Brown & Ors v London General Transport Services Ltd & Anor

An Employment Tribunal must give reasons which identify the issues and findings, identify the relevant law, and explain how that law produces the result. A judgment is erroneous where, even read fairly and as a whole, it leaves the parties and an appellate court unable to understand that reasoning.

In a contractual wages claim, entitlement depends on the objectively construed terms of each employee’s individual contract. Historic or sparse documentation must be assessed with the relevant background. Regular payment may itself be strong evidence of a contractual entitlement. An employee’s signed agreement to a transfer without an allowance is effective unless a properly advanced legal basis exists to negate consent.

Fifty-five bus drivers brought claims for unlawful deductions from wages. The material claims concerned meal allowances for breaks away from a garage and disturbance allowances after a move from Rainham to Northumberland Park.

The Employment Tribunal upheld disturbance-allowance claims for 14 drivers but dismissed all meal-allowance claims. It later refused reconsideration. The drivers appealed the dismissal of the meal claims. The employers cross-appealed the disturbance-allowance decision.

The central issues were whether the Tribunal had adequately explained its contractual conclusions and whether drivers who agreed to move without disturbance allowance could maintain their claims.

1. Appeal and cross-appeal allowed. The Tribunal’s dismissal of the meal-allowance claims was inadequately reasoned. Its conclusions did not explain how the law it stated applied to the contractual evidence, did not engage with the distinct position of route 462, and did not explain the contractual status of the documents, the rejection of an implied term, or the asserted custom and practice.

2. Under Rule 62(5) of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013, reasons must permit the parties and an appellate court to understand the path from findings to conclusion. The authorities, including English v Emery Reimbold & Strick Ltd [2002] 1 WLR 2409 and Tran v Greenwich Vietnam Community [2002] IRLR 735, did not require elaborate drafting. They did require a sufficiently intelligible explanation. The reconsideration reasons did not cure the defects.

3. The claims were contractual and the contract of each employee had to be construed objectively and in context. The Tribunal had to identify the relevant terms before deciding their meaning. Applying the approach in Investors’ Compensation Scheme Ltd v West Bromwich Building Society [1997] UKHL 28, wording concerning relief away from a garage could not be given a qualified meaning without evidence and analysis of the shared background. A regular payment, received and expected as part of normal remuneration, could soon provide strong evidence of a contractual obligation unless shown to be mistaken or accidental.

4. The disturbance-allowance decision was also inadequately reasoned. The Tribunal had introduced an unconscionable-bargain analysis that neither party had advanced, and had not explained why the contractual condition of a compulsory transfer was met. The point did not turn on Regulation 4(4) of Transfer of Undertakings (Protection of Employment) Regulations 2006, because the Tribunal had not decided that a contractual variation was invalid under that provision.

5. However, drivers who signed an unqualified request to transfer to Northumberland Park could not pursue disturbance allowance. They had not pleaded duress, breach of trust and confidence, or another basis for invalidating their consent, and the EAT could not create such a case for them. Claims by drivers who signed under protest could be remitted if they wished to contend that their particular consent was ineffective.

• Employment Appeal Tribunal: Allowed the drivers’ appeal and the employers’ cross-appeal. Meal-allowance claims were remitted to a fresh Tribunal. The possible remission of disturbance-allowance claims was confined to drivers who had signed the transfer request under protest.
• Employment Tribunal, Watford: By a judgment dated 6 August 2015, upheld disturbance-allowance claims for 14 drivers and dismissed the meal-allowance claims. A reconsideration decision dated 9 December 2015 did not materially clarify the reasons.