UK Social Security and Child Support Commissioners' Decisions

[2000] UKSSCSC CJSA_3304_1999 (13 July 2000)

HL/IW/2

THE SOCIAL SECURITY COMMISSIONERS

Commissioner's Case No: CJSA/3304/1999

SOCIAL SECURITY ADMINISTRATION ACT 1992

SOCIAL SECURITY CONTRIBUTIONS AND BENEFITS ACT 1992

APPEAL FROM DECISION OF SOCIAL SECURITY APPEAL TRIBUNAL ON A QUESTION OF LAW

DECISION OF THE SOCIAL SECURITY COMMISSIONER

MR COMMISSIONER H LEVENSON


 


1. This appeal, brought originally by the adjudication officer but taken over by the Secretary of State, does not succeed. I confirm the decision made by the social security appeal tribunal on 12 January 1999. This is to the effect that (assuming that the other conditions for entitlement are satisfied) jobseeker's allowance remains payable to the claimant for the period 18 November 1998 to 21 February 1999 inclusive.
2. Section 1(1) of the Jobseeker's Act 1995 provides that jobseeker's allowance is payable in accordance with the provisions of the Act. Subject to those provisions, section 1(2) provides that a claimant is entitled to a jobseeker's allowance if he is available for employment, has entered into a jobseeker's agreement which remains in force, is actively seeking employment, satisfies contribution conditions or means tested conditions, is not engaged in remunerative work, is capable of work, is not receiving relevant education, is under pensionable age and is in Great Britain. Section 1(3) provides that any jobseeker's allowance is payable in respect of a week.
3. Section 19(1) of the 1995 Act provides that even though the conditions for entitlement to a jobseeker's allowance are satisfied with respect to a person, the allowance shall not be payable in any of the circumstances mentioned in section 19(5) or (6). Section 19(5) is not relevant to this appeal. Section 19(6) lists 4 sets of circumstances. Two of them are not relevant to this case. Section 19(6)(a) applies when a claimant has lost his employment as an employed earner through misconduct. Section 19(6)(b) applies when a claimant has voluntarily left such employment without just cause. Section 19(3) provides that if the circumstances are any of those mentioned in section 19(6), the period for which the allowance is not to be payable shall be such period (of at least 1 week but not more than 26 weeks) as may be determined by the adjudication officer. Since this case arose, the function of the adjudication officer has been taken over by the Secretary of State. On appeal, in an appropriate case, the period is to be determined by the tribunal (or the Commissioner).
4. It is important to note at the outset that section 19(6)(a) uses the words "his employment as an employed earner" and section 19(6)(b) uses the words "such employment".
5. The claimant was born on 21 March 1974. On 23 June 1998 he commenced employment with company A. He left the employment on 31 July 1998 "because I feel that I was being unfairly treated by my employer". He subsequently declined to give any further information about the circumstances in which he left that employment or his reasons for so doing. He did not make a claim to jobseeker's allowance but after 2 weeks commenced employment with company B. After 6 weeks he was dismissed by company B. I have no information about the reasons for or the circumstances of this dismissal. The claimant was awarded jobseeker's allowance from 29 October 1998. The adjudication officer then investigated whether any of the circumstances set out in section 19(6) applied. The original submission from the adjudication officer to the tribunal explains the relevant procedure. On 30 October 1998 the Employment Service sent to the claimant form ES84, asking why the claimant had left his job with company A. He gave the answer to which I have referred above. There is no record of enquiries being made as to how the claimant came to be dismissed by company B. The adjudication officer reviewed the award of jobseeker's allowance and decided that it was not payable from 18 November 1998 to 21 February 1999 inclusive because the claimant had voluntarily left his employment with company A without just cause and the circumstances came within section 19(6)(b). On 19 November 1998 the claimant appealed to the social security appeal tribunal against the decision of the adjudication officer on the basis that his claim was made in relation to losing his employment with company B, not in relation to leaving company A. On 12 January 1999 the social security appeal tribunal allowed his appeal. On 7 May 1999 the adjudication officer applied to the chairman of the tribunal for leave to appeal to the social security Commissioner. On 12 May 1999 the chairman of the tribunal refused leave. The Secretary of State now appeals by leave of Mr Commissioner Pacey granted on 23 September 1999.
6. The claimant indicated that he had no desire to participate in the appeal to the Commissioner and on 6 April 2000 I directed an oral hearing of the appeal because of the importance of the issue raised by the Secretary of State but I excused the claimant from attending the hearing. I held an oral hearing on 6 July 2000. The claimant did not attend and was not represented. The Secretary of State was represented by Mr Scoon from the Office of the Solicitor to the Department of Social Security. I am grateful for his researches and assistance.
7. The wording of the provisions is not explicit as to what is meant by "his employment". On first principles, the claimant's argument seems correct and this was the view taken by the tribunal. The point of jobseeker's allowance is to provide income to a person who is without work. The purpose of section 19(6) is to prevent a claimant deliberately creating a situation in which his income has to be provided by the State because it is his fault that he is without work. When the claimant left company A, he did not seek income from the State. He only sought such income when he was dismissed from company B, but no enquiry was made as to the circumstances of the dismissal. It is an attractive argument that the State was protected from incurring loss by virtue of the claimant voluntarily leaving company A because he made no claim in respect of leaving. The tribunal's approach was that because the claim was in respect of leaving company B, the adjudication officer had no jurisdiction to deal with the claim as if it were in respect of leaving company A. I prefer to put it that the adjudication officer took into account irrelevant considerations. The tribunal's reasoning was as follows:

