United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MS L BROOKS (of Counsel) Messrs Irwin Mitchell Solicitors West Brow 9 Arkwright Road London NW3 6AD


 


MR JUSTICE LINDSAY: We have before us, by way of a preliminary hearing, the appeal of Miss G Fontaine in the matter of Fontaine v BPP Law Courses Ltd t/a BPP Law School. Before us Miss Fontaine has been represented by Ms Brooks of Counsel who has presented a lively argument on the law and the facts.

The decision of the Industrial Tribunal held at London (North) under the Chairmanship of Mr C B Robson. The hearing had been on 1st December 1997 and 13th January 1998 and the decision was promulgated on 14th January 1998.

It was a unanimous decision that Miss Fontaine was not an employee of the respondent Law School and so the decision continued:

"and so these tribunals have no jurisdiction to consider her complaint of unfair constructive dismissal."

The point had been raised as a preliminary point and that is explained in paragraph 1 of the extended reasons:

"The Applicant's complaint is that she was constructively dismissed by the Respondent from her employment by it as a Law Lecturer and that such dismissal was unfair. The Respondent denies that she is an employee and this had been a Preliminary Hearing to determine whether or not she was. If not, then these tribunals have no jurisdiction to consider her complaint."

In paragraph 6 of their extended reasons the Industrial Tribunal directed itself on the law. On the often exceptionally difficult question of "contract of service", "for services" and whether there is an "employer and employee", or quite whatever else is the proper description of the relationship between people who work together, in their paragraph 6 the tribunal set out the law correctly, namely that there are a whole number of factors to be taken into account in determining what the relationship is and whether there is a contract of service or not. In paragraph 6 they refer, inter alia, to the approach of Mummery J, as he then was, as approved by the Court of Appeal in Hall v Lorimer [1994] ICR 218.

It is always a difficult area where, quite often, tribunals and courts have to deal with some factors that point one way, and some factors that point another. But we have not understood their paragraph 6, where the tribunal directs itself on the law on the subject to be wrong. Indeed, it seems to us an impeccable self direction. We do not understand Ms Brooks to say that it was an improper direction, but rather, as she said, that notwithstanding that the tribunal stated themselves to be acting on that proper direction, they nonetheless failed to apply or misapplied that direction.

Amongst the facts that were found by the Industrial Tribunal was that another individual, an undoubted employee of the Law School, who was occupied, to use a neutral term, at the Law School at the same time as was Miss Fontaine, got paid monthly 1/12th of an annual entitlement and was paid in that way without his putting in any invoices. They also found that that undoubted employee, the very same person, received each month a wages slip which indicated deductions for income tax and National Insurance contributions. That being so, it plainly could not have been said that here there was some unusual position in which employees of the Law School habitually had to submit invoices or received remuneration with no indication of deductions therefrom.

By contrast, Miss Fontaine was expected to and did put in invoices. They were not paid regularly and a backlog mounted up and was then paid off. She was, on one occasion, paid in advance a lump sum in respect of a whole year. There were no deductions from invoices or from the payments made on the invoices for income tax or National Insurance contributions. The Industrial Tribunal in their concluding paragraphs begin by saying:

"12 After looking at the matter in the round and considering all the evidence and documentation before us, ... Although there are a number of factors which, if taken by themselves, might be thought to indicate that she was an employee, our considered view is that she was not one but rather a person employed under a contract for services."

Accordingly, they inevitably moved on to their paragraph 14:

"It follows that these tribunals have no jurisdiction to entertain her complaint and her Originating Application is accordingly dismissed."

There was an initial Notice of Appeal by Miss Fontaine. It has since been added to, and somewhat replaced by a new one presented by Ms Brooks but to some extent the points overlap and we think it would be wrong to overlook what was said in the first Notice of Appeal. There, one ground - we are looking at paragraph 1 (on page 2 of our bundle) - was that:

"The industrial tribunal took into account wholly irrelevant and/or irrelevant material, that is, "we are particularly impressed by the fact that the Applicant had legal qualifications and has practised at the Bar, even if not in the field of employment law"."

That is a reference to some words which came immediately after the passage in which the Industrial Tribunal had said that they had considered the matter in the round and were looking at all the evidence and documentation. What they there said was, continuing:

"... we are particularly impressed by the fact that the Applicant has legal qualifications and had practised at the Bar, even if not in the field of employment law. We consider that she must have appreciated that an employee does not submit invoices and receive salary in full without any deduction on account of tax and national insurance contributions."

We do not feel able to say that that consideration was so irrelevant that it should not have been mentioned or that it should not have impressed or even "particularly impressed" the tribunal.

The respondent before the Industrial Tribunal, the Law School had taken the point, as mentioned in paragraph 11 of the extended reasons (at page 8 in our bundle) where it said that :

"Mr Prior [the representative for the Law School] has submitted that the Applicant is not a naive young women but a qualified barrister. Whether she is an expert in employment law or not, he contends, she should surely have known that any employee only receives pay after deductions for tax and national insurance contributions. She must also have realised that employees do not submit invoices for their wages or salaries. She had taken advantage of the benefits of a Schedule D tax status ..."

but, in effect, that she had sought to go back on that.

It does not seem to us that it can be said that the fact that Miss Fontaine had a particular level of education and understanding consistent with her having practised at the Bar after qualifying for the Bar was completely irrelevant. The subjective belief of the parties is very far from determinative of the issue of contract of service or contract for services but it cannot be said, in our view (and we have found no authority relied upon before us to suggest) that subjective belief cannot have any weight in any circumstances at all. Once one gets to a situation in which it can be said that the subjective belief of the parties can be taken into consideration, then it does not seems to us wrong in law that the Industrial Tribunal, having had the submission from the respondent that they had had, accepted it in the way that we have quoted from their paragraph 12 where they said that they were "particularly impressed" by the point.

