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[2009] UKUT 35 (AAC) (05 February 2009)
Main Category: Residence and presence conditions

Decision of the Upper Tribunal
(Administrative Appeals Chamber)

As the decision of the Sutton appeal tribunal (held on 18 September 2007 under reference 154/07/02425) involved the making of an error in point of law, it is SET ASIDE under section 12(2)(a) and (b)(i) of the Tribunals, Courts and Enforcement Act 2007 and the case is REMITTED to a differently constituted First-tier Tribunal (Social Entitlement Chamber).

DIRECTIONS:

The tribunal must conduct a complete rehearing of the issues that are raised by the appeal and, subject to the tribunal's discretion under section 12(8)(a) of the Social Security Act 1998, any other issues that merit consideration.

In particular, the tribunal must investigate and decide whether, on his claim for income support that was made on 2 February 2007 and refused on 2 April 2007, the claimant was a person from abroad with an applicable amount of nil, who was therefore not entitled to income support.

For the avoidance of any doubt, the tribunal will not be bound by any of the facts on which I have based my legal analysis. In the course of that analysis, I have indicated some issues that will have to be considered at the rehearing, but all other issues of fact are open before the tribunal.

REASONS

A. Why I have made this decision again

1. I made a decision in this case on 24 July 2008. Unfortunately, I mistranscribed some of the legislation. I set that decision aside and invited the parties to say whether they objected to me making the decision again and whether they had any further observations. Neither has objected or made further observations on the merits of the appeal.
2. In the meantime, the jurisdiction of the social security of the Commissioner has been transferred to the Upper Tribunal by the Transfer of Tribunal Functions Order 2008 (SI No 2833). This has not affected my decision.

B. The issue

3. The issue is whether the claimant is potentially entitled to income support, which depends on whether he has a right to reside.
4. He worked and then claimed jobseeker's allowance before becoming unable to work and claiming income support. The Secretary of State decided that the claimant did not have a right to reside, but on appeal the tribunal decided that he did and was eligible for income support. The Secretary of State appealed against that decision with the leave of a district chairman.
5. Whether or not the claimant had a right to reside depends on a complex interrelationship of EC and domestic law. The EC law consists of the EC Treaty, the decisions of the European Court of Justice and Directive 2004/38/EC. The domestic law consists of the Immigration (European Economic Area) Regulations 2006 and the Income Support (General) Regulations 1987. It is not immediately obvious how some of the provisions in the EEA Regulations relate to EC law. This requires analysis of the way that the rights of those who are looking for work have been analysed under EC law and how that analysis has been incorporated into domestic law.
6. I begin with that analysis and then apply it to the claimant's circumstances. But before that I want to say something about terminology.

C. Terminology

7. Accurate terminology to convey appropriately delineated concepts is a valuable aid to precision of legal analysis. The editor of the relevant provisions in Social Security Legislation: Volume II has drawn a distinction between a jobseeker (someone who comes to a country to look for work) and a workseeker (someone who has worked and is now looking for work again). Tribunals have adopted that terminology. I have chosen not to for three reasons. First, it is not the language used by the legislation. Second, it is not comprehensive of all the possibilities. A person may decide to look for work in a host State after (i) entering for other reasons or (ii) having worked and then left the labour market. Third, it may conceal the similarity, if not unity, of the relevant legal analysis.

D. EC law

EC Treaty

8. The relevant provisions of the EC Treaty are Articles 18 and 39. The former deals with freedom of movement and residence for EU citizens: the latter deals with freedom of movement for workers.
9. Article 18 provides:

'CITIZENSHIP OF THE UNION

…

Article 18

1. Every citizen of the Union shall have the right to move and reside freely within the territory of the Member States, subject to the limitations and conditions laid down in this Treaty and by the measures adopted to give it effect.

2. If action by the Community should prove necessary to attain this objective and this Treaty has not provided the necessary powers, the Council may adopt provisions with a view to facilitating the exercise of the rights referred to in paragraph 1. The Council shall act in accordance with the procedure referred to in Article 251.

3. Paragraph 2 shall not apply to provisions on passports, identity cards, residence permits or any other such document or to provisions on social security or social protection.'

10. Article 39 provides:

'WORKERS

Article 39

1. Freedom of movement for workers shall be secured within the Community.

2. Such freedom of movement shall entail the abolition of any discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment.

