The claimant went on long term sick leave in 1999 and never returned to work. The respondent contended that he was made redundant in February 2000. The respondent went into administration in November 2000. The claimant subsequently claimed a sum in excess of £1.5 million on account of withheld wages up to his notional retirement in 2008, and unpaid pension thereafter. The ET held that there was no jurisdiction to determine his claims for unlawful deductions because they were out of time and there were, when properly analysed, claims for damages for breach of contract and outwith the statutory regime for unlawful deductions claims. Additional questions related to the date when the claimant's employment had been terminated and whether the administrators had adopted his contract of employment. The claimant appealed.

The EAT dismissed the appeal. No error of law was identified in the ET's decision.

Appeal No. UKEAT/0241/11/JOJ

EMPLOYMENT APPEAL TRIBUNAL

FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8JX

At the Tribunal

On 19 January 2012

Judgment handed down on 14 March 2012

Before

THE HONOURABLE MRS JUSTICE COX (SITTING ALONE)

MR A E ALLSOP (APPELLANT)

CHRISTIANI & NIELSEN LTD (IN ADMINISTRATION) (RESPONDENT)

Transcript of Proceedings

JUDGMENT

For the Appellant
MR A E ALLSOP (The Appellant in Person)

For the Respondents
MR SIMON DEVONSHIRE  (One of Her Majesty's Counsel)

Instructed by:
Gateley LLP
Fleet Place House
2 Fleet Place
Holborn Viaduct
London
EC4M 7RF

JURISDICTIONAL POINTS – Claim in time and effective date of termination

UNLAWFUL DEDUCTION FROM WAGES

The Claimant appealed against the Employment Tribunal's determination at a Pre-Hearing Review that there was no jurisdiction to determine his claims for unlawful deductions from wages, on the basis both that (1) they were out of time and (2) they were, when properly analysed, claims for damages for breach of contract and outwith the statutory regime for unlawful deductions claims.

Additional questions related to the date when the Claimant's employment had been terminated, and whether the Administrators (the Respondents having gone into administration) had adopted his contract of employment.

No error of law was identified in the ET's decision and the appeal was therefore dismissed.THE HONOURABLE MRS JUSTICE COX

1. The Claimant, Alan Allsop, who has represented himself before the Employment Tribunal since May 2001, is appealing against the Judgment of Employment Judge Goodier, sitting alone on a Pre Hearing Review at the Birmingham Employment Tribunal on 28 February 2011.

1. In that Judgment, promulgated with reasons on 7 March 2011, the Employment Judge held:

(1) that the Claimant's complaints of unauthorised deductions from wages, save that in respect of PHI cover, were presented out of time, that it was reasonably practicable for them to have been presented in time, and that the Tribunal therefore lacked jurisdiction to hear them;

(2) that the Claimant's claim of unauthorised deductions from wages in respect of PHI cover was in substance a claim for damages for breach of contract, and that the Tribunal lacked jurisdiction to entertain it; and

(3) that the Claimant's application for leave to amend his Originating Application to assert further claims should be refused.

1. The Claimant's claims were therefore dismissed. He had previously withdrawn a further complaint of disability discrimination.

1. This litigation has a complex and protracted history. The relevant background is as follows, and it is necessary to set it out in some detail so that the issues arising on this appeal may be properly understood.

1. The Claimant is an engineer who was employed by the Respondents as a Senior Projects Manager from 1969. For much of his employment from 1984 onwards he was seconded to work abroad, from 1994 as General Manager of CN (Malaysia). On his return to the UK he accepted a new post with the Respondents, working on specific projects at the UK headquarters.

1. In June 1999 the Claimant commenced a period of long term sick leave, and he never returned to work. What then happened between August 1999 and October 2000, when he lodged his ET1 (his Originating Application as it was then), was the subject of considerable dispute.

1. In his ET1, lodged on 5 October 2000, he made claims under the Disability Discrimination Act 1995 and claims for unlawful deductions from wages under Part II of the Employment Rights Act 1996. He did so on the basis that his employment was then continuing.

1. The Respondents resisted those claims on various grounds, including the ground that the Claimant's employment had terminated in February 2000, and that his claims were therefore out of time.

1. What then happened is that the Respondents went into administration on 17 November 2000, and the Tribunal proceedings were stayed. The Claimant subsequently sought to prove in the administration in the sum of over £1.5 million on account, allegedly, of withheld wages up to his notional retirement on 8 August 2008 at the age of 65 and unpaid pension thereafter.

1. After considerable delay the Respondents were put into liquidation on 30 November 2009. There were sufficient funds in the insolvent estate to meet the Claimant's principal claim, if proved, but only if the Administrators had adopted the Claimant's contract. In accordance with section 19 of the Insolvency Act 1986, then in force, and the decision in Powdrill v Watson [1995] 2 AC 394, wages for services rendered after the adoption of the contract qualified as expenses of the Administration, and therefore preferential debts, with priority over unsecured claims.

1. Absent adoption, however, the claims, even if proved, are unsecured save to the extent of the statutory cap, namely £800, and it is accepted that there are no funds in the insolvent estate to meet the claims of unsecured creditors. The documents before me show that the Claimant has expressly recognised that, if his claims were unsecured, there would be no prospect of payment, even if he succeeded in his claims. In acknowledging this in his email to the liquidators dated 5 March 2010, he said:

"I do not want to waste the time of the [Employment Tribunals] nor the time of the liquidators nor my own time to achieve a hollow victory."

In a subsequent letter to the Employment Tribunal dated 15 April 2010 he acknowledged that determining unsecured claims would be an "academic exercise" and "a waste of the tribunal's time and resources" and that no purpose would be served by their being heard.

1. The Respondents' liquidators did not accept that the Claimant's contract had been adopted. In Re Antal International Limited [2003] EWHC 1339 CH, Laddie J, following the decision in Powdrill, held that the adoption of a contract requires:

"… some conduct by the administrators which amounts to an election to treat the continued contract of employment with the company as giving rise to a separate liability in the administration."

Thus, failing to dismiss an employee in ignorance of his existence after the expiry of the 14 day window permitted by the legislation is not sufficient to constitute an adoption.

1. Attempts to resolve the Tribunal proceedings failed, and the Claimant indicated that although he would no longer be pursuing his claims of disability discrimination, he intended to pursue all his unlawful deductions claims. On 23 September 2010 the Respondents agreed to this claim proceeding to a hearing before the Tribunal. The stage had been reached when this was the only claim outstanding and it was preventing the final discharge of the liquidation. The liquidators therefore gave their consent to the claim proceeding to a determination.

