Industrial Tribunals Northern Ireland Decisions

THE INDUSTRIAL TRIBUNALS

CASE REF:   7364/09

CLAIMANT:                      Deirdre Stephenson

RESPONDENTS:              1. Street Play Leisure Limited (In Administration)

                                        2. Redundancy Payments Service

DECISION

The decision of the tribunal is that the application be dismissed.

Constitution of Tribunal:

Chairman (sitting alone): Mr Davey    

Appearances:

The claimant was represented by her husband Mr Robert Stephenson.

The second named respondent was represented by Mr P McAteer, BL, instructed by the Departmental Solicitors Office.

REASONS

1.              The claimant, in her originating application, sought a redundancy payment and other monies, such as notice pay, arising out of employment with the first named respondent over a period of some 8-9 years.  The issue for the tribunal was whether the claimant was an employee of the first named respondent or not. 

2.              The claimant’s husband had been employed by a company engaged in the same business as the first named respondent in which a management buyout had been proposed.  After some consideration the claimant’s husband and another person decided to reject participation in the management buyout and start up their own business. As time progressed the new business enjoyed some success and, indeed, expanded dramatically.  The expansion was such as to make it, in the words of the claimant’s husband, difficult for him with two young children to engage in the travelling and effort which the business required.  This situation was discussed between husband and wife and it was decided that the claimant should step down from her employment in order to make her husband more efficient.  She carried out tasks for the first named respondent and she was paid a monthly stipend of a size approximately equivalent to that of her husband.  She became a director of the company.  No record was kept of the hours which she worked; the stipend she received was unrelated to the number of hours worked.  It was estimated that during her earlier involvement with the company she would have been working perhaps 5-10 hours per week, though this increased in the later stages to something up to 25 hours per week.  She received no holiday pay as such, even though there were years when no holidays were taken.  There was no provision, or no formal provision, for any review of her remuneration or of her working hours.  She entered into no contract of employment and no memorandum of terms and conditions of  employment was given to her.  She did not carry out her tasks at the company’s office.  Anything she did she did from home. 

3.              After proceeding in this manner for some years the company ultimately ran into difficulties and was forced into administration.  The claimant submitted a claim to the Redundancy Payments Service.  In completing the application form she recorded at question 19, of the form, that she worked no days and no hours per week but was a non-working director.  She also declared, in the same form, that she had no job title, that there were no holiday pay arrangements for her and that she received no holiday pay.

4.              In this case there was no formal document or contract to be considered.  The fact that there was no such document does not mean that there was no contract though the lack of such a document is a factor which can be taken into account.  It is for the tribunal to consider all the circumstances of the case to see whether the relationship

or arrangement involved can properly be said to constitute a contract of employment.  In this case, having regard to the originally stated reasons for the claimant giving up her former employment, the lack of any connection between hours worked and monies paid, the lack of any arrangements for holidays, payment for holidays or reviews and the claimant’s own assessment of her position as a non-working director, the tribunal considers that in this case no employee/employer relationship existed.  While the tribunal has no doubt the claimant did perform tasks for the company, that she did have talents to offer and that she did contribute to the growth of the company, it is difficult to see that she was actually obliged to do any of these things or, indeed, that the first named respondent was in any way obliged to provide such tasks for her to do. There was no contract of employment and accordingly the claim falls to be dismissed.

Chairman:

Date and place of hearing:         25 January 2010, Belfast.          

Date decision recorded in register and issued to parties: