
Jersey Employment and Discrimination Tribunal
Employment (Jersey) Law 2003
NOTIFICATION OF THE TRIBUNAL’S
JUDGMENT
|
Reference:
|
[2017]TRE010
|
|
|
Applicant:
|
Mr Ferdinando Moniz
de Assuncao
|
Respondent:
|
Mr
José Lemos t/a Portuguese Landscape Gardeners
|
Hearing Date:
|
08 June 2017
|
Before:
|
Mrs Hilary Griffin,
Chairman
Mrs Marilyn Wetherall,
Mr Mike Baudains, Panel Members
|
|
|
For the Applicant:
|
In Person, assisted
by Miss C Assuncao and Mr Rui Perez (translator)
|
For the Respondent:
|
In Person
|
THE TRIBUNAL’S JUDGMENT
THE DECISION
It is the unanimous decision of the Tribunal that:
·
the Respondent did not
constructively dismiss the Applicant;
·
the Applicant resigned
and is not entitled to recover notice pay;
·
the Applicant’s claim
for unpaid wages arising from an alleged pay increase fails;
·
the Applicant’s claim
for unpaid holiday pay fails; and
·
the Respondent failed
to provide itemized pay statements.
At the start of the hearing, the Respondent agreed that he
must pay:
·
the Applicant’s wages
for December 2016;
·
a sum to reflect the
Applicant’s entitlement to bank holiday pay.
THE REASONS
1.
A Tribunal hearing
(‘Hearing’) was convened to hear the following claims brought by the Applicant:
a)
that the Respondent
constructively unfairly dismissed the Applicant;
b)
that the Respondent
failed to give statutory notice to the Applicant (this amounting to a claim of
wrongful dismissal);
c)
that the Respondent
failed to pay to the Applicant wages:
i. for
hours worked by the Applicant during December 2016; and
ii. arising from an increase in the Applicant’s
hourly rate from July 2015 to the effective date of termination;
d)
that the Respondent
failed to pay holiday pay to the Applicant;
e)
that the Respondent
failed to pay the Applicant for Bank Holidays;
f)
that the Respondent paid
a wage to the Applicant which fell below the minimum wage; and
g)
that the Respondent
failed to provide to the Applicant itemised pay statements.
2.
The Applicant withdrew
his minimum wage claim at the start of the Hearing.
3.
At the Hearing the
Respondent agreed to pay to the Applicant:
a)
the sum of £955.40,
being the net wages earned by the Applicant during December 2016 (Social
Security contributions and ITIS having already been deducted at source and paid
by the Respondent); and
b)
a sum to reflect 18
bank holidays.
4.
The Respondent
submitted that the Applicant was engaged under a “zero hours” contract, that
the Respondent was not under an obligation to provide work to the Applicant and
that he did not have sufficient continuous employment to claim unfair
dismissal.
5.
The Tribunal heard
evidence from the Applicant and from his daughter, Miss C Assuncao and from Mr
Lemos on behalf of the Respondent.
Evidence
6.
The Applicant worked
for the Respondent as a gardener between March 2015 and January 2017 when the
Applicant resigned. The terms of the
contract between the Applicant and the Respondent were set out in a document
which was signed by both parties. This
document was headed ‘Terms of Employment’ and ‘Zero Hours Contract’
(“Contract”). The Contract contained the
following provisions:
a)
The Applicant was to be
paid £8 per hour, in arrears on the fifteenth of each month;
b)
4% rolled-up holiday
pay was included in the Applicant’s hourly rate;
c)
Each party was required
to give notice to terminate;
d)
The Applicant was
subject to a probationary period;
e)
The Respondent had the
discretion to require a medical certificate to be provided and/or for the
Applicant to be examined by a doctor appointed by the Respondent;
f)
The Applicant was not
entitled to bank holiday pay unless required to work.
7.
The Tribunal was shown
two copies of the Contract, both of which were signed, but one of which had
manuscript questions marked upon it by the Applicant’s daughter (“Marked-up
Contract”). When the Applicant gave the Marked-up
Contract to the Respondent, the Respondent immediately printed off an identical
clean copy which both parties then signed.
There were no discussions between the Applicant and the Respondent as to
the terms of the Contract or about the manuscript questions on the Marked-up
Contract.
8.
The Tribunal heard that
the Applicant routinely worked Monday to Saturday from 8am until approximately
6pm. Save for the period immediately
after the Christmas break, the Applicant was always aware of his timetable in
advance. The Applicant’s hours did vary each week, depending upon the volume of
work but the Applicant appeared for work every day and the Respondent made it
clear in his evidence that if the Applicant were not to arrive for work as
anticipated, the Respondent would immediately call him to query why he was not
in attendance.