1. I will need to describe "the claim" more fully at this point, because, as will appear, the Claimant sought to develop and expand his claim at the Pre Hearing Review.

1. In his original ET1 the Claimant alleged that, as at October 2000, his employment with the Respondents was continuing, and that unlawful deductions from his wages had been made and were continuing. The basis for this allegation was as follows:

(a) from 5 May 1998, when he returned to the UK from the overseas posting, he was paid less than he should have been, and the shortfall in his salary constituted an unlawful deduction;

(b) he should have been paid an enhanced subsistence allowance between November 1998 and September 1999, and the shortfall constituted an unlawful deduction;

(c) he should have been paid a higher salary following reviews in January 1999 and 2000, and the uplifts that were not awarded to him constituted unlawful deductions;

(d) he was entitled to sick pay from March 2000, the non payment of which constituted an unlawful deduction; and

(e) he was entitled to permanent health insurance (PHI cover) after 28 weeks of sickness absence at 75 per cent of his salary, and the failure to provide this cover constituted an unlawful deduction.

However, the Claimant then served on the Tribunal, on 18 November 2010, a document headed "Amendment of and Up Dating to the Originating Application", in which he sought to "update" his ETI and expand the claims "for Registration and the Record". In this "update" the Claimant alleged materially:

(a) that the Administrator had adopted his employment through to the date of his notional retirement in August 2008;

(b) that he wished to pursue the claim for unauthorised deduction from wages and withheld and unpaid wages elements of his ET1; and

(c) that this claim included not only the four elements he had identified in his ET1 at paragraphs (a) to (d) above, relating to level of salary, subsistence, salary review and non payment of salary, but also claims that had not been specifically pleaded as unlawful deductions claims in his original ET1, namely a company car, unpaid annual leave and non payment of salary in retirement.

1. The Claimant described these claims as "a continuation of the sub elements identified at 5 October: they are the 'Roll on Effect' to an existing complaint". All of his claims were based on the premise that in law his employment with the Respondents had continued until August 2008, and that they all amounted to unlawful deductions from wages falling within Part II of the Employment Rights Act. It appears that the Claimant valued his claims in total as between £1.3 million and £1.5 million. He also included claims for prospective deductions from his pension entitlements, projected forward to 2041.

1. At the suggestion of the liquidator's solicitors the case was listed for a Pre Hearing Review to determine the following:

(1) whether the Tribunal had jurisdiction to consider the unlawful deductions claims in the original ET1, given the time limits for the presentation of such claims;

(2) whether those claims should be struck out as having no reasonable prospect of success, being in reality claims for damages not within the relevant unlawful deductions statutory jurisdiction; and

(3) whether the amendments proposed by the Claimant should be permitted.

1. Mr Devonshire QC, appearing on behalf of the Respondents, drew attention in his skeleton argument to the "practical realities" of this litigation. First, the claims are all predicated on the basis that (1) the Claimant was in law employed by the Respondent until 8 August 2008, and (2) the Administrators had adopted his contract, within the meaning of section 19 of the Insolvency Act 1986.

1. Secondly, if the Administrators had not adopted the Claimant's contract, the Claimant would have a preferential claim to unpaid salary, if proved, capped at a statutory maximum of £800. Any other claims would fall to be treated as unsecured claims in the liquidation, and there are no funds in the insolvent estate to meet such claims. This is the position even if the Claimant were to be regarded in law as having been employed by the Respondents until 8 August 2008.

1. Thirdly, and notwithstanding his claims of continued employment, the Claimant in fact made claims for a redundancy payment and notice monies from the Redundancy Payment Service (RPS) in 2001 and 2002, and received such payments totalling almost £10,000 on 10 September 2002. Thereafter he made further claims from the RPS for unpaid wages and holiday pay. Since 2001 he had been drawing Incapacity Benefit and Income Support.

1. Even if the Claimant's contract had subsisted beyond February 2000, Mr Devonshire points out that it had obviously been abandoned or frustrated by 2001 or 2002, at the latest, although the Employment Judge, given his findings on termination, found it unnecessary to make any findings in that respect.

1. At the hearing below the Claimant gave evidence and the Employment Judge considered various bundles of documents. The Employment Judge set out in his judgment detailed findings of fact on the evidence he heard.

1. On the first issue, namely how, why and when did the Claimant's employment come to an end, the Employment Judge held, for the reasons he set out in detail at paragraph 33, that the Claimant's employment was terminated on receipt by him of the letter dated 16 February 2000 from the Human Resources (HR) Director. This stated:

"7. Since unfortunately having declared your job redundant on 24 September 1999 we have subsequently, at your request, fully reviewed all the points you have raised in your grievance via correspondence and at meetings with our Operations Director and Managing Director. It is our considered view that we have fully responded to all these queries and stated our case, quite clearly, in doing so.// Having now reached this stage, I am sorry to re-confirm that your job is still redundant.// …//In effect all the terms are the same as our original redundancy notification letter dated 17 September .. with the exception of the in-lieu notice payment which is no longer applicable…"

1. At the latest the Employment Judge held that his employment was terminated on his receipt of the letter from the HR Director dated 25 February, which said:

"To clarify: 1. Our letter dated 16 February confirms that your job is unfortunately made redundant.// 2. As the original notice period stated in our letter dated 17 September 1999 has expired, the date the redundancy comes into effect is the 16 February.// 3. I have requested the appropriate department to liaise direct with you to arrange for the return of company equipment with immediate effect. This includes the company car."

1. It followed that, allowing two days for postal delivery, the date of termination was either 18 or 28 February 2000.

1. The Judge rejected all the Claimant's contentions in relation to termination, referring to him advancing "a series of ingenious though in some cases self contradictory arguments".

1. The Claimant submitted that the grievance procedure had not been exhausted when the February letters were written, which deprived them of effect. Rejecting that submission, the Employment Judge held:

"33.3 … It is clear from the letter of 16 February … that the HR Director took the view that CNL had responded to all the grievances. He may have been wrong, but even if he had been he plainly had the authority of CNL to act on his belief, and did so."

1. The Claimant submitted that the letter of 16 February was defective, in that it did not contain detail of his redundancy entitlement and in particular did not state the termination date or any period of notice. Rejecting that submission, the Employment Judge held that the purpose and effect of the letter were perfectly clear. There is no requirement that a letter terminating employment on grounds of redundancy should contain any particular information. Whilst it is usual for termination by reason of redundancy to be on notice, it is quite common for redundancy dismissals to take effect at once and to be accompanied by payment in lieu of notice.

