Chief Adjudication Officer v Stafford and Banks

The central legal question was the construction of regulation 5 of the Income Support (General) Regulations 1987 (and the corresponding provisions in the Jobseeker's Allowance Regulations 1996) in particular the interaction between regulation 5(2)(b)(i) and regulation 5(3B). The House held that paragraph (3B) operates only to exclude school holiday weeks from the averaging calculation of hours but does not alter the existence of a recognisable cycle of work of one year. Thus, once the averaged hours (calculated under para 3B) amount to remunerative work as defined in regulation 5(1), that result applies to the whole cycle and the claimant is to be treated as engaged in remunerative work for the relevant weeks in the cycle.

Accordingly the claimant (a term‑time special needs assistant) was treated as engaged in remunerative work during the holiday weeks for the purposes of entitlement to income support and jobseeker's allowance where the averaging result put him above the 16‑hour threshold. The appeal was dismissed.

Background and facts. The appellant, Mr Banks, was employed as a special needs assistant on term‑time hours (about 20–26 hours per week during term) and was unpaid during school holidays. He claimed income support for the summer 1996 holiday and jobseeker's allowance for a half‑term holiday. The adjudication officer and a social security appeal tribunal rejected the claims; Commissioner Rowland allowed them; the Court of Appeal unanimously reversed the commissioner ([2000] 1 All ER 686). The matter came to the House of Lords on the construction of the statutory and regulatory test for being "engaged in remunerative work".

(i) Nature of the claim / relief sought. Mr Banks sought entitlement to income support and, after 7 October 1996, jobseeker's allowance for weeks during which he did not work and was not paid because of school holidays.

(ii) Issues framed. The principal issues were (a) whether regulation 5(3B) (IS Regs) / regulation 51(2)(c) (JSA Regs) meant that school holiday weeks should be disregarded only for the purpose of calculating an average number of hours or whether they also meant that a person is not to be treated as engaged in remunerative work during those holiday weeks; and (b) the legal effect of the averaging and any implied deeming on entitlement under section 124(1)(c) of the Social Security Contributions and Benefits Act 1992 and the Jobseekers Act 1995.

(iii) Reasoning and decision. The majority (Lords Slynn, Hope and Millett) concluded that paragraph (3B) merely modifies the averaging exercise by excluding holiday weeks from the denominator; it does not alter the recognisable cycle of work (one year) or prevent the averaged result applying to the whole cycle. In other words, if the hours calculated by the prescribed averaging procedure meet the definition of "remunerative work" under regulation 5(1) the claimant is treated as engaged in remunerative work for the cycle and thus disqualified from benefit for the holiday weeks. Two members (Lords Cooke and Scott) would have allowed the appeal, adopting the narrower construction that school holiday periods should not be treated as periods of engagement in remunerative work. The House therefore dismissed the appeal but recorded the divergent reasoning and noted the practical hardships and the possibility that the Secretary of State might amend the regulations.

Legal provisions chiefly considered: Social Security Contributions and Benefits Act 1992, section 124(1) and section 137(2); Income Support (General) Regulations 1987, regulation 5 (especially paras (1), (2)(b)(i), (3) and (3B)); Jobseeker's Allowance Regulations 1996, regulations 51–53.

Appeal dismissed. The majority held that regulation 5(3B) (and its JSA counterpart) excludes school holiday weeks only from the averaging calculation of hours but does not remove those weeks from the recognisable cycle of work. If, after excluding holidays for averaging, the computed average meets the definition of "remunerative work" under regulation 5(1) (i.e. not less than 16 hours per week), that result applies to the whole cycle and the claimant is treated as engaged in remunerative work for the relevant holiday weeks. Two Law Lords dissented and would have allowed the appeal.

Doncaster Social Security Appeal Tribunal (two differently constituted tribunals reached different conclusions); Adjudication Officer decision rejecting claim; Commissioner Rowland allowed the appeal (CIS/3216/1997; CJSA/3218/1997); Court of Appeal reversed Commissioner Rowland ([2000] 1 All ER 686); House of Lords dismissed the appellant's appeal ([2001] UKHL 33).