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[2008] UKSSCSC CIS_1039_2008 (01 August 2008)

CIS/1039/2008

DECISION OF THE SOCIAL SECURITY COMMISSIONER

The claimant's appeal is allowed. The decision of the Milton Keynes tribunal given on 21 December 2007 (the tribunal) is erroneous in point of law. It failed to make findings of fact on several important points. Given the gaps in the evidence before it, that is not surprising, but nonetheless it means that I must set aside the tribunal's decision and remit the claimant's appeal for rehearing before a differently constituted tribunal. The claimant should not assume that the fact this appeal has been remitted indicates that the decision of the new tribunal will ultimately be any more favourable to her than was the result of the original tribunal. She must be aware of the importance of presenting adequate evidence to the new tribunal.

The claimant is a 41 year old Norwegian national. She is the lone parent of three dependent children who are with her in the United Kingdom. She appears to have resided in the United Kingdom since 5 March 2003. Although she is not an EC national, regulation 10 Social Security (Persons from Abroad) Amendments Regulations [SI 2006 No. 1026] provides that, inter alia, regulation 21AA(4)(a) to (e) of the Income Support (General) Regulations 1987 shall apply in relation to a national of Norway, Iceland, Liechtenstein or Switzerland as if such were a national of a Member State. This, like regulation 21AA itself is in force from 30 April 2006, and therefore the claim for income support made on 4 June 2007, which is the subject matter of the appeal, falls within its ambit.

The claimant in this case has been in receipt of jobseeker's allowance (JSA) at least between July 2004 and at 20 October 2006. She claims to have worked up to 19 February 2007. The claimant's work was clearly well short of preserving self-sufficiency as there is no record of earnings which resulted in a liability for national insurance contributions. Certain payslips have been provided in support of her argument that she is a worker for the purpose of European law. However the decision maker concluded that the claimant, because of the absence of national insurance contributions, had not established that she was a worker and on 16 August 2007 refused her claim for income support, deciding she was 'a person from abroad' with an applicable amount of nil..

With the assistance of a representative, the claimant appealed against this decision, arguing that she was a worker and retained that status during a period of temporary incapacity for work. Though there is no evidence of incapacity with these papers, presumably such evidence was produced in respect of the March 2007 incapacity benefit claim, which was refused because the contribution conditions were not satisfied.

The claimant was represented at the tribunal hearing. She gave evidence that before coming to the United Kingdom in 2003 she had been dependent on State benefits. Though no wage slips were produced, she is stated to have worked in 2004 for three months as a cleaner for six hours a week, after which she made a claim to jobseeker's allowance. She started another job some 15 months later, which was also part-time. Her net monthly earnings, as the tribunal found, were always below the lower earnings limit. The tribunal concluded on this evidence that the claimant was not a qualified person and therefore could not satisfy the provisions of regulation 21AA(4) of the Regulations. She was a person from abroad whose applicable amount was nil. The tribunal found that the claimant was not a worker, and it also found that as her incapacity for work was not temporary, she did not have retained worker status, and rejected her appeal.

The claimant's representative argues that the tribunal was wrong to conclude that the claimant was not a worker. The representative refers to a decision of Commissioner Jacobs in CIS/1793/2007. I note that the claimant in that case was unsuccessful, and it related to a claim made before the coming into force of Directive, 2004/38/EC and regulation 21AA Income Support (General) Regulations. The representative also argues that the tribunal was wrong to conclude that the claimant's incapacity for work was not "temporary". The tribunal chairman herself granted leave to appeal, and the Secretary of State now supports the claimant's appeal, arguing that the claimant was entitled to retained worker status. There are too many unanswered questions for me to accept that concession.

Such evidence as there is that the claimant worked was provided by the claimant's representative. The Secretary of State had not found any evidence of work, because at no time between the claimant's entry to the UK in 2003 and the date of her claim for income support was there as much as a single national insurance contribution paid. However, I note that as she was in receipt of JSA during this period, there should be declarations of earnings available to the Secretary of State. Though there are gaps in the payments of JSA recorded, there was no evidence of earnings at a self-sufficient level during these gaps. The evidence of earnings available can be summarised as follows:

(i) The letter dated 13 April 2004 from Midlands East African Community stating that the claimant was to work as a part-time cleaner from 13 April 2004 for two hours a day, three days per week. No proof that the claimant was in fact so employed and was paid the £7.00 per hour specified in that letter has been produced, though the tribunal accepted this work lasted for three months, i.e. until July 2004.