Unpaid
wages
9.
The Applicant told the
Tribunal that shortly before accepting the role, the Respondent told the
Applicant that his hourly rate would increase from £8 per hour to £8.50 per
hour from July 2015. The Contract did
not contain any reference to such a pay increase and, despite reading carefully
through the Contract with his daughter, the Applicant did not raise this
omission with the Respondent at the time of signing the Contract.
10. In
July 2015, the Applicant approached the Respondent to ask why his hourly rate
had not increased to £8.50 per hour. The
Applicant’s evidence was that the Respondent told him that he ‘did not deserve’ a pay increase.
11. In
his evidence, the Respondent denied ever telling the Applicant that his hourly
rate would increase. His evidence was
that he told the Applicant that his hourly rate would be between £8 and £8.50
per hour, depending upon how he performed. When the Applicant approached the Respondent
in July 2015, the Respondent said that there would be no increase in the
Applicant’s hourly rate because it had become apparent to the Respondent that
the Applicant did not have the experience which he had claimed to have when he
entered into the Contract. By way of
example, the Respondent told the Tribunal that the Applicant did not know how
to use a hedge-cutter or a lawnmower.
12. The
Applicant confirmed to the Tribunal that after July 2015 he did not rise the
issue of the pay rise again.
Unpaid
holiday pay
13. The
Applicant gave evidence that he did not receive any holiday pay for the
duration of the Contract. The Respondent drew the Tribunal’s attention to a
clause in the Contract which specified that 4% rolled-up holiday pay was
included in the Applicant’s hourly rate.
The clause was underlined in the Contract to highlight its importance
and the evidence showed that the Applicant and his daughter were aware of it
because on the Marked-up Contract, the Applicant’s daughter wrote next to this
clause:
“so should his wages not be more than £8. Should it not be £8.50.”
Late
payment of wages
14. Under
the terms of the Contract the Respondent was to pay the Applicant's wages
monthly in arrears on the fifteenth of each month. The Applicant gave evidence
that the Respondent never paid on that date and that the Applicant usually
received his wages at the end of the month. The Applicant's bank statements and
payslips supported his evidence and the Respondent accepted that he paid at the
end of each month.
15. The
Applicant told the Tribunal that he did periodically raise the issue of the
late payment of his wages with the Respondent. On one occasion he refused to
work until he received payment. However
the evidence showed that the Applicant came to expect payment of his wages
towards the end of the month and if he required funds before that date, he
asked the Respondent for a loan.
16. The
Respondent explained that the late payments were due to cash flow and personal
reasons. He gave evidence that although the Applicant occasionally asked for a
loan, for the most part the Applicant "seemed
happy to help out". At no point
did the Applicant threaten to resign due to the failure of the Respondent to
pay on the fifteenth of each month.
December
2016 payment
17. The
Applicant gave evidence that in December 2016 the Respondent told him that he
would pay the Applicant's wages one week early. The Applicant assumed that this
would mean that he would receive payment on fifteenth of the month. Instead, the Respondent paid the Applicant’s
November wages by cheque on 22 December 2016.
This was a week earlier than normal but was not in accordance with the
terms of the Contract. The Applicant was particularly angry because he had
expected to be paid by BACS directly into his bank account. The receipt of a cheque so shortly before the
Christmas break meant that the Applicant did not have immediate cleared funds
available to him for Christmas.
18. The
Respondent considered that he did pay the Applicant one week early and he
explained that he usually paid his workforce by cheque and not by BACS. Although he had occasionally paid by BACS,
the majority of his employees expressed a preference to be paid by cheque so
they could more easily monitor their own cash flow. The Respondent preferred this method of
payment and wanted to pay all of his staff in the same way. There was no term in the contract which
specified that he must pay by any specific means.
Resignation
19. The
Applicant did not work over the Christmas period. On 3 January 2017, the Applicant telephoned
the Respondent to find out when he was expected to return to work. The Respondent told the Applicant that he
would call him within the next week to let him know; generally there is less
gardening work at this time of year.
20. On
6 January 2017, the Applicant telephoned the Respondent and resigned. The Applicant that he did not give a reason
for his resignation to the Respondent.
21. On
9 January 2017, the Applicant started a new part-time position which then
became full-time.
