IN THE EMPLOYMENT AND DISCRIMINATION TRIBUNAL

 

 

IN THE MATTER:

 

 

BETWEEN

MR DAVID ALBERT COLE

CLAIMANT

 

AND

 

 

MR EDWARD JONES & MRS KATHRYN LE SEELLEUR-JONES

RESPONDENTS

 


TRIBUNAL JUDGMENT


 

Reference:                    [2018] TRE036

 

Hearing Date:                25 May 2018    

 

Before:                                     Mrs H G Griffin, Chairman

 

Appearance:

 

For the Claimant:           Mr Cole, in person

For the Respondents:    Mrs Le Seelleur-Jones & Mr Jones

 

 

THE JUDGMENT

 

It is the judgment of the Tribunal that the Claimant was not an employee of the Respondents; he was a self-employed person who was carrying on a business undertaking on his own account.  Consequently, the Claimant is not entitled to bring his claims in the Tribunal and, accordingly, they are struck out.

 

 

THE DECISION

 

Background

 

1.       By a Claim Form presented on 12 March 2018, the Claimant brought the following complaints:

 

a)       Unfair dismissal;

b)      Wrongful dismissal (failure to give notice); and

c)       Unpaid holiday pay,

(together "Claims").

2.       The Respondents defend the Claims on the grounds that the Claimant was not an employee of the Respondents but a self-employed person who was carrying on a business undertaking on his own account.

 

3.       A Tribunal hearing ("Hearing") was convened to establish whether the Claimant was:

 

a)       an employee as defined under Article 1A of the Employment (Jersey) Law 2003 ("EJL 2003"); or

b)      a self-employed person who was carrying on a business undertaking on his own account.

 

4.       The Claimant and Mrs Seelleur-Jones (“SJ”) each provided witness statements and gave evidence under oath. The Claimant, in breach of the Tribunal's Orders, only provided his witness statement on the morning of the Hearing. However, the Claimant's statement was short and, having read its contents, the Respondents confirmed that they wished to proceed.

 

The Facts

           

Contract negotiations

5.       In either 2010 or 2011, SJ responded to the Claimant's small advertisement in the Jersey Evening Post (“JEP”):

 

EXPERIENCED gardener £9 per hour”

6.       The Claimant advertised in the 'Gardening’ section of the JEP rather than in the 'Situations Wanted" section. The Claimant explained in his evidence that he had previously tried advertising in 'Situations Wanted' but "nothing came of it".  According to the Claimant, when he advertised in the JEP, he usually received approximately five contacts.  The Claimant’s evidence was that he would “take what came along”. The Respondents submitted that, by advertising in 'Gardening', the Claimant projected himself as being self-employed.

 

7.       The Claimant and SJ negotiated terms and entered into an oral agreement whereby the Claimant worked four hours per week at £10 per hour.  During their negotiations, the Claimant increased his hourly rate from his advertised £9 per hour to £10 per hour in order to:

 

a)       reflect the work required in the garden; and

b)      to include the disposal of the garden waste.

8.       Initially, the Claimant’s days were relatively random, but after a time, the Claimant settled into a routine of working every Thursday afternoon.  SJ then requested that the Claimant change to mornings and he then worked on Friday mornings. The Claimant attended work at all times for approximately 48 weeks of the year, in all weathers.

 

Equipment

9.       Except for the lawnmower, the Claimant provided his own gardening equipment.  The Claimant gave evidence that the lawnmower was too large to fit in his small van and too heavy to unload at different gardens.

 

Absences/holidays

10.   If the Claimant wanted to take annual leave, take the day off (eg for a funeral) or was unwell, he simply informed SJ that he would not be working that day.  There were also occasions when SJ informed the Claimant that he could not work because there was no access to the garden.

 

11.   The Respondents did not pay the Claimant if he did not work, no matter what the reason for his absence.  The Claimant did not receive holiday pay.  According to the Claimant, he did not raise the issue of lack of holiday pay because he did not want to lose the work.