"The Statute does not contain any mention of which employment is to be taken into account. It would be onerous indeed if an Adjudication Officer was able to take into account any employment which took the Adjudication Officer's fancy. [The claimant] exercised the freedom of movement of labour which it is everyone's privilege to enjoy in a free society. The only prohibition imposed by the public interest is that if a person chooses to claim benefit as a consequence of having exercised their freedom to withdraw their labour, then unless that person can show just cause for leaving that employment, he exercises this privilege at his own expense and not that of other contributors to the National Insurance Fund. This is precisely what [the claimant] did in respect of the employment at [company A]."

8. The Secretary of State referred to the decision in R(U)35/53. The claimant in that case was dismissed by his employer on 28 April 1953 for what the employers described as gross negligence. On 1 May 1953 he made a claim for unemployment benefit. He was subsequently paid in lieu of notice for the period up to and including 4 May 1953. The insurance officer imposed a period of disqualification for 6 weeks from 5 May 1953 on the grounds that the claimant had lost his employment because of misconduct. This was on the basis of a rule in unemployment benefit which was similar to the provision before me in respect of jobseeker's allowance. In fact, the claimant had taken up new employment on 4 May 1953 but the Commissioner decided that "the present issue all arose on the claim for benefit of 1 May 1953 and all flows from that claim".
9. However, the claim in that case was made after the loss of the first employment. There was no such claim in the case before me. At the hearing before me Mr Scoon mainly relied on this decision to show the flexibility of the insurance officer's powers.
10. The Secretary of State mainly relied on R(U)13/64 in which the facts were very similar to those of the case before me in that the claim was made after the loss of the second employment and not after the loss of the first. The insurance officer imposed a period of disqualification for 6 weeks from the day following the loss of the first employment. The Commissioner upheld the disqualification on the following basis:

"The claimant's contention is quite fallacious. A person who has lost his employment through his misconduct is liable to disqualification for six weeks - normally the six weeks following thereon. If during the period of disqualification he is able to obtain other employment then of course the disqualification will not involve loss of benefit while he is so employed: because, being employed, he has no entitlement to unemployment benefit in any event. The period of disqualification is unaffected, and if he remains employed until the end of the period he will in fact suffer no loss of benefit. But the obtaining of other employment does not operate so as to reduce the period of disqualification: and there is no reason why it should. If, therefore, the person concerned falls idle again before the date on which the period of disqualification expires he remains subject to disqualification until that date. To hold otherwise would mean that a spell of employment obtained during a period of disqualification had the effect of "purging" the disqualification. There is no warrant in the Statute or elsewhere for such a result."

