Case No: A2/2006/1035

Neutral Citation Number: [2007] EWCA Civ 19
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM 
Employment Appeal Tribunal
HIS HONOUR JUDGE PETER CLARK
Mr M Clancy and Mr B Warman (lay members)
Royal Courts of Justice
Strand, London, WC2A 2LL

Wednesday 24th January 2007
Before :

LORD JUSTICE CHADWICK
LORD JUSTICE WALL
and
LORD JUSTICE WILSON
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Between :

	COORS BREWERS LIMITED	Appellant	
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	S P ADCOCK & ORS	Respondent	
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(Transcript of the Handed Down Judgment of
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Thomas Linden QC (instructed by Berwin Leighton Paisner LLP - Solicitors) for the Appellant
Dijen Basu (instructed by Rowley Ashworth - Solicitors) for the Respondent

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Judgment
Lord Justice Wall: 
Introduction
1.	 On 3 June 2005, following a five day hearing lasting from 18 to 22 April 2005, the Employment Tribunal sitting at Leicester (Chairman Mr. C.J. Goodchild) (the Tribunal) gave its reasons for upholding claims by four named individuals (the claimants) who, as a representative sample of more than 500 other employees, had brought proceedings in the Tribunal against their employer Coors Brewers Limited (Coors) under Part II of the Employment Rights Act 1996 (ERA 1996).  Part II of ERA 1996 is headed “Protection of Wages” and the order made by the Tribunal was a declaration that, for the year 2003 (properly payable in 2004) Coors had unlawfully deducted 4% of the claimants’ gross income. 
2.	On 27 January 2006, Coors appealed that decision to the Employment Appeal Tribunal (the EAT) in a constitution chaired by His Honour Judge Peter Clark, with Mr. M. Clancy and Mr. B Warman as its lay members. The EAT handed down its reserved judgment on 30 March 2006.  It allowed Coors’ appeal and set aside the Tribunal’s decision. It did not, however, dismiss the claimants’ claims, but remitted them to a differently constituted Employment Tribunal for rehearing. At the same time, it allowed Coors’ application for permission to appeal to this court against the decision to remit. 
3.	Accordingly, in this appeal Coors has two objectives. The first is that we should set aside the remission of the claims to a fresh tribunal on the ground that the Tribunal did not and does not have jurisdiction to entertain them.  The second, described as “further or in the alternative” is that we should in any event dismiss the claims on the basis that they are without foundation and have no realistic prospect of success.  I propose, accordingly, to identify the two arguments which are  advanced by Mr. Thomas  Linden QC for Coors as; (1) the issue of jurisdiction; and (2) the merits argument. 
4.	There is no cross appeal  by the claimants, who do not seek to uphold the Tribunal’s substantive decision in their favour in this court, although there is a respondents’ notice which seeks to  uphold the EAT’s decision to remit on grounds additional  to those identified in the EAT’s  judgment. 
5.	This unusual state of affairs is brought about by the fact that the principal ground upon which the EAT allowed Coors’ appeal was that the Tribunal’s reasons fell short of being what Sedley LJ in paragraph 17 of his judgment in  Tran v Greenwich Vietnam Community Project [2002] EWCA Civ 553, [2002] ICR 1101  described as “Meek compliant”  (a reference to the well-known decision of this court in  Meek v Birmingham City Council [1987] IRLR 250).  It is, moreover, common ground that the EAT cannot be faulted for allowing Coors’ appeal on this basis, and counsel for the claimants, Mr. Dijen Basu,  acknowledges both that the Tribunal’s reasons are defective, and that, as a consequence, its substantive decision on the merits is vitiated and cannot stand. 
6.	As the EAT observed  when granting Coors permission to appeal to this court,  the aggregate of the claims against Coors (taking all the potential claimants into account) is substantial and amounts to some £600,000.  It further stated that the claims raised important questions, firstly as to “the overlap between Wages Act and breach of contract claims” and secondly as to the identification of implied terms “(i) under Clark v. Nomura [2000] IRLR 766 and (ii) by custom and practice”.
7.	The issue of jurisdiction and the merits argument are, plainly, closely linked.  The issue of jurisdiction depends, in essence, on the nature of the claims. It is common ground between counsel that if the claims are, in reality, deduction from wages claims within ERA 1996 Part II, they can be litigated in the Tribunal. If, on the other hand, they are claims for unquantified damages for the breach or breaches of express or implied terms in the claimants’ contracts of employment, then the Tribunal does not have jurisdiction to entertain them. The essential task for this court, accordingly, is, in my judgment, to identify the true nature of the claims.
8.	Before setting out the facts and addressing the issues in the appeal, however, I would like to record my appreciation for the assistance we have received from both counsel in this appeal. In what is in many ways a highly unsatisfactory case, the one point which has stood out is the integrity, ability, courtesy and realism of counsel on both sides. Each plainly had a very difficult task before the Tribunal, although both were courteously reticent about it.
9.	Mr. Linden faced a Tribunal which, as it seems to me, saw little merit in Coors’ defence of the claims. Mr. Basu, who came late to the case, was faced with applications which had, hitherto, been advanced in a manner with which he did not think sustainable, and a Tribunal apparently determined to find in his favour on a basis which he recognised was vulnerable to attack. Each attempted to guide the Tribunal to a sustainable conclusion, and it is the fault of neither that both failed.  Each is now constrained to recognise that the Tribunal itself failed in its most basic task, namely to find the facts and apply the law to the facts as found. Each has co-operated with the other, in the best traditions of the Bar (and in the absence of a transcript of what occurred in the Tribunal) to remedy the manifest deficiencies of the Tribunal’s decision by attempting to agree a note of the evidence before the Tribunal.  In this latter task, they have, inevitably, failed to a certain extent, but I am nonetheless grateful to them for the attempt.  
The facts: preliminary observations
10.	HH Judge Clark, who is, of course, himself one of the most experienced and knowledgeable circuit judges currently adjudicating in the field of employment law (and who, moreover, has a detailed understanding of the workings of Employment Tribunals) described the Chairman of the Tribunal as “highly experienced” and the Tribunal’s lay members as “well versed in the realities of industrial life”.  Speaking for myself, I do not doubt either of those descriptions.  Equally, however, I entirely agree with the EAT when, in paragraph 4 of its judgment, it said: 
As the Tribunal correctly observed at the outset of their judgment, there is little dispute as to the primary facts, the issue is as to the interpretation of what occurred. Nevertheless, careful findings as to the material facts are essential before analysing the legal issues and applying the law to the facts as found in order to arrive at a permissible conclusion.
11.	Although in many respects uncontentious, the facts are, in my judgment, by no means straightforward.  The normal course of an appeal from the EAT is for this court to decide whether or not the Tribunal has made an error of law, and if it has, whether or not that error has been corrected by the EAT.  The focus is normally on the Tribunal’s decision. In such a case, this court is usually able to take the facts as found by the Tribunal from its reasons, and the Tribunal itself is frequently described as “the industrial jury”. Even where it is asserted that the Tribunal erred in law because the findings it made were not open to it, or were otherwise perverse, the essential bedrock of any decision made by the Tribunal lies in its findings of fact.
12.	In this appeal, we are deprived of the assistance this court normally receives from the Tribunal’s findings of fact. It is common ground that they are inadequate – indeed, virtually non-existent. This places this court in a difficult position, since, self-evidently, it is not a tribunal whose function is to hear oral evidence or to make findings of fact.  The normal course, where, unusually, the Tribunal has made these basic errors, is to remit the application for re-hearing.  That, indeed, is what Mr. Basu asserts we should do.
13.	Mr. Linden, in my judgment, therefore has the difficult task to trying to persuade us (in the absence of findings of fact by the Tribunal) that the Tribunal had no jurisdiction in any event.  That, it seems to me, he can only do if he can persuade us that, on any view of the facts, these are simply not claims within Part  II of  ERA, but are properly categorised as claims for unliquidated damages for breach of contract which must be brought, if capable of being sustained, in the county court.
14.	Before attempting to explain the background and discuss the points of law involved, therefore, I think it worthwhile repeating that, in my judgment, this case is a paradigm example of the truth of the proposition that, however experienced the Chairman of the Tribunal, its essential task in every case remains the same. That task is twofold. It is, firstly, to make clear findings of primary fact; secondly, it is to apply the law to the facts as found.  The Tribunal appeared to recognise this in the first paragraph of its reasons.  It records sitting for 5 days and considering over 3,000 relevant documents, although we were told at the Bar that this figure was a misprint, and should have read “300”.  The same paragraph records that the Tribunal had been: -
….led through with meticulous care the background to this case. In our decision we will make findings of fact. It is fair to say that there is little dispute as to when and how events occurred. The dispute is about the interpretation of what occurred. 
15.	I do not doubt the accuracy of the first 10 words of this citation. Unfortunately, the Tribunal does not appear to have implemented the intention contained in the second sentence, and, furthermore, it does not appear to have addressed what have plainly emerged in this court as the critical issues on the merits argument. I will identify and discuss these once I have set out the background. The principal lesson of this case for Tribunals and their chairmen, however, is that there is never any substitute for the proper performance of the Tribunal’s basic fact-finding function. 

The facts as identified by the EAT
16.	Since it is impossible to summarise the facts from the Tribunal’s decision, I propose to do so by reference to the judgment of the EAT. The citation is a lengthy one, but assists, I think, in understanding the nature of the case.
6.		At all relevant times, the claimants were employed at a brewery in Burton on Trent.  From 1998 until August 2000 their employer was Bass Brewers Ltd (BBL) part of the Bass Group (Bass).
7.	Bass operated a scheme called the Bass Employee Profit Share Scheme (BEPSS) (“the Scheme”) whereby eligible employees, including those claimants then employed by Bass, were entitled to 	the allocation of shares in the Bass holding company based on a proportion of annual group profits assigned to the scheme by the main board of directors at their discretion.  The scheme was tax-	efficient under the terms of the Finance Act 1978 until a change in the relevant legislation, taking effect in December 2002, rendered it tax-inefficient.  Generally, the sum allocated for share purchase for 	the benefit of the scheme members, to be held on trust for them, worked out at between 4%-5% of each member’s annual wage during the 20 or so years of its operation between 1980 and 2002.  	Additionally, of course, the value of the shares fluctuated according to market conditions. 
8.	There were conditions attached to the Scheme, including a minimum period during which the shares had to be held in order to take advantage of the tax break on re-sale under the taxation 	legislation and, significantly, members of the scheme were only eligible to participate in the scheme for so long as they remained employed by the Bass Group.
9.	In August 2000 Interbrew SA completed the acquisition of BBL by way of a share acquisition. Thereafter the former Bass employee members of the scheme who remained in employment with Interbrew became ineligible for continued membership of the scheme by virtue of cessation of their Bass employment.  That gave rise to this potential inequity.  The scheme year ran from 1 October to 30 September.  Thus BBL scheme members would not derive any benefit from their contribution to any profits made by the Bass Group during the year commencing 1 October 1999, normally to be reflected in a share allocation in February 2001.  The Tribunal found (reasons paragraph 14) that any prior contractual obligation owed by Bass to the BBL (Burton) scheme members ceased on the acquisition by Interbrew.  If nothing had been said at the time, there would have been no continuing obligation on the new owners.  However, the Tribunal placed significance on certain questions and answers appearing on the BBL website (Brewnet) as indicating a commitment by the company to put in place a scheme equivalent to the previous BEPSS.  The Tribunal put it in this way; it was a commitment which the company intended to honour to put in place a scheme that would “pay the equivalent value as the former share holding scheme had”, taken with oral evidence given to the Tribunal by Kirsty Derry, Head of Rewards, that this was a promise by the company that was to be acted upon by the workforce.
10.	On 5 January 2001 an announcement was placed on Brewnet by the Chief Executive of BBL, Ian Napier.  It is common ground between Counsel 	that, although not specifically identified, it is this announcement to which the Tribunal refer at paragraph 20 of their reasons where they say under 	the heading “Conclusion”: 
“20.	We believe that the original shareholders’ scheme was part of a contract of employment package.  In 2000, because of the events, the scheme ceased.  Following cessation after the shareholding had been transferred to Interbrew the company by its chief executive promised to replace it with a scheme that would make a payment of equivalent value. That was not just a promise for the next 12 months but was continuing.”
11.	Since the Chief Executive’s announcement of 5 January 2001 played a significant role in the Tribunal’s determination in this case and forms part of the focus of this appeal, we should set it out in full.
“BEPSS Replacement 2001
I am pleased to tell you that for the financial year 2000 people who would have qualified for BEPSS (Bass Employee Profit Share Scheme) shares and were still in employment on 1st January 2001 will be granted a special cash payment of 5% of Shareable Earnings.
Shareable Earnings replicates the calculation used under the Bass PLC plan and means P60 (gross) earnings for April 2000, including shift and overtime pay but excluding items such as Divisional Bonus.
Payment will be made 7th March 2001 for weekly and four weekly paid employees and will be subject to deductions for tax and national insurance.
This special cash payment of 5% of shareable salary substitutes the share allocation that would have been made had we still been part of Bass PLC and honours our commitment to substitute the previous scheme.
Following the announcement made on Wednesday January 3rd we will defer a decision of the future shape of this reward benefit and an announcement will be made at the appropriate time regard nature in the future.
If you have any further questions, please telephone the Employee Services Help Desk on 7200 3456 Option 2”.
