Well, would you believe it? In the week that I gave a talk at the City Business Library about contracts of employment (see here for my slideshare presentation) and the differences between employees, workers and the self-employed, I came across a case in the Employment Appeal Tribunal (EAT) which discussed all these issues. It is an important issue because the answer to the question will determine what legal remedies are available to the individual.
In the case of Clarkson v Pensher Security Doors Ltd  UKEAT 0107_09_1606 the Applicant undertook the bulk of the electrical work for the Respondent company. He provided most of the tools he did and although he was given jobs to do he was not told how to carry out those jobs. He was paid hourly and kept to hours stipulated by the Respondent and, importantly, there was “mutuality of obligation” between the parties – i.e. the Respondent would supply work and Mr Clarkson would undertake it. However, he took no part in the running of the company or attended company meetings or appraisals and was not paid when he didn’t work. He did do some, limited, work for On the facts it seems like he was, at least, a worker (which is a broader category with fewer legal rights). However, it was finally held that Mr Clarkson was neither a worker nor an employee and, instead, he was an independent contractor or “business undertaking”. This meant that his legal rights against the company were confined purely to the terms of the contract between them (and it isn’t clear whether that contract was in writing or purely oral). In other words he had no right to apply to an Employment Tribunal for any remedies that might otherwise have been available to him.
This case demonstrates the need for businesses and workers/employees to enter into clear written agreements that set out their status and thus, hopefully, avoid the need for expensive and time consuming litigation that these parties found themselves embroiled in.
If you need assistance or advice on these issues please do not hesitate to contact me on 0207 464 8433 or at email@example.com