Husband and wife dispute pay in the Employment Tribunal
Judgment was handed down today in the case of Roman v A Plus Care Ltd, an unusual case concerning whether or not there was a legally enforceable agreement over pay between a husband and wife. Mrs Roman claimed to be an employee of her husband’s business, A Plus Care Ltd. Shortly after the couple’s marriage broke down and Mr Roman allegedly terminated his wife’s engagement with the company, Mrs Roman issued him with an invoice for over £62,000, claiming to represent over 5500 hours of unpaid overtime.
She issued a claim for unlawful deductions from wages based on a purported oral agreement between the couple to the effect that she would be paid up to 79 hours of overtime per week for being in receipt of an “on-call” mobile phone. On the face of it, this claim would have been presented outside the three-month time limit for submitting claims under section 23(2) of the Employment Rights Act 1996. However, Mrs Roman claimed that it was a term of the agreement that all overtime would only be paid at the end of the financial year and so time ran from this later date.
After hearing two days of evidence, Employment Judge Pritchard found there had been no agreement as to the payment of overtime. He found Mr Roman’s evidence to be wholly credible but found Mrs Roman’s evidence lacked clarity and provided “no credible explanation as to how the Claimant calculated her hours of overtime for which she invoiced”.
Moreover, the Tribunal accepted the Respondent’s point that it would have been highly unlikely Mr Roman would have reached an agreement with his wife to pay her overtime at the end of the financial year given the sums in question. The overtime element would be nearly three times Mrs Roman’s basic wage and provided an overall income of in excess of £100,000. The effect of such a payment would have negated the company’s annual profit at that time and would have made no commercial sense.
Even if an agreement had been reached, EJ Pritchard held that it would not have constituted a legally binding one as, on Mrs Roman’s evidence, the arrangement appeared to be no more than a device to keep profits within the family. The agreement would have fallen squarely within the domestic arena and would not have been one intended to create legal relations. Moreover, as Mrs Roman’s evidence suggested the promise to pay overtime was seemingly conditional upon profits being made, any agreement would also have failed for a lack of legal certainty.
The Employment Judge also found that, assuming Mrs Roman was an employee as she claimed, there would have been a termination of her employment much earlier than she had suggested. An objective observer reviewing Mr Roman’s earlier email correspondence with his wife would have come to the firm conclusion that he had unequivocally terminated her employment shortly after the marriage broken down. It followed from these facts that Mrs Roman’s claim was presented out of time as the time limit would have run from the last payment of wages and not, as she had claimed, from the end of the financial year.