1. If the Respondents were not entitled to take the stance that by February 2000 the obligation to give notice had ceased, then the remedy for the Claimant was a claim in breach of contract for pay in respect of the notice period; that is, a complaint of wrongful dismissal. No such claim was asserted on his behalf, however, by the firm of experienced employment solicitors (Lewis Silkin) who were then advising him. The Employment Judge held that a letter stating that employment is ended, and containing no mention of notice or a termination date, would be read by a reasonable employee as taking effect immediately upon receipt of it. He went on to state, however, that if he was wrong on that point, then any doubt about the effect of that first letter was removed by the letter of 25 February.

1. The Claimant also relied on various events after February 2000, which he claimed suggested that his employment had not in fact been terminated. The Employment Judge found, however, that the Claimant had produced no clear evidence that the employment relationship had continued or had been resumed. He dealt carefully with all these points at paragraph 33.5, explaining in each case why he regarded them as not being probative of continuity of employment. They included, for example, the Claimant's failure to receive his P45, the fact that he submitted a sick note to the HR department in November 2000 and discussed it with them, and the fact that he retained his company car until April 2001.

1. In rejecting these points the Employment Judge referred, for example, to the fact that it was unsurprising that he had submitted a sick note, since the Claimant was maintaining the position at the time that his employment was continuing. As to the company car, the Employment Judge found that the probable explanation for his retention of the car was that he was allowed to keep it while discussions about his various claims were continuing, and that it was then simply overlooked until after the appointment of the Administrators. Having considered all the points raised by the Claimant, he concluded that none of the evidence produced was sufficient to displace the clear effect of the letters written in February 2000, or to establish that it was later reversed.

1. The Claimant also placed considerable reliance on the letter from the Administrators' officer dated 9 January 2001. The Judge's findings of fact in relation to this letter were set out at paragraph 20 as follows:

"20. On 9 January 2001 the Administrators' officer wrote to Lewis Silkin ... He confirmed the appointment of the Administrators and went on: "The vast majority of the workforce were made redundant on 17 November 2000 with the exception of approximately 20 staff who were retained to assist the administrators.// The information provided by the company in respect of it's (sic) employees unfortunately did not include Mr Allsop and therefore, no redundancy notice will have been issued to him. However, for the avoidance of doubt I confirm that Mr Allsop would be redundant from the above company with effect from 17 November 2000.// The former employees have been issued with application forms RP1, which enables them to claim, up to certain limits, from the Redundancy Payments Service for monies outstanding in respect of redundancy pay, arrears of salary, holiday pay and payment of statutory notice.// I am willing to provide a form RP1 for Mr Allsop, however, the Redundancy Payments Service would, as I understand it, reject his claim on the basis that he had been on long-term sickness (over 26 weeks) and therefore, would state that the contract had become 'frustrated'.// My advice would therefore be to continue with the Employment Tribunal proceedings as they may award a redundancy payment to Mr Allsop together with statutory notice and accrued holiday pay. This may then be claimed from the Redundancy Payments Service on form RP1.""

1. On the basis of this letter the Claimant advanced a number of submissions. He said that this was inconsistent with there having been an effective termination of his employment in February 2000 and was therefore evidence against such a termination. The Employment Judge did not accept this. It had not been written by the HR Director or one of his staff. It was:

… written by an accountant, and it is clear on its face that the information available to him about the history of the employment of Mr Allsop was incomplete. He seems to have assumed that because Mr Allsop was on sick leave for a lengthy period his name had, "slipped through the net", and therefore been omitted from the list of current employees at the date of the administration. On that assumption he then made what was plainly intended to be a hurtful suggestion that might lead (and indeed eventually did lead) to the receipt by Mr Allsop of a redundancy payment et cetera from public funds. For the effectiveness or otherwise of the February 2000 termination it has in my judgement no evidentiary value at all."

1. Nor, as the Claimant submitted in the alternative, could the letter be taken to be a withdrawal or waiver of the February 2000 letters. The Judge held that the Administrators could not possibly have intended to withdraw or waive a termination of which they were ignorant, when they had no need for any services that the Claimant might have provided, and he was in any event on his own case unfit for any work.

1. The Employment Judge then turned to deal with the question of adoption, the Claimant's case being that this letter was evidence of the adoption of his contract of employment by the Administrators. He found as follows at paragraph 33.6.3:

"…In some limited circumstances Administrators of an insolvent company may adopt the employment contracts of some of its employees whose continuing services they require. The effect of the relevant provisions of the Insolvency Act 1986 was considered by the House of Lords in Powdrill and another v Watson and Another (etc) [1995] AC 394. It was held that on the true construction of those provisions, regard being had to the context and to the mischief aimed at by Parliament, a contract of employment was adopted where the conduct of the Administrator amounted to an election to treat a continued contract of employment with the company as giving rise to a separate liability in the Administration, and was inevitably adopted if the Administrator caused the company to continue the employment for more than 14 days after his appointment. It seems to me clear that for there to be an adoption the contract of employment must subsist at the date of appointment of the Administrators. If, as appears to me to be the case, the employment had been terminated in February 2000, then it did not subsist when the Administration Order was made in November of that year. The letter was, as I have noted, written by an accountant who plainly had incomplete information about the relevant history. However, it cannot in my judgement be read as indicating any willingness by the Administrators to assume any liability to Mr Allsop in the Administration: to the contrary, its plain purpose was to enable him to assert claims the accountant understood might be open to him for payment by the Redundancy Payments Service. Mr Allsop referred to later dealings between himself and the Administrators, but did not draw attention to any other document created by them or with their authority which supported the suggestion that there had been an adoption. The critical evidence of adoption would have been the payment by the Administrators of salary or sick pay, and it is common ground that no such payment was made. In my judgment the Administrators did not adopt the contract of employment. "

1. The Claimant sought to argue one final point in respect of the Administrators' letter, namely that it amounted to an agreement by the Administrator that he could pursue his case in the Tribunal proceedings, from which they had later resiled when those proceedings were stayed. Rejecting that allegation on the facts, the Employment Judge held:

"I do not consider that the letter amounted to general or unlimited permission to pursue in the tribunal the claims asserted in the Originating Application: rather, it is suggested a course which the accountant believed would lead to payment by the Redundancy Payments Service. If, however, I am wrong on that point then any alleged abuse by the Administrators of their power under the Insolvency Act to withhold consent to proceedings is a matter with the exclusive jurisdiction of the Court which made the Administration Order. This tribunal has no relevant jurisdiction."

