits. One of those benefits is central to the appeal; it is expressed as "Pension Contributions 10% of basic salary – that is a taxable benefit of £6,000".
2. The issue moving forward in this appeal is whether or not the tribunal were entitled to find that no money having in fact been paid to the respondent or into a pension fund on his behalf during the currency of his service with the appellant, the appellant is liable to make such a payment now.
3. This is, in essence, a question of contractual interpretation. We have been told by Ms Howlett in her helpful presentation that nothing was said at the time of engagement about any period of deferment during which benefits would not accrue. There is certainly nothing in the letter, which we have seen, to that effect. There has been no suggestion, as we understand it, that anything was ever said that made it a precondition of the liability to make payment to the employee that he should first nominate a particular pension fund. It may be that there is a distinction to be made which was not necessarily fully appreciated, between a liability to make payment and the mechanics by which such a payment is to be made. It may be that the arguments addressed to us do not fully appreciate that distinction.
4. In any event, the tribunal found that no pension contributions had been paid. It was argued before them that the responsibility for securing payment was that of the employee who should have told the employer that there was a particular nominated pension fund into which the money might be paid and if he did not do so there was no liability to pay at all.
5. Before us Ms Howlett makes essentially the same point, that it was a necessary precondition for any liability to make payment that the employee should first nominate a particular pension fund. She puts this as a necessary implied term.
6. There are a number of difficulties in such an approach. First of all, we do not see it as being necessary for business efficacy nor as to be implied from the circumstances. Indeed, during the course of argument, one of the lay members of the tribunal observed that as an employer he would have regarded it as the employer's responsibility to secure knowledge of the identity of the appropriate pension fund.
7. However, the Employment Tribunal in its decision came to the view that the employer should have paid contributions according to the contract into an appropriate fund. That they would have had no power to do because the social security legislation effecting pensions would have prevented them from doing so. This is, in our view, an error of law, but notwithstanding, we consider that the decision of the tribunal to order payment to the respondent of the sum, which would otherwise have been paid into a pension fund, is plainly and unarguably right. He had done the work, he was entitled to be paid, part of his payment was a sum by way of pension contribution. It was not paid, he had earned it, and he was entitled to be paid. That, in our view, is a complete answer to the claim.
8. Accordingly, we decline to give permission for this matter to go forward for argument before a full Employment Appeal Tribunal.