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Secretary of State for Work and Pensions [2009] UKUT 169 (AAC) (27 August 2009)
Residence and presence conditions
right to reside

 


IN THE UPPER TRIBUNAL Appeal No. CIS/593/2009

ADMINISTRATIVE APPEALS CHAMBER

Before Deputy Upper Tribunal Judge Poynter

Decision: The Secretary of State's appeal is allowed. The decision of the First-tier Tribunal given at Sutton on 11 November 2008 involved the making of an error on a point of law. I set that decision aside and I remit the case to the First-tier Tribunal for reconsideration in accordance with my directions at paragraph below.

I draw the attention of the parties to the fact that those directions are addressed to them as well as to the First-tier Tribunal, and to the time limits I have imposed.

REASONS FOR DECISION

Introduction

1. This is yet another one of those unfortunate and avoidable appeals in which a claimant who was entitled to, and receiving, jobseeker's allowance has been advised by Jobcentre staff to claim income support instead and then found that she is refused the latter benefit because she does not have a relevant right to reside in the United Kingdom.
2. What happened was as follows. I have included page references in square brackets to assist the tribunal which is to reconsider the matter:

(a) The claimant is an Austrian national. She arrived in the UK on 29 January 2004 [7]. She worked for a cleaning company from May to September 2004 [15]and then attended college from September 2004 to November 2006. From November 2006 she worked for another cleaning company until 31 March 2007. She says that she left that job because she was pregnant [4]although, as her daughter was not born until early October 2007, she can only have been about 13 weeks pregnant at the time.

(b) The presenting officer who attended the hearing before the First-tier Tribunal helpfully searched the Department's records for details of the claimant's previous benefit claims. She told the Tribunal that on 23 November 2007, the claimant claimed jobseeker's allowance and received it from that date until 29 May 2008 [11, 20 & 44].

(c) On 30 May 2008, the claimant contacted Jobcentre Plusand notified the Secretary of State that she wished to claim income support. She says that she did so because she was advised to do so by her adviser at the Jobcentre. That assertion has not been denied by the Secretary of State and—although it is a matter on which the new tribunal will be free to reach its own findings—a long experience of similar cases leaves me in no doubt that such advice was indeed given.

(d) The right to reside test changed on 30 April 2006. Until that date, any right of residence in the United Kingdom satisfied the test for the purposes of all income-related benefits. Since the change, however, it has been necessary for a claimant to have the particular right of residence (or one of the particular rights of residence) that satisfies the test for the specific benefit that is being claimed. On the available evidence the claimant's only right of residence in May 2008 was as a workseeker. Such a right is sufficient to satisfy the right to reside test for jobseeker's allowance but not for income support.

(e) For that reason, the claim for income support was refused on 13 June 2008.

(f) The claimant then re-claimed, and was awarded, jobseeker's allowance from 18 August 2008. It is understood that she continues to receive that benefit and to undertake part-time work.

3. To avoid confusion, I should explain that I use the word 'workseeker' to denote a person who:

(a) is not a worker or a self-employed person;

(b) is seeking employment in the United Kingdom; and either

(c) has never worked in the United Kingdom; or

(d) having worked here, has not retained worker status under Article 7 of Directive 2004/38/EC ('the Directive') or regulation 6(2) of the Immigration (European Economic Area) Regulations 2006 ('the 2006 Regulations').)

The First-tier Tribunal's decision

4. The First-tier Tribunal allowed the claimant's appeal. It found that the claimant had a right of residence by virtue of the direct effect of Article 18 of the EC Treaty. The tribunal judge quoted Mr Commissioner Rowland as stating (in CIS/2358/2006):

'Article 18(1) confers a right of residence where it would be disproportionate to imply from the subordinate legislation that there is no right of residence'

and concluded that as:

'for the period following her entry to the UK the appellant was for the majority of the time either a worker or a jobseeker … it would be wrong to disqualify her from obtaining a right to reside because of short gaps when she was not on [jobseeker's] allowance'.