12.		On 28 February 2001 Mr Napier wrote to employees in these terms:
“Dear Colleague
Bass Brewers Incentive Scheme
I am delighted to inform you that Bass Brewers' has achieved 103% of our budgeted target for Operating Profit for the Interim Bonus Scheme (1st October – 31st December 2000). This triggers a Bonus award of 1% of your base salary. £«bonus».
In accordance with the recently announced cash replacement for BEPSS, you will also receive £«bepss».  This one-off payment honours our commitment to substitute the share allocation that would have been made had we still been part of Bass PLC.
These payments will be subject to tax and National Insurance in the normal way and will be paid into your bank account on 7th March 200I, along with your normal pay for that period.
This has been a tremendous achievement in an intensely competitive and changing market and I am proud of everyone's contribution. Bass Brewers continues to be a tremendously successful company despite all the uncertainty surrounding us - let’s keep it that way.
The focus of our Incentive Scheme for the current financial year, January-December 200I, is Operating Profit. Our performance against target will trigger an incentive payment of 3.5%.
Our number one priority is to crush the competition and smash our targets in 200I. The year has started well and if we maintain this level of performance we will all share in the rewards of our efforts through this Incentive Scheme.”
13.	In evidence, it is common ground before us, Mr Builth, the union shop steward on the Burton site and principal witness for the Claimants, accepted that the 5 per cent payment, made in March 2001, was a one-off and that the position in relation to any future replacement of BEPPS was unresolved at that stage as between the Company and the union.
14.	Following a ruling in September 2001 by the DTI the Burton BBL business was acquired by Adolph Coors Inc: by share transfer on 2 February 2002, and its name was changed to Coors Brewers Ltd, the 	present respondent.  Meanwhile, on 21 December 2001 employees received a letter from BBL headed ‘One-off discretionary payment’.
It began:
“I am delighted to confirm that you, as an employee who would have qualified under the old BEPSS Scheme, will receive a one off discretionary cash payment of 5% of Shareable earnings as a gesture of good will.”
The letter went on to outline what was described as an Interim Company Incentive Scheme for the period 1 January 2002 until Bass Brewers separated from Interbrew.
15.	On 28 February 2002 the Respondent wrote to employees announcing the ‘Coors Brewers Incentive Scheme’ (CBIS), described as ‘a new and enhanced discretionary Incentive Scheme’ to be operated for the remainder of the Coors’ financial year, 3 February – 31 December 2002.  It provided for a scale of payments of between 2 and 8.5 per cent depending on growth performance of the Burton operation (as opposed to Group performance as under the old BEPSS).  That letter continued:
“…Coors Brewers will make a one off discretionary payment of £500 as a gesture of goodwill…”
A payment was duly made on 3 April 2002.  
16.	The Respondent’s performance in 2002 led to incentive payments to the employees in early 2003, following a failure to agree between the Company and the union as to the method of calculation under the CBIS 2002.  The payments were in the order of 4.8 per cent of wages.
17.	In January 2003 the Respondent announced its incentive scheme for 2003 (CBIS 2003) based on a formula measuring the Company’s Earnings before Interest and Tax (EBIT). Growth on performance set against 2002 results (sic). Under this formulation any result representing less than 91.6 per cent of target growth would result in no payment to employees, rising to a payment representing 8.5 per cent of wages if 107 per cent of planned growth was achieved.
18.	In the event, once it became clear that targets would not be reached, lower targets were set in August 2003 but these were not reached and no  payment was made under CBIS 2003, leading to these proceedings.
The EAT’s assessment
17.	On the issue of jurisdiction, the EAT conducted an analysis of the rival arguments, and having reached the conclusion that the appeal had to be allowed on Meek v Birmingham City Council grounds, held that the Tribunal had jurisdiction to entertain the claims.  It accordingly rejected Mr. Linden’s submission that it was not open to the Tribunal on a claim under Part II of ERA 1996 effectively to quantify an unliquidated claim for damages for breach of contract. It held that the claims did not “fail inevitably” on this basis.  In the EAT’s judgment, the outcome would “depend upon precisely what if any legal entitlement is found by the Tribunal”.
18.	On the merits argument, the EAT rejected the cases advanced by counsel on both sides. In paragraphs 43 and 44 of its judgment, it said: -
43.	Mr Linden submits that the Tribunal’s finding that the Respondent unlawfully deducted 4 per cent of annual wages in 2004 is perverse.  Mr Basu accepts that, on the facts of the case, the Tribunal’s apparent conclusion that the Respondent was in breach of an express term of the contract may be so characterized.  However, he submits that the result is plainly and unarguably correct (see Dobie v Burns International [1984] ICR 812) on the basis either of breach of the implied contractual term that the employer will not perversely exercise his discretion under a non-contractual bonus scheme (Clark v Nomura) or on the basis that a term as found by the Tribunal fell to be implied by custom and practice, applying the principles in Quinn v Calder ([1996] IRLR 126).  We reject that submission.  Neither of these ways of putting the Claimant’s case was properly considered by the Tribunal and we are not in a position to say with the degree of certainty required what the outcome of such consideration would be.
44	Equally, we are not persuaded by Mr Linden that claims put in these alternative ways are bound to fail, applying the perversity test as explained in Yeboah v Crofton ([2002] EWCA Civ 794, [2002] IRLR 634).
19.	In paragraph 45, the EAT stated its conclusion that the appropriate course was to remit the matter to a fresh Tribunal, and in paragraph 46, it identified the principal issues to be decided by the fresh Tribunal as being the following:-
At the next hearing the principal issues for the Tribunal to determine are:
(1)	whether the Claimants had a legal entitlement to a bonus payment in 2004 based on:
(a) 	an implied term of the contract of the kind identified in Clark Nomura, or
(b)	a term to be implied by custom and practice, applying the approach in Quinn v Calder.
(2)	if so, whether that bonus payment is clearly ascertainable and
(3)	if so, whether a sum properly payable has  been unlawfully deducted from their wages.
The relevant statutory provisions
20.	It is common ground between counsel, and clear beyond peradventure, that if the claimants’ claims cannot be brought within Part II of ERA 1996, and are properly claims for unliquidated damages of breach of contract, the Tribunal has no jurisdiction to entertain them, and they must be brought in the county court.  The simple reason for this is that article 3(c) of the [Employment Tribunals] Extension of Jurisdiction  (England and Wales) Order 1994 (SI 1994/1623) (the order) which, although initially made under the Employment Protection (Consolidation) Act 1978, now has effect as if made under the Employment Tribunals Act 1996 (the terms of which it is unnecessary to set out) provides that:-
Proceedings may be brought before an [employment tribunal] in respect of an employee for the recovery of damages or any other sum (other than a claim for damages, or for a sum due, in respect of personal injuries) if –
…….
