It is not often that employment tribunal cases involve high-profile individuals. The reputational risks involved for both parties in such cases generally means that any disputes are resolved behind closed doors prior to ever getting before a judge. The recent unlawful deductions case of Mendy v Manchester City Football Club is a notable exception. It involved an unpaid wage bill of around £11 million before tax.

Benjamin Mendy signed with Manchester City Football Club in July 2017. In October 2020, he was arrested following an allegation of rape and was later suspended by Man City in August 2021, following official charges. Mr Mendy was also prohibited from participating in any football related activities by the Football Association (FA) from the date of his arrest up until his acquittal in July 2023. Man City said Mr Mendy was unable to fulfil his role following his suspension by the FA and withheld payment of his wages from the start of his suspension up until the end of his contract in June 2023. For five of these months, he was remanded in police custody.

Mr Mendy claimed unlawful deduction from wages. So was this an unlawful deduction?

As the Employment judge himself noted: “I am …. fairly sure that no other single claimant has ever alleged that sums in the region of £11 million have been deducted from his wages”. The numbers involved were exceptional; the legal principles underpinning the claim were not.

The General Rules

Employers are only able to deduct from an employee’s wage (including paying no wage at all) if authorised by law or the terms of the employee’s contract of employment; if they are recouping an overpayment of wages or if they already have the employee’s agreement.

If there is no statutory or contractual authority for the deduction then the common law ‘wage – work’ bargain must be considered. If an employee is ready, willing and able to work, they are entitled to be paid wages in accordance with their contract of employment. The case of Gregg v NorthWest Anglia NHS Foundation Trust held that, where an employee is ready and willing to work but is ‘unable’ to do so because of an ‘unavoidable impediment’ then any non-authorised deduction of pay is likely to be unlawful.

If an employee believes that unlawful deductions have been made then they are able to make a claim of unlawful deductions from wages under s13 Employment Rights Act 1996. Such claims can only look back a maximum of two years.

The Mendy Case

The single issue in Mr Mendy’s case was whether, by stopping his wages in the period from September 2021 to June 2023, Man City made unauthorised deductions. The tribunal broke down its decision into the following areas:

  • Was Man City entitled under the terms of its contract with Mr Mendy to stop paying his wages? There was nothing in the contract of employment or contractual disciplinary policy which stated that suspension could be on no pay.
  • Was there an implied term of the contract which allowed Man City to withhold wages? The tribunal concluded there was not.
  • Was Man City permitted to stop paying Mr Mendy on the basis that he was not ‘ready, willing and able’ to work whilst he was suspended by the FA and, for five months, in policy custody? In relation to the FA suspension (imposed for safeguarding reasons as one of the allegations involved someone under 18), the key issue was whether it was an ‘avoidable’ or ‘unavoidable’ impediment (Gregg). If it was ’unavoidable’ then Man City were wrong not to have paid him during it. The tribunal found that the FA suspension was involuntary. Mr Mendy did not admit the allegations. Applying Gregg, the suspension was unavoidable and Mr Mendy should have received pay during this period. The situation was slightly different in relation to the five months which Mr Mendy spent in police custody, having not been granted bail. One of the reasons he was not granted bail was because he had previously breached bail conditions. This meant that he was, at least in part, responsible for the fact that he was remanded in custody, and therefore unable to work. The tribunal held that it had been lawful for Man City not to pay him during this five-month period.

Summary

It is important that employers ensure they incorporate clear and defined suspension provisions into employment contracts. If Mr Mendy’s contract had said that no pay was due if he was suspended by the FA then the issues in this case would have been avoided in full.