22. The
Applicant submitted that the reason he resigned was because the Respondent was
“a liar” because:
a)
he failed to pay the
Applicant’s November wages by 15 December 2016; and
b) he
paid the Applicant’s wages by cheque rather than by BACS.
Itemized
payslips
23. The Applicant stated that the Respondent
failed to give him itemised payslips. According to the Applicant, the
Respondent only provided payslips for 2015 in February 2016 and only provided the
payslips for 2016 prior to the Hearing.
24. The
Respondent gave evidence that his accountants prepared the monthly payslips on
his behalf. The Respondent’s accountancy procedures required him to calculate
his employees' wages directly from their worksheets. Once he had calculated the
wages, the Respondent then sent the worksheets to his accountant who would then
prepare the payslips. In the meantime, the Respondent paid his employees. The Respondent would usually receive the
payslips from the accountant after he had paid the monthly wages. The
Respondent therefore gave the payslips to the employees at some point after
they received payment of their wages.
25. The
Respondent confirmed that he routinely provided copies of the payslips to his
employees at the end of the financial year because they often mislaid the
originals.
Conclusion
Preliminary
issue – zero hours contract
26. The
Tribunal first considered the Respondent’s submission that the Applicant was
engaged under the terms of a ‘zero hours’ contract and could not claim
constructive unfair dismissal or notice pay.
27. A
genuine ‘zero hours’ contract is one where:
a)
The employer is not
obliged to provide work to the individual; and
b)
If the employer does
offer work, the individual is under no obligation to accept that offer and will
suffer no detrimental action if they do decide to reject the offer of work.
28. In
essence, a genuine ‘zero hours’ contract will reflect an ‘ad hoc’ arrangement
between two parties.
29. Based
on the evidence, the Tribunal was satisfied that, despite the Contract being
marked as ‘zero hours’, this was not a genuine ‘zero hours’ contract but a
‘variable hours’ contract. Neither the
written terms of the Contract nor the behaviour of the parties supported the assertion
that this was an ‘ad hoc’ arrangement between the Applicant and the
Respondent. The Applicant routinely
worked a six-day week throughout his employment and there was no doubt that he
formed an integral part of the Respondent’s workforce.
30. The
Tribunal was satisfied that the Applicant had sufficient continuous employment
to submit claims of constructive unfair dismissal and a wrongful dismissal
claim for notice pay.
Constructive unfair dismissal
31. As
set out in previous Tribunal cases, in order to establish a successful
complaint of constructive dismissal, four conditions must be met:
a)
the employer must be in
breach of a contractual term (either an express term or an implied term);
b)
the breach of contract
must be fundamental, amounting to a repudiatory breach of contract;
c)
the employee must
resign in response to the employer's repudiatory breach of contract; and
d)
the employee must not
delay too long in terminating the contract; otherwise the breach may be found
to have been waived and the contract affirmed.
(See: Robinson v States of Jersey, Department of
Education, Sport & Culture (JET 1910-028/05); Oprey v Woolworths plc
(JET 2604-085/07); Western Excavating (ECC) v Sharpe [1978] ICR 221; Maclagan
v States Employment Board (JET 79/2015)).
Was
there a repudiatory breach of contract?
32. The
Tribunal first considered whether, the breaches in question were fundamental,
thus amounting to repudiatory breaches of contract. The Tribunal has considered what constitutes
a repudiatory breach of contract on previous occasions. In short, unless the breach of contract is
significant and either goes to the root of the contract or shows that the
employer no longer intends to be bound by an essential express or implied term,
that breach will usually fall short of being repudiatory. Simply acting in an unreasonable manner is
not in itself sufficient grounds for a successful complaint of constructive
dismissal.
33. In
considering the question of whether the Respondent committed a repudiatory
breach of contract, the Tribunal applied an entirely objective test and did not
consider the Respondent’s motives or intentions (see: Maclagan; The
Leeds Dental Team Ltd v Rose UKEAT/0016/13).
34. In
this case, the Applicant submitted that the Respondent committed two
repudiatory breaches by:
a)
failing to pay the
Applicant his November wages on 15 December 2016; and
b)
paying the Applicant
his wages by cheque rather than by BACS.
Late payment of wages
35. The
right to be paid for work undertaken is a fundamental term of an employment
contract and the breach by an employer of that term will usually be repudiatory
in nature. In this case, the fact that
the Respondent routinely paid the Applicant late did not vary the written term
in the Contract which was unambiguous in stating that the Applicant would be
paid on the fifteenth of each month.
