Sharpe v The Bishop of Worcester

An ordained minister is not excluded from employment protection merely because he holds ecclesiastical office or performs spiritual functions. The existence of a contract remains an objective question on the particular arrangements.

Where an incumbent’s duties, discipline, tenure and benefits arise from ecclesiastical law and the bishop neither promises remuneration nor has material powers of control or dismissal, findings that no contract exists with the bishop may be upheld. A collection of diocesan guidance will not be contractual without evidence of its intended incorporation.

For protected-disclosure claims, Employment Rights Act 1996 section 43K(1)(a), as well as section 43K(1)(b), requires a contract with the alleged employer.

The respondent had been Rector of Teme Valley South, a freehold benefice in the Diocese of Worcester. He alleged unfair dismissal and detriments for protected disclosures against the Bishop in his corporate capacity.

The Employment Tribunal dismissed the claims, finding no express or implied contract between the rector and the Bishop. It also found that the rector did not meet the statutory employment and worker definitions. The Employment Appeal Tribunal, Cox J, set that decision aside and remitted the matter.

The Bishop appealed on points of law. The central questions were whether the Tribunal’s findings of no contract and no employment contract were legally sustainable, whether section 43K(1) extended worker status without a contract, and whether the Tribunal could admit and use the evidence of an ecclesiastical-law expert.

1. Appeal allowed unanimously. The court reinstated the Employment Tribunal’s order dismissing the claims.

2. There is no special rule that ministers of religion cannot be employees, nor a presumption against contractual intention in such cases. The question is what legal relationship the parties objectively created, having regard to the manner of engagement, the governing documents and their factual setting. The part of the reasoning in Diocese of Southwark v Coker which imposed such a presumption is no longer good law, but its decision and its analysis of obligations derived from ecclesiastical law remained material.

3. The Tribunal was entitled to find that no express or implied contract existed between the rector and the Bishop. The patron’s offer and the deed of institution did not contain contractual promises by the Bishop. The rector’s duties, discipline and termination were principally incidents of the office imposed by ecclesiastical law. The Bishop had not promised payment of the stipend, had negligible control over performance, and lacked a power of dismissal. The Bishop’s Papers were a collection of guidance for clergy and parish officials, not evidence of incorporated contractual terms on the evidence before the Tribunal.

4. In the alternative, even if a contract had existed, it was not a contract of employment under section 230 of the Employment Rights Act 1996. Applying the Ready Mixed Concrete indicia in the round, the absence of contractual remuneration, control, negotiated service terms and termination powers was inconsistent with employment.

5. Section 43K(1)(a) necessarily requires a contract because it refers to the terms on which the individual was engaged to do work. Section 43K(1)(b) expressly requires one. Since there was no contract with the Bishop, the rector was not a worker for either limb.

6. The Tribunal could admit the expert evidence of Professor McClean. It had distinguished factual evidence from opinion and advocacy, exercised appropriate caution, and reached its own conclusions.

• Court of Appeal (Civil Division): Allowed the Bishop’s appeal and reinstated the Employment Tribunal’s dismissal of the claims: [2015] EWCA Civ 399 .
• Employment Appeal Tribunal: Cox J allowed the rector’s appeal, set aside the Tribunal’s order and remitted the matter: UKEAT/0243/12/DM.
• Employment Tribunal: Employment Judge McCarry dismissed the claims on 15 February 2012 because the rector did not meet the statutory threshold tests.