Industrial Tribunals Northern Ireland Decisions

THE INDUSTRIAL TRIBUNALS

 

CASE REF:  4212/17

 

 

 

CLAIMANT:                          Thomas Easton

 

 

RESPONDENT:                  Robert Murtagh and Geraldine Murtagh,
t/a R M Distribution

 

 

 

DECISION ON A PRE-HEARING REVIEW

The decision of the tribunal is that the claimant was neither an employee of the respondent nor a worker and that his claim is dismissed.

 

                      

Constitution of Tribunal:

 

Employment Judge (sitting alone):       Employment Judge Crothers    

                                   

 

 

Appearances:

 

The claimant was represented by Mr M Quigley, Barrister-at-Law, instructed by Emma Lyons and Co Solicitors.

 

The respondent was represented by Mr O Friel, Barrister-at-Law, instructed by James Strawbridge Solicitors.

 

 

 

TITLE OF RESPONDENT

 

1.         The correct title of the respondent(s) is shown above, (hereinafter referred to as ‘the respondent’).

 

THE CLAIM

 

2.         The claimant presented a claim to the tribunal on 11 July 2017 for unfair constructive dismissal, breach of contract in relation to holiday pay, and further claims relating to an unauthorised deduction from wages and the right to be paid annual leave under the Working Time Regulations.

 

THE ISSUE

 

3.         The issue before the tribunal was:-

 

‘Whether or not the claimant was an employee of the respondents or a worker.’ 

 

SOURCES OF EVIDENCE

 

4.         The tribunal heard evidence from the claimant and considered relevant documentation in the course of the hearing.  The respondent did not give evidence.

 

FINDINGS OF FACT  

 

5.         Having considered the evidence insofar as same related to the issue before it, the tribunal made the following findings of fact, on the balance of probabilities:-

 

(i)      At paragraph 5.2 of his claim form the claimant claimed that he commenced employment with the respondent in July 2014.  In his evidence before the tribunal, he claimed that he commenced employment in June 2014.  The tribunal also considered the respondent’s response and is satisfied that the relevant date is in or around July 2014.

 

(ii)     The claimant had previously worked as a taxi driver for Valu Cabs on a self-employed basis.  After spending some time with the respondent to explore the nature of the work, the claimant began to operate as a courier on the basis of five days per week and one Saturday per month.  He delivered parcels in the Armagh area.  He was supplied with a uniform by the respondent and drove vans with the DPD logo on them.  He claimed that he had to wear the uniform supplied, otherwise he would not be allowed to work.  His day commenced at 7.00 am.

 

(iii)    The claimant referred to two specific episodes in April and August 2016 respectively.  In April 2016 his daughter was born.  He claimed that he was not allowed to take time off to go to the doctor or dentist and was also told by Mr Murtagh that he would be jobless if he did not provide cover during his time off.  He subsequently engaged his sister to do so.  He was married in August 2016 and sought to take two weeks leave.  Again, he provided cover through a friend (Darren) who was familiar with the area to be covered and did not require to be trained up, unlike the claimant’s sister earlier in April 2016.  The claimant accepted that it was his responsibility to provide cover during these two periods.  He paid both his sister and his friend Darren.  The claimant was however paid by the respondent during these two periods in April and August 2016 respectively.

 

(iv)    The tribunal was shown a document entitled “Receipt of Payment” dated 26 September 2014 and signed by the claimant.  It was directed to “Robert Murtagh/R M Distribution” and states:-

 

“I ACKNOWLEGE THAT IN ACCEPTING RECEIPT OF CHEQUES FOR PAYMENT IN FULL OF ANY INVOICES ISSUED BY ME, THAT I AM PERSONALLY RESPONSIBLE/LIABLE FOR PAYMENT OF ALL TAXES, NATIONAL INSURANCE, VAT AND ANY OTHER STATUTORY LEVY”.

 

(v)     The claimant claimed that he was forced to sign this document and that he was told by Robert Murtagh that if he did not sign he would be “out the door”.  The claimant alleged that he did not agree with the form itself although he understood the document.  He acknowledged that he had been responsible for the payment of all taxes during his time with the respondent.

 

(vi)    The tribunal was also referred to a sub-contractor’s invoice for August 2016 and an earlier invoice dated 25 January 2016.  The claimant was of the view that he should have been allowed to provide his own invoices.  He claimed that he objected to the use of the invoice provided to him but had to accept it.  It is clear from the invoices that the claimant was paid a gross amount at the end of each month.  The arrangement pertained until circumstances arose leading to the claimant’s claim of unfair constructive dismissal on 12 April 2017.  The claimant did not have a written contract of employment.

 

THE LAW

 

6.         (1)     Article 3 of the Employment Rights (Northern Ireland) Order 1996 (“the

                     Order”), provides as follows:-

 

“ Employees, workers

 

3.      (1)     In this Order “employee” means an individual who has entered into          or works under (or, where the employment ceased, worked under) a          contract of employment.

 

          (2)     In this Order “contract of employment” means a contract of service            or apprenticeship, whether express or implied, and (if it is express)             whether oral or in writing.

 

          (3)     In this Order “worker” means an individual who has entered into or            works under (or, where the employment has ceased, worked under)      –

 

(a)        a contract of employment, or

 

(b)        any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual;

 

and any reference to a worker’s contract shall be construed accordingly.

 

(4)     In this Order “employer”, in relation to an employee or a worker, means the person by whom the employee or worker is (or, where the employment has ceased, was) employed.

