A Manning v Walker Crips Investment Management Limited

Worker status is determined by applying the statutory language purposively to the facts viewed realistically. Contractual labels and tax arrangements cannot determine the issue.

An express substitution clause does not negate personal service where the engager has an absolute discretion to refuse approval. A term requiring approval not to be unreasonably withheld cannot be implied merely because it appears fair or desirable. Necessity for business efficacy or obviousness remains essential.

Whether the other contracting party is a client or customer remains a fact-sensitive statutory question. Integration, control, dependence and actual marketing are relevant, but no individual factor is conclusive. Personal investment activity is not, without more, a business undertaking with clients or customers.

The Claimant was engaged by the Respondent as an investment manager from 2015 to 2021. He brought whistleblowing and working-time claims. The Respondent denied that he was a worker.

An employment judge held that he was not a worker under section 230(3)(b) of the Employment Rights Act 1996 or regulation 2 of the Working Time Regulations 1998. The judge concluded that a contractual provision permitting approved employees or agents to act for him was subject to an implied reasonableness term and excluded personal service. Alternatively, the Respondent was held to be a client or customer of his business undertaking.

The Claimant appealed. The central issues were whether the substitution clause truly displaced personal service, and whether the Employment Tribunal had lawfully assessed the client-or-customer limb of worker status.

1. Appeal allowed in part. The finding that the Claimant did not undertake personally to perform work or services was set aside. It was substituted with a finding that he did undertake personal service.

2. The Employment Judge erred in implying into clause 2.5 a term that approval of an employee or agent would not be unreasonably withheld. The clause gave the Respondent an express, sole and unqualified discretion. It was commercially coherent without an implied constraint. The suggested term was neither necessary for business efficacy nor so obvious that it went without saying. Its effect would also be to deprive the individual of statutory protection, rather than protect against an abuse of contractual power.

3. The clause therefore pointed to personal performance, subject to an assessment of whether it was genuine when the facts were viewed realistically. The Employment Judge had failed to treat as highly relevant the fact that the contractual approval process had never been used. Occasional practical cover arrangements outside that process did not answer whether clause 2.5 genuinely gave an unrestricted right to delegate all work.

4. The Employment Judge also erred in giving weight to the contractual description of the Claimant as an independent contractor and to his self-employed tax treatment. Those matters were neutral on the distinct statutory question whether the Respondent was a client or customer of a business undertaking carried on by him.

5. Personal trading on the Claimant’s own account did not constitute a separate business undertaking serving clients or customers. The analogy with sub-postmasters conducting an integrated retail and agency business was inapposite.

6. The remaining client-or-customer issue could not be determined by the EAT because more than one conclusion was open on the findings. It was remitted to Employment Judge Stout, who was to determine that issue under section 230 of the Employment Rights Act 1996 and regulation 2 of the Working Time Regulations 1998.

• Employment Appeal Tribunal: Allowed the appeal on personal service and on limited errors in the alternative client-or-customer analysis; remitted the remaining client-or-customer issue to Employment Judge Stout.
• Employment Tribunal: At a preliminary hearing, held that the Claimant was not a worker under section 230(3)(b) of the Employment Rights Act 1996 or regulation 2 of the Working Time Regulations 1998.