Agarwal v Cardiff University (Tyne and Wear Passenger Transport Executive (t/a Nexus) v Anderson)

An Employment Tribunal has no jurisdiction to determine an Employment Rights Act 1996 section 13 claim where deciding the wages properly payable requires construction of the employment contract. This includes deciding whether terms are to be implied. The Tribunal may identify the relevant contractual terms, but it cannot determine their meaning or decide whether additional terms form part of the contract. A mere assertion that construction or implication is required is insufficient. The claim is outside the Tribunal’s jurisdiction only where the conditions of entitlement to pay, or the authority for a deduction, are unclear and require such decisions. The relevant contract is the contract under which the employee is entitled to remuneration, rather than necessarily an inter-employer payment arrangement.

The claimant, a clinical academic, was employed by Cardiff University to perform academic work and held an honorary clinical appointment with Cardiff and Vale University Local Health Board. The University paid her total remuneration. After sickness absence, she resumed academic duties but was not permitted to resume clinical duties and received only half her usual salary.

She brought a claim under section 13 of the Employment Rights Act 1996, alleging unauthorised deductions. The Employment Judge dismissed the claim for want of jurisdiction, holding that it was necessary to construe a complex interdependent contractual relationship. The claimant appealed. The central issue was whether the claim could be determined without construing her contract with the University, including any express or implied preconditions to payment for clinical work.

1. Appeal dismissed. The Employment Judge’s dismissal of the section 13 claim for want of jurisdiction was upheld, although on different grounds.
2. The governing authority was Southern Cross Healthcare Co Ltd v Perkins [2011] ICR 285. It established that an Employment Tribunal may identify the terms of an employment contract, but has no jurisdiction to construe contractual terms in proceedings of this kind. The same principle applies to a section 13 unauthorised-deductions claim.
3. The exclusion extends to deciding whether terms should be implied. Although Marks & Spencer v BNP Paribas Securities Services Trust [2016] AC 742 distinguished construing express words from implying terms, both processes involve determining the scope and meaning of the contract in the broad sense.
4. The material contract was the University contract, because the University was the employer obliged to pay the claimant. The Tribunal could identify relevant terms, including incorporated non-conflicting NHS terms, but could not decide whether the contract contained express or implied requirements to undergo the Health Board’s occupational-health assessment, consent to disclosure of medical information, or participate in mediation before resuming clinical duties.
5. Those matters were central to whether the claimant was able to perform the clinical duties and therefore whether the full amount of wages was properly payable. The need to construe the contract, including the existence and effect of implied terms, placed the claim outside the Employment Tribunal’s jurisdiction. The claim had to be pursued in the civil courts.
6. The contractual arrangements between the University and the Health Board were not material to the jurisdictional conclusion.

• Employment Appeal Tribunal: upheld the Employment Judge’s dismissal of the section 13 claim for want of jurisdiction, on different grounds.
• Employment Tribunal: following a Preliminary Hearing, dismissed the claim in a Judgment with Reasons sent on 22 March 2016.