Contractor ordered to pay engineer over £2,000

Wednesday 05 October 2022

A building contractor business has been ordered to pay more than £2,000 to a former employee for three separate claims for unpaid wages, holiday pay and compensation for the failure to provide payslips.

Plumbing and heating engineer Spencer Ricketts worked for contractor company Inline Group for one year between February 2021 to February 2022.

On 25 March 2022, Mr Ricketts submitted a Claim Form to claim holiday pay, unpaid wages, no payslips, and no terms of employment from his former employee.

David Harper, a director of Inline, denied the claims and issued a counterclaim for money that had been paid to Mr Ricketts to buy parts that were never received.

Chairing the Tribunal, Dr Elena Moran found that "Mr Ricketts was provided with a written statement of his employment" in February 2021 and therefore the "no terms of employment" aspect of Mr Ricketts’ claim fails. However, the claims for holiday pay, unpaid wages, and no payslips were found to to be true.

Pictured: Dr Elena Moran chaired the Tribunal.

Article 51 of the Law requires an employee to be give a written itemised payslip at or before the time of payment, which must contain the net amount of wages payable.

Mr Harper of Inline claimed that “all payslips were sent electronically each month”, however Mr Ricketts was paid weekly so should have received weekly payslips. The Tribunal also found that "the payslips are defective in that they do not state the net amount of wages payable".

Mr Harper accepted that even these monthly payslips had never been provided to Mr Ricketts, explaining that "the wrong email for Mr Ricketts was entered into Quickbooks". His explanation for the lack of weekly payslips was that he was one person running the business by himself and that the staff wanted to be paid on a weekly basis. 

In her judgement, Tribunal Chair Dr Elena Moran described this as a "moderately serious breach of Article 51", explaining that there was a "deliberate decision on the part of Mr Harper not to issue weekly payslips and even the defective monthly payslips were not sent to Mr Ricketts".  It was noted that the lack of payslips lasted for more than a year.

However, Dr Moran accepted that there was"no evidence of any prejudice to Mr Ricketts' and Mr Harper informed the Tribunal that he is now using a professional payroll provider.  For the lack of payslips, Mr Ricketts was awarded compensation amounting to two weeks’ pay which totalled £888.

In reference to the lack of holiday pay, Dr Moran concluded that the "contract fails to comply with the statutory holiday provisions in Articles 11 and 13 of the Law" as the 4% holiday pay was included with Mr Ricketts' hourly pay instead of being added on top. Inline therefore had to pay Mr Ricketts an additional 4% for hours worked in 2021 and an additional 6% for hours worked in 2022 which equalled a total of £937.75.

There was also a dispute over a week's worth of unpaid wages. Mr Ricketts said that, on Saturday 19 and Sunday 20 February 2022, he worked two full days on a site. However, Mr Harper said he was informed by the block layers that Mr Ricketts left the site half an hour after opening, however he "produced no emails or other evidence from the block layers to this effect" and Dr Moran therefore concluded that Mr Ricketts had worked these days.

The parties agreed on the hours worked for the rest of the week apart from on Thursday 24 February, but WhatsApp messages proved that Mr Ricketts worked for 1.5 hours on this day.

The total hours that had been worked for the week were 37.5. Applying an hourly rate of £22.50 per hour plus a holiday uplift of 6%, Mr Ricketts was awarded a total of £894.38 in unpaid wages.

Mr Harper counterclaimed for money that had been paid to Mr Ricketts to buy parts that were never received. It was proved that Mr Ricketts received two payments into his bank account to pay for parts in February 2022 totalling £580.

Although there is proof Mr Ricketts did purchase these parts, he later returned all but two parts and received a cash refund.

Mr Ricketts says that he obtained refunds because he spent much more than £580 and he didn’t want to use his own money, so he took the parts back and then bought new parts on a priority basis.

The fact that Mr Ricketts returned all but two of the parts for cash means that the burden shifts onto him to prove that he later bought parts for use in the construction. He was unable to prove that he later purchased any parts used in the construction, apart from the two parts that were not returned by him initially.

Dr Moran explained that Mr Ricketts "could have done so by requesting duplicate invoices from the suppliers or producing the relevant entries from his bank account", but he "did neither" and the Tribunal therefore decided that Mr Ricketts must repay Inline £580 minus £63.80 which totals £516.20.  

Overall, the Tribunal concluded Inline must pay Mr Ricketts £894.38 for unpaid wages, £937.75 for holiday pay and £888 for the failure to provide payslips making a total of £2,720.13. Although Mr Ricketts owes £516.20 to Inline, the net result is that Inline must pay Mr Ricketts a total of £2,203.93.

HR Now, a business which provides external HR support to other businesses, said that this case "highlights the struggles that many businesses have in dealing with issues arising from employment and discrimination legislation, but especially small businesses who often have no professional HR advice and support in place."

Pictured: Becky Hill, CEO of HR Now, said small businesses may not be "familiar with the small print" contained in articles of employment legislation.

CEO Becky Hill added: “It’s not surprising that often small businesses, some of which might only have one person as owner/manager, are not familiar with the small print in Articles contained in what are very specialised and legalistic documents.

"And add to this the fact that there are regular amendments and changes to the law which require the business to keep informed about. It’s essential that organisations employing people invest in getting their staff handbooks, contracts, and processes compliant with the law, otherwise it could end up costing them far more in a tribunal claim.”