Ping On 3 Ltd v Secretary of State for the Home Department

This is an application for judicial review brought by Ping on 3 Ltd, a limited company, against the Secretary of State for the Home Department. The background is that the claimant is a limited company involved in the restaurant business who employed three individuals, a Mr Gwan, a Mr Huang and a Mr Lean, in its restaurant known as Ping on 3 which is at the Metrocentre in Gateshead. Those employees were employed under work permits. Mr Gwan was employed as a second chef, having been granted entry clearance and arrived in the UK on 13 September 2009; he had a work permit visa valid for 18 months. Mr Lean was employed as a chef; he had a work permit visa valid until 27 September 2011; he had been an employee of the restaurant at the time of the business being taken over by Mr Wong and he had worked at the company since 2007. Mr Huang was assistant manager of the restaurant and had a work permit visa valid until 13 December 2010; he also had been employed since 2007 and was already employed at the time when the owner of the company, Mr Wong, took over the business.

On 13 July 2010 the claimant company was subject to an unannounced UK Border Agency compliance visit by the Sponsor Management Unit in Newcastle-Upon-Tyne. The history of that was that the claimant company had applied to become a sponsor with a view to taking on other employees and as part of that procedure there was a necessary pre-application visit by the Sponsor Management Unit. I understand that the officers concerned were a Mr Baird and a Ms Charman. Following that visit the claimant received a letter dated 26 July from Ms Charman outlining what steps needed to be taken to ensure that the claimant was conforming to the work permit scheme. The letter requested further evidence be produced, including wage slips in respect of the three employees (which I have named already) up to and including 15 October 2010. I think it is accepted that the claimant also wrote to and telephoned Ms Charman (that is, Mr Wong at least) to clarify points arising from the visit.

The claimant then received a letter dated 8 September from Christopher Grant of the Revocation Section of the UK Border Agency requesting documentary evidence before 22 September 2010 and stating that if satisfactory evidence was not provided then revocation action would be taken. Mr Wong of the claimant company sent a letter to Mr Grant enclosing a number of documents on 21 September 2010. Notwithstanding those documents and that letter, on 4 November 2010 Mr Grant wrote to the company stating that it was doubtful that the work permit holders were working in the job roles as specifically approved and that revocation would take place in respect of the work permits of those three employees, and indeed notification of revocation was sent to them shortly afterwards.

Mr Wong then wrote to the Border Agency expressing his concern and shock at the decision to revoke the work permits and made representations in relation to the decision which had been taken. A further letter was received by the claimant from the Revocation Section on 24 November 2010 saying that the decision to revoke had been reconsidered but the previous decision was maintained. Then on 13 December solicitors on behalf of the claimant wrote a letter to the Revocation Section which included submissions made in relation to the decision. Eventually a letter was sent on 23 December but received on 4 January 2011 from the Revocation Section maintaining the previous decision. The claimant claims that the original decision of 4 November and the two subsequent decisions to maintain that decision are both irrational and Wednesbury unreasonable in the circumstances.

A brief summary of the grounds – hopefully doing the best I can to summarise the many points which are made – the claimant claims that the decision to revoke the work permits was procedurally unfair in that the defendant failed to follow a fair and open procedure. It is also alleged that the defendant failed to follow their own guidance set out in the Compliance and Validation Checks document (which I have been referred to in the course of the hearing). It is complained that the claimant was sent letters by different departments of the UK Border Agency telling him to respond with different timescales. That refers to the letter of Carole Charman of 26 July and the letter of Mr Grant of 8 September 2010. It is said that the claimant has relied on advice given by one individual of the UK Border Agency only to have that course of action dismissed by another individual; that is referring to advice given by Carol Charman allegedly and Mr Grant’s failure to take that into account. It is said that the decision fails to give adequate reasons; it is said that the decision of 4 November pays little regard to the documents provided by Mr Wong. It is submitted that it is trite law that a person is entitled to an opportunity to make meaningful representation to a public body about a decision and before that decision is made; that is conceded by the defendant. The claimant claims to have made representations and provided relevant evidence but this was not properly considered by the defendant. It is said the defendant had a discretion not to refuse the work permits and that discretion has not been exercised properly or proportionately in the circumstances. It is said that some of the documentation – such as wage slips and the letter from an accountant – was completely overlooked. It is complained that at no stage were any of the three employees directly spoken to by officers of the defendant either on the random check on 13 July or subsequently. It is said that the defendant has failed to consider the impact on the claimant of the decision to revoke three of its key staff’s work permits and also by implication the Secretary of State has failed to consider the impact on those employees individually.

