Chassis & Cab Specialists Ltd v Lee

A contract is an apprenticeship according to its substantial character and purpose, rather than the labels used in the documents. The central question is whether the employer undertook to provide training directed towards acquiring practical and other skills, with the worker undertaking to serve and work during the training period. Modern arrangements may remain apprenticeships where off-the-job training is provided by a specialist third party. The absence of an inter partes document using the word apprentice is not determinative. Where the relationship has the essential characteristics of an apprenticeship, the national minimum wage exclusion in regulation 12(2) of the National Minimum Wage Regulations 1999 may apply.

The Employment Tribunal awarded the claimant £4,181.60 for unlawful deduction of wages, holding that he was entitled to the national minimum wage. It found that his legal status changed to employee from 31 March 2008, when he began receiving wages, but concluded that the relationship was not an apprenticeship for the purposes of regulation 12(2) of the National Minimum Wage Regulations 1999.

The employer appealed. The central issue was whether the contract from 31 March 2008 was a common-law contract of apprenticeship, notwithstanding the absence of an express apprenticeship contract and the involvement of an external training provider.

1. Appeal allowed. The claimant’s claim for unlawful deductions was dismissed.
2. The relevant contractual relationship was an apprenticeship. Its essential purpose, shown by the work-based training agreement and individual learner plan, was to train the claimant to achieve a recognised qualification and a specified level of skill.
3. Following Flett v Matheson [2006] IRLR 277, a modern apprenticeship may combine on-the-job and off-the-job training. The fact that academic or specialist training is supplied by a third party does not prevent the employer’s relationship with the worker from being an apprenticeship.
4. The use of the word apprentice in documents is relevant to construction but is not decisive. Conversely, the absence of that word from a document, particularly one of doubtful status or date, does not determine the issue. What matters is the substantial character of the relationship.
5. The low level of the qualification and the duration of the arrangement did not prevent this particular contract from having the essential characteristics of an apprenticeship. The Tribunal’s reliance on the absence of an express apprenticeship label, and potentially on the external funding of off-the-job training, was misplaced.
6. Written witness statements are admissible even where their authors are not called, although their weight may be limited if their contents are unclear or disputed. The appeal would have succeeded even without the additional statement considered by the EAT.
7. The EAT noted that an apprentice may have a claim for substantial damages for premature termination, but no such claim was before it and no compensation was awarded.

• Employment Appeal Tribunal: Allowed the employer’s appeal against the Employment Tribunal’s award for unlawful deductions and dismissed that claim.
• Employment Tribunal, Manchester: Awarded the claimant £4,181.60 for unlawful deduction of wages, while dismissing the unfair-dismissal claim and allowing the holiday-pay claim. The latter matters were not appealed.