1. In the paragraph that then followed the Employment Judge observed that the Claimant had sought to rely on what he said were concessions made by a representative of the liquidator during discussions with him. These alleged concessions were not recorded in a letter or agreed minutes of any meeting. From the Claimant's account of them the Judge considered it clear that the discussions were part of an attempt to reach a settlement on outstanding claims, and that they were privileged, so that he should not receive evidence of them. The Claimant objected that the words "without prejudice" had not been used at the relevant meeting or meetings. The Employment Judge held that, given the nature of the discussions, that was irrelevant. The question was whether there was an attempt to compromise actual or impending litigation, and whether from the circumstances the court could infer that the attempt was in fact to be covered by the "without prejudice" doctrine. The Employment Judge clearly did so infer in this case on the material before him.

1. I have dealt with the first issue to be determined at the PHR, namely termination of the Claimant's employment, in some detail because the Employment Judge rightly described it as an issue of considerable importance for the determination of the remaining issues on the PHR.

1. The next issue was whether the ET1 was out of time. The Employment Judge directed himself correctly as to the relevant provisions of sections 13 and 23 of the Employment Rights Act 1996. In relation to the claims for salary, subsistence, salary uplift and sick pay, the Employment Judge concluded on the material before him that the ET1 was presented several months out of time. The Claimant's submission that the deductions continued, so that he could claim in respect of all of them until the date of the hearing, was rejected.

1. The Employment Judge held that a claim for unlawful deductions under section 13 can relate only to those deductions that have been made by the date on which the claim is lodged. The question of whether the Claimant could amend to add later deductions as part of his claim was considered as part of the amendment issue generally.

1. Having concluded that all his claims, save that in respect of the PHI cover, were out of time, the Employment Judge then directed himself correctly to the relevant legal principles governing the next issue, namely whether it was reasonably practicable for the Claimant to have lodged the claims in time.

1. Having considered the facts, including the striking feature that this Claimant had been represented by experienced employment solicitors from February 2000 until May 2001, and the fact that the Claimant was himself a highly intelligent and articulate man, he declared himself satisfied that it was reasonably practicable for his claims to have been presented in time. There was therefore no jurisdiction to determine them.

1. The next issue, dealt with at paragraph 36 of the reasons, was whether the claims in the ET1 were such that they fell outside the jurisdiction in respect of unauthorised deductions.

1. This issue was particularly important for the claim in respect of PHI cover, which was held to be in time, but it also provided an alternative basis on which, the Respondents submitted, jurisdiction for the Claimant's remaining claims should be declined.

1. The Employment Judge's decision on this issue was as follows, and in view of its importance in this appeal I set it out in full here:

"36.2 The leading case on the subject is Coors Brewers Ltd v Adcock and others [2007] ICR 983. In that case the claimants complained that a decision not to award an incentive payment under a discretionary incentive scheme was an unauthorised deduction from wages. The Court of Appeal upheld the decision of the EAT that the case did not fall within the jurisdiction of the tribunal. The claimants' case at its highest was that the employer was under an obligation to put in place a scheme which, properly and fairly operated, was capable of replicating the benefits of an earlier scheme; that if the scheme it had put in place, as operated, did not fulfil that obligation the claimants would have suffered loss; the amount of that loss was unquantified, so that the tribunal was invited to quantify it. The claim was therefore one for damages for breach of contract and not within the scope of the unauthorised deduction regime, which was said by Wall LJ to be "essentially designed for straightforward claims where the employee can point to a quantified loss ... [and] designed to be a swift and summary procedure".

36.7 As to the PHI cover claim, Mr Allsop protested that it was for a quantified sum, namely 75% of salary. That, in my judgment, does not accurately reflect its true nature. Quite apart from the fact that the value of salary at the material time was itself the subject of disputed claims, it is pleaded on the basis that the respondent "failed to consider [Mr Allsop] for" benefit under the Scheme. As in Coors, the claimant asserted that a discretion had been exercised to his detriment, and that this was a breach of contract. The claim is one for damages for breach of contract, and on the Coors principle is not within the jurisdiction of the tribunal.

36.7 In case I am wrong in my conclusion as to time limits, I should record that in my judgement the same is true of the claims:

(a) for salary (pleaded on the basis that Mr Allsop's notional salary "should have been taken into consideration when setting the level of [his] salary on his return to the UK, on the basis that this was a typical salary for this particular position");

(b) for subsistence (pleaded on the basis that the payments" were not increased, as Mr Allsop had been led to expect");

(c) for salary uplift on review (pleaded on the basis that Mr Allsop" had a reasonable expectation of an increase to the same extent as his peers and subordinates"); and

(d) sick pay, (because although it was common ground that sick pay was at 100% for 6 months and 50% for the next 6 months, the salary to which these percentages apply was itself the subject of the claims at (a) and (c) above, which I consider to be claims for breach of contract.

Accordingly, on this ground also I conclude that the tribunal lacks jurisdiction to entertain the claims."

1. The final issue was whether the ET1 should be amended to admit the new claims.

1. The Judge directed himself to the case of Selkent Bus Company Ltd v Moore [1996] ICR 836 and stated that, whenever the discretion to grant an amendment is invoked, the Tribunal should take into account all the circumstances and should balance the injustice and hardship of allowing the amendment against the injustice and hardship of refusing it.

1. Whilst he did not set out an exhaustive list of relevant circumstances, in this case he held that the list would include the following:

(a) the nature of the amendment, and whether it is a minor matter or a substantial alteration pleading a new cause of action;

(b) the applicability of time limits and whether any new complaint or cause of action proposed to be added by way of amendment would be out of time, and if so, whether the time limit should be extended; and

(c) the timing and manner of the application, including delay.

1. The Employment Judge then addressed the claims sought to be added by way of amendment. He found that the claim that the Claimant's employment was adopted by the Administrators to the date of his notional retirement in August 2008 had no prospect of success given his previous findings. Further, when first articulated in November 2010, the claim was almost two years out of time.

1. The claim to be entitled to amend, to claim for elements that the Claimant described as a continuation of those already claimed as unlawful deductions, was also found to be unarguable given his conclusion that all but one were out of time and indeed outside the scope of the unlawful deductions regime. In any event the Employment Judge held that these were fresh claims, not mere continuation of claims already made, and that they had been made more than ten years out of time.

