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Case update (2): Employment status – Worker or self-employed?

Summary:  Does an individual need to be offered and accept a minimum amount of work in order to be a ‘worker’?

No, says the EAT in Somerville v Nursing & Midwifery Council (available here).

Background:  The law groups staff as either employees, workers or self-employed and provides different levels of protection. Employees have the most protection and the self-employed the least. Workers are in the middle and are entitled to some statutory rights, including those in relation to the national minimum wage, working hours, annual leave and protection from discrimination.

The well-established legal test to establish worker status is set out at s230 of the Employment Rights Act 1996 (‘ERA’) and other legislation such as the Working Time Regulations, Trade Union and Labour Relations (Consolidation) Act and National Minimum Wage Act.

The test is that:

If the individual does not meet that test they will be self-employed.

To establish a contract there must be some level of obligation between the organisation and the individual to create a legally binding ‘worker’ relationship.  However, this does not mean the employer needs to offer, or the employee to accept, work.

To be for ‘personal work or service’, a promise simply to get the work done by somebody is not enough. It has to be the person contracted with. If there is a genuine right to substitute another person under the terms of a contract, this means it is likely to be self employment, rather than worker status.

Facts:  Mr Somerville was a panel member chair of the Nursing and Midwifery Council’s (NMC) Fitness to Practice Committee from 2012 to 2020, which he did alongside his work as a barrister. His contract with the NMC said he was a self-employed contractor and gave no requirement for him to be offered any work.  Further if Mr Somerville was offered work (in this case a ‘sitting date’), he was not obliged to accept it and was free to withdraw.

Mr Somerville claimed that he was either an employee or a worker, and was therefore entitled to paid holiday.

Employment Tribunal decision

The Tribunal held that Mr Somerville was a worker. There was a series of individual contracts between him and the NMC each time he agreed to sit on a hearing panel, as well as an overarching four-year contract for each term of appointment to the committee.

There was no right of substitution in the contracts and the lack of control in his relationship with the NMC was not something Mr Somerville would likely accept if genuinely self-employed. He had to do the work personally, work to the standards and requirements of the NMC and undertake mandatory training as part of his duties.  Further, his pay was fixed and non-negotiable.

EAT decision

The NMC appealed to the EAT. The NMC argued that to be a worker there must be some obligation to accept and perform a minimum amount of work.  To support this argument it referred to a comment in the Supreme Court’s decision in Uber which it said set out an ‘irreducible minimum of obligation’ as a general test for worker status.  Therefore the absence of any obligation on Mr Somerville to accept and perform some minimum amount of work meant that he could not be a worker.

The EAT dismissed the appeal and agreed with the Tribunal that Mr Somerville was a worker on each occasion he provided work (and under the overarching contract for providing his services). The EAT rejected the NMC’s argument that a lack of obligation to accept and perform a minimum amount of work was inconsistent with worker status.

The EAT reviewed previous case law and concluded that this does not establish a requirement for an ‘irreducible minimum of obligation‘ as a condition for worker status. The Supreme Court in Uber did not set this out as a general test for worker status.  Its comments were not made in that context.

Implications:   This means that in the EAT’s view, worker status does not require an individual to be offered and accept a minimum amount of work.  Even though Mr Somerville could refuse and withdraw from work, and his contract said he was self-employed, he was in fact a worker.

Central to the EAT’s finding of worker status was the requirement for personal service.  What is important is who, not when or what.  The fact that Mr Somerville had to provide the services himself at all times, and was controlled by the NMC in his work, overrode all other considerations.

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