Newham v Skingle 1

United Kingdom

Reference: (2003) All ER(D) 287

Mr Skingle is a former local government employee who is now retired. His pension depends upon his final earnings. Like many other local government employees, he worked normal hours and overtime. The question arose as to whether his final salary for the purposes of computing his pension includes his overtime earnings. The pension scheme excluded non- contractual overtime. Mr Skingle's contract set out an agreed rate for overtime. But it did not provide that either the authority or Mr Skingle could insist upon any overtime working. There was no compulsory overtime.

The Ombudsman determined that Mr Skingle was not contractually bound to work overtime. However, this did not mean that the remuneration he received for doing so was non-contractual. On the contrary, there were specific contractual arrangements for overtime payments. Therefore, the overtime covered by the payments set out in the contract was contractual and so Mr Skingle's overtime earnings could be included in the computing of his pension.

The Ombudsman's determination left no possible meaning for non-contractual overtime and the Ombudsman erred in law in his construction of the Regulations.