Weatherilt v Cathay Pacific Airways Ltd

For a claim under Part II of the Employment Rights Act 1996, an employment tribunal may determine disputes about the construction of the employment contract and the implication of terms when deciding what wages were properly payable. The tribunal is not confined to the existence of an express contractual entitlement.

Where contractual provisions establish an exhaustive scheme governing additional pay, that scheme may determine entitlement during sickness. On the proper construction of the conditions of service, additional flying-related payments did not accrue during unrostered sickness.

The claimant, a commercial pilot employed by Cathay Pacific Airways Ltd, brought a claim under Part II of the Employment Rights Act 1996 after he was paid basic salary and overnight allowances but not Excess Flying Pay or Hourly Duty Pay during sickness occurring after rostered flights.

The Employment Tribunal dismissed the claim, holding that the contractual conditions of service did not provide for those payments during unrostered sickness. The claimant appealed. The respondent cross-appealed on jurisdiction, implication of terms and estoppel by convention. The central issues were whether the Employment Tribunal could construe and imply contractual terms in a section 13 claim and whether the conditions of service entitled the claimant to the disputed payments.

1. Jurisdiction under Part II. The Employment Tribunal has jurisdiction to determine disputes about the construction of an employment contract and the implication of terms when deciding the amount of wages properly payable under section 13 of the Employment Rights Act 1996. Delaney v Staples and Camden Primary Care Trust v Atchoe were binding authority. Agarwal v Cardiff University was not followed because it had been decided without adversarial argument on the point and relied on authority concerned with different statutory provisions.
2. The Employment Tribunal does not have exclusive jurisdiction over contractual interpretation. A party may pursue a contractual debt or declaration in the civil courts, and the tribunal may stay proceedings where appropriate.
3. Construction of the conditions of service. The court applied the established contractual construction principles, considering the natural meaning of the words, the other provisions, the overall purpose, the relevant background and commercial common sense.
4. Schedule 2 was naturally read as an exhaustive statement of the circumstances in which credit hours accrued for HDP and EFP. It expressly provided for sickness on the published roster but made no provision for unrostered sickness. Accordingly, no HDP or EFP accrued during unrostered sickness.
5. The general wording in Condition 27.2 concerning salary, allowances and benefits did not override the specific scheme in Schedule 2. Reading it otherwise would treat unplanned sickness more generously than rostered sickness and create difficulties after the reduction of salary following 126 days’ sickness.
6. The appeal was dismissed. The alternative submissions concerning loss of a chance, implied terms and estoppel by convention did not require an order on the cross-appeal. Had the construction issue been decided for the claimant, the loss-of-chance argument would have been rejected and the estoppel issue would have been remitted for findings.

• Employment Tribunal: Employment Judge Wade dismissed the claimant’s unlawful deduction from wages claim by Judgment dated 23 August 2016.
• Employment Appeal Tribunal: The appeal was dismissed. The respondent was granted permission to amend its cross-appeal, but the jurisdiction ground was rejected.