This is a question posed in the House of Lords in a very famous housing case (Street –v- Mountford) in 1985. Lord Templeman memorably stated that “a five pronged implement for manual digging is a “fork”, whatever the manufacturer chooses to call it”
A similar question has been asked very recently by the Supreme Court in Autoclenz Ltd v Belcher . This case hinged on whether an individual was an “employee” or a self-employed contractor and therefore a “worker” for the purposes of employment legislation. The Supreme Court came to very similar view as to the Lord Templeman 26 years ago.
This case concerned 20 people who valetted cars. They paid their own tax and national insurance and also had to purchase uniforms and materials. Their contract said that they were not obliged to attend work although the original Tribunal did find that in practice they were expected to attend everyday and provide the services personally.
However, despite all the written evidence and the fact that the Tribunal had held that these people had entered into a contract with their eyes wide open, the Supreme Court held that the reality of the relationship trumped any written contract. They were in reality obliged to provide their services themselves (albeit that there was a substitution clause in the contract) and this coupled with another accepted test of employment that of control, i.e. they were told what to do and when to do it, made them employees.
So the lesson to be learned is that the most important thing in a relationship between employer and employee is what happens in reality and not necessarily a cleverly constructed contract that seeks to preclude their status as employees. It is vital that both employers and employees/contractors are sure of the latter’s status and the implications that flow from this.
If you need advice on how the courts would interpret a situation and hence your obligations and exposure as an employer or employee then please do contact the experienced employment lawyers at Hanne & Co Solicitors on tel: 020 7228 0017 or by email to info@hanne.co.uk
