Gas exploration firm ex-director awarded £131k

A former director of a gas exploration company has been awarded more than £131,000 by an employment tribunal following a dispute over unpaid wages.

Diccen Sargent, who was also chief executive officer of Crogga Limited before leaving the company in 2022, made a claim of unlawful deduction of pay.

In 2020, directors of the firm, which has a licence to look for gas in Manx waters, agreed to defer their salaries until the next funding round as "funds were running low" in respect of a seismic survey required.

The tribunal ruled the issuing of new shares to raise funds in June 2022 constituted a funding round and the outstanding sums should have been paid then.

The dispute between the parties had centred around the trigger for when that money was due to be paid.

Mr Diccen had served as a director of both Crogga Energy Limited and Crogga Operations Limited, with both entities respondents in the case.

In the autumn of 2020 certain employees had agreed to defer part of their salaries to help, and would receive a 15% uplift upon repayment.

In June 2022, approximately £800,000 was raised by issuing new shares to existing shareholders.

Having previously received an email that stated deferred salaries would be paid when "the Crogga Groups next funding round is completed", Mr Sargent expected to receive payment at that point.

But the firm argued it had been stated in an October 2020 board meeting the salaries would be distributed when a funding round labelled EQ, to raise the £12.75m for a 3D seismic survey, had been completed.

As yet, that total has not been reached.

Chairman of the tribunal Felicity Kniveton found the wording of the email had meant the "completion of any funding round".

As the June 2022 appeal to raise monies through shares could be described a funding round, the deferred salary was due at that time and should be paid, she said.

In her judgement she ruled Crogga Energy Limited was therefore liable to pay £131,646, which included £10,000 for unused holidays, but not the 15% uplift as it could not be classed as wages.

The firm was granted a Seaward Production Innovate License in October 2018.

An attempt to vary its licence to skip completing a 3D seismic survey to begin drilling an appraisal well remains under consideration by the Department of Infrastructure.

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