Part of the grounds set out the personal circumstances of the employees but it seems to me that that is a matter for their applications to the Secretary of State on human rights grounds, which I think they are pursuing in any event. It is complained that the defendant failed to consider alternatives which are less draconian than revocation of the work permits and should have considered alternatives. It is said that overall the decision to revoke the work permits is both unreasonable and irrational under Wednesbury principles and that the procedure was unfair and because of that the claimant seeks an order quashing the decision to revoke the work permits, a mandatory order requiring the defendant to reinstate the work permits. There is also a claim for damages and consequential orders.

The defendant’s case is that the procedure engaged was both fair and open. The claimant was informed of the concerns which the defendant had in particular in relation to whether the individual employees were doing the jobs they were employed to do and for which they had been given permission to enter the country initially. The defendant says the claimant was given time to address those concerns. The defendant’s case is that the claimant failed to address those concerns either before the decision was made on 4 November or before it was reconsidered on two separate occasions thereafter. It was submitted that the issue had not been addressed in in the course of these proceedings either , although I think it is fair to say that in Mr Wong’s second witness statement those concerns are perhaps addressed at that point; the defendant says that was too late. The defendant says that the claimant offers no explanation for the failure to provide that information which is reasonably required by the defendant. In terms of whether the defendant has followed its own guidance, whilst the defendant accepts the relevance of the documents the claimant refers to, the defendant says that the guidance is set out in a document called the B & C Guidance (which I think stands for Business and Commercial Guidance) which provided comprehensive guidance on the scheme in relation to sponsors of employees from non-EU countries who are seeking to work in this country. The B & C Guidance provides that the defendant will seek to verify that the duties are as described on the application form. Where discrepancies are found the defendant will work with the employer to take steps to bring the employment back in line with the work permits’ arrangements if possible. It also states that there may be occasions where they cannot verify the statements made in the application at all; in these cases the Compliance and Validation Team have the right to revoke the work permits and consequentially curtail the leave that the overseas national has to remain in the UK. The defendant’s case is that the decision to revoke was entirely within the terms of that B & C Guidance.

The defendant concedes that two different time limits were provided for the provision of evidence, but the defendant says that that had no effect on the claimant because the claimant does not say they were unable to produce evidence within the time limit set. The defendant does not accept that conflicting advice was given to the claimant, in particular about whether part of Mr Huang’s allowance could be paid in part with food, but the defendant’s case is that this was not one of the reasons used for revocation of the work permits.

The defendant’s case is that the decision letter is adequate and clear and does give clear reasons. The defendant’s case is that all relevant documents were taken into account and indeed, for example, the accountant’s letter was specifically referred to in the decision letter of 4 November. The defendant’s case is that discretion was exercised properly in the circumstances. Insofar as an allegation is made that the employees should have been interviewed, the defendant’s case is that there was confusion at the initial visit and the defendant’s case is that they did ask to interview the one employee who was present and that request was refused. The defendant’s case is that there is no subsequent obligation to interview specific employees and it is for the claimant to satisfy the defendant that the employees are complying with the terms of the work permit applications and that the roles assigned to those employees could have been proved by the claimant either by documentation or by some sort of oral statement at the initial visit or by witness statements.

