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Employment Law

Legal guidance - compliance - software

Veale Wasborough Vizards , 29 JUN 2015

Employment status - worker, employee or neither?

Employment status - worker, employee or neither?
Colin Godfrey
Associate, Veale Wasbrough Vizards

A recent Employment Appeal Tribunal (EAT) decision has considered the employment status of a GP who sought to bring whistleblowing, unfair dismissal and discrimination complaints.

Mr Suhail was a registered GP. He provided services to a Primary Care Trust (the Trust) via the Partnership of East London Co-operative (PELC). Mr Suhail brought whistleblowing, unfair dismissal and discrimination claims in the Employment Tribunal (ET). The first, preliminary issue, which the ET had to determine was whether Mr Suhail was an employee or worker for the purpose of his claims.

The ET held that Mr Suhail was not an employee or a worker as the basis of his relationship with the Trust "was more of client and customer". The ET highlighted that Mr Suhail sold his services on a shift-by-shift basis to the Trust as and when he chose. The agreement he had with PELC referred to him as a self-employed contractor and he issued invoices which were paid without deduction for tax or NI. PELC did not have to offer him work and he did not have to accept work when it was offered to him. Mr Suhail appealed to the EAT. 

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In rejecting the appeal the EAT referred particularly to the lack of exclusivity in the contractual arrangements. Mr Suhail was not offering his services exclusively to the Trust and could work for any other third party. That was inconsistent with employee or worker status and supported the ET's finding that the relationship between Mr Suhail and the Trust was analogous to that of a client/customer. On this basis Mr Suhail was neither an employee nor a worker for employment law purposes, instead he was a self-employed contractor. As a result, his claim failed.

Best practice

Questions of employment status are necessarily very fact specific. This case does however highlight that a properly considered contractual arrangement can (if it reflects the way in which the relationship works in practice) help to ensure that properly independent contractors do not come within the definition of a worker and/or employee.

Given the substantial benefits and protections which are afforded to employees and workers, it is important that businesses put in place clear contractual arrangements for any independent contractors at the start of the relationship.