G4S Secure Solutions (UK) Ltd v Alphonso

A label of zero-hours contract does not itself determine whether an individual remains employed under a contract of employment. The tribunal must make sufficient objective findings about the parties’ actual contractual obligations and the terms governing the relationship.

The appropriate starting point is the legal character of the relationship when work is performed. Only if work on those occasions is performed under a contract of employment can an overarching employment relationship readily bridge the intervals between engagements. The absence of an obligation to offer or accept work is important, but it does not by itself end the inquiry or necessarily end an existing contractual relationship.

The claimant had formerly been a permanent security officer. At his request, he moved in November 2011 to what was described as a standard zero-hours arrangement. He was subsequently offered work on limited occasions and received a P45 in May 2012, stating that his employment had ended on 31 March 2012.

An Employment Judge held that the effective date of termination was 17 May 2012, when the claimant received the P45, and that his unfair-dismissal claim presented on 16 August 2012 was in time. The employer appealed, principally disputing that the claimant remained an employee. The claimant also appealed a Registrar’s order debarring him for failures to file an answer in the appeal.

The central issue was whether, at the asserted termination date, the zero-hours arrangement was a contract of employment.

1. Appeal allowed and remitted. The Employment Judge had not made sufficient findings to determine whether the claimant was employed under a contract of employment at the relevant date. The conclusion on effective date of termination could not stand until that issue had been determined.

2. The claimant’s appeal against the debarring order was allowed. Although the Registrar had been entitled to debar him under rule 26, the EAT could reconsider the matter. In substance, the application was one for late relief from sanctions in an existing appeal. The importance of the issue and the assistance of representation meant that the overriding objective favoured hearing the merits.

3. The fact that the arrangement was called a zero-hours contract did not answer the employment-status question. There was admittedly an overarching contract, but its terms were not before the tribunal. The absence of a retainer and the finding that the employer need not offer work where none was available were relevant, but they did not establish what obligation, if any, arose where work was available.

4. The tribunal should begin by examining the relationship on days when work was actually performed. If those engagements were contracts of employment, an employment relationship may more readily subsist in the gaps between them. An umbrella employment relationship cannot be constructed where the work itself is undertaken as an independent contractor.

5. The matter was remitted to Employment Judge Palca, unless the Regional Employment Judge directed otherwise, to determine objectively whether a contract of employment existed on 17 May 2012. If it did not, the claimant’s claim was to be dismissed.

• Employment Appeal Tribunal: allowed the employer’s appeal and remitted the employment-status issue to the Employment Judge; also allowed the claimant’s appeal against the Registrar’s debarring order.
• Employment Tribunal: held at a preliminary hearing that the claimant’s contract of employment terminated on 17 May 2012 and that the claim was in time.