1. In fact, as the Employment Judge recorded at paragraph 32, the Claimant had sought to add a further, entirely fresh claim at the Pre Hearing Review itself. He described it in these terms:

"…At the PHR Mr Allsop gave notice of a further new claim that he wishes to pursue, which he frankly said had occurred to him only as he was preparing for the PHR. It is for payments continuing until the death of the later of him and his spouse under what he says is a contractual Income Protection Plan. The basis of the claim is an "Announcement to All Monthly Staff" dated 11 June 1990 of such a Plan, said to be "A significant improvement to terms of employment for monthly staff' (C3 22). The announcement says "Full details and formal amendments to the staff conditions of employment booklet will be issued in due course", but does not say that the Plan is to be insured. Mr Allsop argues that this announcement gave rise to a contractual obligation on the part of CNL: though CNL chose to effect the Long Term Disability Scheme in order to comply with that obligation, the obligation was not expressed to be constrained by the terms or duration of that Scheme."

1. The Employment Judge found that the Claimant had conceded at the hearing that this was an entirely fresh claim. He stated that it was being made a decade after the date on which he had concluded that the Claimant's employment ended. It was in his judgement a hopeless claim because it was a classic instance of a claim for damages for breach of contract that, applying the principle in Coors Brewers Ltd v Adcock and Ors [2007] ICR 983, is not within the jurisdiction of the Tribunal.

1. Since he found that the proposed new claims had no reasonable prospect of success, the Employment Judge concluded that the application to amend to add them should be refused. No significant hardship would be caused to the Claimant, and to allow them to proceed, he held, would cause considerable hardship to the Respondents because it would delay the conclusion of the liquidation and cause further legal costs to be incurred. Further, the true impact of the hardship would be largely on creditors of the Respondents, who were waiting for any final payments that might be due to them. Balancing the competing hardships, he concluded that the application to amend should be refused.

1. Thus all the Claimant's claims were dismissed and leave to amend to pursue others was refused.

1. The Claimant's Notice of Appeal is lengthy, factually detailed and discursive, consistent with the Claimant's long involvement with this case, his own view of the facts and his deep sense of wrong. Under two main headings, namely mistakes of law and perversity, the Claimant develops a large number of points that are then expanded upon in his skeleton argument and in his written responses to the Respondents' skeleton argument.

1. Having considered them and having heard the Claimant's admirably succinct oral submissions on appeal, it is clear that the main focus of his complaints, which are all interlinked, can be summarised as follows:

(1) In concluding that he was dismissed in February 2000, the Employment Judge wrongly applied the "without prejudice" rule so as to exclude from his consideration (a) the Respondent's letter dated 25 April 2000 and the Claimant's response of 4 May 2000, and (b) three separate discussions the Claimant had with the Respondent's liquidators between January and April 2010. In denying himself knowledge of these matters the Employment Judge erred in law so that his judgment is fundamentally flawed.

(2) The Employment Judge ignored every fact showing that his employment had continued after February 2000 and made speculative explanations, in relation to the facts relied on by the Claimant as showing that it had continued.

(3) The Employment Judge erred in his application of the law as to adoption and in failing to understand the importance of the letter of 9 January 2001.

(4) The Employment Judge reached an incorrect conclusion in relation to his complaints being out of time, on the basis that his decision as to termination was entirely flawed.

(5) The Employment Judge erred in refusing his application to amend and failed to understand both that his original claim for unauthorised deduction from wages would need to be updated to the date on which it progressed to a hearing, and that his proposed amendments related to continuing deductions and were not new claims.

(6) The Employment Judge erred in law and his conclusion was perverse, because he failed to understand "the independence and interdependency between contract terms and conditions of employment, and the income protection plan (IPP) and permanent health insurance scheme (PHI)."

1. This last point featured heavily in both the written and oral submissions made by the Claimant. It relates to the claim that the Claimant sought to advance at the PHR itself by reference to the document called "The Announcement". His point is that the IPP, which was announced by the Respondents on 11 June 1990, was referred to in the Claimant's terms and conditions of employment. His contract made no reference to the PHI scheme, which was an insurance policy purchased by the Respondents and was solely a matter between the relevant insurer and the Respondents. The IPP was a benefit bestowed on him as a term of his contract. The Employment Judge failed to understand this and erred in his conclusion that there was no jurisdiction to determine his claim.

1. As I understood his argument, the Claimant was contending that the Employment Judge should have treated the Announcement as resulting in an unconditional entitlement to the benefits payable under the IPP after 26 weeks of incapacity and continuing until retirement; and that he should have permitted him to amend his ET1 to advance a claim for arrears extending over the years since he commenced proceedings in the Tribunal and on into retirement in 2008.

1. I start with the Claimant's criticisms concerning the exclusion of privileged material.

1. His first complaint is that the Employment Judge wrongly excluded a "without prejudice" letter from the Respondents dated 25 April 2000, the Respondents having objected to it being produced. In fact, the Respondents do not now recall what use the Claimant was seeking to make of this letter, and the Employment Judge does not refer to it in his judgment. However, the Respondents accept, for the purposes of the appeal, that the Claimant wished to place reliance on this document, and that the Employment Judge did not permit him to do so.

1. Mr Devonshire, who attended the hearing below, informed me that the Claimant had arrived at the Tribunal with multiple copies of two full lever-arch files, which had not been served in advance of the hearing, and sought to justify his position on the basis that the materials contained in the files were not documents but "references". It is therefore possible that the Claimant referred to the letter of 25 April, as being one of these "references", during the course of the hearing, and that the Respondents objected to reliance being placed upon it given its privileged character.

1. To put this letter in context, the Claimant's solicitors had written an open letter on 29 February 2000, in which they had asserted that the Claimant's contract had not been effectively determined by the letters written in February 2000, but that he was entitled to 12 weeks' notice, which should be treated as running from 16 February 2000. There was then a without prejudice proposal from the Claimant's solicitors, dated 3 March, with three principal terms. There was an offer to settle on the basis that:

(a) The Claimant's employment should continue until he was fit enough to return to work; alternatively, he should receive benefits under the PHI scheme.

(b) He should receive compensation for his other alleged losses, which were essentially those that had originally been pleaded.

(c) He should receive an ex gratia payment in consideration of his agreeing not to bring claims in respect of unfair and wrongful dismissal, disability discrimination and personal injury.

1. The letter from the Respondent of 25 April was a response to this proposal. Having read it, I agree with Mr Devonshire's submission that this letter was exploring the possibility of a settlement pursuant to which the Respondents' PHI insurers accepted a claim on the Claimant's behalf under the PHI scheme, presumably exploiting the disagreement as to the Claimant's employment status, without prejudice to the Respondent's case that his contract had in fact been determined in February 2000. The offer made in this letter was not unconditional, as the Claimant suggests. On the contrary, the offer made was subject to two provisos set out in detail in the body of the letter.

