Dr Mark Ter-Berg v Simply Smile Manor House Ltd & Ors

The Employment Appeal Tribunal considered whether the employment tribunal erred in concluding that the claimant was not an employee. The EAT applied the Autoclenz v Belcher approach as explained in Uber BV v Aslam and confirmed that tribunals may begin by examining written terms but must, where contested, look beyond them to the full factual matrix without being constrained by ordinary contractual rules. The tribunal did not err in starting from the Associate Agreement or in treating the clause stating the parties did not intend an employment relationship as reflecting the parties' true intentions in this case, and grounds 1 and 2 of the appeal failed. However, the EAT found that the tribunal misinterpreted clause 36 (the locum/substitution clause) by construing "other cause" too broadly; that construction wrongly suggested an unfettered right of substitution inconsistent with personal service. The EAT quashed the tribunal’s conclusion on employment status and remitted the matter for reconsideration limited to the correct construction of clause 36 and the question of personal service.

Background and parties

The appellant, a dentist, sold his dental practices to the first respondent and entered into a standard British Dental Association form "Associate Agreement" in 2013. He brought unfair dismissal proceedings alleging dismissal for making a protected disclosure. The employment tribunal (Employment Judge Ord) decided only the preliminary issue of whether the claimant was an employee of the first respondent and held he was not, dismissing the unfair dismissal claim. The claimant appealed to the EAT.

Nature of the claim / relief sought

• Claim: unfair dismissal, including that dismissal was for making a protected disclosure (whistleblowing).
• Relief sought: ultimately the appeal sought quashing of the tribunal’s finding that the claimant was not an employee so the substantive claim could proceed.

Issues before the EAT

1. Ground 1: whether the tribunal erred in treating the written Associate Agreement as the starting point rather than applying the Autoclenz/Uber approach to the factual matrix;
2. Ground 2: whether the tribunal should have struck down the clause stating the agreement did not create an employment relationship under section 203(1) Employment Rights Act 1996;
3. Ground 3: whether the tribunal misconstructed clause 36, in particular whether "other cause" should be read as not requiring any cause or as requiring a cause similar to ill health, and whether that affected the obligation of personal service.

Court’s reasoning and conclusions

• The EAT reviewed Autoclenz and Uber. It confirmed that tribunals must adopt the Autoclenz purposive approach when the true nature of the relationship is contested, and that Uber supplies further policy reasoning; but a tribunal may begin with written terms provided it does not treat them as conclusive and looks to the wider factual matrix.
• On Ground 1 the EAT found the tribunal did not fail to apply Autoclenz/Uber: the tribunal properly examined the written agreement and the wider circumstances; it was entitled to treat the agreement and the parties' intentions at the time of signing as reflecting the true agreement, given the facts found.
• On Ground 2 the EAT held that section 203(1) renders void any term objectively intended to exclude or limit statutory employment protections, but such a clause is not necessarily always ineffective; where a clause genuinely records the parties' true agreement it may be taken into account. The tribunal did not err in treating clause 5 as relevant and not automatically void in this case.
• On Ground 3 the EAT upheld the ground. The tribunal erred in construing clause 36 as allowing substitution whenever the claimant chose not to use the facilities for more than 20 days. The proper construction is that the triggering event is a failure to utilise the facilities "through ill health or other similar cause", not a voluntary choice, and therefore the tribunal’s conclusion that clause 36 negated personal service was flawed.

Disposition

The EAT quashed the tribunal’s finding that the claimant was not an employee and remitted the case for fresh consideration of the correct construction of clause 36 and the consequential question of whether there was an obligation of personal service, taking account of the original tribunal’s findings except as to clause 36. The EAT directed that Employment Judge Ord should not preside on the rehearing of that issue.

Appeal allowed in part. The EAT held that the tribunal had not erred in its overall use of the written agreement or in refusing to strike down the clause denying an employment relationship (grounds 1 and 2 failed), but the tribunal had misconstructed clause 36; that error affected the conclusion on personal service and employment status, so the tribunal’s decision was quashed and limited remittal ordered for construction of clause 36 and reconsideration of personal service and employment status.

Appeal from the employment tribunal (Cambridge) decision of Employment Judge Ord dismissing the claimant's unfair dismissal claim on the basis that he was not an employee (no neutral citation for the ET decision provided); judgment of the Employment Appeal Tribunal in this appeal: [2023] EAT 2.