(c) 	the claim arise or is outstanding on the termination of the employee’s employment (emphasis supplied)
21.	Mr. Basu accepts that article 3(c) of the order applies, and that to succeed in vesting the Tribunal with jurisdiction to hear and determine the claimants’ claims, he has to bring them within Part II of  ERA 1996. He wryly makes the point that if any of the 509 individual claimants had been dismissed from, or had otherwise left, Coors’ employment, they would have been – indeed, would be - able to make an ERA 1996 Part II claim, since in each case the sum involved is lower than the £25,000 ceiling imposed on such claims by article 10 of the order.  I have no doubt that Mr. Basu’s point is correct, but equally, that it is irrelevant. The obvious response to it – the correctness of which he properly accepts – is that this court has to apply the legislation as it has been enacted by Parliament, which, in this instance, has plainly limited contractual claims in the Tribunal to those arising or outstanding  on the termination of an  employee’s employment.  It is, therefore, on the facts of this case, Part II or nothing, so far as the issue of jurisdiction is concerned. 
22.	Under Part II of ERA 1996, employees have the right not to suffer unauthorised deductions from  their wages. For present purposes, it seems to me that the relevant  provisions of Part II are contained in section 13, which I propose to set out in full: -
13. (1)	An employer shall not make a deduction from wages of a worker employed by him unless –
(a) the deduction is required or authorised to be made by virtue of a statutory provision or a relevant provision of the worker's contract, or
(b) the worker has previously signified in writing his agreement or consent to the making of the deduction.
(2)	In this section "relevant provision", in relation to a worker's contract, means a provision of the contract comprised-
	(a) in one or more  written terms of the contract of which the employer has given  the  worker  a  copy  on  an  occasion prior to the employer making the deduction in question, or
	(b) in one or more terms of the contract (whether express or implied and, if express, whether oral or in writing) the existence and  effect, or combined  effect, of which in relation to the worker the employer has notified to the worker in writing on such an occasion.
(3)		Where the total amount of wages paid on any occasion by an employer to a worker employed by him is less than the total amount of the wages properly payable by him to the worker on that occasion (after deductions), the amount of the deficiency shall be treated for the purposes of this Part as a deduction made by the employer from the worker's wages on that occasion.
(4)	Subsection (3) does not apply in so far as the deficiency is attributable to an error of any description on the part of the employer affecting the computation by him of the gross amount of the wages properly payable by him to the worker on that occasion. 
(5)	For the purposes of this section a relevant provision of a worker's contract having effect by virtue of a variation of the contract does not operate to authorise the making of a deduction on account of any conduct of the worker, or any other event occurring, before the variation took effect.
(6)	For the purposes of this section an agreement or consent signified by a worker does not operate to authorise the making of a deduction on account of any conduct of the worker, or any other event occurring, before the agreement or consent was signified.
(7)   	This section does not affect any other statutory provision by virtue of which a sum payable to a worker by his employer but not constituting "wages" within the meaning of this Part is not to be subject to a deduction at the instance of the employer.
23.	“Wages” are defined in ERA 1996, section 27(1) as follows: -
27.	(1) In this Part "wages", in relation to a worker, means any sums payable to the worker in connection with his employment, including-
	(a) 	any fee, bonus, commission, holiday pay or other emolument referable to his employment, whether payable under his contract or otherwise.
24.	Also relevant for present purposes is ERA 1996, section 27(3), which provides: -
(3) 	Where any payment in the nature of a non-contractual bonus is (for any reason) made to a worker by his employer, the amount of the payment shall for the purposes of this Part –
(a)	be treated as wages of the worker, and 
(b) 	be treated as payable to him as such on the day on which payment is made.

The Tribunal’s approach to the issue of jurisdiction
25.	In paragraph 20 of its reasons, the Tribunal found that “during the year 2003 there existed a contractual term to pay the direct workforce money equivalent  to what the workers would have received under the old shareholders scheme.” Having made that finding, the Tribunal addressed the  issue of jurisdiction (which, it reported, had worried it very much). It  went on: -
21.	On the issue of the payment due, (Mr. Linden) says that the amount cannot be identified. Following Delaney v Staples ([1991] ICR 331), the amount due has to be identifiable. At the most that can be said (sic) is that it would not go to more than 5%.
22.	Mr. Basu, in a carefully constructed argument argues that we should assess the amount due. He comments that if this case had been brought under the Transfer of Undertakings Regulations (TUPE) there really would not be any issue, as we would be able to assess the amount due. However, ironically Regulations designed to put an asset transferred workforce in the same position as (if Mr. Linden’s argument is followed) puts them in a stronger position (sic). Mr. Basu says that where the exact amount is difficult to ascertain then it must be left to the Tribunal to assess. It cannot be right, he would say, that merely because the exact amount of money cannot be fixed, even though there is a clear obligation to pay a sum, that a respondent can walk away saying it is not enforceable. The law relating to employment cannot be regarded as a law that is written in stone and is fossilised. It must actually take into account what is actually happening on the ground. 
23.	In the cases referred to us we can see that under (TUPE) there is a power to assess. We note (the Chairman did the case management) that Delaney v Staples was on a different factual basis and was aimed at the then practical problem of the Tribunal’s powers to deal with breach of contract cases. Not this issue. We resolved the difficulty in this way. We went back as urged by the First President of the Employment Appeals Tribunal to the clear waters of statute, we find that somewhere between 4% and 5% of income was properly payable. We adopt the same process as we would have adopted if this had been a (TUPE) case and we follow the way that (Mr. Basu) has asked us to follow. We make an assessment. 
24.	We know that 2003 was a profitable year but not such a profitable one as Coors had hoped for. We know also from documents in the bundle that Coors internationally is a highly profitable company. We received no evidence that this was a case of the whole group suffering a bad year or of the brewery in England suffering major losses. However, we do accept evidence that of the respondents to keep the pension benefits alive of their English workforce made substantial payments into the fund (sic). Mr. Linden like the trade union in 2003 decided on this issue to keep his powder dry and not to assist us in making an assessment. He simply says to make any assessment is wrong. It could be easy for us, therefore, to say that as in the past 20 or 22 years the workforce had received close to 5%m (sic), we order 5%. However, looking at the actors relating to the pension payment (sic) we believe that this may have been a year in which the old scheme would have paid less than 5%. We therefore assess the amount due as 4%.
25.	We hold that the respondents failed to make a payment of 4% of the gross basic wage of each of the four claimants. That payment was due in 2004 and the respondents are ordered to make payment of the sum. If there is any difficulty as to the assessment the matter can be referred back to this Tribunal.
The approach of the EAT to the issue of jurisdiction
26.	Having identified the relevant authorities, the EAT stated in paragraph 30 of its judgment that: -
30.	In order to bring a (ERA 1996 Part II) claim, the claimants must show a legal entitlement to an ascertainable sum which, although properly payable, has not been paid in whole or in part.  Where the legal entitlement is said to arise from a contractual term, the monetary value of that entitlement must be clear.  The point does not turn on whether the legal entitlement amounts to liquidated or 	unliquidated damages for breach of contract.