 

12.   SJ was not always present when the Claimant was working.  The Claimant was able to access the garden and, if SJ was not at home, she left the Claimant’s money in in a safe place for the Claimant to collect.

 

13.   If the Claimant did not work as expected, there were no adverse consequences (eg warnings or disciplinary processes) and the Claimant’s money simply remained in the safe place until the Claimant did attend to carry out the work.

 

14.   Occasionally, SJ would identify jobs which she noticed required the Claimant’s attention, but the parties agreed that, for the most part, the Claimant worked unsupervised.  The Claimant gave evidence that it was “obvious” what jobs needed to be undertaken and SJ gave evidence she did not supervise the Claimant because she was buying in his services as an experienced gardener.

 

Personal performance/personal service

15.   At no point during the time that the Claimant worked for the Respondents did anyone else act as a substitute for the Claimant. The Claimant was clear that he did not employ anyone else and SJ expected the Claimant to personally carry out the gardening work in accordance with their agreement.  She did not expect the Claimant to send someone else to undertake the work.

 

Tax and social security

16.   The Claimant gave evidence that, having retired, he was not liable for social security contributions. However he did pay his own tax.

 

Claimant's submissions

17.   The Claimant was clear in his submissions that he considered himself to be an employee with multiple employers. In his words, he was "employed for two, three or four hours to do the gardening and I then to move on to another garden.”

 

18.   The Claimant was adamant that he was not self-employed or a "contractor". He believed that in order to be a contractor he would have to “register” and he stated that he never had any need to be a contractor. The Claimant said that if he were a contractor he would have placed advertisements in Yellow Pages and would then have had to employ other people; he did not think it was worth employing others and preferred to work alone.

 

Respondents’ submissions

19.   The Respondents submitted that the Claimant was not an employee because:

 

a)       there was no mutuality of obligation between the parties; and

b)      the Respondents did not exercise any control over the Claimant who worked unsupervised.

 

The Law

20.   Article 1A EJL 2003 states:

“1A ’Employer’ and ‘employee’

(1)  In this Law –

      (a)        ‘employer’ means a person who employs another person; and

      (b)        'employee' means a person who is employed by an employer stop

(2)  For the purposes of paragraph (1), a person is employed by another person if the first person works for the second person under a contract of service or apprenticeship with the second person.

(3)  For the purposes of paragraph (1), a person is also employed by another person if the first person enters into any other contract with the second person under which –

      (a)        the first person undertakes to do, or to perform personally, work or services for the second person; and

      (b)        the status of the second person is not that of a client or customer of any profession or trade or business undertaking that is carried on by the first person.

(4)  It is immaterial whether a contract to which paragraph (2) or paragraph (3) refers is express or implied.

(5)  If the contract is express, it is immaterial whether it is oral or in writing.”

 

21.   In the case of Bisson v Doré & Red Appco Cabs Limited D-34/2016, the Tribunal analysed in detail both the provisions of Article 1A EJL and the relevant English case law.   The Tribunal detailed the distinction between:

 

a)       individuals who are ‘employees’ under Article 1A(2) (“1A(2) Employees”), ie those who are employed under a contract of service (more commonly known as a contract of employment);

b)      individuals who are ‘employees’ under Article 1A(3) (“1A(3) Employees”), ie those who provide their personal services as part of a profession or business undertaking carried on by someone else (classified as a ‘worker’ in the UK); and

c)       self-employed individuals who carry on a profession or a business undertaking on their own account and enter into contracts with clients or customers to provide work or services to them.

[see per Lady Hale in Bates van Winkelhof v Clyde & Co LLP & Another [2014] 1 WLR 2047]

 

22.   In the UK, the distinction between (a) and (b) above is of great importance; those who fall under (a) enjoy more enhanced employment rights than those termed as ‘workers’ under (b).  In Jersey, however, both groups are treated identically; they are both ‘employees’ for the purposes of EJL 2003, each enjoying identical rights arising from that employment status.

