RSA Consulting Ltd v Evans

Worker status in a multi-party agency arrangement cannot be determined from contractual documents alone. Where a claimant relies on an implied contract, the tribunal must consider evidence of the parties’ actual relationship and ask whether implication is necessary to explain it. Labels in the documents do not replace that legal analysis. A claim should rarely be struck out at a preliminary hearing where central facts remain disputed. The claimant’s case should be taken at its highest, unless even that evidence cannot sustain the claim or is wholly inconsistent with undisputed contemporaneous documents. Under the Employment Rights Act 1996, section 230, the issue may be whether the claimant is a worker under a contract for personal services rather than an employee under a contract of employment.

Dr Evans, a molecular immunologist, obtained payroll services from Parasol, which was described as her employer. Parasol contracted with RSA Consulting Ltd to provide services to third parties, and RSA introduced Dr Evans to PharmaNet.

After PharmaNet ended the assignment, Dr Evans brought unauthorised-deduction claims under section 23 of the Employment Rights Act 1996 against Parasol, RSA and PharmaNet. The Employment Tribunal struck out the claims against Parasol and RSA and dismissed the claim against PharmaNet after withdrawal. It later refused a review.

The Employment Appeal Tribunal, in UKEAT/0536/08/RN, allowed Dr Evans’s appeal concerning RSA, holding that the question of an implied worker relationship required proper consideration at a full hearing. RSA appealed. The central issue was whether the Employment Tribunal was entitled to conclude, on the documents and evidence before it, that no arguable worker relationship with RSA existed.

Appeal dismissed unanimously. The Employment Appeal Tribunal was right to hold that the Employment Tribunal’s decision concerning RSA could not stand, although Elias LJ did not entirely share Bean J’s reasoning. The Court did not determine whether an implied contract with RSA actually existed.

1. Under section 230 of the Employment Rights Act 1996, the relevant question was not simply whether Dr Evans had a contract of employment with RSA. It was whether she had a contract, express or implied, under which she personally undertook work or services for RSA so as to qualify as a worker.
2. Where implication of a contract is said to follow from necessity, the contractual documents are not the beginning and end of the inquiry. The tribunal must consider evidence of the parties’ actual relationship. An implied contract may be found only where necessary to explain that relationship and give it business reality. Labels in the documents cannot substitute for legal analysis. This approach was derived from Dacas v Brooke Street Bureau (UK) Limited [2004] ICR 1437 and James v London Borough of Greenwich [2008] EWCA Civ 35. Lloyd LJ also referred to The Aramis [1989] 1 Lloyd's Rep 213.
3. Strike-out at a preliminary hearing is rarely appropriate where central facts are disputed. The claimant’s case must be taken at its highest. Strike-out may nevertheless be justified where, even on that basis, the evidence cannot sustain the claim or is wholly and inexplicably inconsistent with undisputed contemporaneous documents. The principle in Eszias v North Glamorgan NHS Trust [2007] ICR 1126 applied.
4. The Employment Tribunal had not made findings about Dr Evans’s material oral evidence or clearly directed itself on the necessity test. Its focus on the documents was therefore too narrow. The Court of Appeal could not take over the tribunal’s function of assessing the evidence. The email, Dr Evans’s negotiations and direct communications with RSA might ultimately prove insufficient, but their weight was for the tribunal at a proper hearing.
5. The complaint concerning Dr Evans’s status as a litigant in person failed. She had been given an opportunity to give evidence and identify the documents on which she relied. A tribunal may assist a litigant in person within proper bounds, but it must not enter the arena and conduct the case for that party. The observations in Muschett v HM Prison Service [2010] IRLR 451 were applied.

Etherton LJ agreed with both judgments. Lloyd LJ agreed that the appeal should be dismissed, while expressing doubt that the claim would ultimately succeed. The EAT’s decision allowing the claim against RSA to proceed was upheld.

• Court of Appeal (Civil Division) [2010] EWCA Civ 866 dismissed RSA’s appeal and upheld the EAT’s decision concerning RSA.
• Employment Appeal Tribunal UKEAT/0536/08/RN allowed Dr Evans’s appeal concerning RSA, holding that the claim should proceed to a full hearing. It also allowed the appeal concerning Parasol, which was not challenged in the Court of Appeal.
• Employment Tribunal struck out the claims against Parasol and RSA at a pre-hearing review, dismissed the claim against PharmaNet after withdrawal, and later refused an application for review.