31.	That brings us to the different ways in which a contractual right to payment may be established.  Three possibilities arise:
(1)	express term of the contract of employment;
(2)	implied term of the contract, applying the approach in Clark v Nomura International plc [2000] IRLR 766 (Burton J);
(3)	a term to be implied by custom and practice – see Quinn v Calder [1996] IRLR 126.

27.	The EAT accepted that all three possibilities had been advanced by Mr. Basu before the Tribunal. However, it had failed to give Meek compliant reasons for its conclusion, and there was no analysis of the three different ways in which the alleged legal entitlement to payment had been put by the claimants. The Tribunal had also mis-stated the “officious bystander” test for implying contractual terms, and it was unclear to the EAT whether the Tribunal was finding an express as opposed to an implied contractual term. There had been  no analysis by the Tribunal of what, in law, amounted to an express term of the contract, nor was there any analysis of the legal requirements for the implication of a contractual term by custom and practice or under Clark v Nomura  principles. In summary, therefore, the EAT was unable to say by what process of reasoning the Tribunal had reached its conclusion. 
28.	Unfortunately, when the EAT itself came to consider the issue of jurisdiction, it did not resolve it.  Instead, it said in paragraph 42 of its judgment: -
42.	We have earlier considered the rival submissions of counsel dealing with Mr. Linden’s point that it is not open to an Employment Tribunal, on a (claim under ERA 1996 Part II), effectively to quantify an unliquidated claim for damages for breach of contract.  In our judgment the claims do not fail inevitably on this basis.  It will depend upon precisely what if any legal entitlement is found by the Tribunal. 
 
The argument for Coors on the issue of jurisdiction in this court
29.	The essence of Mr Linden’s submission was, in effect, that the Tribunal’s analysis was simply wrong, and that the EAT’s refusal to grapple with the issue would not do.  Alternatively, he argued that whichever of the EAT’s three options was adopted, the result was the same. The claims, if they resonated at all, were unquantified claims for damages for breach of contract.  They were not, accordingly, justiciable under Part II of  ERA 1996.
30.	Mr. Linden adhered to his submission that the unlawful deduction of wages provisions in Part II of ERA 1996 required there to be a legal obligation to pay a specific sum on the occasion in question.  A requirement to consider whether a payment should be made was not enough. Thus, where the legal obligation contended for was said to be contractual in nature, then, in order to be justiciable, the claim under the unlawful deduction of wages provisions had to be the equivalent to an action for an agreed sum.  Mr. Linden relied on a passage from the judgment of  Nicholls L.J. (as he then was) in Delaney v. Staples  [1991] ICR 331 at 340E-F
If, come his “pay day”, a worker is in law entitled to a particular amount as wages and he receives nothing, then, whatever be the reason for non-payment, that amount is to be treated as a deduction made from his wages on that occasion.
31.	Mr. Linden emphasised the words “particular amount”. Whilst he acknowledged that the context for Nicholls LJ’s judgment was slightly different from the present, and that the precise boundaries of the unlawful deduction of wages provisions have not been fully explored, he nonetheless relied on Nicholls LJ’s judgment as a correct statement of the position.  In amplification / addition, he made the following five points:-
(i)		the concept of “wages properly payable” on a particular occasion in section 13(3) of the 1996 Act did not readily comprehend an award of damages for breach of contract;
(ii)	the definition of “wages” in section 27 referred to “sums payable” and the examples given were of payments due under contract or otherwise,  not of damages for breach of contract; 
(iii)	ERA 1996, section 27(3) clearly assumed that a non- contractual bonus (i.e. one which is discretionary) was only wages and/or payable once the sum has been paid or, as was held in Farrell Matthews & Weir v Hanson [2005] IRLR 160, declared.  In the instant case the best that  could be said was that the bonus had been declared as nil, and thus no sum was therefore identifiable as wages and/or became payable;
(iv)	furthermore, other features of the unlawful deduction of wages provisions, such as the lack of any power on the part of the employer to plead a set-off or counterclaim and the lack of any power to award a quantum meruit in industrial action cases, suggested that Parliament cannot have intended that these provisions permitted an employee to do anything other than bring an action for an agreed sum.  The provisions were clearly directed at simple questions as to whether a worker had been paid less than his due rather than contemplating that Employment Tribunals would be concerned with the complexities of the law of contract;
(v)	apart from the dictum of Nicholls LJ cited above, when Delaney v. Staples was before the House of Lords, Lord Browne-Wilkinson, who had given the leading speech,  did not question the proposition that there was no power to award damages for breach of contract under the unlawful deduction of wages provisions.  Whilst, again, the context was slightly different, the House appeared to have proceeded on the basis that it is a given that there must be a contractual or other right to a specific sum by way of liquidated damages which arises on a particular occasion.
32.	Mr. Linden also relied upon the matters to which I have already referred, namely that the jurisdiction of  Employment Tribunals to award damages for breach of contract was set out in what is now section 3 of the Employment Tribunals Act 1996 and the Order, and was closely circumscribed. He cited the £25,000 limit of a damages award as an example, and argued that it would be inconsistent with the provisions of the Order for there to be a power under ERA 1996 Part II to award unlimited damages in relation to breach of contract claims arising during the employee’s employment.  
The argument for the claimants in this court
33.	For the claimants, Mr. Basu argued that in order for Part II of ERA 1996 to apply, there did not need  to be a legal obligation to pay a specific sum on the occasion in question. He submitted that it was sufficient for there to be a quantifiable sum which, if it was in dispute, would be decided by the Tribunal. The Tribunal was thus entitled to, and did, find that, following the departure of the company now known as Coors from the Bass group, the claimants were entitled to a payment of a sum of money pursuant to an express term communicated by way of the ‘Company Announcement’ made by Coors’ then Chief Executive, Iain Napier, and individual letters very much like it, in January 2001. All that the Company Announcement left open for the future, he submitted, was the “future shape“ and “nature” of “this reward benefit”. Rather like many perfectly enforceable settlement agreements, the precise terms were left to be ironed out in due course.
34.	Mr. Basu submitted that the Tribunal had made a permissible assessment of the sum properly payable pursuant to the replacement for BEPSS, in the light of the evidence from Coors of the profit which it had made, the shortfall in the pension fund which it had sought to correct and the application of the old BEPSS scheme over the course of 20 years, in good, and less good, years. Coors had, moreover, chosen not to lead evidence on the performance of any ‘group’ of which it might have been part, or on the performance of its United States parent company, to contend for a lower payment.