36. Based
on the evidence, the Tribunal was satisfied that the delay in paying the
Applicant his wages in December 2016 did amount to a repudiatory breach of
contract.
Payment by cheque
37. Based
on the evidence, the Tribunal concluded that the Respondent’s decision to pay
the Applicant’s wages by cheque did not amount to a repudiatory breach
of contract. The Tribunal accepted the
Respondent’s evidence that the majority of the workforce preferred this method
of payment and there was no evidence to suggest that either an express or
implied contractual term existed that the Applicant should be paid by BACS.
Did
the Applicant resign in response to the breach?
38. Having
established that the failure to pay the Applicant’s wages on 15 December 2016
amounted to a repudiatory breach of contract, the Tribunal then considered
whether the Applicant resigned in response to that breach.
39. The
Tribunal noted that the Applicant:
a)
delayed three weeks
before resigning in response to the late payment of his wages;
b)
sought to return to
work after the Christmas break by contacting the Respondent on 3 January 2017;
and
c)
did not mention to the
Respondent at the time of his resignation that he was resigning in response to
the Respondent’s failure to pay him on 15 December 2017.
40. The
evidence was clear that although the Applicant may have been frustrated with
the late payments and the payment of wages by cheque, the Applicant resigned on
Friday 6 January 2017 because he had secured a new position which commenced on
Monday 9 January 2017.
41. The
Tribunal therefore concluded that the Applicant did not resign in
response to the Respondent’s breach of contract but for other reasons as
detailed above.
42. In
any event, had the Tribunal found that the Applicant did resign in response to
the Respondent’s breach, the Tribunal would have found that the delay of three
weeks between the breach and the resignation was too long and that the
Applicant affirmed the Contract in any event.
43. The Tribunal finds that
the Respondent did not constructively dismiss the Applicant.
Wrongful dismissal/notice pay
44. As
set out above, the Applicant resigned from his position on Friday 6 January
2017 in order to commence new employment on Monday 9 January 2017.
45. The
Applicant’s claim for notice pay is therefore rejected.
Unpaid wages
46. The
Tribunal accepted the Respondent’s evidence that he did not offer or agree to a
wage increase for the Applicant. Indeed,
the Contract made no reference to such an increase and the Applicant did not
raise this as an issue after July 2015.
47. The
Applicant’s claim for unpaid wages is therefore rejected.
Holiday
pay
48. The
Contract clearly stated that the Applicant’s 4% rolled-up holiday entitlement
was included in the £8 hourly rate. The
Applicant understood this term and his daughter identified it as a term to
query with the Respondent. Despite this,
the Applicant did not raise holiday pay as an issue with the Respondent before
signing the clean version of the Contract.
49. The
Applicant’s claim for unpaid holiday pay is therefore rejected.
Itemized pay statements
50. The
Tribunal accepted that the Respondent did provide pay statements to the
Applicant at various times throughout the year.
However the Respondent’s evidence was clear that those pay statements
were generally provided after he paid the Applicant.
51. Under
Article 51 of the Employment Law, an employer must provide an itemised pay
statement to an employee on or before each pay date. This clearly did not occur in this case, and
the Respondent was therefore in breach of Article 51 of the Employment Law.
52. The
Tribunal also noted that the pay statements did not separately identify the
Applicant’s holiday pay for each month.
In future, the Respondent should ensure that holiday pay is separately
identified in his employees’ pay statements.
53. Since
the Applicant’s employment terminated before the Employment (Amendment No. 10)
(Jersey) Law 2016 only came into force on 1 April 2017 (ie. after the termination of the Applicant’s employment) the
Tribunal may not make an award of compensation in this instance. However the Tribunal strongly urges that
Respondent to:
a)
change his accountancy
practices as a matter of urgency so that he is able to provide his employees
with pay statements at the same time as giving them their wage cheques; and
b)
ensure that holiday pay
is itemized on the pay statements.
54. The
Respondent agreed that he owed the following amounts to the Applicant:
a)
unpaid wages, amounting
to £955.40 (this being a payment net of ITIS and Social Security contributions;
and
b)
bank holiday pay,
amounting to a gross payment of £1,152 (total of 18 bank holidays of 8 hours
per day at £8 per hour) which is subject to ITIS and Social Security
deductions.
55. The Tribunal HEREBY
ORDERS that the Respondent pays to the Applicant the sum of £2,107.40.
Signed:
Mrs
HG Griffin, Chairman
Dated: 5 July 2017
Judgment and Reasons sent to the parties
on
5 July 2017
For the Tribunal Office