Council Loses Tribunal Case

Douglas Council has been ordered to pay an employee over £5,000 for unlawful deductions from his salary.

William Pye, who has worked for the Council for 36 years, had gone on holiday to Cyprus in March last year and was due to be back on the island two weeks later. However as Cyprus closed its borders shortly after he arrived, he found himself stuck on the island for over three months.

Mr Pye (the complainant) was finally able to leave Cyprus on July 1, arriving back on the Isle of Man the day after and, after completing isolation, he returned to work on July 20. Based on two sick-notes from his doctor, whilst in Cyprus, he was paid sick-pay equal to his normal pay. Although sick-pay entitlement under his second sick-note lasted longer, the Council (the respondent) stopped paying from July 5.

In his judgement, tribunal chairman Douglas Stewart explained: ‘For the first time, on July 8, the Respondent challenged the Complainant’s entitlement to have received any sick pay. To recoup that outlay, for weeks beginning July 5 and July 13, the Respondent did not pay the Complainant anything and from then on, the Respondent continued to claw back the sick-pay at the rate of £100 per week until fully reimbursed.’

Through the tribunal, the Council argued that Mr Pye’s trip to Cyprus, which he took every year with his mother returning with him to spend her summer on the Isle of Man, was a reckless decision as Cyprus had declared a state of emergency. However as pointed out during the tribunal, that was not declared until after he arrived. 

Furthermore, the report says ‘there had been no warning from the Manx Government or from the Respondent to those scheduled to travel on or about March 13 that there could be adverse consequences involving their pay and/or holiday entitlement – least of all that travelling off-island would be considered as reckless’.

The Law

Pivotal to this tribunal was whether an exception to the Employment Act 2006 permitted the Council to make what would otherwise be unlawful deductions from wages. The section is designed to prevent employers wrongly making deductions from wages in a variety of situations. Essentially, the tribunal’s focus was whether the Council could lawfully reimburse itself by deducting from Mr Pye’s wages based on the argument of overpayment of wages.

Conclusions

During the first wave of Covid, the Manx gov had used its Emergency Powers to create a category of ‘vulnerable persons’.

Mr Stewart’s report says: ‘The Complainant had been certified as within that category by the GP ensuring an entitlement to self-isolation. This would have been so, whether the Complainant was at home or in Cyprus. These third-party actions were the cumulative reason for the Complainant failing to report for work between March 31 and July 20. All these third- party actions were beyond his control.’

It added: ‘The Tribunal declares that, pursuant to section 25 of the Employment Act 2006, the Complainant suffered unlawful deductions in the sum of £3,536.18.’

The tribunal also awarded Mr Pye four week’s salary in compensation, giving a final total award of £5,208.54.

Leave a Reply