EAT dismisses first-year solicitor’s claim for unpaid commission after appeal by London firm

About this case:

• Citation:
  [2025] EAT 129
• Judgment:
  External link
• Court:
  Employment Appeal Tribunal
• Judge:
  Andrew Burns KC

It was found by the Employment Tribunal that Raymond Saul & Co LLP was not permitted to apportion profit costs billed to and paid by clients for the purpose of calculating the commission due to its employee Billy Rashbrook. The appellant argued that the ET had misinterpreted the contract term relating to commission and failed to recognise that commission was only due in respect of work carried out by him and not by his colleagues.

The appeal was heard by Deputy High Court Judge Andrew Burns KC, with Joe Kendall appearing for the appellant. The respondent did not appear and made no representations.

No mention of apportionment

Mr Rashbrook was first employed by the appellant in 2019 as a trainee and became fully qualified in 2021. Under his contract, he was to be paid a commission comprising 20 per cent of profit costs invoiced by him that exceeded the amount of three times his salary, which was initially £38,000 per year. During the commission year, the claimant worked on a large project with other members of the firm, which he was told would be subject to apportionment for commission purposes.

The claimant initially disputed the apportionment because no mention of it was made in his contract, but subsequently agreed that 60 per cent of invoices he billed on that project should be apportioned to him. He left the firm on 1 November 2022, when the amount of commission due to him was still under review. On 14 November, he was told that once the work of supervising partners and trainees was deducted from his invoices, he did not reach the commission threshold, and therefore no commission was due to him.

It was concluded by the ET that the wording of the contract simply required the appellant to pay the claimant commission of 20 per cent on the amount he invoiced in excess of £114,000. The ET held that the respondent did not engage in any meaningful exercise of apportionment during the year as it did not send monthly statements as required. There was no evidence of the appellant keeping the necessary records to properly engage in an exercise of apportionment on his files.

Before the EAT, the appellant pointed out that the claimant’s case was not that he did all the work on the files he billed, and it was normal for work by a first-year solicitor to be supervised and assisted. It argued that the ET had not interpreted the commission clause according to its natural meaning, which was that he would receive commission in respect of work invoiced by him, paid by the clients, and carried out while he acted as a solicitor.

Fanciful to think

In his decision, Deputy Judge Burns said of the appellant’s proposed interpretation of the contract: “It provides for a workable apportionment of fees for the purposes of commission between two solicitors who may often work together on the same file or matter. Mr Kendall submits, and I agree, that it would have been known to both parties at the time of entering into this contract that in a City solicitor’s firm there would be property and commercial transactions in which multiple fee earners contributed.”

He continued: “Applying the correct interpretation of clause 8.1 the claimant, as a newly qualified solicitor working as he did under the supervision of partners who worked on his files with him, and supported by others, would be highly unlikely to reach the threshold of billing more than three times his own salary early in his Commission Year, if at all. In fact there were never any sums due to the claimant pursuant to clause 8.1 for which there needed to be a monthly statement of account under clause 8.2. The ET used a ‘bootstrap’ justification for its erroneous interpretation of the contract.”

Considering the ET’s decision on how the apportionment was actually done, Deputy Judge Burns said: “It was perverse for the ET to say that it had no evidence of the appellant keeping the necessary records when it was undisputed evidence before the ET that the appellant had a time recording system. The claimant regularly contributed to this and it was used by the appellant in its Exhibit D to support its position as to apportionment.”

He concluded: “I think it is fanciful to think that the claimant would be able to satisfy any reasonable ET that he did sufficient work during the Commission Year in order to cross the commission threshold. When the supervision and contribution of partners, other fee earners and trainees are taken into account (as they must because that was undisputed) there is no reasonable prospect of him showing that he did the vast majority of the work on all of these other files in the very first year of his practice.”

The EAT therefore allowed the appeal and dismissed the claim.