It is denied by the defendant that they failed to consider the impact on the business or on the individual employees and the defendant’s case is that the steps which were taken were proportionate and reasonable in the circumstances. Insofar as they should have considered alternatives, the defendant says that whilst there may have been alternatives, given the shortcomings which had been identified and the claimant’s failure to address in particular job concerns, there was no other reasonable remedial step available in place of revocation. So the defendant’s case is that the decision which was made was proportionate, was fair to the claimant and, to the extent that it has produced a result with which the claimant is unhappy , the reason for that is the claimant’s unwillingness or inability to provide the necessary information.

That sets out both parties’ case and in many ways the facts of the case are not substantially in dispute. I have had the benefit of reading two witness statements from Mr Wong and one from one of the employees; I have also read statements from the defendant’s officers detailing what they did and why they did it. In many ways where there is a contest in relation to factual evidence it probably has no real impact in relation to the issues in this case.

Insofar as it is necessary for me to set out any findings, I do so as follows. I find that there was a visit to the claimant’s premises on 13 July and it is clear from the documentation that I have seen that concerns were raised with Mr Wong about a number of issues. Firstly, there appeared to be no employment contracts for the three employees which were at that time working subject to work permits. Secondly, it was clear that there was a discrepancy between what the work permit application said they were to be paid and what they were actually being paid, which is in part connected with their working hours which I now know should have been 36 hours a week but on information given by Mr Wong to investigators they were each working between 50 and 55 hours per week. That had implications in respect of not only the Working Time Directive but also in relation to a calculation as to whether they were actually being paid what they were supposed to be paid in accordance with their work permit application. There was also an issue in relation to job descriptions and I say that because it is clear from the report which was prepared by Mr Baird that no formal job description was provided and the employer was unable to describe the role carried out of each of the individual employees. That is contained in the report prepared by Mr Baird called a Pre-Licence Visit Report. He recommended revocation of the licences in the light of the breaches in compliance that he found. It is not clear from that document whether he recommended it because of the absence of any information as to a job description or whether it was one of the other discrepancies in relation to working hours or salary.

Be that as it may, I accept that a letter was then sent on 26 July 2010 requesting certain information from the claimant company and giving probably until 15 October to comply with that request. I also accept that in his letter of 21 September 2010, which Mr Wong sent in reply to Mr Baird’s letter, he effectively complied with the request for disclosure made by Ms Charman. In a letter of 8 September the Secretary of State set out the concerns which they had at that point in relation to the matters which had been discovered at the visit on 13 July; this was the letter written by Christopher Grant. The letter sets out a number of concerns of the type that I have indicated but it is fair to say that in relation to each of the three employees there is an identical first paragraph which states as follows (I quote here from the part related to Mr Gwan):

“Mr Gwan is not employed in the job as stated on his work permit application. Whilst he did state that he was a second chef, we note that you were not able to give a verbal job description nor were you able to provide a written one. An employer should have knowledge of the job roles of all staff, especially within a small business. We were also not satisfied that these individuals have supervisory, training and staff management responsibilities.”

There were then in Mr Gwan’s case two other paragraphs which dealt with difficulties in relation to his working hours and the salary which he was being paid. It is fair to say also that an identical type of paragraph appeared in relation to both Mr Huang and Mr Lean. I accept that a time limit was given in relation to that of 22 September 2010, which was only two weeks from the date of the letter, but it is clear that a letter was written by Mr Wong which I have indicated and did actually arrive on 21 September within the timescale. Mr Wong did not request further time to provide further documentation and did not indicate in the letter that further documentation could be provided or was available at some other stage. It seems to me that if Mr Grant had refused to accept documentation that was submitted after the time limit, then that might well be an unreasonable decision, particularly bearing in mind the conflict with what Ms Charman has said about her disclosure, but that did not occur.

The next important step was the decision on 4 November to revoke the work permits of each of the relevant employees and it is a relatively lengthy letter but in essence the way it is set out is the initial complaints are set out verbatim as they were in the letter of 8 September. There is then a summary of the submissions which were made in the letter of 21 September which includes reference to the letter from the accountants explaining the discrepancy in both Mr Gwan’s and Mr Lean’s case caused, in one issue, because he had only worked a part year and secondly because the other employee had been ill, and also acknowledged receipt of the employment contract, wage slips and attendance sheet for each work permit holder.