3. It shall entail the right, subject to limitations justified on grounds of public policy, public security or public health:

(a) to accept offers of employment actually made;

(b) to move freely within the territory of Member States for this purpose;

(c) to stay in a Member State for the purpose of employment in accordance with the provisions governing the employment of nationals of that State laid down by law, regulation or administrative action;

(d) to remain in the territory of a Member State after having been employed in that State, subject to conditions which shall be embodied in implementing regulations to be drawn up by the Commission.

4. The provisions of this article shall not apply to employment in the public service.'

Case law of the European Court of Justice

11. The Treaty makes no express provision for those who exercise their freedom of movement in order to look for work in a host State, although they are covered by Article 18 in their capacity as Union citizens.
12. Their position on and immediately following arrival in the host State was considered by the European Court of Justice: R v Immigration Appeal Tribunal, ex parte Antonissen (Case C-292/89) [1991] ECR 1-745. The case arose before Article 18 was inserted into the Treaty and concerned a decision by the United Kingdom to deport Mr Antonissen. He had entered the United Kingdom in 1984 and had not found employment by the time he was sentenced for drug offences in 1987. When he was released on parole, the decision was made to deport him under an immigration rule that allowed deportation if a jobseeker had not found work within six months. The High Court referred to the European Court of Justice the question whether this rule was in accordance with EC law. The Court answered (paragraph 22) that it was not contrary to EC law to remove an unsuccessful jobseeker after six months 'unless the person concerned provides evidence that he is continuing to seek employment and that he has genuine chances of being engaged.' This answer reflected the wording of the question referred.
13. The Court reached this conclusion in two stages. First, it decided (paragraph 15) that persons who moved in order to seek work had 'the right, under Article [39] and the provisions of Regulation No 1612/68 …, to stay in a Member State for the purpose of seeking employment'. Second, it decided (paragraph 16) that they had to be afforded 'a reasonable time in which to apprise themselves, in the territory of the Member State concerned, of offers of employment corresponding to their occupational qualifications and to take, where appropriate, the necessary steps in order to be engaged.' The period of six months was only mentioned because that was enshrined in domestic law. However, the Court clearly approved the use of six months as a default position.
14. It is clear from the Court's reasoning in Centre public d'aide sociale de Courcelles v Lebon (Case 316/85) [1987] ECR 2811 at paragraph 26 that a person who moves in search of employment is not a worker, at least not for any purpose other than access to employment.
15. The Court has also considered the position of a person who has become a worker in the host State and who, having ceased to work, remains in that State to look for further work. This was touched on by the Court in Hoekstra v Bestuur der Bedrijfsvereniging voor Detailhandel en Ambachten (Case 75/63) [1964] ECR 177 at page 185:

'The Treaty and Regulation No 3 thus did not intend to restrict protection only to worker in employment but tend logically to protect also the worker who, having left his job, is capable of taking another.'

It was also was considered by Mr Commissioner Mesher in R(IS) 12/98. He held that the claimant had retained worker status as she had remained available for and actively seeking employment. This was in accordance with the Court's approach to persons who ceased work and undertook training.

16. I am not aware of any authority on the position of (i) a person who moved to a host State without any intention of seeking employment but then decided to do so or (ii) a worker who lost contact with the labour market but then again sought work. Both are in principle covered by the reasoning in Antonissen. (i) is also covered by the language used in that case, although that reflects the way the questions were posed in the reference rather than the facts of the case.

Directive 2004/38/EC

17. This came into force on 30 April 2006.
18. All Union citizens have a right to reside under Article 6 for three months, although with no guarantee of access of the State's social assistance system (Article 24(2)). Thereafter, the right to reside depends on the person's status.
19. After three months, they have a right to reside if they are covered by Article 7:

'1. All Union citizens shall have the right of residence on the territory of another Member State for a period of longer than three months if they:

(a) are workers or self-employed persons in the host member State;

…

3. For the purposes of paragraph 1(a), a Union citizen who is no longer a worker or self-employed person shall retain the status of worker or self-employed person in the following circumstances:

(a) he/she is temporarily unable to work as a result of an illness or accident;

(b) he/she is in duly recorded involuntary unemployment after having been employed for more than one year and has registered as a job-seeker with the relevant employment office;

(c) he/she is in duly recorded involuntary unemployment after completing a fixed-term employment contract of less than a year or after having become involuntarily unemployed during the first twelve months and has registered as a job-seeker with the relevant employment office. In this case, the status of worker shall be retained for no less than six months;

(d) he/she embarks on vocational training. Unless he/she is involuntarily unemployed, the retention of the status of worker shall require the training to be related to the previous employment.'

