Cormie v Rodger (t/a Dalneigh Post Office & Stores)

Whether an employment relationship continues after a material change in duties depends on the whole factual circumstances. Written contractual arrangements with a third party are important but are not necessarily determinative.

Mutuality of obligation may be established through indirect remuneration and other benefits, including the provision of premises and equipment. Control need not be unrestricted or direct in every aspect of the work. A worker may perform additional duties for another principal without ceasing to be an employee, provided the overall relationship remains consistent with a contract of employment.

The Claimant had worked for the Respondent in a post office and general store since 2001. After Post Office Limited suspended the Respondent as sub-postmaster, she temporarily assumed that role under a contract with Post Office Limited, while continuing to open and work in the Respondent’s general store.

The Employment Tribunal found that she was neither an employee nor a worker of the Respondent on 13 January 2010, principally because the Respondent paid her no wages and exercised no direct control over her post-office work. She appealed, arguing that the Tribunal had failed to consider the complete arrangement, including the use of the premises, equipment and the income redirected through Post Office Limited. The central issue was whether the pre-existing employment relationship had continued.

1. Appeal allowed. The Employment Tribunal’s judgment was set aside and replaced by a finding that the Claimant remained employed by the Respondent after 5 November 2009. Her employment was terminated on 13 January 2010.

2. The Tribunal erred by focusing narrowly on the absence of wages paid directly by the Respondent and the absence of direct control over the Claimant’s post-office duties. The relationship had to be assessed by reference to the whole relevant facts and circumstances.

3. The arrangement satisfied the three elements identified in Ready Mixed Concrete (South East) Limited v Minister of Pensions and National Insurance: the Claimant provided her work and skill for the Respondent’s benefit; she received consideration through Post Office Limited remuneration and benefits supplied by the Respondent; and the Respondent retained a sufficient measure of control.

4. Control included the Respondent’s ability to determine whether and when the premises could be used, and his continuing control over the general-store work. It did not need to extend directly to every task. The Claimant’s continuing work in the store, her use of the Respondent’s premises and equipment, and the arrangements that enabled her to receive Post Office Limited income were relevant consideration.

5. The Claimant’s temporary contractual obligations to Post Office Limited did not make her its employee and did not displace her existing employment with the Respondent. The addition of those duties was consistent with the continuation of the employment relationship.

• Employment Tribunal, Inverness: found that the Claimant was not an employee or worker of the Respondent on 13 January 2010. The judgment was registered on 4 May 2011.
• Employment Appeal Tribunal: upheld the appeal and substituted a finding that the Claimant remained employed by the Respondent until her dismissal on 13 January 2010.