1. In response to this letter the Claimant's solicitors wrote two separate letters. In an open letter dated 5 May the solicitors gave notice of the Claimant's wish to be considered for the receipt of benefits under the Respondents' PHI scheme. No reference was made in that letter to the without prejudice correspondence, indicating that the solicitors themselves had not regarded privilege as having been waived. They also wrote a separate response, dated 4 May, headed "Without prejudice", in which, far from accepting the conditional offer made in the letter of 25 April, the solicitors made it quite clear that the provisos set out in that letter could not be accepted by the Claimant.

1. Subsequently, in the ET1 submitted on behalf of the Claimant by the solicitors then acting for him, it was pleaded at paragraph 7 that the Claimant had not received notification of any termination date, and consequently his employment was continuing, but it was not pleaded that there had been any supervening agreement that his employment would be treated as continuing.

1. There is nothing therefore to abrogate the privilege that would normally apply to correspondence written in these terms.

1. I agree with Mr Devonshire that the response from the Claimant's solicitors of 5 May does not evidence acceptance of the Respondents' offer. On the contrary, further pre conditions for settlement were stipulated. The fact that the Claimant's solicitors did not refer in their open letter of 5 May to the without privilege letter of 25 April, respecting the privilege attaching to that letter, was unsurprising in the circumstances.

1. It is clear, in my judgment, that the Respondents' offer made in the letter of 25 April was not accepted and did not result in a settlement. There is nothing whatsoever in any of the documents that I have looked at to indicate that the privilege that would normally apply to documents written in such terms was abrogated. The Judge was therefore entirely right to express the view he did as to the need to exclude privileged material. Contrary to the submissions of the Claimant, this correspondence viewed as a whole discloses no concluded agreement and no understanding by the Claimant's solicitors that the privilege to be attached to this correspondence had been abrogated.

1. In any event it seems to me that the two letters on which the Claimant relies could not be said to be such as to have any material impact upon the outcome of this case. The Claimant's concerns that, by excluding this correspondence, the Employment Judge denied himself the opportunity to consider relevant material in arriving at his decision seem to me to be misplaced. Whilst there were, as the Claimant suggested, references to the company car and to the Claimant retaining it within these documents, these are points that, as is clear from his judgment, the Employment Judge had very much in mind, and which he dealt with expressly at paragraph 33.5(d) and his observations later on in that paragraph. I do not accept the Claimant's submission that, by excluding this material, the Employment Judge overlooked or failed to consider highly relevant material.

1. The second complaint made by the Claimant under this head is that the Employment Judge wrongly excluded reference to discussions that the Claimant had had with the liquidators between January and April 2010. Once again the Claimant submits that these discussions were relevant and would have informed the Judge's approach.

1. During the course of these discussions the liquidators offered to settle in respect of unpaid wages up to 17 November 2000, subject to the £800 statutory cap. There had been substantial delays in the Administration, and 778 preferential creditors were awaiting receipt of a total of £1.2 million. All but two of these creditors are former employees of the Respondents. In the circumstances the Claimant's own substantial claims were holding up the distribution of funds for those preferential creditors who had already been identified.

1. In those circumstances it is perhaps unsurprising that there would be attempts, recognising the commercial realities, to agree an accommodation with the Claimant in order to enable early distribution of the relevant sums to the employees concerned. In commercial terms this agreement would have saved potential legal costs in addition. However, no agreement could be reached.

1. In the circumstances the Employment Judge was, in my view, fully entitled to conclude that these discussions were privileged. In paragraph 33.7 of his reasons I can identify no error of law in his approach or in his conclusions. Discussions between the Claimant and the liquidator's representative more than ten years after the Claimant had stopped working for the Respondents could not sensibly be said to be probative of an acceptance that his employment had continued. Indeed they could not be said to have any probative value at all in the context of the Tribunal's enquiry as to the effective date of termination. The decision of the Employment Judge on the question of termination is in my view plainly correct.

1. The main thrust of Mr Devonshire's submissions in response to the other grounds of appeal, after addressing the challenge in respect of the without prejudice material, was that even if the Claimant were right that his employment had continued beyond February 2000, the decision of the Employment Judge was plainly and unarguably right. He submits that none of the Claimant's grounds of appeal vitiate or undermine:

(a) the conclusion of the Employment Judge that the majority of his pleaded claims did not engage the unlawful deductions jurisdiction, but were in reality claims for damages;

(b) his decision that the claims sought to be added by way of amendment were legally misconceived and did not come within the unlawful deductions jurisdiction;

(c) his decision, in the exercise of his discretion, to refuse to allow the amendments sought; and

(d) his conclusion that the Administrators did not adopt the Claimant's contract.

1. I shall deal with these points in turn. First, in considering whether the claims originally pleaded fell within the unlawful deductions regime, the Employment Judge rightly directed himself to the leading case of Coors. As the court in that case made clear, this regime is designed for straightforward claims where the employee can show that he has not been paid quantified or quantifiable sums properly due to him under his contract. It cannot be used as the vehicle to advance claims for damages for breach of contract, consequent, for example, upon the non exercise or allegedly capricious exercise of a contractual discretion.

1. In relation to his salary claim, the position appears to be that the Respondents credited those employees working overseas with notional salaries for comparable UK employment. However, these notional salaries were expressly stated not to be an indication of future home based salary. The Claimant was advised of this practice and of his notional salary in letters sent to him on 13 January 1986, 9 January 1987, December 1987 and 8 February 1989. The last of those letters, to which the Claimant referred in his ET1, contained the statement, "your actual salary on return to the UK would be assessed according to the appointment in question". By letter dated 9 January 1998 the Claimant was advised that following an annual salary review of his Malaysian appointment his salary from 1 January 1998 would be increased and that, as a result, "your UK notional salary has been increased by an identical percentage to [that] increase …".

1. The Claimant's Malaysian appointment ended in February 1998, and he accepted a new role under the terms of the UK contract, with continuity preserved, from May 1998 at a salary of £50,000. He has been paid that salary, and no further sums appear to be properly due to him. The Claimant seems to be contending that his notional salary should have been taken into consideration when setting the level of salary on his return to the UK. However, even if this gave rise to a cause of action, it would only sound in damages, i.e. the shortfall between his actual salary and the level at which it should have been set. It is therefore not justiciable under Part II of the Employment Rights Act. This was what the Employment Judge found in his reasons at paragraph 36.7(a).

1. In relation to the Claimant's subsistence claim, on his return to the UK the Claimant was granted a subsistence allowance at £480 per month, reviewable in six months. Essentially, he complains that the allowance was not reviewed and uplifted after the period of six months. He is therefore complaining of a failure to exercise a contractual discretion in his failure. To the extent that this gives rise to a claim, it must be a claim in damages and not an unlawful deductions claim. The Employment Judge correctly made a finding to this effect at paragraph 36.7(b).

