THE INDUSTRIAL TRIBUNALS

CASE REF:	1174/05

CLAIMANT:			Turan Mirza

RESPONDENTS:		1.	Smart Light Devices Ireland Limited
					(In Liquidation)
2.	Department for Employment & Learning
Redundancy Payments Services

DECISION
The claimant’s claim for £69.29 in unpaid expenses is dismissed.  The                      second-named respondent shall pay the claimant a percentage of arrears of pay of £402.60 (such percentage to be calculated by the second-named respondent, and accepted by the claimant).  The first-named respondent is ordered to pay the claimant £150.00 by way of preparation time Order for Costs.

Constitution of Tribunal:
Chairman (sitting alone):		Mr M O’Brien

Appearances:
The claimant appeared in person.
The first-named respondent did not appear and was represented.
The second-named respondent was represented by Ms P Baird.

Sources of evidence

1.	The claimant gave evidence and referred to a large amount of documentation.

Findings of fact

2.	By his claim, presented on 12 August 2005, the claimant asserted he had been employed by the first-named respondent, and had put his complaint in writing to the first-named respondent on 14 June 2005. 

3.	The first-named respondent entered a response on 14 September 2005, indicating that it was represented by McClure Watters, Chartered Accountants.  The response did not dispute the dates of the claimant’s employment, his hours of work his earnings, or the amounts he claimed for notice payment.  The response disputed the amount claimed by the claimant in respect of pension arrears.  At Section 6.2 of the response, the first-named respondent company indicated that it was trying to effect the liquidation of the company, and continued:-

“The claimant’s statement that unauthorised deductions from his salary were made without his knowledge is erroneous.  Pension deductions from monthly salaries were made in line with long-standing arrangement.  Any inference by the claimant that an improper deduction was made from his salary is highly offensive.”

4.	By a letter to the Office of the Industrial Tribunals, dated 25 April 2006, the   second-named respondent advised that _

“As the company is in an insolvent position any award made could fall to the Department.  I would ask that the Department be joined to the proceedings and that this letter be treated as a notice of appearance …”.

By an order of the Vice President of the Office of the Industrial Tribunals & The Fair Employment Tribunal, dated 30 May 2006, the second-named respondent was thus joined as a respondent in these proceedings.

5.	The claimant’s employment with the first-named respondent started on 1 September 2002 and ended on 14 March 2005.  He had been employed as a programme manager, working 37.5 hours a week and earning                   £35,000.00 per annum.  His average net pay was £2,200.00 per month.  The claimant paid £113.80 per month to a pension fund, which was also contributed to by the first-named respondent company every three - four months. 

6.	The tribunal finds the first-named respondent company made no pension payments to the pension provider for the period December 2004 – March 2005.  The amount thus owed in £402.60.  The tribunal rose from 10.45 – 11.35 am on 8 December 2006 to allow Ms Baird to ascertain from the liquidator that this amount was due and owing to the claimant.  This figure was confirmed by Ms Baird at 11.35 am, and it was agreed that the second-named respondent will pay out a percentage of this, and that the claimant would accept this assessed percentage.

7.	The first-named respondent company ceased trading on 14 March 2005 making all staff redundant without any notice.  The first-named respondent company indicated to its employees that it was going into liquidation.  The claimant made verbal and written requests for outstanding monies owed him, without success.  The claimant was owed the following amounts on the termination of his employment:-

(i)	£4,402.33 in unpaid wages;

(ii)	£   201.90 in holiday pay;

(iii)	£2,692.31 in notice pay;

(iv)      £     69.29 in unpaid expenses;

(v)       £   402.60 in pension arrears; and

(vi)      £1,346.15 redundancy payment.

8.	The tribunal finds from facts agreed between the parties that the                         first-named respondent company went into liquidation on 9 March 2006.  A   winding-up order was made on 9 March 2006 and a liquidator appointed on that date. 

9.	The claimant worked 21 days in January 2005, 20 days in February 2005 and 10 days in March 2005.  The second-named respondent has paid the following amounts to the claimant from the statutory fund:-

(i)	£1,736.00 in respect of arrears of unpaid wages.  This was paid on 25 March 2006, and is capped at the statutory maximum;

(ii)	£12.32 in respect of arrears of holiday pay.  This was issued to the claimant on 7 July 2006.  The claimant did not receive the entire amount of £201.90 in respect of holiday pay, as this is calculated on the basis of accrued holidays from 10 March 2005.  From this date the claimant had accrued 0.22 holidays = £12.32;

(iii)	£560.00 in respect of arrears of notice pay.  This was issued to the claimant on 16 May 2006; and

(iv)	£560.00 in respect of statutory redundancy payment.  This was issued to the claimant on 4 May 2006.

10.	After 14 March 2005, the claimant agreed to work for the first-named respondent company as a self-employed person on a contract for services.  He claimed that the first-named respondent company owed him a total of £3,364.50 in unpaid monies for work done in this latter period.  The claimant submitted a letter on 11 September 2006 in this regard to the Office of the Industrial Tribunals. 