11. It is clear that on first principles I disagree with the approach taken by the Commissioner in that case. I am emboldened in this view by the comments made by Mr Commissioner Goodman in CU/64/1994 (*57/95). in paragraph 9 of that decision he said:

"... A close examination of R(U)13/64 reveals that there was in fact no actual imposition by an insurance officer of a period of disqualification following loss of the first employment. The question of whether a period of disqualification should be imposed as a result of the loss of the first employment arose only on a claim for unemployment benefit on loss of a subsequent employment. Insofar as R(U)13/64 may decide that on a claim for unemployment benefit it is permissible to look back to hitherto unadjudicated-on terminations of employment, I would have thought that that is doubtful. It should be borne in mind that there can be no disqualification unless it has actually been imposed by an adjudication officer's decision".

12. Mr Commissioner Goodman's case concerned a claimant who had been disqualified from receiving unemployment benefit for 26 weeks and had found and lost a second job while the period of disqualification was running. The Commissioner said:

"... In my view, the disqualification must run its natural course. That is so, in my judgment, even though the period of disqualification is now 26 weeks, whereas at the time of R(U)13/64 it was only 6 weeks. I therefore affirm the rule for which R(U)13/64 is said to be authority, although its application is somewhat dubious on its facts as I have indicated. My decision is confined to cases where there is period of disqualification running because it has actually been imposed by an adjudication officer or other adjudicating authority ... If therefore there is already a period of disqualification running from the loss of an earlier employment, it will continue to run even though the claim to unemployment benefit is because of loss of a subsequent employment".

13. The Commissioner was clearly concerned at the implications of the decision in R(U)13/64 and his own decision was confined to the proposition that I have taken the liberty of underlining. Although for his purposes the extension of the period of disqualification from 6 weeks to 26 weeks was not relevant, in my opinion it is a very relevant distinction on facts such as those in the case before me, for the reasons that were indicated by the tribunal.
14. That leaves the question of the extent to which decisions on this issue made in respect of unemployment benefit can have effect for the jobseeker's allowance scheme. There are very significant differences between the two schemes. The editors of the 1999 edition of Non-Means Tested Benefits: The Legislation (Bonner and others) point out at page 329:

"The section and the approach it embodies, however, differ in a number of significant respects from disqualification under C & BA 1992, s.28. Under the latter, days of disqualification were not days of unemployment (not days of entitlement) and so did not count towards the 312-day maximum period of entitlement. The position under JSA is very different. As noted in the annotations to s.5 above, days on which, despite entitlement, an allowance is not payable because the claimant is caught by s.19 (e.g. for leaving a job through misconduct) do erode the 182-day maximum period of entitlement to contribution-based JSA, so that, if someone with an underlying entitlement to contribution-based jobseeker's allowance is denied payment for the maximum period of preclusion (26 weeks), that preclusion not only prevents payment, but extinguishes entitlement to such an allowance based on the tax/contribution years relevant to that claim, and, to gain another period of entitlement, the claimant will have to satisfy the requalification rule set out in section 5(2). So reaching the right and proper decision on what under the unemployment benefit regime would have been called 'disqualification', and determining in subs.(6) situations the appropriate period of preclusion, is even more important than before".

15. Another significant difference is that a person who was disqualified from unemployment benefit under the old scheme would, subject to means, be entitled to a reduced rate of income support under section 22 of the Income Support (General) Regulations 1987. The only recourse for a person in respect of whom a sanction has been imposed under section 19(6) of the Jobseeker's Act 1995 is a hardship payment under part IX of the Jobseeker's Allowance Regulations 1996. Unless the claimant is in one of the vulnerable categories indicated in regulation 140(1) the payment cannot commence until the 15th or 18th day following the date of claim. Even then, in deciding whether a person is a person in hardship, resources which may be available from a person in the claimant's household who is not a member of the family are taken into account and there is a restrictive definition of hardship (for example in regulation 140(5)(c)).
16. For the above reasons, I am of the view that authorities relating to disqualification under section 28 of the Social Security Contributions and Benefits Act 1992 and its predecessor provisions are not necessarily binding in respect of decisions under section 19 of the Jobseeker's Act 1995. A period of non-payment may not be imposed under section 19(3) except where a claim has been made and in respect of the employment immediately preceding the claim. Accordingly, in essence the decision of the tribunal was not made in error of law and this appeal by the Secretary of State does not succeed.

(Signed) H Levenson

Commissioner

(Date) 13 July 2000