20. The Directive does not define 'worker'. It must broadly take its meaning from the decisions of the European Court of Justice. However, that is subject to a qualification. The Directive distinguishes between workers and those who retain the status of worker. The latter are not workers, which must be limited to those who are in employment. That is the only way to make sense of the provision in paragraph (3) that 'a Union citizen who is no longer a worker … shall retain the status of worker'. The Court's decisions are not clear on this. In Hoekstra, 'worker' was used to refer to someone who, having worked, was capable of working again. In Lebon, however, 'worker' was not used so broadly.
21. The Directive does not define 'job-seeker'. In Article 7(3)(b) and (c), it is used to describe workers who have retained that status. However, Preamble (16) refers to 'workers … or job-seekers as defined by the Court of Justice'. That is unclear. It is wide enough to refer to Antonissen. However, Article 14(4)(b) repeats the actual language of that case rather than using 'job-seeker'. This does not confer a right to reside, but limits the State's power of expulsion:

'4. … an expulsion measure may in no case be adopted against Union citizens or their family members if:

…

(b) the Union citizens entered the territory of the host Member State in order to seek employment. In this case, the Union citizens and their family members may not be expelled for as long as the Union citizens can provide evidence that they are continuing to seek employment and that they have a genuine chance of being engaged.'

This provision reflects the precise terms of the answer given by the European Court of Justice to the question referred in Antonissen. It covers both the facts of that case and the person who, having been a worker and having left the labour market, is now again looking for work. It does not cover the position of a person who only decided to look for work after moving to a host State.

22. For former workers who are now looking for work, the position under the Directive is this: (i) those who have worked for at least a year retain the status of worker indefinitely; (ii) those who have worked for less than a year retain the status of worker in EC law for six months only. In either case, this is conditional on the person being registered as a job-seeker, on which see CIS/3505/2007. No doubt, the difference between (i) and (ii) reflects the fact the greater integration achieved after working in a host State for a year. The effect of (ii) is to extend the default position in Antonissen to those who have been in employment. It leaves Member States free to allow a longer period in domestic law.
23. The six months' limit in Article 7(3)(c) and the prohibition on expulsion in Article 14(4)(b) reflect the Court's answer in Antonissen, but the Directive does not translate the Court's reasoning in that case into a right to reside for those are not in the labour market.

E. Domestic law

Immigration (European Economic Area) Regulations 2006

24. These Regulations in part reflect the Directive and in part give additional rights of residence. They came into force on 30 April 2006.
25. Jobseekers (with no hyphen in domestic legislation) have a right to reside under regulation 14, which provides:

'(1) A qualified person is entitled to reside in the United Kingdom for so long as he remains a qualified person.'

'Qualified person' is defined by regulation 6:

'(1) In these Regulations, "qualified person" means a person who is an EEA national and in the United Kingdom as-

(a) a jobseeker;

(b) a worker; …'

26. 'Worker' is defined by regulation 4(1)(a):

(a) '"worker" means a worker within the meaning of Article 39 of the Treaty establishing the European Community'.

In view of Lebon, that definition would not include someone who moved to look for employment. Hence the separate category of jobseeker. This is defined by regulation 6(4):

'(4) For the purpose of paragraph (1)(a), "jobseeker" means a person who enters the United Kingdom in order to seek employment and can provide evidence that he is seeking employment and has a genuine chance of being engaged.'

That definition reflects Antonissen. But the right to reside is not limited to six months.

27. Those who have become workers are dealt with in regulation 6(2):

'(2) A person who is no longer working shall not cease to be treated as a worker for the purpose of paragraph (1)(b) if-

(a) he is temporarily unable to work as the result of an illness or accident;

(b) he is in duly recorded involuntary unemployment after having been employed in the United Kingdom, provided that he has registered as a jobseeker with the relevant office and-

(i) he was employed for one year or more before becoming unemployed;

(ii) he has been unemployed for no more than six months; or

(iii) he can provide evidence that he is seeking employment in the United Kingdom and has a genuine chance of being engaged;

(c) he is involuntarily unemployed and has embarked on vocational training; or

(d) he has voluntarily ceased working and embarked on vocational training that is related to his previous employment.'