23.    In order for the individual to be a 1A(2) Employee, the following three elements must be present:

 

a)       there must be a 'mutuality of obligation' between the parties (to the extent that the employer is obliged to provide work to the employee and the employee is obliged to accept it [Marchem (Europe Limited) v Carré [2015] JRC075];

b)      the contract must contain a requirement that the individual provides personal service; and

c)       the 'employer' must exercise a sufficient degree of control over the work carried out by the individual so as to make the 'employer' the master.

 

24.   In order for the individual to be a 1A(3) Employee:

 

a)       there must be a contract between the parties (ie there must be mutuality of obligation insofar as there is an exchange of promises between the parties in line with a normal contract);

b)      the contract must contain a requirement that the individual provide personal service; and

c)       the person for whom such service is performed must not be a client or customer of the individual undertaking the work.

 

25.   As stated in Red Cabs, if an individual is a 1A(2) Employee, that individual will also automatically be a 1A(3) Employee.  Therefore, in practical terms, the question of whether or not an individual is a 1A(2) Employee is effectively irrelevant for the purposes of identifying an individual’s employment status and the Tribunal need only apply the tests relevant for a 1A(3) Employee. By the same token, the question of whether or not there was ‘mutuality of obligation’ between the parties is only relevant for determining whether a person is a 1A(3) Employee insofar as it relates to whether or not there were contractual relations between the parties (rather than whether the employer was obliged to provide work and the employee obliged to accept it).

 

Personal performance/personal service

26.   Whether or not the individual is obliged to provide personal service under a contract (ie is require to personally perform that contract) is key to the question of whether or not an individual is an employee or is self-employed. In the absence of ‘personal performance’ or ‘personal service’, an individual will necessarily fall outside both Article 1A(2) and 1A(3) EJL 2003; put quite simply, without personal performance or personal service an individual cannot be an ‘employee’.

27.   The issue of whether an individual is required to provide personal service or personally perform a contract will be fact sensitive.  The terms of the contract (be it written or oral) must be examined to establish whether it includes an express or an implied right of substitution, ie was the individual entitled to provide a substitute to undertake the work or was there a requirement that the individual personally perform or undertake that work?

28.   Where a substitution clause appears to exist, the Tribunal will look at the evidence to ensure that it reflects the true nature of the relationship between the parties [Consistent Group Ltd v Kalwak [2007] IRLR 560].

29.   When assessing the question of personal performance or personal service, the Tribunal will consider the following five principles as identified in Pimlico Plumbers Limited & another v Smith [2017] EWCA Civ 51, and which the Tribunal endorsed in Bisson v Doré & Red Appco Cabs Limited D-34/2016:

a)       an unfettered right to substitute another person to do the work or perform the services is inconsistent with an undertaking to do so personally;

b)      a conditional right to substitute another person may or may not be inconsistent with personal performance.  It will depend on the precise contractual arrangements and, in particular, the extent to which the right of substitution is limited or occasional;

c)       a right of substitution only when the contractor is unable to carry out the work will, subject to any exceptional facts, be consistent with personal performance;

d)      a right of substitution limited only by the need to show that the substitute is as qualified as the contractor to do the work, whether or not that entails a particular procedure, will, subject to any exceptional facts, be inconsistent with personal performance; and

e)      a right to substitute only with the consent of another person who has an absolute and unqualified discretion to withhold consent will be consistent with personal performance.

What is the nature of the relationship between the parties?

 

30.   If the Tribunal finds that the individual is required to personally perform the contract, the Tribunal must then consider the nature of the relationship between the two parties; was the person to whom the individual was providing personal service a client or customer of the individual who was undertaking the work?

31.   In Bates van Winkelhof, Lady Hale approved comments made in the EAT case of Cotswold Developments Construction Ltd v Williams [2006] IRLR 181.  In that case, Langstaff J made the following comments:

“… A focus on whether the purported worker actively markets his services as an independent person to the world in general (a person who will thus have a client or customer) on the one hand, or whether he is recruited by the principal to work for that principal as an integral part of the principal's operations, will in most cases demonstrate on which side of the line a given person falls.”

 

32.   It is worth noting that in Bates van Winkelhof, the Supreme Court found that the claimant was a ‘worker’ (a 1A(3) Employee in Jersey).  A key factor in this decision was the fact that the claimant was not free to market her services as a solicitor to “the world in general”.

Conclusion

33.   For the reasons set out in paragraph 25 above, I did not consider the question of whether the Claimant was a 1A(2) Employee.  I only turned my mind to the question of whether the Claimant was either:

a)       a 1A(3) Employee; or

b)      a self-employed individual who carried on a profession or a business undertaking on his own account.

Was there a contract between the parties?

34.   As set out above, the terms of contract were agreed orally between the parties.  There was 'mutuality of obligation" between the parties insofar as there was an exchange of promises between the Claimant and SJ that the Claimant agreed to undertake gardening for the Respondents in exchange for payment of £10 per hour.  I am satisfied that this basic contract remained in force until SJ terminated it on 9 February 2018.

35.   I therefore find that the first limb of the Article 1A(3) Employee test is satisfied.

Was there a requirement for personal performance/personal service?

36.   Having established that there was a contract between the parties, I then considered (based on the conduct of the parties over the course of the contract) whether there was an express or implied right of substitution.

37.   On the evidence it was clear that there was no express or implied right of substitution in line with the principles set out in Pimlico Plumbers; at no stage did the Claimant offer to provide a substitute gardener when he was either on holiday or ill and SJ expected the Claimant to personally undertake the gardening work.

38.   I therefore find that the second limb of the 1A(3) Employee test is satisfied.

What was the nature of the relationship between the Claimant and the Respondents?

39.   Finally, I considered the question of whether or not the Respondents were ‘customers’ of the Claimant.

40.   In considering this question, I noted in particular the following points:

a)       The Claimant commercially advertised his services; he placed regular advertisements in the JEP and was free to market his services to the world in general.  Unlike in Bates van Winkelhof, the Claimant was free to work for as many other people as he wished.  The Respondents did not require (or expect) exclusivity and, when the Claimant needed more work, he simply re-advertised in the JEP. 

b)      The Claimant enjoyed flexibility in his work.  Although SJ indicated to him that she would prefer that he worked in the mornings, I accepted that SJ was happy for the Claimant to work on any morning; it just so happened that the Claimant chose to come regularly on a Friday.

c)       There were no adverse consequences if the Claimant informed SJ at short notice that he would not be attending that day; I accepted SJ’s evidence that the money would simply stay until the Claimant did work.

d)      The Claimant was free to take holiday whenever it suited him; he simply informed SJ that he was going on holiday or was unable to attend.

e)      The Claimant paid his own tax.

41.   In light of Bates van Winkelhof, in reaching my decision I considered it particularly relevant that the Claimant was able to source his own work through the placing of an advertisement in the JEP.  Unlike in Bates van Winkelhof, the Claimant was not constrained in his ability to work for others; the fact that he advertised his services demonstrates that he had an unfettered ability to provide gardening services to new customers notwithstanding that he already provided gardening services to the Respondents.

42.   In view of the above, I concluded that the Claimant carried on a business undertaking on his own account. The Respondents were his 'customers' and he provided them with a gardening service.  The fact that the contract continued over a prolonged period does not magically turn the Claimant’s employment status from self-employed to that of a 1A(3) Employee.  During the entire time that he undertook work for the Respondents, the Claimant continued to advertise for new work when necessary and the fact that he enjoyed a long-term source of work from the Respondents is evidence only of his abilities as a gardener.

43.   I therefore find that the third limb of the 1A(3) Employee test is not satisfied.

44.   Consequently, the Claimant was not an employee under the provisions of Article 1A EJL 2003.  The Claimant was a self-employed person who was carrying on a business undertaking on his own account.

45.    The Claimant is therefore not entitled to pursue the Claims in the Tribunal

46.   The Claims are HEREBY STUCK OUT.

 

 

 

 

Mrs H G Griffin, Chairman                                                    Date:           12 June 2018

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