(ii) Payslips covering the period 28 February 2006 to 31 July 2006 showing as employer the Open University. The gross pay shown on the payslip for 28 February 2006 indicates that the claimant had been working there for at least three months prior to that date, i.e. was employed from November 2005 until 31 July 2006, a period of nine months.

(iii) This is consistent with the application form at pages 37 to 39 of the tribunal bundle showing employment at the Open University starting 2 November 2005.

(iv) That employment ended on 31 July 2006, as is evidenced by the P45 which appears at page 36 of the papers.

The papers do not show what the claimant was doing between ceasing work in July 2006 and the unsuccessful claim to incapacity benefit made on 5 March 2007. She provided no evidence which established that she worked after the end of July 2006. It can only be a matter of speculation how she supported herself between then and 4 June 2007, the date of the claim to income support. As far as can be seen payment of jobseeker's allowance ended on 20 October 2006. The papers do not show in what circumstances the claim ended.

The tribunal heard oral evidence from the claimant. The claimant's evidence to the tribunal was that she had left her job at the Open University on 19 February 2007 because she felt sick, saying the problem was with her knee. Her GP had given her a sick note which she took to the JSA office. The tribunal did not, so far as can be seen from the record of proceedings, pursue the question of what the claimant was doing between 31 July 2006 and the claim for income support nearly a year later, nor why it was if she did continue to work after the end of July 2006, when her P45 was issued, she was not able to produce any evidence of it.

So far as payment of jobseeker's allowance is concerned, pages 22 to 25 set out the payments made to the claimant. There are some weeks for which the amount paid was significantly reduced, and some of these coincide with the period when she was employed at the Open University. However the correspondence between the amounts paid and the dates the claimant is known to have been working is weak. DWP records show payment of JSA started 29 July 2004, and with some breaks, which require explanation, continued until 20 October 2006.

By the date of the claim to income support the claimant had been in the United Kingdom for almost exactly four years. The proven evidence about work is only that which relates to the Open University and it shows part-time work for a nine month period. The tribunal accepted that the claimant worked for three months in Birmingham for six hours a week, but even if that is added to the work carried out at the Open University, the claimant worked part-time for a maximum of one year in aggregate out of the four years she was in the United Kingdom. Admittedly, work for a nine month period is not insignificant. But it never gave her self-sufficiency, and appears to have abandoned long before the income support claim was made. Was the tribunal right, therefore, to conclude that the claimant, though not a worker at the time of her claim to income support had "retained worker status", or rather, that she would have done so had it been shown that her incapacity for work was temporary?

The Income Support (General) Regulations 1987 reflect the requirements of the Social Security Contribution and Benefits Act 1992 that a person in Great Britain is entitled to income support if he has no income or his income does not exceed the applicable amount (section 124(1)) and the applicable amount shall be such amount as may be prescribed in relation to that benefit, including nil as an applicable amount (section 135). Paragraph 17 of Schedule 7 to the Income Support (General) Regulations prescribes that the applicable amount for a "person from abroad" is nil, and "person from abroad" is itself defined by regulation 21AA, in force from 30 April 2006:

. Regulation 21AA, Income Support (General) Regulations provides as follows:

(1) 'Person from abroad' means, subject to the following provisions of this regulation, a claimant who is not habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland.

(2) No claimant shall be treated as habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland unless he has a right to reside in (as the case may be) the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland other than a right to reside which falls within paragraph (3).

(3) A right to reside falls within this paragraph if it is one which exists by virtue of, or in accordance with, one or more of the following –

(a) regulation 13 of the Immigration (European Economic Area) Regulations 2006

(b) regulation 14 of those Regulations, but only in a case where the right exists under that regulation because the claimant is –

(i) a jobseeker for the purpose of the definition of 'qualified person' in regulation 6(1) of those Regulations, or

(ii) a family member within the meaning of regulation 7 of those Regulations such as jobseeker;

(c) Article 6 of Council Directive No.2004/38/EC; or

(d) Article 39 of the Treaty establishing the European Community (in a case where the claimant is a person seeking work in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland).

(4) The claimant is not a person from abroad if he is –

(a) a worker for the purpose of Directive No. 2004/38/EC;

(b) a self-employed persons for the purposes of that Directive;

(c) a person who retains the status referred to in sub-paragraph (a) or (b) pursuant to Article 7(3) of that Directive.