The determination part then went on to set out the difficulties which had arisen with defining the job role and that was set out in full. Obviously the only relevant documentation which had been provided was the employment contracts which actually describe the individuals as administrators, presumably because the contract had been obtained as some sort of template, but it did not set out the nature of the work that they did and there was no job description provided. There was then another part of the letter that dealt with the salary deficit and the explanations which have been provided subsequently. The conclusion stated as follows:

“The visiting officers attempted to ascertain the nature of the work permit holder’s roles but to no avail. Whilst you have correcting some of the breaches, you have failed to address the job concerns or offer any explanation.

Work permits are only issued for genuine and specific employment, following detailed consideration of an application. In this case, it is doubtful that the work permit holders are working in the job roles as specifically approved.

As a result of this, revocation action has now taken place.”

It seems to me that that relatively clearly set out that the conclusion of the decision maker was that there had been a failure to address the work permit holders’ roles currently within the business and because of that revocation was taking place.

The only other developmenst are that a further letter was then sent by Mr Wong complaining about that decision and providing further information and that resulted in a reconsideration and the maintenance of the original decision. There was then a long and detailed letter before action by the solicitors on behalf of the claimant which again was considered and the original decision was maintained. The only important point I need to make about both of those letters is that neither of them at all addressed the issue of the concerns which the decision maker had, that is, whether the three employees were working in the roles for which they had originally been taken on.

In the light of those findings I turn now to consider the case for judicial review. Firstly it is said that the whole system is procedurally unfair. This is not a system which is set out by, for example, immigration rules or any other specific document, save that it is mentioned in a document entitled Compliance and Validation Checks where it says that there may be occasions where evidence is found to show that an employer or representative has knowingly deceived Work Permits UK or whether statements made in the application could not be verified at all. In these cases the CVT have the right to revoke the work permits and consequentially curtail the leave of the overseas national as to remain in the UK.

The system operated here was that there was a visit to the premises for another reason – to check on the sponsorship application – but that necessarily included checking on current work permits and whether existing controls were being maintained. When concerns arose as a result of that a letter was written on 8 September setting out the concerns and given an opportunity to reply. It may be that the opportunity to reply was somewhat short but the reply was supplied within that timescale and a decision was not taken until 4 November. Subsequently further submissions were made and reconsidered on two occasions. It does not seem to me that that is a procedurally unfair system in that provided the information is properly taken into account by the decision maker then it does seem to me that the claimant under this system has had the opportunity to make representations both before and after a decision is taken.

Dealing next with the fact that conflicting timetables were given, I accept that Ms Charman asked for some information in a letter of 26 July which included payslips up to 15 October and it is self-evident from that that information could not have been supplied until October. I accept that in the letter of 8 September Mr Grant imposed a two-week timetable and it might be said asked for additional information in the sense that he was asking also for evidence to show what job roles the employees were doing. Although I think it is unfortunate that that was done in that particular way, it seems to me there was no prejudice to this individual claimant because he was able to reply within the timescale set by Mr Grant and his failure to address the issue of the job roles continued in any event through two reviews. It was only this week that he or those advising him have submitted evidence to deal with that point. It cannot be said that those conflicting timetables have had any causal effect on what went afterwards.

Similarly, although there is an issue about whether misleading advice was given, in particular about whether it was appropriate to pay Mr Huang part of his accommodation allowance in food, it is clear from the decision letter that although that is referred to, it was not an operating reason why the revocation occurred. It is interesting that although it was part of Mr Huang’s application for a work permit initially, no allowance has been paid to him until that became clear after the visit, so the issue whether he was paid at all or whether he was paid some of it in money and some of it in food I suspect would not make much difference to the decision of the Secretary of State. It seems to me that the decision letter makes clear that it is the job roles which were the major concerns. Therefore if there was any misleading advice about whether it was appropriate to have some of the allowance in food does not seem to me to have any operational effect on the decision which was taken.

