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	United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Hunt v. Power Resources Ltd [2005] UKEAT 0545_04_1002 (10 February 2005) URL: http://www.bailii.org/uk/cases/UKEAT/2005/0545_04_1002.html Cite as: [2005] UKEAT 545_4_1002, [2005] UKEAT 0545_04_1002

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APPEARANCES

 

For the Appellant	Mr S D Hunt (the Appellant in Person)
For the Respondent	No Appearance or Representation By or on Behalf of the Appellant

SUMMARY

Practice and Procedure

The Employment Tribunal found contract of employment illegal-appeal dismissed.
 


HIS HONOUR JUDGE PROPHET

1. On the 23 April 2004 an Employment Tribunal sitting at Manchester with Mr AJ Simpson as the Chairman and Mr Cooper and Mr Riley as the lay members, held a hearing in respect of an application by Mr Hunt, which included complaints against his former employer, Power Resources Ltd, of breach of contract and unpaid wages, holiday pay and sick pay.
2. As the evidence emerged during the hearing, the Employment Tribunal identified of its own volition, as it was entitled to do, a possible problem for Mr Hunt in the form of whether his contract of employment was tainted with illegality, so that the Employment Tribunal would be unable to deal with his complaint. That was, again quite properly, drawn to the attention of both representatives, i e. Mr Horsfield, then representing Mr Hunt, and Mr Southall for the employer, to enable those gentlemen to include in their representations, and their final submissions, matters relating to that particular issue. The outcome was that the Employment Tribunal decided that there were arrangements in place which rendered Mr Hunt's contract of employment illegal, and that consequently the Employment Tribunal could not provide a decision or judgment on the merits of Mr Hunt's complaints.
3. However, very sensibly if we may say so, the Employment Tribunal proceeded to do a belt and braces exercise on the basis of if they were wrong on the illegality matter, they were in a position having considered the evidence presented to them in the submission from the parties, to make findings on the actual complaint. There is no appeal or cross appeal on those findings and accordingly they stand.
4. We return then to the issue of illegality, which forms the subject matter of Mr Hunt's appeal. We are constituted today to conduct a full hearing in respect of that appeal. Mr Hunt attends unrepresented, and has made submissions to us in accordance with his skeleton argument. There is no attendance or representation on behalf of the Respondent, but a document dated the 22 December from Mr Whiting, the manager/ director of the Respondent Company, but received by us on the 11 January 2005, has had our consideration.
5. To understand the matter it is necessary to explain what arrangements were entered into by Mr Hunt and his employer, which caused the Employment Tribunal to identify illegality.

In the early summer of 2003 Mr Whiting engaged an agency to find him a sales manager/director The agency found Mr Hunt, and he was duly offered the vacant post by a letter from Mr Whiting dated 22 May 2003. That letter indicated that Mr Hunt was to work three days a week as from 2 June 2003, at a salary of £18,000 per annum

6. However, it seems that the intention on both sides was that Mr Hunt would work for the first month only on a part-time basis, and thereafter on a full time basis at a salary of £30,000 per annum. Mr Hunt was subject to a restrictive covenant, the terms of which precluded him from working for Power Resources Ltd as a competitor to his previous employer, for a period of three months from leaving that previous employment. Mr Whiting was concerned when that matter came to his notice.
7. What then happened was the payments made to Mr Hunt for his services for the months of June and July, took the form of invoices for work done with gross pay shown and indeed paid. What is undoubtedly the case is that Mr Hunt was not being properly paid for his services as an employee, as he should have been, on a Pay As You Earn (PAYE) basis.
8. As from 1 August, and for the period up to the ending of his employment in September of 2003, the payment arrangements went back to a proper form in the sense that they were properly worked out on a gross and net basis, with Pay As You Earn (PAYE) payments to the Inland Revenue, and National Insurance payments also paid.
9. It seems to us that the Employment Tribunal was understandably concerned about the arrangements made in June and July, and whether there was as a consequence a potential fraud on the Revenue. It is the case that when Mr Hunt submitted his complaints to the Employment Tribunal, he relied on having been employed for a full period of about four months and that that was the basis of his claims.
10. Our judgment on the matter is that on the evidence before them the Employment Tribunal was quite entitled to find that having regard to the arrangements made in June and July between Mr Hunt and the employer, the contract of employment was illegal as constituting a potential fraud on the Revenue. Accordingly the appeal in this matter is dismissed.