THE INDUSTRIAL TRIBUNALS

CASE REF:	1817/07

CLAIMANT:			Christopher Paul Edwards

RESPONDENT:		LexZander Limited

DECISION ON A PRE-HEARING REVIEW

An industrial tribunal does not have jurisdiction to entertain the claimant’s claims because those claims were the subject of an agreement of the type which is specified in Article 245(2)(e) of the Employment Rights (Northern Ireland) Order 1996.

Constitution of Tribunal:

Chairman:		Mr P Buggy (sitting alone)

Appearances:

The claimant appeared in person.

The respondent was not present and was not represented.

REASONS

1.	The respondent had notified the Office of the Tribunals that the respondent did not intend to be present at this hearing.  In those circumstances, I decided to proceed with the hearing, even though the respondent was not represented.  In disposing of this pre-hearing review (“PHR”) I took account of the documentary information which had been provided by both parties in connection with this matter.

2.	In these proceedings, the claimant made claims in respect of holiday pay, in respect of unpaid wages and in connection with entitlements to paid annual leave.

3.	On 14 January 2008, the Office was notified that a settlement had been concluded between the parties “… of the tribunals as a result of conciliation action by the Labour Relations Agency”.  I construe that message as including two statements.  First, that a settlement had been concluded between the parties.  Secondly, that the settlement was concluded pursuant to action taken by the Agency under Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996.

4.	The question which I have had to determine in the context of this PHR is whether the claimant can continue with his industrial tribunal proceedings, or whether the “settlement” (as notified in the LRA message) prevents him from doing so.

Key legislative provisions

5.	Article 245(1) of the Employment Rights (Northern Ireland) Order 1996 (“ERO”) states what amounts to a general rule.  According to Article 245(1), any provision in a settlement is void in so far as it purports to preclude a person from continuing any proceedings before an industrial tribunal.

6.	However, as Article 245(2) makes clear, that general rule is subject to a number of specified exceptions.  The only such exception which is relevant in the circumstances of this case is the exception which is listed at Article 245(2)(e).  According to Article 245(2)(e), the general rule, as stated in Article 245(1)

“does not apply to any agreement to refrain from instituting or continuing proceedings where the [LRA] has taken action under Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996.”

The issues

7.	The claimant accepted that the LRA had indeed taken action under Article 20 of the Industrial Tribunals Order (“ITO”).

8.	Accordingly, the issues I have had to determine were as follows.  First, was there indeed an “agreement” within the meaning of Article 245(2)(e).?  Secondly, did that agreement incorporate a commitment on the part of the claimant to refrain from continuing his tribunal proceedings?

The facts

9.	In the course of this PHR, the claimant gave evidence on oath.  I accepted the truthfulness of his testimony.  I find the facts as follows.

10.	A settlement was entered into between the parties on 14 January 2008.  No document incorporating all the terms of settlement was ever signed by both parties.  However, the terms were as set out in a document which the claimant signed on 18 January 2008.  According to those terms, the respondent was to provide the claimant with £2,777.68 in “full and final settlement of these proceedings”.  The following were also terms of the agreement:

“4.	Upon payment of the said sum the Claimant shall withdraw his claim to the Industrial Tribunal.

5.	The respondent shall pay the aforementioned sum within 21 days of completion of this document”.

11.	In a letter dated 7 April 2008, addressed to the Office of the Tribunals, the respondent confirmed that, as part of the terms of the settlement, it was under an obligation to pay the claimant the sum of £2,777.68.

12.	The respondent has not paid the sum due under that settlement.

The arguments

13.	The claimant has argued that he should not be bound by the settlement.  When the agreement was being brokered by the LRA, the claimant was not explicitly informed that if the respondent failed to pay pursuant to the agreement he would nonetheless not be entitled to continue with his Tribunal proceedings.  He was under the impression that the proceedings could be revived if the respondent did not pay.

Discussion and conclusions

14.	Although the claimant subjectively was under the impression that he could continue with the proceedings if the respondent did not pay, the actual terms of the agreement did indeed contain an implied unconditional provision, as part of the agreement, that the claimant would not continue his tribunal proceedings.  I have arrived at those conclusions for the following reasons, and against the following background.  

15.	First, I am satisfied that the agreement incorporates a provision that the claimant will refrain from continuing with the proceedings because the agreement is stated to be in “full and final settlement of these proceedings…”.

16.	Secondly, I am satisfied that the agreement provision was unconditional because paragraph 4 deals only with the mechanics of when the formal process of withdrawal notification will be undertaken (as distinct from leaving open any question as to whether there will be a withdrawal).

Implications for the claimant

17.	According to the terms of settlement, the respondent was to pay the settlement money within 21 days “of completion of this document”.  Accordingly, by mid-February 2008 at the latest, the respondent became the claimant’s debtor in respect of that sum.

18.	Because of the settlement, the claimant has ceased to have the right to pursue his claims in an industrial tribunal.  Instead, the settlement (in substitution for that right to pursue the claims) has conferred upon him the right to receive payment of the agreed settlement sum.  He can enforce that substituted right as a debt in the County Court.

19.	If the claimant now seeks to recover that sum in the County Court, he may also be able to claim interest in respect of the unpaid amount from mid-February 2008 to the date of judgement.  He should also be able to seek recovery of any legal costs incurred by him in those County Court proceedings.  And if the respondent does not contest the proceedings, there may be no need for the claimant to be present to give evidence.

20.	Accordingly, the outcome of this PHR does not leave the claimant without any means of recourse against the respondent.  Far from it.  

General comments

21.	As I have already noted above, the Article 245(2)(e) exception to the general rule (that you cannot contract out of your entitlement to bring proceedings before an industrial tribunal) is applicable only to an agreement “to refrain from instituting or continuing proceedings”.

22.	The settlement in this case did not include such a clause.  However, because of the factual circumstances of this case, I was satisfied that such a provision was an implied term of settlement.  That conclusion reflects the particular facts of this case.

23.	No doubt, in some cases in which relevant terms of settlement do not include an explicit agreement to refrain from instituting or continuing proceedings a tribunal may well conclude that the agreement cannot be construed as containing such an applied term.

24.	Against that background it seems to me that it would be best if any relevant agreements contained an explicit statement that the settlement incorporates an agreement to refrain from instituting or (as the case may be) continuing industrial tribunal proceedings.

Chairman:

Date and place of hearing:	20 August 2008, Belfast.

Date decision recorded in register and issued to parties: