CA-2024-001613 - [2025] EWCA Civ 956

The ET consisted of Employment Judge Broughton sitting alone. After a two-day hearing, the ET dismissed the appeal and upheld the notices. The ET’s judgment is long and detailed. There are about 50 pages of closely typed text. The issues in the EAT were narrower than they had been before the ET. The EAT’s summary of the ET’s judgment is sufficient, at least for the purposes of the appeal to the EAT, as Miss Hughes accepted in her oral submissions. I will rely principally on that summary, for which I am grateful. I will, nevertheless, add some factual details. Further, because HMRC’s argument in this court was somewhat different from their argument in the EAT, it is necessary to see what the ET had to say about that argument, as it was developed in the ET hearing. HMRC called two witnesses, Ms Romanek, who was involved in HMRC’s investigation of the Respondents’ business, and Mr Gregory, who had worked on and off for the Respondents for about ten years.

In the course of her oral submissions, Miss Hughes referred us to some specific passages in the ET’s judgment, so I note those first. The ET described the effects of the notices in paragraphs 2 and 3. TPS was assessed for NMW arrears of £32,128.42 and penalties of £28,741.64. TSL was assessed for arrears of £30,259.84 and penalties of £30,103.80. The notices related to different periods, according to whether the employer of the relevant workers was TPS, or (after a TUPE transfer) TSL.

The evidence recorded by the ET included answers given by the workers to questions asked of them by the HMRC investigator. In paragraph 56 the ET recorded that the replies were ‘pretty consistent in that the vast majority who replied stated that the workers always travelled to sites in the company vehicles and they were picked up from their home (or close by)’. The replies ‘were consistent in stating that there was no alternative to get to the sites and a number stated that they were personally unable to drive’ (paragraph 56). Ms Romanek confirmed in cross-examination in the ET that she had not asked the workers whether ‘they had at any point asked to travel from [the Respondents’] offices/business unit by their own mode of transport and whether this was refused’ (paragraph 57).

Other evidence elicited from the Respondents by Ms Romanek and apparently accepted by the ET was that the journeys to the sites could be a four-hour drive one way but that the sites were normally two hours away (paragraphs 83 and 245 of the ET’s judgment). The ET also recorded that Ms Romanek had accepted that ‘the vast majority of the workers did not have their own means of transport’. She also ‘conceded that the location[s] were not accessible by public transport and none of the Workers had said that they had asked to use their own cars and been told that they could not do so’ (paragraph 112).

The ET’s judgment shows that HMRC argued in the ET that the facts of this case were not the sort of facts at which regulation 34 is aimed. The travelling hours were ‘very much longer and more arduous than ordinary commuting and were completely under [the Respondents’] control’ (paragraph 167.i). HMRC added that ‘the true agreement’ between the Respondents and the workers was that the workers were required to report to the Respondents’ office if the Respondents so chose and were paid for travelling hours on the basis that in practice they were usually picked up from near their homes as a matter of mutual convenience. ‘It would be arbitrary and anomalous for a minority of workers required to attend the office to qualify for NMW and regulation 34 and other workers picked up from near their home a few minutes away…are excluded (paragraph 167.ii). That ‘minority’ appears to be a reference to Mr Wood (occasionally) and to Mr Gladwin (paragraphs 58 and 59). In the ET, HMRC relied on Autoclenz Limited v Belcher [2011] UKSC 41; [2011] ICR 115 for that approach (paragraph 166 of the ET judgment), but it also referred to Uber, albeit in a different context (see paragraph 200).

The ET was aware of the decision in Mencap (see paragraphs 211, 212, and 238 of the ET’s judgment). It quoted paragraphs 35 and 36 of Lady Arden’s judgment in paragraph 213. The ET considered regulation 34 in paragraphs 256-272. It is convenient for me to summarise and comment on that reasoning below (at paragraphs 77-90).