Cornwall County Council v Prater

The Court of Appeal dismissed the Council’s appeal against findings that a succession of individual teaching engagements each amounted to a contract of service and that, by operation of section 212 of the Employment Rights Act 1996, the gaps between those engagements were treated as temporary cessations of work for continuity purposes. The key legal principle is that the "irreducible minimum" of mutuality of obligation required for a contract of service can exist within each discrete engagement (an obligation to teach matched by an obligation to pay) and it is not necessary for there to be a continuing obligation to offer or accept further work across the whole period. The court held the Employment Tribunal was entitled to find mutuality within each assignment and that section 212 bridged the gaps between assignments.

This was an appeal by Cornwall County Council against EAT and Employment Tribunal findings that Mrs Margaret Prater, a home tutor engaged on multiple discrete teaching assignments between 1988 and 1998, was an employee of the Council for that period.

Background and facts:

• Mrs Prater taught pupils unable to attend school under many individual engagements of varying durations between April 1988 and September 1998. Work was offered by reference to particular pupils; the Council was not contractually obliged to offer work and she was not contractually obliged to accept offers, although in practice she did not refuse work.
• Payments were made in arrears, tax and national insurance were deducted at source, and a P60 was issued; she did not receive holiday or sick pay until after 1 September 1998 when she took a part‑time contract that the Council accepted made her an employee.

Procedural posture:

• Employment Tribunal (extended reasons 2 December 2004) found each individual assignment amounted to a contract of service and that gaps were temporary cessations of work under section 212(3)(b) so continuity of employment ran back to 1 April 1988.
• Employment Appeal Tribunal (order dated 8 June 2005) dismissed the Council’s appeal; permission to appeal to the Court of Appeal was granted on 21 July 2005.

Nature of the claim and relief sought:

• The claimant sought a declaration of written particulars of employment on the basis that she should be treated as continuously employed since 1988.

Issues framed by the court:

• Whether each individual teaching engagement was a contract of service (focused on mutuality of obligation).
• Whether section 212 of the Employment Rights Act 1996 could bridge gaps between engagements so as to establish continuity of employment.

Reasoning and outcome:

• The Court of Appeal examined authorities relied upon by the Council (including O’Kelly, Clark, Carmichael and Stevedoring) and concluded they were distinguishable because they did not concern a succession of individual engagements each containing mutual obligations. The court held that mutuality of obligation within each discrete assignment (the obligation to teach and the obligation to pay) was sufficient for a contract of service.
• The court accepted the Employment Tribunal’s factual finding that inter‑assignment gaps were temporary cessations of work within section 212(3)(b) and that section 212(4) limited the weeks to be counted. On that basis section 212 produced continuity of employment for the purposes of the 1996 Act.

Appeal dismissed. The Court of Appeal held that the Employment Tribunal was entitled to conclude that each individual engagement contained the mutuality of obligation necessary for a contract of service and that section 212 of the Employment Rights Act 1996 lawfully bridged temporary cessations of work so as to secure continuity of employment from 1 April 1988 to 1 September 1998.

Employment Tribunal (extended reasons 2 December 2004): found claimant was an employee from 1 April 1988. Employment Appeal Tribunal (order dated 8 June 2005, HHJ Serota QC presiding): dismissed Council’s appeal. Permission to appeal to the Court of Appeal was granted on 21 July 2005 (Hooper LJ). Court of Appeal ([2006] EWCA Civ 102): appeal dismissed.