Employment law CONTRACT OF EMPLOYMENT

Contract of employment Contract of employment and contract of self- employment – fundamental importance Contract of employment and contract of self- employment – fundamental importance Only employees qualify for employment rights – unfair dismissal, redundancy payments, minimum notice on termination etc. Only employees qualify for employment rights – unfair dismissal, redundancy payments, minimum notice on termination etc. Employees – contract of employment or contract of service Employees – contract of employment or contract of service Self-employed persons (independent contractors )– contract for services Self-employed persons (independent contractors )– contract for services

s. 230 of the ERA 1996 (limited guidance in the legislation) (1) in this Act “employee’ means an individual who has entered into or works under (or where the employment has ceased, worked under) a contract of employment. (1) in this Act “employee’ means an individual who has entered into or works under (or where the employment has ceased, worked under) a contract of employment. (2) in this Act’ contract of employment’ means a contract of service or apprenticeship, where express or implied, and (if it is express) whether oral or in writing. (2) in this Act’ contract of employment’ means a contract of service or apprenticeship, where express or implied, and (if it is express) whether oral or in writing.

Tests developed through case law for determining the employee’s status Control test – does the person who is to be regarded as the employer control the employee or servant? Control test – does the person who is to be regarded as the employer control the employee or servant? Control extends to not just what the employee does, but how it is done Control extends to not just what the employee does, but how it is done If the answer is in the affirmative – there is employer/employee relationship If the answer is in the affirmative – there is employer/employee relationship Independent contractor – might be told what to do, but not how to do the work Independent contractor – might be told what to do, but not how to do the work One problem – interpreted strictly it results in skilled and professional people One problem – interpreted strictly it results in skilled and professional people

Integration test- counters the deficiencies of the control test The question to be asked is – how far is the servant/employee integrated into the employer’s business The question to be asked is – how far is the servant/employee integrated into the employer’s business Fully integrated into the employer’s business- Whittaker v Minister of Pensions and National Insurance (1967) Fully integrated into the employer’s business- Whittaker v Minister of Pensions and National Insurance (1967) Employer could avoid tax and national insurance provisions, liability for accidents Employer could avoid tax and national insurance provisions, liability for accidents

Multiple test- much wider The servant agrees that, in consideration of a wage or other remuneration, he or she will provide his or her own work and skill in the performance of services; The servant agrees that, in consideration of a wage or other remuneration, he or she will provide his or her own work and skill in the performance of services; He or she agrees expressly or impliedly, that in the performance of that services, he or she will be subject to the other’s control in a sufficient degree by the employer; He or she agrees expressly or impliedly, that in the performance of that services, he or she will be subject to the other’s control in a sufficient degree by the employer; The other provisions of the contract are consistent with its being a contract of service; The other provisions of the contract are consistent with its being a contract of service;

Multiple test – wide application Proved to be most adaptable; Proved to be most adaptable; Control is always to be considered, but not as a sole determining factor; Market Investigations Ltd v Minister of Social Security (1969); Control is always to be considered, but not as a sole determining factor; Market Investigations Ltd v Minister of Social Security (1969); Continuous to be flexible to the changes in the labour environment (casual or seasonal workers); Continuous to be flexible to the changes in the labour environment (casual or seasonal workers); “Mutuality of obligation” – O’Kelly v Trusthouse Forte plc (1983) p 427, Business Law; “Mutuality of obligation” – O’Kelly v Trusthouse Forte plc (1983) p 427, Business Law; Wickens in Montgomery v Johnson Underwood Ltd (2001) p. 428, Business Law Wickens in Montgomery v Johnson Underwood Ltd (2001) p. 428, Business Law

Legislation is extended to protect part time employees Section 23 of ERA 1999 – broadening of the scope of legislative provisions; Section 23 of ERA 1999 – broadening of the scope of legislative provisions; Working time regulations 1998; Working time regulations 1998; National minimum wage; National minimum wage; Part-Time Workers (Prevention of Less Favourable Treatment) regulations a part time employee is defined as ‘one who is not identifiable as a full time employee’; Part-Time Workers (Prevention of Less Favourable Treatment) regulations a part time employee is defined as ‘one who is not identifiable as a full time employee’;

The impact of EU law R v Secretary of State for employment ex p Seymour-Smith (1999), ECJ; R v Secretary of State for employment ex p Seymour-Smith (1999), ECJ; Employment Relations Act 1999 – qualifying period for unfair dismissal was reduced to one year; Employment Relations Act 1999 – qualifying period for unfair dismissal was reduced to one year;

Loaning or hiring of employees The courts are reluctant to find that there has been a transfer of employment where employees are loaned or hired out, unless there is consent on the part of the employee or there is an agreement which clearly states the position in the event of liability; The courts are reluctant to find that there has been a transfer of employment where employees are loaned or hired out, unless there is consent on the part of the employee or there is an agreement which clearly states the position in the event of liability; CASE LAW – Sime v Sutcliff Catering (1990)- exception where the court declared the employee has become an employee of the ‘second ‘employer CASE LAW – Sime v Sutcliff Catering (1990)- exception where the court declared the employee has become an employee of the ‘second ‘employer

Continuity: periods away from work In order to acquire employment protection rights, there should be continuity of employment In order to acquire employment protection rights, there should be continuity of employment Important to consider the impact of weeks away from work; Important to consider the impact of weeks away from work; Section 212 of the ERA 1996 – main legislative provision Section 212 of the ERA 1996 – main legislative provision Pregnancy, childbirth, sickness or injury, temporary cessation of work or custom or practice will generally count in computing the period of employment Pregnancy, childbirth, sickness or injury, temporary cessation of work or custom or practice will generally count in computing the period of employment

Industrial disputes Any week in which an employee takes part in a strike does not count towards continuity (s.212, ERA 1996), but does not brake it Any week in which an employee takes part in a strike does not count towards continuity (s.212, ERA 1996), but does not brake it Absence due to lock-outs is treated in the same way Absence due to lock-outs is treated in the same way

Formation of the contract of employment Written statement of terms - Pt 1 of ERA 1996 – names, rate of pay, hours of work etc. Written statement of terms - Pt 1 of ERA 1996 – names, rate of pay, hours of work etc. The Trade Union Reform and Employment Rights Act 1993 – non-permanent employment, collective agreements etc. The Trade Union Reform and Employment Rights Act 1993 – non-permanent employment, collective agreements etc. Specimen statement of terms of employment Specimen statement of terms of employment

Terms of the employment contract Express terms – agreed upon by the employer and the employee; Express terms – agreed upon by the employer and the employee; Breach of an express term of the contract may result in the dismissal of the employee, while breach on behalf of the employer, may enable the employee to resign and bring an action for constructive dismissal Breach of an express term of the contract may result in the dismissal of the employee, while breach on behalf of the employer, may enable the employee to resign and bring an action for constructive dismissal

Implied terms – the purpose is to make the contract more effective (trust and respect) May arise out of the custom and practice of a particular industry May arise out of the custom and practice of a particular industry Have to be read subject to any express terms Have to be read subject to any express terms Standard implied terms – duties imposed on the respective parties Standard implied terms – duties imposed on the respective parties Breach by the employee may result in disciplinary action or even dismissal; Breach by the employee may result in disciplinary action or even dismissal; Brach by the employer may result in legal proceedings before a tribunal; Brach by the employer may result in legal proceedings before a tribunal;