Breach of contract / illegal deduction of wages

[Manccat250685]

Hi there if possible I would like some advice on a current situation that I am involved in. I have recently left an employer after a two week period of gardening leave. Myself and my employer supposedly “mutually agreed” this as an exit strategy due to “performance issues”. I have less than two years service so I can’t claim on that front. My issue is that contractually I am entitled to a company car, shortly before my gardening leave commenced I was verbally told that my car would be allocated to a colleague and that I would need to return this before my gardening leave commenced and I would be paid car allowance instead. There is no mention of car allowance in my contract. The part that really irks me is that I recieved a leavers letter detailing that £120 was deducted from my final pay due to the car not being cleaned before it was returned as they believe I have broken a contractual term! Now the deduction was made from my final pay - this was made whilst I was still on gardening leave. I would consider this an illegal deduction of wages but I wanted some advice on this. There is a clause in my contract about deductions which states “if at any time money is owed and payable by you to the company you agree that the company may deduct from your pay” some examples are then listed but it is not listed to those. I have tried to resolve this through ACAS but the organisation would not engage with this so I have my conciliation certificate. As an additional I am also owed £160 in expenses, I have chased these and have a text message from my previous line manager to confirm that she has authorised these but cannot confirmed when they will be paid. I do not have any other audit trail as this was all on my Works laptop which was handed back prior to gardening leave. I understand that my next step would be an employment tribunal claim - any advice on my chances of success would be gratefully recieved!

[ULA]

Hi, there are a couple of things to provide a response to on your thread so I will deal with them one at a time.

Firstly, employees are entitled to full pay and benefits during periods of garden leave. However, an employer may be entitled to ask for the return of items such as a company car where it is purely a tool of the job and provided for business use only. Where the company car is a contractual benefit for personal use as well, the employer should not seek the return of the car until the end of the garden leave period, unless there is a specific term in the contract of employment requiring the employee to return them during a period of garden leave. So if you were allowed personal use of the car and there is no contractual clause allowing the company to request return of the car prior to the end of your garden leave, I am presuming that as compensation for the loss of a contractual benefit the company sought to provide you with a monetary value to be paid as part of your final salary.

What did any company car policy or clause in your contract state about the return of a company vehicle and the condition it needed to be in? Have they justified the £120 by giving you a breakdown of how this sum was arrived at? The clause you have quoted is a perfectly legal clause and is often quoted in contracts of employment and against which the company has the right to make deductions from final salary for sums owing. A company can provide an example list of things that will typically be covered by such a clause but it is not intended that it will be exhaustive and cover every eventuality that may arise.

What I suggest you need to do now, before progressing your claim, is get a copy of the policy/clause regarding the condition of a car on returning it and the breakdown of the £120 from the company. Also find out where in the authorisation process your expenses claim is and when it might get paid.

You need to get this information as soon as possible because you need to be in a position to know whether a claim would be viable within the timescales you have to proceed otherwise it will be out of time.*

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[Manccat250685]

Thanks so much for this, I have chased my expenses. in terms of the deduction I will get hold of a copy of the p9licy however it states in my employment contract that no policies are contractual. In my leaver letter it states that the amount was deducted from my final pay due to “it being considered a break in my contractual terms” I’m just wondering if they will use the deduction clause as justification for the deduction? The letter stated that the receipt for the cleaning of the car was enclosed but it wasn’t.*

[ULA]

It will depend on what is written in the company car policy so it will be interesting to get a copy of it. By making a policy such as car policy non-contractual it means that they can amend it, giving reasonable notice of any changes, without having to get your agreement to the changes.

Do you have any idea what they mean by "it being considered a break in my contractual terms"?

If they did not enclose the receipt for cleaning then that is something you need to let them know and request a copy.

[Manccat250685]

Hi there

thanks again, I have got a copy of the policy it doesn’t say anything about costs just “it is the employees responsibility to keep the vechile in good repair and maintain Road worthy conditions complying with legal requirements”.

No idea about the break in contractual terms! From my perspective there is no contractual term which covers cleaning a company car before return! I have managed to get a e receipt for the cleaning of the car. Essentially it was valeted by a mobile company who seem very expensive, they haven’t done anything but clean the car.

any further advice would be gratefully recieved!

[ULA]

How dirty/untidy was the car when you returned it?

So other than the e-receipt for the cost of cleaning which I assume is not £120 has the company provided any other evidence of what they needed to do to the car to bring it back to the level required in

the clause " it is the employees responsibility to keep the vehicle in good repair and maintain Road worthy conditions complying with legal requirements”.

If you do not have all the information to understand how the total amount of £120 was arrived at, then I suggest emailing the company and asking for the extra information you need and pointing out if they have made the deduction based on that clause then they need to fully justify the amount. Give them a timescale in which to respond e.g. 5 working days and say that if they have not responded in that time you will continue with a claim to the employment tribunal for unlawful deduction of wages and for the unpaid expenses.

Please though double check my suggested timescales keep you within the time limits for making a claim to the tribunal.

[Manccat250685]

Thanks for this - sorry if I wasn’t clear the e receipt was for £120 but I checked on the company’s website and their prices start from £85 to do a mini valet on a car.

i did remove all rubbish and personal items from the car wiped it down and gave it a quick hoover before return.

I have also enquired about about my expenses which are apparently being processed but I cannot be given a timescale for payment due to the current situation with regards to covid.

my understanding is that I have 12 weeks to make a claim from the point of the deduction being made, I have a fair bit of time yet.

[ULA]

Sounds like they had the full bells and whistles valet, however they have provided proof of the spend of £120. What it will come down to is whether or not that cost is justifiable v the condition of the car when you returned it and the requirements of the clause you have detailed.

You have three months less a day from the time of the deduction, however you will have a minimum of month from the date of the early conciliation certificate so please check.