The court was asked whether an employee could complain of unfair dismissal where the tribunal had held that the employee knew or ought to have known that her employer had failed to pay tax and national insurance contributions in respect of her wages. The majority of the Employment Appeal Tribunal had been of the view that, where both employer and employee knowingly commit an illegality by way of a fraud on the revenue in the payment and receipt of the employee’s remuneration under a contract of employment, the contract was turned into one prohibited by statute or common law and the employee was precluded from enforcing any employment rights which she might otherwise have against the employer. The majority thought the essential question to be: ‘Has the employee knowingly been a party to a deception on the revenue?’
Held: May J said: ‘We have no doubt that Parliament never intended to give the statutory rights provided for by the relevant employment legislation to those who were knowingly breaking the law by committing or participating in a fraud on the revenue.’
 IRLR 359,  ICR 521
England and Wales
Cited – Hall v Woolston Hall Leisure Limited CA 23-May-2000
The fact that an employment contract was tainted with illegality of which the employee was aware, did not deprive the employee of the possibility of claiming rights which were due to her under a statute which created rights associated with but not . .
Cited – Colen and Another v Cebrian (UK) Limited CA 20-Nov-2003
The company paid the claimant sales commission. Part was diverted and paid to his wife to reduce the tax payable. The employer had appealed a finding of unfair disamissal, the company arguing that the contract was illegal.
Held: The contract . .
Lists of cited by and citing cases may be incomplete.
Updated: 12 May 2022; Ref: scu.189941