Mr K Kakara v CrossFlow Payment Trading Solutions Limited — 2022

Mr K Kakara was employed by CrossFlow Payment Trading Solutions Limited as a junior DevOps Engineer from 8 November 2021 until 26 January 2022. He was dismissed on 19 January 2022 and given one week’s notice. The respondent withheld £1,770.02 from his January wages and also sent him an invoice for a further £4,229.98 under clause 16.5 of the employment contract, which purported to require repayment of £6,000 for training costs if employment ended within 12 months.

The tribunal accepted that the claimant was an employee, that the claim was in time, and that a deduction of £1,770.02 had been made from wages. The main issue was whether the deduction was authorised by contract. The tribunal held that clause 16.5 was not a penalty clause because there had been no breach of contract: the respondent had terminated the employment by giving the required notice. The tribunal therefore treated the clause as enforceable in principle.

On the facts, however, the tribunal found that the respondent had not shown that material training had been provided which would justify the deduction. It gave limited weight to the respondent’s witness evidence and documents because Mr Shortland and Mr Keating did not attend to be cross-examined, there was no contemporaneous documentary record of the alleged training, and the documents produced were either undated or prepared after the claimant had left. The tribunal found that much of what was described as training was in fact on-the-job supervision and induction for a new starter, not training within clause 16.5.

Applying section 13 of the Employment Rights Act 1996 and the authorities it cited, including Cavendish Square Holding BV v Makdessi, Kaur v Hatten Wyatt Solicitors, Fairfield Ltd v Skinner and MBL UK Ltd v Quigley, the tribunal concluded that the respondent had not proved any material training cost that would support the deduction. It therefore held that £1,770.02 had been unlawfully deducted from the claimant’s wages and ordered that sum to be paid. The respondent’s application for a preparation time order was rejected.