5. I have considerable sympathy for the tribunal judge. He was trying his best to prevent a situation in which the claimant lost her benefit entitlement solely because she had relied on the incorrect advice she had been given by the Jobcentre. However, there are some wrongs which a tribunal cannot remedy and, in this case, the judge went further than the law permits in his pursuit of that desirable outcome.
6. To begin with, CIS/2358/2006cannot fairly be read as holding that Article 18 of the EC Treaty has direct effect and bestows a right of residence whenever it would be 'wrong' not to do so. On the contrary, it decided that Article 18 could only be relied upon in exceptional circumstances. The Tribunal's use of the quotation from Mr Rowland was selective and out-of-context. The full passage reads:

'15. One can derive from the judgment in Baumbast, therefore, the principle that, where a right of residence is not expressly conferred by subordinate Community legislation, Article 18(1) confers a right of residence where it would be disproportionate to imply from the subordinate legislation that there is no right of residence. However, it seems to me that to rely on Article 18(1) where the Council of the European Communities has apparently deliberately excluded a class of persons from the scope of a directive would be to attack the directive and, if such an attack had any substance, it would be necessary to consider referring the case to the European Court of Justice because only that Court has the power to hold a directive to be incompatible with the Treaty. On the other hand, one can derive from the Advocate General's opinion in Baumbast the idea that there may be a lacuna in a directive, in which case there is no implication that exclusion from the scope of a right of residence was deliberate because the situation of the claimant in question simply was not considered by the Council. In other words, Article 18(1) may be relied upon to supplement a directive but, in proceedings before a national court or tribunal, it cannot be relied upon to remove limitations necessarily implicit in a directive.'

7. Since the Tribunal's decision in this case, the 'lacuna-filling' approach suggested by Mr Rowland has been confirmed on appeal.In Kaczmarek v Secretary of State for Work and Pensions[2008] EWCA Civ 1310, the Court of Appeal upheld the decision in CIS/2358/2006and (at paragraphs 22-23) specifically approved both the passage quoted above and Mr Rowland's view that the terms of the Directive provide a benchmark against which proportionality should be measured.
8. It follows that the approach of the First-tier Tribunalto proportionality in this case cannot be sustained. It did not ask itself whether the claimant fell within any lacuna in the Directive. Had it done so, the only conclusion it could properly have reached was that—on the evidence before it—she did not.
9. At the date of her income support claim, the claimant was not self-employed, self-sufficient, a student or retired. She was not a worker and, on the available evidence, had not retained that status. Any right of residence she may have had as a workseeker did not count for the purposes of income support and she did not assert any right of residence as a family member—or former family member—of another EEA national. She could therefore only have been entitled to income support if she had acquired a permanent right of residence.
10. The Directive says that EEA nationals acquire such a right if they have 'resided legally for a continuous period of five years' in an EEA State other than their own. The effect of the Tribunal's decision was to confer an equivalent right (for benefit purposes at least) on a person who, at the date of her claim, had lived in the UK for no more than four years and four months and whose residence had probably not always been 'legal' in the required sense.
11. That is directly contrary to Kaczmarek. A lacuna only arises where a claimant's circumstances are not covered by the Directive. That is not the case here. The Directive makes express provision for EEA nationals who come to the UK to work, to look for work or to study. It requires five years' legal residence before such people attain a permanent right of residence. People in the position of the claimant have been deliberately excluded from that right by the express terms of the Directive.
12. Moreover, as the terms of the Directive are to be the benchmark by which proportionality is to be judged, it cannot be said without more that it is disproportionate to refuse a permanent right of residence to a person who has not resided legally in the UK for five years.
13. The only circumstance in this appeal that is not expressly covered by the Directive is that the claimant was given incorrect advice by staff at the Jobcentre. That circumstance makes it unfair to deny her claim for benefit. But it does not point to a lacuna in the Directive or make it disproportionate to deny her a permanent right of residence in the UK.

The decision of the Upper Tribunal

14. It follows that the First-tier Tribunal's decision involved the making of an error on a point of law. As that error affected the outcome of the appeal, it is material. I therefore exercise my discretion under section 12(2)(a) of the Tribunals, Courts and Enforcement Act 2007 ('the Act') to set the decision aside. Having done so, section 12(2)(b) gives me power either to re-make the decision myself or to remit the case to the tier Tribunalwith directions. As it is necessary for further findings of fact to be made, and as there is a further issue which has not yet been considered by the tier Tribunal, it is expedient that I should remit the case.

Directions

15. I give the following directions

To the First-tier Tribunal

(a) Under section 12(3)(a) of the Act, I direct that the judge of the First-tier Tribunal is chosen to reconsider the case is not to be the same as the judge who made the decision that has been set aside. In this decision I refer to the judge who is so chosen as 'the new tribunal'.

(b) The new tribunal must weigh all the evidence and, to the extent permitted by the evidence, make findings on all disputed issues of fact. He or she is not bound by the previous tribunal's findings of fact, or by the views I have expressed on factual issues.

The issues for the new tribunal: income support

(c) The new tribunal must first consider whether the claimant was entitled to income support from 30 May 2008.

(d) Unless fresh evidence become available, the answer to that question will probably be 'no'. The existing evidence suggests that, immediately before her income support claim, the claimant's only right of residence was as a workseeker and such a right does not count for the purposes of income support.

