27 May 2021
The Employment Appeal Tribunal (EAT) has recently considered the status of an individual who had no obligation to accept and perform any minimum amount of work.
Nursing and Midwifery Council v Somerville, UKEAT/2021/258
Mr Somerville was a fee-paid panel member for the Nursing and Midwifery Council (NMC), on its Fitness to Practice Committee. Under a ‘Panel Member Services Agreement’, Mr Somerville was given the status of an independent contractor. The NMC had no obligation to offer him any minimum number of sitting dates. He did not have to accept those he was offered and could withdraw from dates he had accepted. There was no right of substitution in the agreement; Mr Somerville had to provide his services personally.
He presented a claim to the Employment Tribunal for holiday pay, on the grounds that he was either an employee or a worker for the purposes of the Working Time Regulations 1998. The tribunal found him to be worker, but there was insufficient mutuality of obligation to give rise to either an overarching employment contract or an employment contract in relation to individual assignments. The NMC appealed to the EAT.
The EAT dismissed the appeal, upholding the tribunal’s decision that Mr Somerville is a worker. It rejected the NMC’s argument that the tribunal’s finding of a lack of mutuality of obligation was inconsistent with its conclusion of worker status. The EAT reviewed previous case law on mutuality of obligation and concluded that this does not establish a requirement for an ‘irreducible minimum of obligation’ as a prerequisite to finding that an individual is a worker. This means that in the EAT’s view, there is no requirement for an individual to be offered and accept a minimum amount of work in order for worker status to be established.
The EAT accepted the tribunal’s finding that there was an agreement for the claimant to provide his services personally, under the terms of an overarching agreement. On each occasion he provided work, there was a separate contract between the parties under which he was a worker. The tribunal had not erred in law in concluding that the absence of an irreducible minimum of obligation was not incompatible with worker status.
Consequences of this decision
This decision emphasises the importance of the requirement for personal service in making a finding of worker status, rather than there being any obligation on the employer to offer, or the individual to accept, a minimum amount of work (which is likely to feature in an employment relationship). Someone who only provides their services on an irregular basis, and without any obligation to do a minimum amount of work, can still be designated a worker and be entitled to the applicable statutory benefits, including holiday pay.
This decision also illustrates once again how the label attached to the relationship, in this case as ‘independent contractor’ in the documentation, will not preclude a finding of worker (or in some cases, employee) status by a tribunal.
These articles are from the May 2021 issue of Employment and Immigration Law Update, our monthly newsletter for HR professionals. To download the latest issue, please visit the newsletter section of our website. For further information please contact Liz Stevens or another member of Birketts’ Employment Law Team.
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at May 2021.