 

(5)     In this Order “employment”

 

(a)        in relation to an employee, means (except for the purposes of Article  206) employment under a contract of employment, and

 

(b)        in relation to a worker, means employment under his contract;

 

and “employed” shall be construed accordingly.

 

(6)     This Article has effect subject to Articles 67K and 70B(3); and for the purposes of Part XV so far as relating to Part VA or Article 70B, “worker”, “worker’s contract” and, in relation to a worker, “employer”, “employment” and “employed” have the extended meaning given by Article 67K.]”

 

(2)     In the case of Ready-mix Concrete (South East) Ltd v The Minister of Pensions and National Insurance (1968) 2QB497 , a threefold test for identifying a contract of service was set out as follows:-

 

(a)     An agreement exists between the servant and the master for the provision of services personally in return for pay;

 

(b)     The master has a degree of control over the servant; and

 

(c)     All the other provisions in the agreement are consistent with a contract of service. 

 

The other provisions may include:-

 

·        Provision of a uniform and/or equipment

 

·        Integration into the business

 

·        Which party bears financial risk

 

·        Whether there is provision for bonuses, benefits or insurance

 

·        Whether holidays and sick days are paid

 

·        How tax is paid on earnings.

 

(3)     In Carmichael v National Power (2000) IRLR43 , the factor of mutuality of obligation emerged.  Carmichael recognised that the tribunal must look at the overall factual matrix.

 

(4)     In the Supreme Court case of Autocleanz v Belcher and Others (2011) UKSC 41 , (which involved an allegation that the terms of a written contract were an incorrect representation of the nature of the working relationship) it was held that the correct approach is to discover the actual legal obligations of the parties by assessing all relevant evidence, including the parties’ conduct in practice.  In some cases the parties’ conduct in practice may be determinative in showing that the claimant is an employee or worker, despite being labelled as self-employed.

 

(5)     The case of Byrne Brothers (Farm Work) Ltd v Baird (2002) IRL96 , considered the test for identifying a worker as follows:-

 

(a)     did the person agree to personally perform work or services?  The power to appoint a substitute may, depending on the circumstances, prevent workers’ status being found;

 

(b)     was the alleged employer actually a client of a business undertaking carried on by the person?

 

(c)     was there mutuality of obligation between the parties?

 

(6)     In Yorkshire Window Company v Parkes UKEAT/0484/09 the Employment Appeal Tribunal had to consider the concept of “worker” for the purposes of the Working Time Regulations 1998.  The following principles emerged:-

 

(a)     whether or not a person is a worker engaged under a contract for personal services is a matter of construction;

 

(b)     the tribunal must construe the contract rather than addressing matters of policy;

 

(c)     whilst an individual may choose to provide a service personally, the issue is whether he is contractually obliged to do so;

 

(d)     the existence of a right to provide a substitute does not necessarily preclude the finding of a contract for personal service unless that right is unconstrained;

 

(e)     a worker holds the middle ground between an employee and a self-employed person carrying on his own business undertaking.

 

(7)     The tribunal also carefully considered the additional authorities referred to in the parties’ written submissions annexed to this decision together with the Supreme Court decision in Pimlico Plumbers Ltd v Another (appellants) v Smith (respondent) , UKSC2017/0053 (judgement date 13 June 2018).

 

SUBMISSIONS

 

7.         Respective counsel made short oral submissions at the conclusion of the hearing.  These are included in the written submissions, which are appended to this decision.    The tribunal postponed promulgation of this decision pending the outcome of the Supreme Court case in Pimlico .  The parties subsequently stated that they did not wish to make further written submissions following the Pimlico case.  However, the tribunal, at its own request, invited counsel to address it further on various matters,  including the Pimlico Supreme Court decision, and the aspects of personal service and evidence relating to whether the claimant had an unconstrained right to provide a substitute in April and August 2016 respectively.

 

CONCLUSIONS

 

8.         The tribunal, having carefully considered the evidence before it and having applied the relevant principles of law to the findings of fact, concludes as follows:-

 

(1)        It is satisfied, and the representatives agreed, that the factual matrix in the Pimlico Plumber’s case could be distinguished from the present case on the basis that the substitution alleged in the Pimlico case related to the distribution of work between other workers in the respondent’s organisation.  In this case, the claimant substituted individuals who had no connection with the respondent.

 

(2)        The tribunal is satisfied, on the basis of the statutory test and the relevant authorities referred to, that the claimant was not an employee of the respondent.  In the tribunal’s view, the claimant clearly regarded himself as being self-employed when he assumed the role with the respondent.  The tribunal also finds that there was a lack of mutual obligation between the parties, and that the claimant also assumed responsibility for Income Tax, National Insurance, VAT and any other statutory levy.

 

(3)        Having also had regard to the conduct of the parties, the tribunal is satisfied that the claimant had an unconstrained right to provide two substitutes on two separate occasions.  There is no evidence before the tribunal that the respondent had to provide permission in order for the substitutes to be used.  On the contrary, and on the claimant’s evidence, Mr Murtagh allegedly told him that he would be jobless unless he provided such cover.

 

(4)        The tribunal is therefore satisfied that the claimant was neither an employee of the respondent nor a worker as defined in the Order.  The claimant’s claims are therefore dismissed.

 

 

 

Employment Judge:

 

 

Date and place of hearing:  29 November 2017 and 2 August 2018, Belfast.

 

 

Date decision recorded in register and issued to parties: