EAT decision concerning the use of the power to strike out where implied terms are in dispute

Alex Ustych represented the successful appellant, Mr. Bonkay-Kamara, in an appeal (Bonkay-Kamara v. APCOA Parking UK Ltd.) concerning unlawful deduction from wages by his former employer, a global parking company.  The appellant worked as a car park Administrator for a number of years and later ‘acted up’ as a Contract Manager after his supervisor had left the company. He was not issued with a contract to reflect the new role and was not remunerated at the Manager’s level whilst ‘acting up’.  He brought a Tribunal claim on the basis that he was entitled to a higher salary, either with reference to an implied term in his contract (established via custom and practice) or as such sums were “otherwise” payable to him (within the broad s.27 Employment Rights Act 1996 definition of ‘wages’).

The Respondent applied for a Pre-Hearing Review in order to strike out this claim. The Tribunal initially decided that no PHR would be held, as it would be proper to decide the case at a full hearing. However, following further representations from the Respondent, the Tribunal reversed its decision and held a PHR. At the PHR (where Mr. Bonkay-Kamara was not represented by counsel), his claim was struck out on the basis that there was no implied term which entitled him to a higher salary than that recorded in his contract.

In the EAT, before Mr. Recorder Luba QC, the appellant argued that (1) the Tribunal had no jurisdiction to reverse its earlier decision and thus hold the PHR, absent any material change in circumstances and (2) that the Tribunal erred in law by striking out the claim without hearing evidence on the existence or otherwise of an implied term (and did not take the claimant’s case at its pleaded highest).

The EAT upheld both grounds of appeal, ruling that the Tribunal’s broad case management powers did not extend to re-making an existing case management decision where there has been no material change in circumstances and there was therefore no jurisdiction to hold the PHR (the strike-out decision thus a nullity). In doing so, the EAT applied the decision in Goldman Sachs Services Ltd v F M Montali  [2002] ICR 1251 (in spite of the Respondent’s submission that Montali did not apply as it was decided under the 2001 Rules). The EAT also held that “no reasonable employment judge properly directing herself could have determined that the proper course was to strike-out” a claim where the existence of an implied term was in dispute, as this required findings of fact in relation to the parties’ understanding as well as custom and practice.

This decision is important in that it establishes that a Tribunal cannot lawfully ‘change its mind’ in relation to a case management decision (even in the face of repeated and forceful representations by the party disagreeing with its initial decision) unless there has been a material change of circumstances. The decision also suggests that Tribunals should be slow to strike out claims where the parties dispute the existence of an implied term, because hearing evidence as to the parties’ understanding is crucial to determining if such a term ever existed.

Alex frequently appears in the Employment Tribunals and in the EAT, with a particular emphasis on whistleblowing and disability discrimination cases (both for employers and employees). He is co-authoring ‘The Employment Tribunals Handbook’ (4th edition) with Alan Payne and John-Paul Waite, focusing on the changes to employment law and procedure implemented in 2013.