“Casual” workers may be permanent employees in disguise

A recent Employment Appeal Tribunal (EAT) decision has established that a market researcher could be an employee even if his assignment could be terminated at any time. Although this decision does not amount to new law, it may well influence how employment tribunals deal with similar cases in the future.

The latest Employment Appeal Tribunal decision to tackle the world of casual work has done much to clarify precisely when an employment relationship can arise in this environment. It says the fact that a particular assignment can be terminated at will, does not necessarily mean that an employment relationship can not exist while it lasts. If such a relationship arises, the worker will still need to establish the necessary continuity of employment, either by means of an “umbrella” contract or by linking together a series of assignments.

In this case the claimant was a market researcher for MORI. He was not guaranteed work or obliged to accept it when offered. In addition, once he started work, the employer was entitled to end the assignment at will. The EAT ruled that the fluid nature of these arrangements did not preclude the existence of a contract while each assignment continued. Whether or not it was a contract of employment was for the employment tribunal to decide, applying the usual legal principles.

Although the employment tribunal still has to decide whether the market researcher was actually an employee, two recent cases have illustrated how a casual worker can acquire continuity of employment via an umbrella contract. The first of these was the widely reported case of a lap dancer at Stringfellows. The claimant Ms Quashie obtained a ruling from the EAT earlier this year that the terms of the flexible working rota she had signed up for amounted to an umbrella contract of employment. The employer’s appeal will be heard in the next few months.

The second case, involved care workers engaged under “zero hours” contracts. In this case it was clear that the workers were employees for the duration of each assignment. However, the employers argued that the terms of their contracts (which shared many features with the terms under which MORI’s researcher was engaged) meant that no contract of employment subsisted between assignments. The EAT was prepared to support the employment tribunal’s finding that the contract did not reflect the “reality of the situation”. These workers were shift workers required to deliver a continuous service looking after a customer with high care needs. While the express wording of their contracts stated that they had no expectation of being given work, or obligation to do it when offered, the reality of the situation was quite different.

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