11.	The assets of the first-named respondent company have been sold by the liquidator, and a sum of money has been realised from such sale.  This sum has not been revealed to the second-named respondent.

The issues to be decided

12.	The claimant is satisfied that the above payments are the maximum that can be paid to him from the statutory fund.  He pursued his outstanding claims before the tribunal, viz:-

i.	£     69.29 in unpaid expenses; and

ii.	£   402.60 in pension arrears;

Applicable law

13.	The applicable law in respect of the claimant’s residual claims is provided by the following:-

(a)	Article 227 of the Employment Rights (NI) Order 1996 [‘the 1996 Order’] provides for an employee’s rights on the insolvency of the employer.

(b)	Article 228 of the 1996 Order provides a definition of insolvency. Article 228(3)(a) provides that an employer is insolvent if a       winding-up order has been made.

(c)	Article 229 of the 1996 Order provides a list of the type of debts which may be paid from the statutory fund.  Article 229(1)(a) provides that such a debt may comprise arrears of pay up to a maximum of eight weeks.

(d)	Article 230(c) of the 1996 Order provides that the ‘appropriate date’ in respect of a debt owed the employee by the employer is the date when the employer became insolvent.

(e)	Article 233(1) - (2) of the 1996 Order provides that a claim against the Department shall not be considered unless it is presented within three months of the date on which the Department communicated its decision on payment to the claimant.

(f)	Where a tribunal finds a claim well founded, by Article 233(3) of the 1996 Order, it shall:-

(i)	make a declaration to that effect; and

(ii)	declare the amount of such payment which it finds the Department ought to make.

(g)	Rules 38 - 48 of Schedule 1 to the Industrial Tribunals (Constitution and Rules of Procedure) Regulations (Northern Ireland) 2005 make provision for the making of an order for a party’s costs.

The decision of the tribunal

14.	Pursuant to Article 233(1) - (2) of the 1996 Order, the claim for £3,364.50 was presented within three months of 7 July 2006.  However, the claimant was not an employee of the first-named respondent during this latter period, and thus does not satisfy the provisions of Article 227 of the 1996 Order.  This determination should not be taken as a decision that this amount is not recoverable from the liquidator of the first-named respondent company.

15.	Pursuant to Article 228 of the 1996 Order, the first-named respondent company became insolvent on 9 March 2006, on which date a winding-up order was made.

16.	Pursuant to Article 230(c) of the 1996 Order, the first-named respondent company became insolvent on 9 March 2006, which is the appropriate date.

17.	Nothing in Article 229 of the 1996 Order makes provision for payment from the statutory fund for unpaid expenses.  In this regard, the decision of the tribunal is that the claimant’s claim for £69.29 is dismissed.

18.	Pursuant to Articles 227 and 229(1)(a), the claimant is owed £402.60 arrears of pay in respect of the monies unpaid by the first-named respondent company to the pension provider.  This claim is well-founded and agreed by the claimant and the second-named respondent. 

19.	Accordingly, pursuant to Article 233(3) of the 1996 Order, the tribunal declares the claimant is owed £402.60, and – by consent of the second-named respondent – orders that a percentage of such amount be paid the claimant by the             second-named respondent.  It is agreed by the claimant and the second-named respondent that such percentage is to be calculated by the second-named respondent and accepted by the claimant.

20.	The tribunal considered the claimant’s application for a preparation time order pursuant to Rules 44 - 45 of Schedule 1 to the 2005 Rules.  The tribunal received a large amount of documentary evidence from the claimant in this regard, and pursuant to Rules 45 (1) - (2), estimates that a reasonable assessment of the preparation time for the claimant was six hours.  Pursuant to Rule 44(3), the tribunal is satisfied that section 6.2 of the first respondent’s response indicated that the claim of £402.60 was not due and owing, and did so in strenuous and extravagant terms which later turned out to be entirely misleading.  By causing the claimant to prepare for the hearing to prove his claim in this regard, the first respondent company has put the claimant to avoidable inconvenience and preparation, and thus has conducted these proceedings in a misconceived and unreasonable manner.  Having had regard to the statement from the liquidator that there are funds in the first respondent company following the sale of its assets, the tribunal satisfied the requirements of Rule 45(3) of the 2005 Rules.  The tribunal has stated that it estimates the amount of time spent by the claimant was six hours.  Applying the provisions of Rule 45(2), the claimant’s preparation time is assessed at six hours @ £25.00 per hour  =  £150.00.  Accordingly, the tribunal now makes a preparation time order for costs in favour of the claimant, and against the first respondent in the amount of £150.00.

21.	No other or further order was sought or is now made.

22.	This is a relevant decision for the purposes of the Industrial Tribunals (Interest) Order (Northern Ireland) 1990.

Chairman:

Date and place of hearing:	8 December 2006, Belfast

Date decision recorded in register and issued to parties: