England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
(HIS HONOUR JUDGE J MCMULLEN QC)

		Royal Courts of Justice Strand London WC2A 2LL Thursday 8 August 2002

1. LORD JUSTICE PILL: This is an application by Mr Ian Senior for permission to appeal against the order of the Employment Appeal Tribunal, His Honour Judge McMullen QC presiding, given on 22 March 2002. The Appeal Tribunal dismissed an appeal from an Employment Tribunal sitting at Sheffield on 7 August 2001.
2. The Employment Tribunal held that it had no jurisdiction to hear the claim of the applicant for unfair dismissal because he did not have the required length of service set out in section 108 of the Employment Rights Act 1996 and because he was not an employee of the respondent. The tribunal also held that it had no jurisdiction to hear the applicant's breach of contract claim because he was not employed by the respondent under a contract of employment.
3. The facts are succinctly set out in the judgment of the Employment Appeal Tribunal:

"The Applicant was engaged in a working relationship, to put it neutrally, by the Respondent [the NESCO Group] as a commissioning engineer at BT telephone exchanges, from 4 October to 24 November 2000, when the relationship ended. The Respondent says it was terminated pursuant to the terms of a written contract. The Respondent's business is providing temporary contract staff to its clients. The contract between the Applicant and the Respondent provides that no contract of employment arises. The Respondent terminated the contract as its client, Marconi, who complained that the Applicant failed to fulfil quality standards. If the Applicant succeeds, the Respondent counterclaims for a laptop, which it says the Applicant misappropriated from Marconi."

4. I would make two points. The Employment Tribunal is the tribunal of fact. It has been set up for that purpose. It consists of a legally qualified chairman and two lay members, one a representative of each side of industry. It is for that tribunal to make findings of fact, having heard witnesses and having considered oral and documentary evidence. Secondly, the law is laid down in decisions of the courts whose duty it is, amongst other things, to construe Acts of Parliament. This court is bound that by its previous decisions.
5. Mr Senior has addressed the court, in person, and has helpfully submitted a written submission to which he has made reference in the course of his oral submissions. He submits that he was employed by NESCO and there has been an error of law in the tribunals below holding otherwise.
6. I have made the two preliminary points because it is clear from his oral and written submissions that Mr Senior does not approve of the current state of the law and considers that it should be changed. He is, of course, fully entitled to that view, and there are ways in which the law can be changed, notably by amendment to Acts of Parliament such as the Employment Rights Act. He makes this point in his written submission by reference to the judgments below and to the case of Montgomery v Johnson Underwood Ltd [2001] IRLR 269 CA. He says:

"This judgment which has been handed down is, in my view, unsound because it is based solely on the subjective personal opinions and views of a judge. It is not an Act of Parliament. It is not the written law of the land and should in itself be dismissed as the legal employment status of agency part-time, temporary and casual workers is a task for Parliament to decide."

7. However the applicant has also put forward, as he did before the Employment Tribunal, a list of reasons why he was employed by the respondents. I would refer to the case of Montgomery with which the applicant is clearly familiar. There is no doubt that people in the applicant's position have been the subject of concern both inside and before the courts. The applicant submits that public opinion would be on his side and that, in taking the course they are, agencies such as the respondents are excluding the rights of people and creating an underclass in society. The applicant would like to see something done about it. He has had 12 years out of work. Notwithstanding the skill shortage which exists and the skills which he has, he has been refused employment with the police. All he requires, he says, is a viable livelihood.
8. Before the Employment Tribunal, the applicant appeared in person and made his case as clearly, I have no doubt, as he did before me. The tribunal have expressed the view, in paragraph 3, that many lay people find it hard to accept that he may not have been an employee just because he was paid regular wages for regular work and had tax and national insurance deducted at source as set out in pay-slips which he received.
9. Upon the material before them, and applying the case of Montgomery and other cases, the tribunal nevertheless concluded that:

"Whichever way one looks at it, he was not, in our view, an employee of the Respondents."

10. The EAT upheld that view, again citing authority and accepting that they approached the case on the basis that the contract between the applicant and the respondents was not based on the written contract alone but was built up from a number of oral communications and discussions (paragraph 9 of their judgment).
11. The written part of the contract was not included by the applicant within his bundle. I suggested at the beginning of the hearing that the applicant might like to show it to me. He did not take advantage of the invitation at that time but has subsequently done so. It is in standard form and stated: "Contract of the engagement of services of a temporary worker". The particulars specific to this contract refer to the client as being Marconi Communications, to a start date of 30 October 2000 and a finish date of 22 December 2000. Reference is made to the rate of pay, the number of hours to be worked per week and other matters.
12. The situation in Montgomery was very similar. The court considered the position of employment agencies, such as the respondent in this case. It was pointed out that the court could only intervene if the decision of the Employment Tribunal involved an error of law or was perverse. Giving the leading judgment Buckley J cited, rightly in my view, the often quoted statement of MacKenna J in Ready Mixed Concrete (South East) Limited v Minister of Pensions and National Insurance [1968] 2 QB 497 at 515:

"I must now consider what is meant by a contract of service. A contract of service exists if these three conditions are fulfilled. (i) The servant agrees that, in consideration of a wage or other remuneration, he will provide his own work and skill in the performance of some service for his master. (ii) He agrees, expressly or impliedly, that in the performance of that service he will be subject to the other's control in a sufficient degree to make that other master. (iii) The other provisions of the contract are consistent with its being a contract of service."

13. Buckley J applied that principle and stated that the first two criteria stated by MacKenna J must be met as an irreducible minimum. The judge concluded that the requirement was not met in that case. Longmore LJ agreed, stating that:

"46. In the context of a claim for unfair dismissal, an applicant must show that she (or he) is an employee of the defendant sued. In a case where (as here) the [employment] tribunal has found as a fact that there was 'little or no control, direction or supervision', on the part of JU, a conclusion that Mrs Montgomery was the employee of JU cannot stand. Whatever other developments this branch of the law may have seen over the years, mutuality of obligation and the requirement of control on the part of the potential employer are the irreducible minimum for the existence of a contract of employment."

14. A similar statement was made by Brooke LJ, who agreed with the judgments which had been given.
15. In my judgment, the Employment Tribunal in the present case, as in the case of Montgomery, was entitled to reach the conclusion it did. In his written submissions, the applicant has referred to matters which should be borne in mind when a decision is taken as to whether a contract of employment exists. Some of them were argued before the Employment Tribunal. As I have said, that tribunal is the fact finding tribunal. It is not open to any applicant to re-argue questions of fact in this court. I agree with the Employment Appeal Tribunal that, on the material before them (including the Inland Revenue documents which are produced) that the Employment Tribunal were entitled to reach the conclusion they did. It is not, in my judgment, arguable that this court would reverse or impugn the decision of the Employment Tribunal in the circumstances of this case.
16. I add that, before the Employment Appeal Tribunal, the applicant was represented by a solicitor appearing under the Employment Law Free Advice Sercice. I understand the feelings of the applicant on this question; so, clearly, did the tribunals below; so did this court when giving judgments in Montgomery. Comments to that effect, appear in each of the judgments. For example, Brooke LJ began his judgment by expressing his sympathy, first with the tribunals below, in the difficulty in which they had been placed. Brooke LJ added at paragraph 48:

"I am not surprised that the lower tribunal sought to achieve for Mrs Montgomery the rights under modern employment law which they correctly held that O & K was not willing to accord to her. But, if the result of overturning their decision is not a happy one the remedy lies with Parliament."

17. The same can be said in the present case in relation to the employment agency concerned. I dare say that Mr Senior would also wish to say it in relation to Marconi. Buckley J did leave open the possibility that there could be circumstances in which a person "taken on" by an employment agency is an employee in the light of the law. However, on the facts of this case - and I bear in mind the short time for which the contract under its written terms was to apply - the Employment Tribunal were entitled to reach the conclusion they did. At paragraph 40 of his judgment Buckley J contemplated that there could be a necessary mutuality, although, he added, it would be more difficult to find it in a very short assignment. I too sympathise with the position of the applicant and others in his position.
18. For the reasons I have given, this application is refused. I see no real prospect of this court overturning the decisions below.
Order: Permission to appeal refused.