1. In relation to his uplift claim, the annual review provision in his UK contract did not guarantee any annual increases. His claim appears to be a claim for damages on the basis that this contractual discretion was not exercised in his favour. In his ET1 the claim is pleaded as a complaint that the Respondent breached his "reasonable expectation of an increase to the same extent as his peers and subordinates". Once again a claim in this respect could in my view only be a claim for damages under the contract.

1. In relation to his sick pay claim, the Claimant did not receive any sick pay after 16 February 2000 because, as the Employment Judge found, his employment had been terminated. Any further claims would thus sound in damages. In fact, the Claimant had by 16 February been on extended sick leave for almost eight months. Even if his employment had continued after 16 February and he remained entitled to receive remuneration under his contract, his entitlement was to sick pay at 50 per cent of salary until 21 June 2000. He had no ongoing entitlement to salary after that date. The Employment Judge's decision at 36.7(d) was therefore correct.

1. Mr Devonshire's second, main submission is that the claims that the Claimant sought to add by way of amendment did not fall within the unlawful deductions regime.

1. I consider that he is right. The Respondents' failure, as alleged, to comply with what is said to be a subsisting obligation under the contract to provide the Claimant with a car does not in my judgment engage the unlawful deductions jurisdiction. This is a claim that would sound only in damages.

1. In relation to his claim for unpaid annual leave, the Claimant seeks to support this claim by relying on the cases of Commissioners of Inland Revenue v Ainsworth [2005] ICR 1149 CA and the decision of the European Court of Justice in Stringer v HM Revenue and Customs Commissioners [2009] ICR 932. The point he is making is that he remained incapacitated from July 1999 to 8 August 2008, that being the date on which he retired, and that the earliest stage at which he could have taken the outstanding and accumulated paid annual leave to which he was entitled was after 8 August. However, as the EAT has recently made clear in [Fraser v Southwest London St George's Mental Health Trust ]()[2011] UKEAT/0456/10/DA, the rule in relation to holiday pay is "use it or lose it". A pre condition to payment is that the employee, even if on sick leave, has first notified his or her employer of his or her intention to take such leave. As Underhill P explained at paragraph 30 of the judgment in that case:

"It might appear somewhat artificial for an employee who is not at work anyway to have to give notice of an intention that part of her absence should count as holiday; but that merely reflects the artificiality of a period of long term sickness counting as holiday at all. In any event, the giving of notice is more than a formality. Without it the employer, who is not otherwise paying the employee, or is paying him only sick pay, will not know whether, or - just as importantly - when he is obliged to make any payment under Regulation 16."

1. Clearly, even on the Claimant's own case, no such notice was given here.

1. In relation to the claim for the non payment of salary in retirement, I agree with Mr Devonshire that Part II of the Employment Rights Act cannot be used to advance claims in respect of sums not paid to an employee in retirement. The statutory regime concerns unauthorised deductions being made from the wages of a worker who is employed by the employer. Even if the Claimant remained employed until 8 August 2008, Part II does not confer jurisdiction upon a Tribunal to entertain claims for losses accruing after that date. In his Notice of Appeal the Claimant only asserts that he was entitled to payment through to retirement.

1. In these circumstances, it is unnecessary in my view to go on to consider Mr Devonshire's argument, presented below, that the Employment Tribunal has no power in any event to admit claims in respect of causes of action accruing after the claim form was issued. The Employment Judge held correctly at paragraph 34.6 that the language of section 13 of the ERA is such that a complaint about deductions can relate only to deductions that have happened by the date of the claim. It is not apt to permit a complaint about "prospective deductions in the future". However, the Employment Judge considered that he did have a general discretionary power to allow amendments to add causes of action post dating the ET1 on the authority of Prakesh v Wolverhampton City Council UKEAT/0140/06. Mr Devonshire submits that he was wrong so to conclude, but having regard to my findings on all the other heads of this appeal I take the view that it is unnecessary for me to deal with that submission in this case.

1. I turn now to the IPP issue, which took up a great deal of time in the Claimant's written and oral submissions in this appeal. It is clear, in my view, from the reasoned judgment that this was an entirely fresh claim that was raised only at the Pre Hearing Review itself.

1. In addition, as Mr Devonshire points out, not only was it an entirely fresh claim but it was inconsistent with the Claimant's previously pleaded case as set out in his ET1.

1. At paragraph 17 of his ET1, the Claimant's solicitors pleaded the following:

"The applicant is entitled to contractual sick pay for six months at full salary and at half salary for a further six months, during any 12 month period. In addition, the applicant has a contractual entitlement to the receipt of benefits under the Respondent's permanent health insurance scheme, after the first 28 weeks of his current sickness absence, subject only to acceptance by the insurer. Under this scheme the applicant may receive payments equivalent to 75 per cent of his usual salary payments. The Respondent failed, however, to consider the applicant for the same."

1. That this is clearly the same as the IPP scheme, and that the Claimant's entitlement was the same as that now arising under the IPP, is reflected in the relevant contractual documents that were before the Employment Judge. The Claimant's terms and conditions of employment referred on page 3 to the following:

"Income Protection Plan - this plan is offered to all employees who complete five years' service. However, due to the seniority of your position within the company you will be enrolled from your date of commencement […]. In the event of prolonged disability you will be guaranteed 75 per cent of your net income after state benefits and taxes have been taken into account. See the scheme notes for further details."

1. The relevant scheme notes appear at pages 17 21. This document, headed "Group Permanent Health Insurance Scheme", gives brief details of the scheme set up for the benefit of eligible employees and provides for the continuation of a proportion of their normal earnings from the employer in the event of long term absence occurring as a result of illness or injury. The document was issued in 1992 and therefore pre dated the Claimant's contract of employment. The necessity for completion of at least five years' continuous service with the employer in order for an employee to be eligible for membership of the scheme is spelled out on page 18. The benefits described at paragraph 3 of this document on page 19 are exactly those benefits he was afforded under his contract. In relation to cessation of membership, dealt with at paragraph 4 on page 20, it provided that a member would cease to be included in the scheme "on ceasing to be in the Employer's service". The Respondents retained the right to amend or discontinue the scheme at any time. Members were told that they would be notified of any such amendment.

