Article

Deductions depend on contract terms

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Article by

Helen Webster

Helen Webster

Issue

A worker may bring a claim for ‘unlawful deductions from wages’ in respect of any outstanding payments due under the contract of employment. Quantum meruit means "the amount deserved" or what would be a reasonable sum in respect of services supplied. The question in the case of Abellio East Midlands Ltd v Thomas was whether a claim for unlawful deductions could be based on a quantum meruit claim in respect of work carried out which was over and above that required by the contract.

Facts

Mr Thomas, an Area Manager, agreed to take responsibility for a larger and more complex location on the basis he would get a £10,000 per annum pay rise. Mr Thomas began in the new post but was offered only a £6,000 pay rise. He did not accept this and complained that the previous manager for the area had been on £10,000 more and the job had been formally evaluated at that rate. No agreement was reached and he claimed unlawful deductions from wages for the extra duties performed.

Decision

It was held that Mr Thomas had started a different and more demanding role and a quantum meruit may be recoverable for the provision of services beyond the scope of those provided for in the existing contract. However the statutory claim for unlawful deductions had to be limited to ‘wages’ which was basically ‘consideration for work done or to be done under a contract of employment’. A claim for work done which falls outside and goes beyond the scope of the contract could not fall within that definition.

Key points

The decision means that a quantum meruit claim cannot be brought under the unlawful deductions provisions of the Employment Rights Act 1996. It would have otherwise been difficult to identify how much and when sums became ‘properly payable’ under the statutory provisions. It might be possible for the quantum meruit claim to be brought in the civil courts but it was outside the scope of the statutory jurisdiction available in the Employment Tribunal.

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