The fact that they were "particularly impressed" is very far from saying that they found that fact conclusive. It is to be borne in mind that the paragraph begins

"After looking at the matter in the round and considering all [our emphasis] the evidence and documentation before us ..."

And they later go on to say, having recognised that there were factors in her favour, that, nonetheless, their considered view what that she was not an employee.

Thus, although it is very easy to exaggerate the role that subjective belief has in cases such as this, we cannot say that the Industrial Tribunal has necessarily gone wrong in law in approaching the matter as they did.

The original Notice of Appeal also had a point about the timing of that realisation. The original Notice of Appeal said at 2:

"The industrial tribunal failed to state in relation to its determination that "she must have appreciated that an employee does not submit invoices and receive salary in full without any deduction on account of tax and national insurance contributions" the time when it considered such appreciation existed, that is, whether before or after the contract was concluded."

That point has not been pressed Ms Brooks but it has not in terms been abandoned either. However, it seems to us that no importance can be attached to it, because the subjective belief that the Industrial Tribunal spoke about was one engendered, if at all, from the fact that she had legal qualifications and had practised at the Bar, which was a state of fact which existed even before she went to the Law School. Accordingly, it does not seem to us important to establish exactly as at what date that appreciation might or might not have come into existence.

It may be argued, and it was raised by Ms Brooks, that here, in any event, the Industrial Tribunal was improperly speculating on what was or was not in Miss Fontaine's mind and on what was her belief on the subject. It would be wrong to think that an Industrial Tribunal, commonly spoken of as the "industrial jury", has no ability to draw inferences. Plainly, some inferences will be beyond what is legitimate, but the inference that a person who has legal qualifications and has practised at the Bar could be reasonably be expected to know that employees do not ordinarily submit invoices or receive salary in full without any deductions does not seem to us an inference that could be described as beyond the pale. If there had been evidence on Miss Fontaine's part that notwithstanding those qualifications and that practice she never did realise as the Industrial Tribunal seem to have supposed she had, that might have been different. But there is no suggestion in the finding of the Industrial Tribunal that she ever said she was not aware in the way that, by inference, the Industrial Tribunal concluded that she had been aware.

There is, in the original Notice of Appeal, also a complaint that the decision was perverse in the strict sense. It is submitted, and we think Ms Brooks maintains the submission, that no Industrial tribunal properly instructing itself could have come to the conclusion to which this one came. That is never an easy submission. In an area such as this, peculiarly one of difficulty and where there is a careful balancing of the evidence and of the factors emerging from the evidence, it becomes quite exceptionally difficult to sustain an argument of perversity.

We see no ground for it in this case. It is unnecessary for us to say that we would have concluded as the Industrial Tribunal has but, if we ask ourselves whether an Industrial Tribunal properly instructing itself could not have concluded as this one did, we find it quite impossible to come to that conclusion.

It is also said that there are some factors which were in evidence before the Industrial Tribunal to which no adequate weight or perhaps no weight at all has been given by this Industrial Tribunal. But that, again, is a difficult argument. The cases make it clear that it is far from incumbent on an Industrial Tribunal to spell out every single matter that it has had laid in front of it and then either to accept it or to reject it. So long as the parties are clearly informed why they have lost or why they have won, that, generally, is taken to be a sufficient requirement of an adequate extended decision. Here we see no reason to regard the decision as failing that robust test. It is quite plain from a reading of the decision why Miss Fontaine failed and why the respondents succeeded.

We have had our attention drawn to Young & Woods Ltd v West [1980] IRLR 202 and Narich Pty. Ltd v Commissioner of Pay-Roll Tax [1984] ICR 286 and to a number of other cases in the skeleton argument which Ms Brooks usefully furnished to us.

We do not see any conflict between the guidance given in those case on the law and the decision before us. It is quite plain that the label that parties, be it one party or two parties, attach to a relationship is far from conclusive, but there is nothing in the decision before us that deals with labels or their conclusiveness.

The principles emerging from the cases show that there are a great many factors and that they have to be weighed by the body required to conduct the exercise and that it is ultimately very much a matter of fact and degree, because the matter, although one of law, is not unmixed with fact.

Doing the best that we can on the argument addressed to us on the authorities, we are unable to discern any way in which this Industrial Tribunal misdirected itself. We cannot accept, having looked at the terms of paragraph 12 of the decision, that, having set out the appropriate test, the Industrial Tribunal did not in fact then apply it.

We have not as yet gone in detail through the amended grounds of appeal. Some of them, in fact, do raise matters that touch on the facts rather than the law, but at the heart of Ms Brooks's powerful argument, was criticism of the point in paragraph 12 of the Decision that Miss Fontaine must have appreciated that an employee does not submit invoices and receive remuneration in full and that the inference of that had been regarded by the Industrial Tribunal as at least strongly supportive of their conclusion and possibly even conclusive. We do not feel able, on the language of paragraph 12, to say that the Industrial Tribunal necessarily gave it quite that importance. They were indeed "particularly impressed" by it - that is what they are saying - but that is in the context of them having in terms said that they were looking at the matter in the round and considering all the evidence and documentation. That central ground, having not, in our view, succeeded, we see nothing in the other grounds that is of sufficient weight to amount to a truly arguable case that ought to go forward.

Although we are grateful to Ms Brooks for her interesting argument, we do not see here that this is an appropriate case to go to a full hearing. We do not say that we would have decided as the Industrial Tribunal did decide but we do say that it cannot be said that no Industrial Tribunal could have concluded as this one did. We see no sustainable case to the contrary.

Accordingly, we dismiss the appeal at this preliminary stage.