35.	Specifically as to quantum, Mr. Basu argued that Coors had told the Tribunal that its profits in the relevant year had been £83,500,000, roughly static from the previous year, but that it had had to make provision for a pensions shortfall. In 2003, Coors’ employees brewed (and sold) a greater amount of beer than they had ever done before. Coors had  chosen not to put forward evidence of the performance of any group of companies to which it might have considered that it belonged (analogous to the Bass group, the performance of the UK parts of which had been relevant to the assessment of the distribution under BEPSS). Coors had chosen not to assist the tribunal with any competing basis for assessment of the sum properly payable.
36.	The evidence before the Tribunal was that, for 20 years, Coors’ employees had received allotments of shares to the value of between 4 and 5% of their salary.  In every one of the years that BEPSS operated, there was an allotment of shares, even when the performance of Bass PLC was disappointing.  Documents before the Tribunal showed the approach taken under BEPSS. For example, a memorandum from D. B. Walsh and J. Watson to E. P. Jowett and M. Hough dated 7 September 1994, was before the Tribunal. It spoke  of the  company (then called Bass Brewers Limited) showing a reduction in profit of 7% but that company (as opposed to Bass PLC) still being “able to provide employees with a 4.5% share allocation on the profit share scheme”. That, Mr. Basu submitted, was evidence of the approach taken by Coors’ predecessor in a disappointing year.
37.	The Tribunal’s reference to the TUPE Regulations, at paragraph 23 of its judgment, was a reference to the claimants’ argument that, had they left the Bass PLC Group by reason of a relevant transfer, then they would have been entitled to the benefit of a bonus scheme of substantial equivalence. Mr. Basu argued that, on whichever of the bases the claimants succeeded, the sum now properly payable should be substantially equivalent to the value of the shares which they would previously have been allotted, or to the cost to Coors of paying for those shares.
38.	The Tribunal accordingly had jurisdiction, and the appeal should be dismissed on this point.
Discussion
39.	In paragraph 19 of this judgment, I set out the issues identified by the EAT for the new Tribunal for determine on remission for rehearing.  The first was whether the claimants had a legal entitlement to a bonus payment based on an implied term of the kind identified in Clark v Nomura. Speaking for myself, however, I do not gain a great deal of assistance from that case when considering the issue of jurisdiction in this appeal.  
40.	The critical issue for Burton J in that case (which, as Wilson LJ pointed out in the course of argument, was heard in the High Court and is firmly rooted in the law of contract) was whether or not the terms of the claimant’s contract entitled the defendants not to pay him a bonus. The crucial phrase in the contract was: “Nomura operates a discretionary bonus scheme, which is not guaranteed in any way and is dependent upon individual performance and after the first 12 months your remaining in our employment on the date of payment” (see paragraph 31 of the judgment). The claimant’s individual performance - from the financial perspective – plainly warranted the payment of a bonus. 
41.	In paragraph 40 of his judgment, Burton J identified the test to be applied to the exercise of the defendants’ discretion not to pay the claimant a bonus. He said: 
My conclusion is that the right test is one of irrationality or perversity (of which caprice or capriciousness would be a good example) i.e. that no reasonable employer would have exercised his discretion in this way …. Such a test of perversity or irrationality is not only one which is simple, or at any rate, simpler to understand and apply, but it is a familiar one.   In reaching its conclusion what the court does is thus not to substitute its own view, but to ask the question whether any reasonable employer could have come to such a conclusion. Of course, if and when the court concludes that the employer was in breach of contract, then it will be necessary to reach a conclusion, on the balance of probabilities, as to what would have occurred had the employer complied with its contractual obligations, or, as Timothy Walker J put it in Clark v BET [1997] IRLR 348, assess, without unrealistic assumptions, what position the employee would have been in had the employer performed its obligation. That will involve the court in assessing the employee’s bonus, on the basis of the evidence before it, and thus to that extent putting itself in the position of the employer; but it will only do so if it is first satisfied, on the higher test, not that the employer acted unreasonably, but that no reasonable employer would have reached the conclusion it did acting in accordance with its contractual obligations, and the assessment of the bonus then of course is by way of an award of damages.  
42.	Speaking for myself, I do not doubt the correctness of Burton J’s legal analysis of the position in Clark v Nomura. However, it does not seem to me that the case addresses the point of this appeal. Clark v Nomura was a claim for unliquidated damages for breach of contract.  By contrast, the critical question to be addressed in this appeal, in my judgment, is whether or not  - on the assumption that  the claimants can establish what I will describe as a Clark v Nomura breach of Coors’ obligation to make them discretionary payments - that breach resulted in an unauthorised deduction of wages. Clark v Nomura does not, in my judgment, provide any real assistance in answering that question.  For similar reasons, I do not gain any great assistance from the decision of the EAT in Quinn v Calder Industrial Materials Ltd [ 1996] IRLR 126.
43.	More relevant, in my judgment, is the line of cases deriving from Delaney v Staples [1991] ICR 331 in this court and [1992] ICR 483 in the House of Lords.  The facts were straightforward. Miss Delaney was dismissed.  She was given a cheque, said to be payment in lieu of notice, which her employers later stopped on the ground that they were entitled to dismiss her summarily.  At the date of her dismissal, however, it was common ground that she was due commission and holiday pay. She was not paid any of these sums, and took proceedings in what was then the Industrial Tribunal for unauthorised deductions from her wages. Her employers argued, not only that a payment in lieu of notice did not constitute “wages”, but that sums owed for commission and holiday pay were, similarly, not “wages” as defined by the statute. The employers’ defence in relation to commission and holiday pay failed in the Tribunal, succeeded in the EAT, but failed on appeal to this court, which restored the Tribunal’s award.  Miss Delaney went on to appeal to the House of Lords against the Tribunal’s decision (upheld in the EAT and in this court) that a payment in lieu of notice was not “wages” within the statute, but she was unsuccessful, and her appeal on that issue was dismissed. 
44.	This court was highly critical of the statutory provisions which enabled the Tribunal to entertain only part of the employee’s claim. That criticism was reinforced by the speech of Lord Browne-Wilkinson in the House of Lords, and the result was a change in the law.  To some extent, therefore, the case is of historical interest only, although in my judgment it is helpful for the light it continues to throw on the true ambit of the statutory provisions.
45.	The leading judgment in this court was given by Nicholls LJ. Two passages from his judgment were extracted by Mr. Linden and Mr. Basu, each arguing that the passage in question supported their respective stances.  Mr. Linden lit on the passage at [1991] ICR 331 at 340 which I have already set out in paragraph 30 of this judgment when summarising his argument in this court.  Mr Basu referred us to a passage on the following page, in which Nicholls LJ said: -
Fifth, as already noted, one item in the calculation prescribed by section 8(3) is the “total amount of wages that are properly payable” by the employer. It is implicit in this that in the event of dispute, this amount will be determined by the industrial tribunal when a complaint has been made under the Act. This must be so in a case where the employer claims that no wages are properly payable as well as in a case where the employer admits that something is due.
