Okuoimose v City Facilities Management (UK) Ltd (Jurisdictional Points : Fraud and illegality)

A non-EEA family member of an EEA national derives a right to reside and work from that status. The right does not depend on possession of a residence card or the continued validity of a passport stamp. Expiry of documentary evidence does not, by itself, terminate the underlying right.

In deciding whether an employment contract is illegal, the tribunal must determine the substantive immigration entitlement. The employer’s reasonableness, its belief about work entitlement, the risk of civil penalties and the availability of documentary evidence are irrelevant to contractual legality. An employer-protection regime operates separately from the existence of the employment right.

The Claimant, a Nigerian national and family member of a Spanish EEA national, was employed as a cleaner. A residence endorsement in her passport stated that her right of residence continued until 8 July 2010.

On that date the Respondent suspended her without pay because it considered that she lacked permission to work. The UK Border Agency later issued a certificate stating that, pending determination of her application, she was treated as a family member of a legally resident EEA national and was free to live and work in the United Kingdom.

The Employment Judge held that the employment contract was illegal and dismissed the claim for unlawful deductions under section 13(1) of the Employment Rights Act 1996. The appeal concerned whether the Claimant’s substantive right to work had expired with the passport endorsement and whether the contract was therefore illegal.

1. Appeal allowed. The Employment Judge’s conclusion that the contract was illegal was a question of law and was substituted by the Employment Appeal Tribunal.
2. Under Article 23 of Directive 2004/38/EC, a family member of an EEA national with the relevant residence status is entitled to work. That entitlement arises from the person’s status and does not depend on a residence card, passport stamp or other documentary formality.
3. Article 25 of the Directive prevents possession of a residence document from being made a precondition to exercising the relevant right. The corresponding domestic provisions require the Secretary of State to issue a residence card, but the card evidences the right rather than creating it.
4. The expiry on 8 July 2010 of the endorsement in the Claimant’s passport did not terminate her underlying right to reside and work, provided that she remained a family member of the EEA national. Her contract was therefore not illegal.
5. Alternatively, the UK Border Agency certificate retrospectively recognised her entitlement from receipt of the application on 23 July 2010. It therefore established entitlement to work at least from that date and supported payment for the relevant period.
6. The Employment Judge wrongly considered the employer’s reasonableness, its belief about the Claimant’s entitlement, the possibility of civil penalties and the production of documentary evidence. Those matters concern the employer’s statutory protection and do not determine whether the contract is legally enforceable.
7. The penalty provision in section 15 of the Immigration, Asylum and Nationality Act 2006 did not apply to a person whose entitlement arose as of right from family-member status rather than from time-limited leave. The agreed sum was substituted, representing unlawful deductions throughout the suspension period.

• Employment Appeal Tribunal: allowed the appeal against the Employment Judge’s reserved judgment of 3 February 2011 and substituted an agreed sum.
• Employment Tribunal: held that the employment contract was illegal and disallowed the claim for unlawful deductions.