The allegation that representations made to the decision maker were not considered properly is not, in my view, arguable. The decision letter of 4 November clearly sets out the letter from the accountant about which complaint is made and also sets out ways in which the previous concerns about salary, hours and such matters had been addressed. I do not think it is fair to say that information properly provided was ignored by the decision maker.

The next point is that the discretion which the Secretary of State held was not properly exercised in making the decision to revoke. It seems to me that that is a matter within the discretion of the decision maker and I can only overturn that decision if it was irrational or was unreasonable in terms of Wednesbury grounds. Given that he had expressed his major concern, which was the confirmation that the employees were actually doing the job role which had formed the basis of their application to come to this country in the first place and that my review of the evidence shows that that information was not provided until last week, I do not think it can be said that his decision was either irrational or unreasonable in those circumstances.

The next point is that the Secretary of State or those working for her should have worked with the claimant to ensure compliance. It is fair to say that in the B & C Guidance that is one of things that the Secretary of State says they will do, but in this case there are a number of serious breaches which were partially addressed by the claimant and that the Secretary of State did write on 8 September setting out what the problems were. Unfortunately one of those issues was completely ignored by the claimant and I do not think it is unreasonable that the Secretary of State did not go back and keep reminding the claimant of the difficulties. I thought the letter of 4 November was clear and I wonder what might have happened if witness statements, such as the ones I have seen today served last week, were sent to the Secretary of State within a short period after 4 November. If that had been done any review would have had to take that into account but of course that did not occur and because of that the Secretary of State did not have much to work with. It seems to me to suggest that they should have interviewed the three employees was going too far in circumstances where the obligation in my view is on the claimant to satisfy the Secretary of State that the employees that he or a predecessor have asked to come to this country to work are still doing the work that they were brought over for.

The next allegation is that the Secretary of State failed to consider the importance to the business of these three gentlemen and indeed the importance of the gentleman concerned of losing their work permits. I accept that it was very important to the employees because it affects their right to remain in this country and also I can see how it would be important to the business to lose three key members of staff. There is no evidence in the paperwork that the decision maker failed to consider that this was an important point, in fact he included it as the first paragraph of his letter of 8 September warning the claimant of the difficulties. It did not seem to me that there was any evidence that the importance had not been properly considered.

At the end of the day it comes down to how the points based system works and the system which preceded it. In essence the nature of that part of immigration policy is that workers should only come into the UK from non-EU countries in circumstances where there is a need for that particular type of employee that cannot be provided by the indigenous population or a population from other EU members. The system is set up so only those with particular skills to do roles which are hard to fill are allowed to come to work here. It is fair to say that the initial application was set out in such a way to put forward a convincing case, but it is not then unreasonable for the Secretary of State to say down the line, “Are these employees still doing this type of difficult and skilled work for which they were brought into this country?” The example I gave was that if a skilled chef was actually being employed as a pot-washer (which is probably the lowest type of skill in a kitchen) then there would not be any continuing justification for him to remain in this country. It does seem to me that the Secretary of State is entitled to evidence that a skilled employee is still doing the type of skilled work he was brought here to do. In the light of the failure of the claimant to provide that evidence, the decision of the Secretary of State to revoke the work permits of the three employees, whilst regrettable, was in my view not irrational nor unreasonable.

I think it is somewhat unfortunate because I think that had the claimant company taken proper advice at the time from a lawyer or an advisor with experience in immigration control and the requirements of the system and the importance of the nature of the job role of each of the employees, it may well be that evidence could have been provided which would have prevented the revocation.

However, my role today is to decide whether the decision made by the Secretary of State was one which was irrational or unreasonable, given the information that was available to the decision maker at the time. I find that on the evidence which was available to the Secretary of State at that point the decision was not unreasonable or irrational and it is for those reasons the application for judicial review is dismissed.