Gordon Bowen v Secretary of State for Work and Pensions

For the Universal Credit Administrative Earnings Threshold, monthly earnings are calculated before deductions for income tax, National Insurance contributions or relievable pension contributions. The reference to employed earnings in regulation 99(6) excludes earnings that are not employed earnings; regulation 55(5) does not convert the starting monthly-earnings figure to a net figure. Where the applicable earnings exceed the threshold, work-search and work-availability requirements cannot be imposed. A medium-level sanction for failing to meet a work-search requirement cannot stand where no such requirement was validly imposed.

Gordon Bowen, a claimant under a joint Universal Credit claim, and his partner had combined gross employed earnings of £1,508.41 in the relevant assessment period. The Department for Work and Pensions deducted £87.49 in relievable pension contributions when testing their earnings against the couple’s £1,437 Administrative Earnings Threshold, leaving £1,420.92. After Bowen failed to meet a work-search commitment, the Secretary of State imposed a 28-day medium-level sanction.

The First-tier Tribunal (Social Security and Child Support) dismissed Bowen’s appeal, accepting that the pension contributions should be deducted. The Secretary of State supported Bowen’s appeal to the Upper Tribunal. The central issue was whether monthly earnings for the threshold are measured before or after pension and other deductions.

1. Appeal allowed. The First-tier Tribunal’s decision involved an error of law. The Upper Tribunal set it aside and re-made the decision, allowing Bowen’s appeal against the Secretary of State’s decision.

2. Under the Universal Credit Regulations 2013, the starting point for the Administrative Earnings Threshold in regulation 99(6) is “monthly earnings”. Regulation 2 directs that term to regulation 90(6), under which the usual measure is earned income before deductions for income tax, National Insurance contributions or relievable pension contributions.

3. Regulation 99(6) excludes earnings that are not employed earnings. For that carve-out, employed earnings are assessed net of relevant deductions under regulations 99(6A) and 55(5). That does not alter the gross monthly-earnings starting point for the threshold. Bowen and his partner’s gross earnings exceeded the applicable threshold, so regulation 99(6) applied and no work-search or work-availability requirements could be imposed on him.

4. As no work-search requirement was validly imposed, no medium-level sanction could be applied for failing to take reasonable action to search for work. The Secretary of State was directed to remove the 28-day sanction applied from 21 August 2024 and calculate and pay any Universal Credit underpayment. Any additional compensation claim for maladministration fell outside the tribunals’ jurisdiction and would have to be pursued through the Department’s complaints regime and the Independent Case Examiner system.

1. Upper Tribunal (Administrative Appeals Chamber) — In [2026] UKUT 224 (AAC) , allowed the appeal, set aside the First-tier Tribunal’s decision for error of law and re-made it. Bowen’s appeal against the Secretary of State’s decision was allowed.
2. First-tier Tribunal (Social Security and Child Support) — After a hearing on 25 March 2025, dismissed Bowen’s appeal, accepting that the pension deduction reduced the couple’s earnings below the threshold.
3. Secretary of State for Work and Pensions — On 2 September 2024, imposed a 28-day medium-level sanction for failure to meet a work-search requirement. The Upper Tribunal directed that the sanction be removed.