28. Paragraph (2)(b)(i) and (ii) reflect Article 7(3)(b) and (c). However, paragraph (2)(b)(iii) is not in the Directive. It reflects the conditions set out in Antonissen and contains the same conditions as the definition of jobseeker. However, it can only apply to a former worker who remains in the labour market. It has no relevance for someone who has been employed for a year or more. But, in conjunction with paragraph (2)(b)(ii), it allows someone who was employed for less than a year to retain worker status so long as the additional conditions (evidence of seeking employment and a genuine chance of success) are satisfied. In practice, they are not likely to be very different from the conditions that must be satisfied by anyone who is receiving jobseeker's allowance, although it is perhaps arguable that the 'genuine chance of being engaged' is more stringent than would be required for a jobseeker's allowance.

Income support legislation

29. Income support was established by the Social Security Act 1986. The relevant provisions have been consolidated by the Social Security Contributions and Benefits Act 1992.
30. Section 124(1) of the 1992 Act provides:

'(1) A person in Great Britain is entitled to income support if-

…

(b) he has no income or his income does not exceed the applicable amount.'

31. Section 135 provides:

'(1) The applicable amount, in relation to any income-related benefit, shall be such amount or the aggregate of such amounts as may be prescribed in relation to that benefit.

(2) The power to prescribe applicable amounts conferred by subsection (1) above includes power to prescribe nil as an applicable amount.'

32. The Income Support (General) Regulations 1987 are made, in part, under that authority. Paragraph 17 of Schedule 7 to those Regulations prescribes that the applicable amount for a 'person from abroad' is nil.
33. 'Person from abroad' is defined by regulation 21AA. This has been the governing provision since 30 April 2006. The relevant provisions of the current version provide:

'Special cases: supplemental – persons from abroad

21AA.—(1) "Person from abroad" means, subject to the following provisions of this regulation, a claimant who is not habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland.

(2) No claimant shall be treated as habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland unless he has a right to reside in (as the case may be) the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland other than a right to reside which falls within paragraph (3).

(3) A right to reside falls within this paragraph if it is one which exists by virtue of, or in accordance with, one or more of the following—

…

(b) regulation 14 of those Regulations, but only in a case where the right exists under that regulation because the claimant is—

(i) a jobseeker for the purpose of the definition of "qualified person" in regulation 6(1) of those Regulations, or

…

(d) Article 39 of the Treaty establishing the European Community (in a case where the claimant is a person seeking work in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland).

(4) A claimant is not a person from abroad if he is—

(a) a worker for the purposes of Council Directive No. 2004/38/EC;

…

(c) a person who retains a status referred to in sub-paragraph (a) or (b) pursuant to Article 7(3) of that Directive; … '

34. It is convenient to refer to this regulation as dealing with the right to reside. Strictly, paragraph (4) is not drafted in terms of a right to reside, but a claimant who comes within any of the subparagraphs will have a right to reside.
35. The structure of this regulation is important. A claimant who is within paragraph (4) is not a person from abroad. And paragraph (4) is, for the most part, drafted in terms of the Directive, not in terms of the EEA Regulations. The result is that a person who is within one of the listed provisions in the Directive is eligible for income support and is not subject to the exclusions in paragraph (3). In those cases where domestic law is more generous in giving a right to reside than EC law, the claimant will come within paragraph (2) but subject to paragraph (3). It is, therefore, important to know not only whether a claimant has a right to reside, but also the legal basis for that right.

F. Analysis

36. The claimant is Swedish and came to the United Kingdom on 4 January 2004. He has worked for three separate periods with intermittent awards of jobseeker's allowance. The dates I have used are those provided by the claimant's representative in her submission to the appeal tribunal. They do not agree with the dates recorded by the tribunal's chairman as having been provided by a presenting officer, but they are consistent with the evidence of payslips and an employment contract. The tribunal at the rehearing will not be bound by the dates I have used.
37. The claimant made his claim for income support on 2 February 2007 on the basis that he was unable to work. The claim was refused on 2 April 2007 on the ground that the claimant was a person from abroad with an applicable amount of nil. As a result, he was not entitled to income support. The issue is whether he had a right to reside between February and April 2007 sufficient to make him potentially eligible for income support. This requires a methodical and chronological approach to his residence status at different times.