46.	In my judgment, the underlying facts of Delaney v Staples are a paradigm of the circumstances in which Part II of ERA 1996 is designed to operate.  The employee complains that there has been an unlawful deduction from his wages.  He has not been paid an identified sum. He makes a claim under Part II. The employer may have a number of defences. Those defences may raise issues of fact. Those issues will be for the Tribunal to determine. But the underlying premise on which the case is brought is that the employee is owed a specific sum of money by way of wages which he asserts has not been paid to him.  That, it seems to me, is the proper context both of Delaney v Staples and Part II of ERA 1996. 
47.	The answer to the passage on which Mr. Basu relied is, in my judgment, to be contained in an earlier part of Nicholls LJ’s judgment at [1991] ICR 339H to 340A, where he says: -
The Act is, indeed, concerned with unauthorised deductions. But section 8(3) makes plain that, leaving aside errors of computation, any shortfall in payment of the amount of wages properly payable is to be treated as a deduction.  That being so, a dispute, on whatever ground, as to the amount of wages properly payable cannot have the effect of taking the case outside section 8(3). It is for the industrial tribunal to determine that dispute, as a necessary preliminary to discovering whether there has been an authorised deduction.
48.	This, in my judgment, is saying in more elegant and succinct terms what I was striving to say in paragraph 46 above. Furthermore, it does not seem to me – for the reasons set out below - that the terms of ERA 1996 section 27(3) affect the position.
49.	In my judgment, this approach is not inconsistent with the majority decision of this court in New Century Cleaning Co Ltd v Church [2000] IRLR 27 (which, in any event, was decided on a different point) and is consistent with the decision of the EAT in Farrell Matthews & Weir v Hansen [2005] ICR 509. The latter is authority for a proposition with which I have no difficulty, namely that a non-contractual bonus can constitute wages, with the consequence that its non-payment by an employer may found a claim within Part II of ERA 1996. It is, however, to be noted (and in my judgment is of importance) that the claim in Farrell Matthews & Weir v Hansen was for an identified amount. It fell, accordingly within section 27(3) of ERA 1996: - see [2005] ICR 509 at 516, paragraph 22.
50.	In my judgment, therefore, the first question which falls to be addressed in this appeal can be articulated as follows: - what (if anything) was the nature of the obligation incurred by Coors as a consequence of the inevitable cessation of the BEPSS scheme?  On the assumption that there was an obligation to replace the BEPSS scheme, the second question  then becomes:  was the scheme identified in paragraphs 17 and 18 of the EAT’s judgment a proper implementation of Coors’ obligation to its workforce?
51.	 I agree with Chadwick LJ, whose judgment I have had the advantage of reading in draft, that if the scheme put in place by Coors was not a proper implementation of its obligation to its workforce, then the critical question in this appeal is that which I have identified in paragraph 42 above, namely whether the claim for damages which arises from Coors’ failure to perform its obligation can be said to be an identifiable sum, failure to pay which is to be treated as an unauthorised deduction of wages. 
52.	In answering these questions, and in particular the critical question identified in paragraphs 42 and  51,  I have to say that I prefer the submissions made by Mr. Linden. In my judgment, the highest the case can be put for the claimants is that Coors was under an obligation to put in place a scheme which, properly and fairly operated, was capable of replicating the benefits of the BEPSS scheme.  Whichever way one examines the case, however, the result is that that any payment due to the workforce under the 2003 incentive scheme was incapable of quantification in the Delaney v Staples sense. To put the matter another way, none of the claimants could properly say that on any given date in 2004, let alone the March date operated under the previous scheme, Coors had made an unlawful deduction of a quantified amount from their wages. For the reasons which Chadwick LJ sets out in his judgment, with which I respectfully agree, the claimants’ remedy (if they have one) sounds in damages for breach of contract, not under ERA 1996 Part II.. 
53.	I therefore conclude that if the scheme, as operated, did not represent a fulfilment of Coors’ obligation to create a replacement for the BEPSS, the result in jurisdictional terms is that the claimants would have suffered a loss, but that the amount of that loss was unquantified.  
54.	Had Mr. Basu been able to advance his claim to the Tribunal on the basis that there had been a breach of an obligation on the part of the employer to pay a bonus of a specified amount (whether expressed in monetary term or as a percentage of gross earnings) – or even, perhaps, a term to be implied by custom and practice - that, every year on 30 March they would receive a bonus of  x (whether expressed as £x or as a percentage of basic salary)  I think it would be arguable that the claim was quantifiable, and that, as a consequence, the claim was justiciable as an unlawful deduction of wages. 
55.	Mr Basu was, however, constrained to accept that the claim could not properly be advanced to the Tribunal on that basis. The fact is that the claimants were unable to quantify the breach, and required the Tribunal to do so. That, in my judgment renders the claim one for damages for breach of contract, as opposed to a quantifiable claim for unlawful deduction of wages.
56.	Part II of ERA 1996, as I read it, is essentially designed for straightforward claims where the employee can point to a quantified loss. It was designed to be a swift and summary procedure. Of course such claims would throw up issues of fact.  The example canvassed in argument was of an employee being paid piece work, and asserting that his employer had deducted sums properly payable to him for work undertaken on the grounds that some of the items produced by the employee were defective. Delaney v Staples provides another example.  Such a dispute would not take the case outside Part II of ERA 1996. I also accept that Part II is capable of expansion along Farrell Matthews & Weir v Hansen lines as envisaged by ERA 1996, section 27(3). However, in my judgment to extend it to the present case is a step too far. 
57.	I am therefore of the clear opinion that the Tribunal did not have jurisdiction to entertain the claimants’ claims, and that the EAT was wrong to remit them to another Tribunal which, equally, would not have jurisdiction to hear them. I would therefore allow the appeal on the issue of jurisdiction, and set aside the EAT’s remission of the claims.
The merits question: are the claims bound to fail in any event?
58.	In my judgment, the merits question takes this court into a difficult area. If the Tribunal has no jurisdiction to entertain the claims, then the claims as brought in the Tribunal under ERA 1996 Part II must inevitably be dismissed. However, Mr. Linden invites us to go further, and to conclude that our dismissal of the claims on the issue of jurisdiction should also take effect as a dismissal of the claims on their merits, and should in turn govern any county court proceedings which the claimants are advised to take. 
59.	In my judgment, however, this also is a step too far. Self-evidently, there are currently no county court proceedings, and we do not have them before us.  We have not heard the evidence advanced in support of the claimants’ claims for breach of contract. Mr. Linden may be proved right in the result, but equally, if the claimants can establish, for example, that Coors in 2003 deliberately set  unrealistic targets with a view to ensuring that no bonus was paid that year; or if, to take another example, Coors’ clearly articulated but ambiguous policy that a company in its position should only be paying out bonuses every four years in five found expression in  a deliberately unrealistic threshold for the payment of bonuses based on the 2002 and 2003  performance, it may well be arguable that Coors was in breach of contract, and that the claimants have a claim for damages, which the county court could then quantify. 