1. The Claimant now takes issue with that construction and contends that these scheme notes have no relevance to the IPP entitlement referred to in his contract. He made a similar claim in an email he sent to the EAT on 22 December 2011, when he objected even to the inclusion of these scheme notes in the documentary materials before the EAT. It seems to me, however, that not only were these not submissions he made before the Employment Tribunal, but the position he now takes in respect of these notes is wholly inconsistent with his pleaded case in his ET1. It is also inconsistent with his solicitors' letter to the Administrators, dated 21 December 2000, predicated on the basis that the claim under the income protection plan was to be pursued "on behalf of our client with the company's insurers" and enclosing a "copy of the guidance received by our client setting out further details of the above entitlement", which can only have been a reference to the scheme notes.

1. Thus however the Claimant now seeks to characterise his IPP claim, it seems to me not only to depart from the position he has previously taken in this respect but to deny the plain effect of the contractual documents.

1. On the basis of his pleaded claim in this respect I agree with the submission of Mr Devonshire that the Claimant had at best a claim that the Respondent had failed to facilitate his submission of a claim under the scheme. This much is clear from the phrasing of his claim at paragraph 17 of his ET1 referred to above. This is a failure that could only sound in damages and is not justiciable under Part II, as the Employment Judge held correctly at paragraph 37.3(c).

1. In relation to Mr Devonshire's third point as to the exercise of discretion, even assuming that the Employment Judge needed to exercise the discretionary jurisdiction as far as amendment was concerned, it is clear in my judgment that the Employment Judge's decision is unassailable. He directed himself correctly as to the applicable Selkent principles, and his conclusion was well within the range of legitimate discretionary decision making on the facts of this case. He carefully considered the relevant factors and balanced the competing hardships. He was fully entitled to conclude, for the reasons he gave, that it would be inappropriate to permit the amendments in this case out of time.

1. The final point relates to the Employment Judge's decision that the Administrators had not adopted the Claimant's contract. For the reasons I have set out above this appeal is really academic unless the Claimant can demonstrate that the Administrators adopted his contract.

1. The Employment Judge's findings on the question of adoption are set out at paragraph 33.6.3. Importantly, the Employment Judge does not deal with the point solely on the basis of his finding that the Claimant's employment had terminated in February 2000. He goes on to deal with the letter of 9 January 2001, which, as Mr Devonshire points out, was the high point of the Claimant's case. The contents of this letter were set out at paragraph 20 of the reasons, to which I have already referred. As the Employment Judge rightly concluded, that letter cannot be read as indicating any willingness by the Administrators to assume any liabilities to the Claimant in the Administration. On the contrary, its plain purpose was to enable him to assert claims the accountant understood to be open to him for payment by the RPS. Whilst the Claimant criticises the Employment Judge's characterisation of the author of the letter as an "accountant", the reality is that a joint Administrator will invariably hold that qualification. The judge was clearly making the additional point, in any event, that the author of this letter was not in possession of all the facts.

1. The Claimant contends that the Employment Judge's conclusion is inconsistent with the decision of the House of Lords in Powdrill. I disagree. As Lord Browne Wilkinson said at 448E:

"The meaning of the word 'adopt' in sections 19 and 44 of the Act of 1986 therefore has to be gathered from the context in which it is used. It is important to bear in mind that the appointment of an administrator or receiver does not terminate the employee's contract of employment with the company. Only if the company (acting by the receiver or administrator) is noticed terminating the employment or, by failing to pay wages as they accrue due, repudiate the contract of employment will the contract with the company terminate. Therefore so long as wages are paid by the company, the employee remains the employee of the company. The Court of Appeal … lost sight of this factor when, in the passage I have quoted …, they wondered how the employee continued to be employed if there had been no adoption by the administrators. Therefore the mere continuation of the employment by the company does not lead inexorably to the conclusion that the contract has been adopted by the administrator or receiver."

1. At 449F he continued:

"The mischief aimed at by the Act … must mean that the concept of adoption of the contract covers at least accepting liability for payment for services rendered to the administrator under contracts which he has continued."

**

1. In Antal, Laddie J said as follows at paragraphs 6 and 7 of his judgment:

"6. The question of whether or not the contracts of employment have been adopted has been considered in detail by the House of Lords in [Powdrill]. In a full speech, Lord Browne Wilkinson discussed the existing case law in relation to the meaning of the word 'adoption' in this context, and the history of the legislation in which adoption of the contracts had arisen. Miss Hilliard placed particular reliance on the following passage in his speech:

'In my judgment, as Mr Sumption submitted, adoption in Section 19 and 44 can only connote some conduct by the administrator or receiver which amounts to an election to treat the continued contract of employment with the company as giving rise to a separate liability in the administration or receivership.' (p 449)

That statement was of importance because in the Court of Appeal in the Powdrill case, the court had held that the mere continuation of employment of a company's employees by an administrator was to be deemed to be an adoption of their contracts of employment. What Lord Browne Wilkinson was pointing out was that it was important to find some conduct on behalf of the administrator or receiver which could be treated as a election or could be regarded as an election to continue the contract of employment, viz some activity by the administrator or receiver which could be regarded as him exercising a choice as to whether or not the contracts of employment were to be adopted."

1. At paragraph 12 he said this:

"It appears to me that it is not necessary to resolve whether that is the meaning of the last two passages which I have quoted from the speech of Lord Browne Wilkinson. I think the important direction given in Powdrill is that contained at the top of p. 449. It is necessary to look at the facts and to decide whether there has been some conduct by the administrator or receiver which can legitimately be treated as an election to continue the employment. In my view, Miss Hilliard is right in this case in saying that there is no conduct by the administrators which could be said to amount to an election to treat the contracts of employment as continuing. Her arguments have persuaded me that in this case the administrators have at all times, once they knew of the existence of the contracts, made it clear that they elected not to continue the employment of any of these employees. It follows that I will give the administrators the declaration which they seek."

1. In my judgment, that reasoning wholly supports the approach taken by the Employment Judge in the present case and the conclusion to which he came.

1. For these reasons, none of the grounds of appeal advanced by the Claimant has demonstrated that the Employment Judge made any error of law in his decision. Nor does his reasoning, or any of his conclusions, remotely approach the threshold that must be crossed in order to sustain a perversity challenge. In his written grounds the Claimant referred to a number of alleged factual errors, in terms of dates on which various events took place and other, alleged mistakes of a similar kind. Even if there were errors of this kind, and it is not clear to me that they were all errors as alleged, I am confident that they were not errors that in any way go to undermine or vitiate the decision. They do not appear to me to have any bearing on the Employment Judge's decision making on the substantive issues in this case. To the extent that any factual errors were made, in my judgment, and for the reasons I have set out above, his judgment was plainly and unarguably right.

1. For all these reasons, this appeal must be dismissed.