(e) However it is possible that further evidence may show that the claimant was a person who retained worker status. Whether or not that is the case will depend upon whether she was involuntarily unemployed (i.e., whether she continued to be in the labour market) between 31 March 2007, when she stopped work, and 23 November 2007, when she re-claimed jobseeker's allowance following the birth of her daughter.

(f) At present, there is a tension in the evidence about that period. On the one hand, the claimant says she gave up her job because of her pregnancy. On the other, the presenting officer is recorded as having told the Tribunal that the claimant received jobseeker's allowance for at least some of that period. That, of course, implies that the claimant was capable of work, and available for, and actively seeking, employment at the time. However, that tension may be more apparent than real. It is possible, for example, that the claimant was too ill to work in the early stages of her pregnancy but recovered subsequently; or that her pregnancy made her unable to continue with the particular job she had in March 2003 but would not have prevented her from undertaking other types of work.

(g) The new tribunal must investigate and, so far as the evidence permits, make findings of fact about the claimant's circumstances during that period. It must then decide whether on 29 May 2008, she was a former worker who retained that status or merely a workseeker.

(h) If the evidence does not permit the necessary facts to be found, the new tribunal should decide that issue by applying the burden of proof, having regard to the principles laid down in Kerr v Department of Social Development, [2004] UKHL 23 (also reported as R 1/04 (SF)). The directions I give at to below are an attempt to ensure that the necessary evidence becomes available.

(i) If the new Tribunal decides that the claimant retained the status of a worker, then she may be entitled to income support. That will depend upon whether she had "registered as a jobseeker with the relevant unemployment office" (see Article 7(3)(b) of the Directive, regulation 6(2)(b) of the 2006 Regulations, and CIS/601/2008).

(j) At this point the position becomes more complex. In CIS/184/2008, Mr Commissioner Jacobs held that, under the law that applied from 30 April 2006, it was not possible for an income support claimant to register as a jobseeker in the required manner. However, he has subsequently set that decision aside and the issue whether it is possible to retain "worker" status in the context of an income support claim is presently being reconsidered by a Three-Judge Panel of the Upper Tribunal (sub nom. E v SSWP).

(k) If, therefore, the new tribunal concludes that the claimant retained the status of worker until 29 May 2008, it must consider whether it should then adjourn pending the decision in E.

(l) The new tribunal may conclude that, but for a period immediately before and after the birth of her child in which she was unable to work, the claimant would have been in the labour market from 31 March 2007 to 23 November 2007.

If so, then I direct that the existence of such a period does not automatically mean that the claimant lost her status as a worker. Whether she did so will depend on all the facts of the case and, in particular, on whether the claimant intended to start looking for work again as soon as reasonably practical after the birth.

The new tribunal may find it helpful to consider the analogy of a worker who, on becoming involuntarily unemployed, who decides to take an extended holiday for an equivalent period but who intends to look for work at the end of that period.

It may also be relevant that the claimant was awarded jobseeker's allowance with effect from November 2007 and that the Secretary of State must therefore have accepted that she was capable of work, and available for and actively seeking employment, seven weeks after her daughter was born.

The issues for the new tribunal: jobseeker's allowance.

(m) On the facts of this case, two decisions had to be made before the claimant could lose her benefit entitlement altogether.

(n) The claimant has appealed against the decision to refuse her claim for income support.

(o) However, the Secretary of State must also have made a decision superseding the claimant's award of jobseeker's allowanceso as to bring it to an end on 29 May 2008.

Awards of jobseeker's allowance are indefinite and—subject to revision and supersession—final. If the Secretary of State has not superseded the award, then the claimant continues to be entitled to jobseeker's allowance by virtue of the original decision to award it to her.

(p) Any decision to supersede the award of JSA is also appealable. In this respect, I refer the new tribunal to what was said by Mr Commissioner Jacobs at paragraphs 27 to 32 of CIS/4144/2007 (which I need not repeat here).

(q) It will therefore be necessary for the new tribunalto consider whether the claimant's appeal should also be treated as an appeal against the decision to end her entitlement to jobseeker's allowance and, if so, to decide that appeal in accordance with CIS/4144/2007.

To the Secretary of State for Work and Pensions

(r) The Secretary of State must arrange for a presenting officer to attend the hearing before the new tribunal.

(s) The Secretary of State must file a further submission:

i) giving details of every claim for benefit made by the claimant between 29 January 2004 and 13 June 2008 except the claim that led to this appeal;

ii) stating in the case of each such claim whether an award of benefit was made and, if so, the period covered by each such award; or

iii) confirming that no other claim for any benefit was made.

