Energy start-up ordered to pay former finance boss £65k

Thursday 21 March 2019

A renewable energy-start up brought to the island by Locate Jersey has been ordered to pay its ex-finance boss £65,000 in unpaid notice period wages after they sacked him amid company money struggles.

The Royal Court ruling against Strada Drilling comes ahead of a wider trial over disputed earnings its former Chief Financial Officer, Paul Gothard, says are owed to him.

Ahead of that trial, the Master of the Royal Court ordered the company to pay him over £65,000 in wages due for his four months’ notice period after he was placed on garden leave when the company was struggling financially.

The dispute between Mr Gothard and Strada Drilling - part of a company called Strada Energy, which was brought to the island by Locate Jersey that seeks to bring high revenue companies to the island - dates back to 2017 when they fired him.

Having already been the subject of an Employment Tribunal hearing, which also ruled in Mr Gothard’s favour, the circumstances of his dismissal are now become the subject of further proceedings in the Royal Court.

Pictured: Paul Gothard's dismissal has already been the subject of an Employment Tribunal hearing which ruled in his favour.

For his role as Chief Financial Officer, Mr Gothard was on an annual salary of £200,000, but parts of his 2017 salary were in arrears due to an accruement arrangement with his employers.

Mr Gothard’s claim is two-fold: seeking both the remainder of salary he agreed to accrue until the company could afford to pay him, as well as wages for nearly four months he spent on notice of being fired when he was placed on garden leave. In total, this amounts to £91,758.82.

The Master of the Royal Court Advocate Matthew Thompson – who is tasked with reviewing civil claims brought before the Court to ascertain whether the dispute warrants a trial – considered both aspects.

Mr Gothard told the court in an affidavit that his letter of dismissal “clearly stated” that he should have been paid as normal until his last day of work. He says: “It was my clear understanding that by my final day of employment I would be paid in full.”

Pictured: Director of Strada Drilling Warren Strange told the Employment Tribunal that the agreement was always that Mr Gothard would be paid "as and when the company could afford it". (Locate Jersey)

But company director Warren Strange gave a witness statement as part of the Tribunal proceedings which said that the agreement between himself and Mr Gothard was always that he would be paid “as and when the Company could afford it".

Mr Gothard’s lawyer, Advocate Matthew Jowitt, however, argued that “any such agreement… did not apply to salary payable during the notice period”. 

Responding on behalf of the company, Ben Strange maintained that the original agreement also applied to the notice period pay and that because this is “a factual dispute”, the company “should have the benefit of a trial to argue all matters in dispute”. Mr B Strange also “reminded [the Master of the Royal Court] that [he] should not conduct a mini trial” and that the company “should be allowed to file further evidence". 

Ultimately, the Master ruled that although Mr Gothard’s claim for salary which he agreed to accrue whilst he was employed is a matter for trial, there was no defence for accruing wages due for his notice period. 

Pictured: The dispute has escalated to the Royal Court.

The Master subsequently ruled in Mr Gothard’s favour, awarding him the £65,704.80 in arrears from his notice period May to August 2017 – an amount including the unpaid wages as well as Strada Drilling’s social security contributions as an employer.

In his judgment, Advocate Thompson noted: “…[Strada Drilling] had every opportunity to respond to the plaintiff’s first affidavit but did not do so… That was the defendant’s opportunity to set out what its case was and to provide the necessary detail to persuade me that there was an issue for trial.

"In the absence of any said evidence there is no issue that requires determination by the Royal Court.”

Having made this decision, the Master ordered Strada Drilling to pay Mr Gothard the amount due for his notice period together with costs. 

The case continues.