M Fraser v. South West London St George’s Mental Health Trust
Employment Appeal Tribunal
At the start of the substantive tribunal hearing of discrimination claims, a mental health trust was entitled to argue that the employment tribunal lacked jurisdiction because of the employee's failure to raise a grievance, notwithstanding that the point had not been pleaded prior to the hearing. An employee who had been on long-term sick leave would only be entitled to statutory holiday pay under the Working Time Regulations 1998 reg.16 where she had actually taken leave in respect of which she sought to be paid by giving her employer notice of her intention to take annual leave under reg.15.
The appellant employee (F) appealed against the dismissal of her claims for discrimination and unpaid statutory holiday pay against the respondent employer mental health trust.
F, a nurse, had gone on long-term sick leave and never returned to work following a knee injury in an accident at work. After her entitlement to sick pay expired she received no pay until the trust had resumed salary payments when she had been certified fit to return to work. The trust ceased paying her salary when it was unable to find work for her, and finally dismissed her. F brought several claims, including for non-payment in respect of her holiday entitlement for the period between the cessation of her sick pay and the resumption of her salary, and for discrimination on grounds of disability and age. In F's claim form for discrimination she asserted that she had raised a grievance relating to the discrimination, and that assertion was not denied in the trust's response form. At the start of the substantive hearing in the employment tribunal the trust took the point that F had not complied with the Employment Act 2002 s.32(2), which was in force when F made the complaints, because she had not raised a grievance in relation to her discrimination claims and so the tribunal had no jurisdiction to entertain the claims. The tribunal accepted that argument and dismissed the discrimination claims. The tribunal also dismissed the claim for statutory holiday pay on the basis that F did not "take leave" during the relevant leave years as she had not given notice under the Working Time Regulations 1998 reg.15 of her wish to do so.
F submitted that the tribunal had erred in law because (1) it was too late for the trust to take the non-compliance point in respect of her discrimination claims; (2) there was no requirement to take leave in order to qualify for statutory holiday pay under reg.16(1) , and if there was such a requirement the trust had breached its implied duty of trust and confidence by not informing F of that requirement.
HELD: (1) The trust was entitled to take a point on non-compliance under s.32(2) at the commencement of the substantive hearing notwithstanding that it had not been pleaded in the response form or at any time prior to the hearing. The effect of s.32(6)(b) was that a compliance issue could be relied on provided it was raised before the tribunal started considering the merits of the complaint, Glasgow City Council v Stefan Cross Claimants applied. An absolute bar to a claim being raised arose only once the tribunal had commenced its consideration of the substantive issues in the case. That had not happened in the instant case: the trust had left it to the last possible moment, but it remained on the right side of the line (see paras 11-12 of judgment). (2) F's entitlement to holiday pay depended on her having given the trust proper notice under reg.15 of her intention to take annual leave, which she had not done, Brown v Kigass Aero Components Ltd  I.C.R. 697 applied, List Design Group Ltd v Douglas  I.C.R. 686 and Canada Life Ltd v Gray  I.C.R. 673 not followed, Pereda v Madrid Movilidad SA (C-277/08)  E.C.R. I-8405 considered. List and Canada Life had been wrongly decided on the point; it could not be right for employees to receive holiday pay for leave they had not taken. It might have appeared artificial for F, who was not at work anyway, to have to give notice of an intention that part of her absence should count as holiday, but that merely reflected the artificiality of a period of long-term sickness counting as holiday at all. The giving of notice was more than a formality, because without it an employer, who was not otherwise paying an employee, or who was only paying sick pay, would not know whether or when it was obliged to make any payment under reg.16 (paras 25, 27, 30). The trust was not in breach of the implied term for not informing F of her right to take annual leave while on sick leave because the entitlement to take holiday arose as a matter of general law and not of contract, and there was no duty to advise F of her rights as a matter of general law, Scally v Southern Health and Social Services Board  1 A.C. 294 considered (para.37).
Counsel for the respondent: Andrew Midgley, instructed by Capsticks.
 IRLR 100