First period of work

38. This lasted from 10 May 2004 to 30 June 2004. The claimant was not paid, but was given expenses and accommodation. I doubt whether this work was sufficient for him to become a worker in EC law for two reasons: (i) he was only paid in kind; and (ii) the work he did may not have been in pursuit of an economic activity. But this does not matter, as this period does not affect any later part of my analysis.
39. I do not know what happened between the end of this period of work and the start of the second period. Again, that does not matter, as it does not affect any later part of my analysis.

Second period of work

40. This lasted from 25 July 2004 to 24 February 2005. Taking account of the duration and continuity of the work, the hours of work and the earnings, this seems like genuine and effective work that made the claimant a worker. I shall proceed on that basis. The result is that, at the end of this period, he was a worker and, as such, he had a right to reside.

The first award of jobseeker's allowance

41. This ran from March 2005 to January 2006. He retained his status as a worker under Mr Commissioner Mesher's decision in R(IS) 12/98.

Third period of work

42. This lasted from 3 January 2006 to 3 February 2006. There may be a doubt whether this is sufficient to count as work in EC law, because it is so short. However, Mr Commissioner Mesher accepted five weeks' work as genuine and effective in R(IS) 12/98 and I will assume for this analysis (in the claimant's favour) that he was a worker during this period. (If he was not, he could not retain that status when he claimed jobseeker's allowance or, later, income support.) This issue will have to be investigated at the rehearing.

The second award of jobseeker's allowance

43. There followed a period on jobseeker's allowance from 20 March 2006 to 14 January 2007. If the claimant was a worker during his third period of work, he initially had a right to reside as a person who had retained his status as a worker under R(IS) 12/98.
44. The Directive and the EEA Regulations came into force on 30 April 2006. From then on, the legal analysis has to take account of those provisions.
45. Assuming that the claimant was a worker during the third period of work, did he retain that status and, with it, the right to reside under Article 7(3) of the Directive? He did not come within Article 7(3)(b), because he had not previously been in work for at least a year. He did retain that status under Article 7(3)(c) of the Directive, but only for six months. Accordingly, he no longer retained that status under the Directive at the time when he became unable to work and his award of jobseeker's allowance came to an end.
46. Did the claimant retain his status as a worker and, with it, the right to reside under regulation 6(2) of the EEA Regulations? He did not come within subparagraph (b)(i), because he had not been in work for at least a year. He did retain that status under subparagraph (b)(ii), but only for six months. However, he could retain it under subparagraph (b)(iii) provided he satisfied the conditions. This issue will have to be investigated at the rehearing.

The claim for income support

47. If the claimant has so far retained his status as a worker, this can only be under regulation 6(2)(b)(iii). He would then have a right to reside and come within regulation 21AA(2) of the Income Support (General) Regulations 1987. That right would continue under regulation 6(2)(a) when he became unable to work. See my reasoning in CIS/4304/2007:

'34. The first question is: can she move from one head of regulation 6(2) to another? My answer is: yes. This is the answer suggested by the context and there is nothing to indicate otherwise. The context is the retention of worker status for those who have not abandoned the labour market, but who are either unable to work or to find work or are training to improve their job prospects. The sequence in which those events occur is purely arbitrary and I can see no policy factor that limits the beneficial effect of regulation 6(2) or Article 7(3) to the first of the eventualities that happens to occur.'

This has now been accepted by the Secretary of State: CIS/1951/2008.

48. If the claimant has so far not retained his status as a worker, he can only regain it by actually working. There is nothing in either the Directive or the Regulations that confers a right to reside on someone who becomes unable to work unless immediately before that the person was either a worker or retained worker status. Worker status can be gained and retained. There is no power for it to be revived after it has been lost other than by working.

G. The tribunal's decision

49. I have not so far mentioned the tribunal's decision. It is sufficient to say that the tribunal decided the issue with too great a generality of reasoning and without sufficient attention to the precise terms on which a right to reside arises in the context of the facts of the case. The chairman's reasoning, as summarised in both his decision notice and his full statement of the tribunal's decision, was that the claimant was a jobseeker and a worker and continued to retain worker status and a right to reside. As my analysis has shown, it is not that simple.

H. Disposal

50. I set aside the tribunal's decision because it was wrong in law and direct a rehearing.

Signed on original on 4 February 2009

Edward Jacobs Upper Tribunal Judge