HMRC V Middlesbrough Football Club

Sometimes the law gets in the way of common sense!

Middlesbrough Football Club offered employees the opportunity to buy season tickets for family members. If an employee wanted to buy season tickets, the club allowed them to make payment by having money deducted from their weekly pay, normally over 39 or 40 weeks. That all sounds like a decent employer so far.

This, as you will readily appreciate, was not an attempt by Middlesbrough to avoid paying minimum wage. However, once the weekly installments for season tickets were deducted, some employees were receiving less than the national minimum wage in their pay packets.

The employees themselves did not complain, but HMRC issued notices of underpayment to the club, who then appealed to the Employment Tribunal. The Employment Tribunal found in favour of the club, but HMRC then appealed to the Employment Appeal Tribunal (EAT), who found in favour of HMRC.

The reason for this decision, was that there are a very limited number of lawful grounds for making deductions from an employee’s pay, which would result in the pay received being beneath the national minimum wage. This is, of course, intended to protect vulnerable employees.

Even when an employee is more than happy for a deduction to be made to their pay, if the effect of the deduction is to take what they actually receive below the national minimum wage, then the employer must not make that deduction, unless it falls within the very limited exemptions.

If it doesn’t fall within an exemption, then don’t do it!

If you want to know what lawful deductions can be made from an employee’s pay, even if it takes them below the minimum wage threshold, please email me on and I will send you the list.

Alternatively, you can look up regulation 12(2) of the National Minimum Wage Regulations 2015 SI 2015/621. But I warn you, it’s not exciting reading!

In giving their judgement, the EAT explained that the national minimum wage legislation is underpinned by social policy objectives designed to protect workers. By adopting a very rigid interpretation of the Regulations, the Courts are trying to protect workers, even if there can sometimes be strange outcomes, such as there was in this case for Middlesbrough Football Club.

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Written By: Jon Loney, Nash & Co Solicitors

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