Claimant v Secretary of State for Business and Trade
Outcome
Individual claims
Both Claimants failed to prove they were employees of Anglo Freight UK Ltd when it went into liquidation. The tribunal found the Claimants were controlling shareholder-directors, not employees. There was no genuine contract of employment, no mutuality of obligation, and no control by the company over the Claimants' work.
C1's claim for unpaid salary was struck out as significantly out of time under s.188 ERA 1996. The tribunal found it was reasonably practicable for C1 to present the claim within three months of the rejection letter dated 21/11/23. C2's claim was within time but failed on the merits as she was not an employee.
C1's claim for unpaid notice pay was struck out as significantly out of time under s.188 ERA 1996. C2's claim was within time but failed because the tribunal found no genuine employment contract existed and the written contracts relied upon were shams inconsistent with actual practice.
C1's claim for holiday pay was struck out as out of time. C2's claim was within time but failed on the merits. Additionally, the tribunal found the quantum was inconsistent with claimed contracts, carried-forward holiday contradicted express contractual terms prohibiting carry-forward, and the Claimants were not employees in any event.
Facts
Mr and Mrs Goodman were equal shareholder-directors of Anglo Freight UK Ltd from 2013 until its voluntary liquidation in July 2023. They claimed redundancy pay and other payments from the National Insurance Fund. The tribunal found they received irregular ad hoc payments rather than genuine salaries, P60s showed pay below national minimum wage for claimed hours worked, claimed written contracts were shams inconsistent with actual practice, and payments were structured for tax avoidance purposes.
Decision
The tribunal dismissed all claims. C1's claims for unpaid wages, notice pay and holiday pay were struck out as significantly out of time. C2's claims were in time but failed on the merits. Both Claimants failed to prove they were employees when the company went into liquidation. The tribunal found no genuine employment contracts existed, no mutuality of obligation, and the Claimants were controlling shareholder-directors operating through the company as a tax-efficient vehicle.
Practical note
Shareholder-directors claiming payments from the National Insurance Fund must prove genuine employee status at the date of insolvency; tax-structured remuneration arrangements, irregular payments below minimum wage, and lack of genuine contractual obligations will defeat such claims even where written contracts exist.
Legal authorities cited
Statutes
Case details
- Case number
- 1401654/2024
- Decision date
- 16 May 2025
- Hearing type
- full merits
- Hearing days
- 1
- Classification
- contested
Respondent
- Sector
- central government
- Represented
- Yes
- Rep type
- lay rep
Employment details
- Role
- Director
- Salary band
- Under £15,000
- Service
- 10 years
Claimant representation
- Represented
- No