60.	Although some time was spent in argument examining the somewhat exiguous evidence relating to the January 2003 scheme, it would, in my judgment, be quite wrong for this court to prejudge the issue and shut the claimants out from making a claim in the county court for unquantified damages for breach of contract based upon it, if that is what they are advised to do.  I would, accordingly,  decline the invitation to take that course.  Mr. Linden, it seems to me, has to be content with success on the first limb of his appeal. 
61.	Whilst expressing absolutely no view on the likely outcome of county court proceedings, I think it nonetheless proper to make the observation that if ever a case cried out for a negotiated settlement, this is that case.  It is to my mind a thousand pities that the bonus arrangements for the claimants were not negotiated by their trade union as part of a collective agreement, so that the terms of the agreement were clear and capable of straightforward implementation. It would seem to me most unfortunate if, considerable energy and expense having been exerted on one round of litigation, a second followed. It cannot be in the interests of either Coors of the claimants for this to occur. 
62.	That thought, however, is outside this court’s remit.  My conclusion is that the claims do not fall within ERA 1996 Part II. The Tribunal was wrong to find that they did, and the EAT was wrong to remit them to a different Tribunal. The claims as articulated in the Tribunal must be dismissed. If the claimants have a remedy, they must seek it in the county court. 
63.	I would, accordingly, allow this appeal to that extent. The precise form of order may need some careful drafting, and I would invite counsel to consider the matter when this judgment is sent to them in draft. If they can agree a form of order, there will be no need for any attendance when our judgments are handed down.
Lord Justice Wilson
64.	I agree with both substantive judgments and therefore join in allowing the appeal on the issue of jurisdiction.  It follows that, for so long as they remain in the employment of Coors, it is in the county court that the claimants must seek such remedy as, on advice, may seem available to them.
Lord Justice Chadwick
65.	I agree that this appeal should be allowed on the ground that, on a proper analysis, the employees’ claims do not fall within Part II of the Employment Rights Act 1996. 
66.	I am content to assume for the purposes of this appeal (but without deciding): (i) that the history of the claimants’ employment with the company now known as Coors Brewers Limited (formerly Bass Brewers Limited) was such that, following the transfer of the employer company out of the Bass Group (with the consequence that the claimants and other employees ceased to be eligible for continued membership of the Bass Employee Profit Share Scheme) the employer company was obliged to put in place a substitute scheme which, properly and fairly operated, would be capable of replicating the benefits of the BEPSS scheme; and (ii) that the scheme which was put in place by the employer company for the year 2003 (the Coors Brewers Incentive Scheme 2003) did not meet that requirement. On the basis of those assumptions, I am content to assume that the claimants have claims against the employer company for breach of contract; and, further, that those claims may entitle them to awards of damages which are more than nominal. 
67.	On the basis of those assumptions, the first question on this appeal is whether the failure of the employer company to make any payment to the claimants in respect of the year 2003 by way of substitution for the benefits that would have been received under the BEPSS scheme (had the company not left the Bass Group) can properly be described as “a deduction from wages” for the purposes of sections 13(1) and (3) of the 1996 Act. I am satisfied that the answer to that question is “No”. It must follow that the other questions do not arise.
68.	It is important to keep in mind, as it seems to me, that a conclusion that the CBL 2003 scheme did not meet the requirement imposed on the employer company by the claimants’ employment history does not lead to the conclusion that a scheme which did meet those requirements would, necessarily, have given rise to the payment of some benefits (and, in particular, benefits equivalent to those which would have been received under the BEPSS scheme, had the company not left the Bass Group). The requirement was to put in place a substitute scheme which, properly and fairly operated, would be capable of replicating the benefits of the BEPSS scheme. It would be going too far, in my view, to hold that the employer company was obliged to put in place a scheme which would, in all circumstances, replicate the benefits of the BEPSS scheme. The test - for determining whether a scheme met that requirement - is potential, not outcome. Given that the targets and incentives under the chosen scheme are fixed by reference to a realistic prediction of the employer company’s likely financial performance for the year ahead (2003) and (if that prediction proves accurate) can be expected to give rise to benefits equivalent to those which the claimants would have received under the BEPSS scheme, the chosen scheme will pass that test; notwithstanding that, when applied at the end of the year to the company’s actual financial performance, the scheme does not, in fact, give rise to equivalent benefits.
69.	It is important, also, to recognise that there will be a number of different schemes – that is to say, schemes which differ in the targets set and the incentives offered – which will meet the test. To put the point another way, given a realistic prediction of the employer company’s likely financial performance for the year ahead (which, itself, allows some flexibility within a range of possible outcomes, the prediction of any of which can be said to be realistic), it will be possible to choose different combinations of targets and incentives. All that is required is that the chosen combination, in conjunction with the prediction of likely performance for the year ahead, can be expected to give rise to benefits equivalent to those which the claimants would have received under the BEPSS scheme. If there are a number of different combinations of targets and incentives, any one of which satisfies that requirement, it is impossible to hold that the employer company was bound to choose one rather than another. And, of course, different combinations of targets and incentives can be expected to give rise to different outcomes when applied to the company’s actual financial performance at the year end.
70.	It follows that it is impossible to hold that, if the employer company had met the requirement imposed on it by the claimants’ employment history, the amount of the wages paid to any individual claimant on the relevant date for payment of benefits accrued in respect of the year 2003 would have been greater than the amount of the wages actually paid to that claimant on that date. The most that can be said is that it might have been. And, accepting that it might have been, it is impossible to say by how much the amount of the wages actually paid was less than the amount that would have been properly payable if the employer company had met the requirement to put in place a substitute scheme which, properly and fairly operated, would be capable of replicating the benefits of the BEPSS scheme. It is that feature which, to my mind, makes it impossible to hold that there has been “a deduction from wages” for the purposes of Part II of the 1996 Act.
71.	As I have said, I am content to assume for the purposes of this appeal that the claimants have claims against the employer company for breach of contract. But, on a true analysis, those claims are, as it seems to me, claims for damages by way of compensation for the loss of the chance that, if the employer company had put in place a substitute scheme which met the requirement imposed by the claimants’ employment history, the effect of such a scheme, when applied to the company’s actual financial performance for the year 2003, would have been that the claimants received some benefit which (absent such a scheme) they did not receive. I have no reason to doubt that, in the context of a claim for damages advanced on that basis, a court could measure the loss of chance by an appropriate award. But that task is outside the jurisdiction which (in the case of a claimant whose employment has not come to an end) the legislature has chosen to confer on an Employment Tribunal by the 1996 Act.  I agree with Lord Justice Wall that, if and for so long as the claimants remain in the company’s employment, they must seek their remedy in the county court.