(t) The submission should also include:

i) a copy of the decision awarding the claimant jobseeker's allowance from 23 November 2007;

a copy of the decision bringing that award to an end with effect from 29 May 2008; and

the Secretary of State's written observations on whether the First-tier Tribunal should treat this appeal as also being against the decision referred to in (above and, if so, what the outcome of that appeal should be, having regard to CIS/4144/2007.

(u) The Secretary of State's submission must be received by the Sutton office of the Tribunals Service no later than one month from the date on which this decision is issued to the parties.

To the claimant

(v) The claimant should attend the hearing before the new tribunal. This is a case in which the Tribunal will need to ask her further questions. If the Tribunal cannot get the evidence it needs because she is not there to answer those questions, then the effect of my direction at paragraph above is that she will probably lose her appeal.

The legal issues that the new tribunal must address are not straightforward. The appellant should therefore ask Merton Citizen's Advice Bureau (which has helped her in the past) whether they can represent her at the hearing. If they cannot, she should ask whether they can refer her to the Free Representation Unit or to a similar organisation.

Even if it is not possible for the claimant to be represented she should still attend the hearing.

(w) If the claimant has any further documents relating to the issues I have set out above (and, in particular, any documents which cast light on what she was doing and how she was supporting herself between 31 March 2007 and 23 November 2007) she should send them to the Sutton office of the Tribunals Service. Such documents might include (but are not limited to):

i) records of attempts to find work kept to show to the Jobcentre;

job adverts considered;

written job applications;

records of telephone applications made (supported with the relevant itemised telephone bill if possible);

letters to potential employers asking about vacancies; and

ii) rejection letters

(x) The claimant may also make further written observations on any aspect of the case.

(y) The Tribunals Service at Sutton must receive any such documents or written observations no later than one month from the date on which this decision is issued to the parties.

To the Tribunals Service

(z) As soon as it is received from the office of the Upper Tribunal, the Tribunals Service is to refer the file for this appeal to District Tribunal Judge Penny Wood at Sutton so that she may consider whether further procedural directions are required.

For the avoidance of doubt, the procedural directions set out above are subject to any further or alternative directions that may be given by Judge Wood, by any other District Tribunal Judge, or by the judge who reconsiders the appeal.

Concluding remarks

16. This appeal is just one example of a problem which, in my day-to-day experience as a District Tribunal Judge of the First-tier Tribunal, is occurring regularly and frequently in Jobcentres.
17. Whilst I appreciate that the Secretary of State has no wish to profit from incorrect advice given by his staff, there is something unattractive about advising a claimant who is properly receiving jobseeker's allowance (and is content to do so) to claim income support instead and then, once she has done so—and has given up her right to jobseeker's allowance—telling her she is not entitled to income support. Claimants are certainly left with a strong and justified sense of grievance when that happens.
18. In cases where the claimant is a British or Irish citizen, or has leave to remain in the UK, there may be circumstances in which it is correct for Jobcentre staff to advise a lone parent who is receiving jobseeker's allowance to cease her jobsearch and claim income support instead.
19. However, such cases are likely to be few and far between because:

(a) even if the lone parent would be entitled to income support, ceasing to sign on may affect her eventual entitlement to retirement pension by making her ineligible for unemployment credits under regulation 8A of the Social Security (Credits) Regulations 1975 and forcing her instead to rely upon the less advantageous rules for home responsibilities protection; and

(b) in any event, it is government policy that lone parents should be encouraged and assisted to seek work.

20. In cases where the right to reside is an issue, such advice will almost always be incorrect. The structure of the right to reside test means that a lone parent who is an EEA national (other than a citizen of the United Kingdom or Ireland) will only be entitled to income support if they have acquired a permanent right of residence or are the separated (but not divorced) spouse of another EEA national who has right to reside in the UK.
21. I therefore take the opportunity provided by this case to express the hope that the Secretary of State will remind Jobcentre staff nationally that lone parents who are of working age (and who are capable of work) should be advised to claim—or to continue to claim—jobseeker's allowance unless it is clear either:

(a) that they would satisfy the right to reside test if they were to claim income support; or

(b) that they will not be able to receive—or to continue to receive—jobseeker's allowance for some other reason.

22. The Secretary of State has an incentive to do what he can to ensure that the advice given by his staff is correct. Where wrong advice is given, he can increasingly expect claimants to seek compensation from him under the Financial Redress for Maladministration scheme. A guide to that scheme is supposed to be available to members of the public in every DWP office. It can also be found on the DWP website (currently at http://www.dwp.gov.uk/publications/specialist-guides/financial-redress/).

(Signed on the original)

Richard Poynter Deputy Judge of the Upper Tribunal 27 August 2009