Scanlon v Young Engineers Ltd

An Employment Tribunal determining an unlawful-deduction claim must make clear, reasoned findings on the contractual or other basis on which wages were properly payable. Where remuneration arrangements have developed through informal exchanges, it must identify what was agreed, including any later authorisation of work or payment.

A finding that an employer did not give a worker carte blanche to incur unlimited paid time does not, without more, determine whether further payment was agreed or payable. If the tribunal rejects evidence of work done, it must explain its treatment of material corroborative schedules. The absence of a written statement of changed terms under Employment Rights Act 1996 section 4 does not displace the tribunal's duty to determine the parties' actual agreement.

The claimant was engaged as a web developer at a daily rate of £150, with work to be agreed with the respondent's chief executive. He claimed unlawful deductions for 158.5 days' work. The respondent maintained that, after a meeting on 27 April 2016 concerning an unfinished database project, no further payment was due unless further work was specifically agreed. It accepted liability for 23.5 further days and the Employment Tribunal awarded £3,525.

The claimant's reconsideration application failed. He appealed, principally contending that the Tribunal's reasons were inadequate and that it had failed to make findings about the remuneration agreement, later authorised work, and evidence of the days worked. The central issue was whether the Tribunal had given sufficiently clear and reasoned findings to determine what wages were properly payable.

1. Appeal allowed. The Employment Tribunal's decision was insufficiently reasoned and could not stand under the requirements identified in Meek, [1987] IRLR 250.

2. For a claim under Employment Rights Act 1996 section 13, the essential question was what express or implied agreement governed remuneration from time to time, how it was calculated, and whether the claimant had received all sums contractually earned. The Tribunal had to determine those matters from all the evidence, notwithstanding the absence of live evidence from the respondent's witnesses and the informality of the parties' dealings.

3. The Tribunal was entitled to find that the respondent had not agreed to allow the claimant to work an unlimited number of days and later receive the daily rate for all of them. That negative finding did not identify the positive agreement reached after the meeting of 27 April 2016. It did not establish whether any further payment was promised, how it was to be calculated, or how future work and payment were to be authorised.

4. The Tribunal also failed to address the significance of its finding that ten further days' work had been agreed in July 2016, and of the respondent's concession that payment at the daily rate was due for 23.5 days. It did not explain how those matters fitted with its view of the April meeting.

5. Its rejection of the claimant's asserted days as an uncorroborated bald recital was inadequately explained. The claimant had supplied a week-by-week schedule, and the respondent's counter-schedule reflected his figures. The Tribunal had to give reasons for rejecting that material evidence.

6. Section 4 of the Employment Rights Act 1996, even if applicable, did not resolve the dispute. The absence of a written statement of variation did not remove the Tribunal's obligation to decide the actual terms agreed. The claim was remitted for a complete rehearing before a different Employment Judge.

• Employment Appeal Tribunal: Allowed the claimant's appeal and set aside the Employment Tribunal's award of £3,525. The unlawful-deduction claim was remitted for a fresh hearing before a different Employment Judge.
• Employment Tribunal: Following a merits hearing, awarded the claimant £3,525 for 23.5 days' unpaid wages. A subsequent reconsideration application was unsuccessful.