(d) …

(e) …

The structure of this regulation is convoluted, but with the double negatives removed, the effect of this provision is clearer. It falls into two parts. The first part, regulation 21AA(2) and (3), sets out those who will not be treated as habitually resident, and they will not have a right to reside. The second part, regulation 21AA(4), sets out those who will be treated as having a right to reside. Where does this leave the claimant? Regulation 21AA(3) excludes a person present during the initial three months period of residence conferred by Article 6 Directive 2004/38/EC and set out in regulation 13 Immigration (European Economic Area) Regulations (the EEA Regulations), and a person whose extended right of residence under regulation 14 EEA Regulations is dependent on being a jobseeker, or a family member of a jobseeker is also excluded. This means that the first part of this test as it applies to her treats the claimant as a person who is not habitually resident. Does regulation 21AA(4) help her? She is not a worker or a self-employed person, and she is not a person who has a permanent right of residence. I say she is not a worker because Directive 2004/38/EC distinguishes between a worker and a person with 'retained work status.' A person with this status will be treated as habitually resident and have a right to reside.

Regulation 21AA(4)(c) does not refer to the definition in the Immigration (European Economic Area) Regulations 2006. It refers instead to Article 7(3) of Council Directive No. 2004/38/EC. Article 7(3) provides:

For the purposes of paragraph (1A), a Union citizen who is no longer a worker or self-employed person shall retain the status of worker or self-employed person in the following circumstances:

(a) he/she is temporarily unable to work as the result of an illness or accident

(b) is in duly recorded involuntary unemployment after having been

employed for more than a year ….

(c) …

(d) he/she embarks on vocational training. Unless he/she is involuntarily unemployed, the retention of the status of worker shall require the training to be related to the previous employment.

The starting point in analysing these provisions is to decide whether, before the income support claim was made, the evidence shows that the claimant was a worker. If she was not, then the "retained worker status" set out in Article 7(3) cannot assist her. The fact that her work has been consistently part-time, and appears at all times to have fallen short of rendering her self-sufficient, is not enough under the European jurisprudence to mean that she is not a worker. Further, there are periods for which there is no evidence and it might be that the claimant did in fact work during these times. This is something which the new tribunal will have to consider. The test is whether the work she did represents the pursuit of an effective and genuine economic activity, or was it on such a small scale as to be purely marginal and ancillary? If it was the latter then it will not amount to "work". In Raulin v. Minister Van Onderwijs en Wetenschappen [1992] ECR 1-1027 the ECJ held that in determining whether activities are purely marginal and ancillary, regard may be had to their irregular nature and limited duration.

If that question is decided against the claimant, though it has been suggested that she is a student, this is not a question which need detain the new tribunal to which this appeal is remitted. She worked as a cleaner, and seemingly has very little English. It would not appear that she would be able to show that the part-time study she is undertaking relates, as Article 7(3) requires, to the previous employment. Further, it is only satisfaction of Article 7(3)(a) or (b) which helps the claimant in respect of regulation 21AA(4) If the new tribunal to which this matter is remitted finds that the claimant was a worker, it then needs to go on to consider whether she has retained worker status because she is a person temporarily unable to work as the result of an illness or accident. The tribunal decided this question against the claimant, noting that by the date of hearing, 21 December 2007, the stated incapacity was still preventing the claimant from working. In the application for leave to appeal against the tribunal's decision, the claimant's representative has made some useful points about what might be meant by temporary. The Secretary of State's submission to the Commissioner unfortunately does not really address this point. However, regardless of the theoretical limits of what amounts to "temporary", the claimant would be well advised to produce some evidence to the new tribunal which enables it to make findings about her work up to February 2007, and also whether her incapacity for any work that she could reasonably be expected to undertake is from a medical viewpoint "temporary".

The claimant and her representative should be prepared to present the following to the new tribunal:

(i) Evidence of work done and hours worked. Her P45 said she ceased work 31 July 2006. If she claims to have worked after this date, she must provide evidence of wages earned and hours worked.

(ii) She must explain why there are gaps in her JSA entitlement, and how she supported herself when she was neither working nor in receipt of JSA.

(iii) She must provide evidence of incapacity, and whether this is a temporary incapacity in respect of any work she could reasonably be expected to do.

The Secretary of State should present to the new tribunal any evidence which can be found of earnings declared by the claimant during her JSA claim, and any evidence available concerning gaps in the JSA awards.

These issues are at large before the new tribunal. It must decide whether the claimant's work was marginal and ancillary, or whether it was an effective and genuine economic activity. If it decides that question in the claimant's favour, it will then need to consider whether the incapacity for work is temporary. The claimant must provide to it evidence which enables these questions to be answered.

(Signed on the Original) Mrs A Ramsay

Deputy Commissioner

1 August 2008