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Court of Appeal Case Considers the Apportionment of Compensation Under the Agency Workers Regulations 2010

In the recent Court of Appeal (“CA”) case of London Underground Ltd v Amissah and Ors [2019], it was held that the approach of both the Employment Tribunal (“ET”) and the Employment Appeal Tribunal (“EAT”) were wrong in relation to their assessment of compensation.

The Claimants were employed by Trainpeople.co.uk LTD (“TP”), a company now dissolved, which supplied temporary workers. TP provided the Claimants’ services to the appellant and hirer, London Underground Ltd (“LUL”). When TP’s contract with LUL came to an end, the workers brought a claim against both of them for breach of Regulation 5 of the Agency Workers Regulations 2010 (“AWRs”), which provides that workers “shall be entitled to the same basic working and employment conditions” as employees. The employment judge confirmed that the workers’ claims were well-founded. LUL had paid TP all of the sums due to the Claimants by the time the claims were brought but that money had not been paid on time and the sums were not paid to the Claimants by the agency (TP went into insolvency).

Employment Tribunal

The employment judge concluded that LUL’s liability was 50%. He reached this conclusion by firstly considering Regulation 14(2) which provides that the hirer may be liable for any breach of Regulation 5 “to the extent that it is responsible for that breach”. LUL were criticised for being too slow in ensuring that TP back pay the Claimant’s the sums due. The employment judge then considered Regulation 18(9) which provides that the compensation payable by each respondent should “be just and equitable having regard to the extent of each respondent’s responsibility for the infringement to which the complaint relates”. Ultimately, the judge found that even if the under-payment were attributable to the infringements found, for which LUL had been 50% liable, it would not be just and equitable for LUL to compensate the Claimants. The Claimants’ succeeded on an appeal to the EAT, which ordered the issue of remedy to be remitted.

Court of Appeal

LUL appealed to the Court of Appeal. The CA considered Regulation 14(2) and 18(9) which require the tribunal to assess the extent to which the agency and hirer are responsible for the breach. The CA confirmed that it was wrong for the employment judge to hold that justice and equity required that LUL should not pay the claimants compensation. While it was recognised that LUL funded TP to pay the arrears, this did not mean that it was just and equitable to deprive the claimants of the compensation due. The CA confirmed that the amount of compensation payable by LIL would be 50% of that assessed under Regulation 18(10) which provides that the amount of compensation to be that which is just and equitable having regard to the infringement and the loss attributable to that infringement.

This bulletin is for general guidance purposes only and should not be used for any other purpose.

Brabners is a Limited Liability Partnership