Partnership of East London Co-Operatives Ltd v Joanne MacLean

A tribunal may find that a service recipient contracted directly with an individual even where payment was made to that individual’s limited company, where the contractual documents make the company a payment mechanism rather than the contracting party.

For employment status, a tribunal must explain any inference that an umbrella contract imposed continuing minimum obligations to offer and accept work. Regular work over several years will not alone support that inference where the agreed arrangements expressly provide for ad hoc bidding, no obligation to offer work and no obligation to accept it. A conclusion that a substitution right was impracticable must also be adequately reasoned.

The claimant, a qualified nurse, worked as a Clinical Streamer at urgent treatment centres operated by the respondent from August 2018 until March 2023. She brought claims requiring employee and/or worker status under Employment Rights Act 1996 and Working Time Regulations 1998.

The Employment Tribunal found that the respondent contracted with the claimant personally, notwithstanding payments to her limited company. It further held that she was a limb (b) worker whenever she accepted work and was an employee overall. The respondent appealed.

The central issues were the identity of the contracting party, whether there was sufficient continuing mutuality of obligation for employee status, and whether an ostensible substitution right displaced the obligation of personal service.

1. Appeal allowed in part. Ground 1 failed. The tribunal was entitled to find that the contract was with the claimant personally. The payment authorisation declaration expressly treated payment to her company as discharging a liability owed to her, while the Members Agreement was framed as an agreement with an individual clinician. The tribunal was entitled to treat those documents as decisive on contracting-party identity.

2. There was no inconsistency in the tribunal treating some provisions of the Members Agreement as accurately recording the parties’ agreement while deciding, under Autoclenz and Uber, that other provisions did not reflect the reality of the working relationship. Written terms are relevant but are not necessarily conclusive in a status dispute.

3. Ground 2 succeeded. The tribunal found an umbrella relationship under which neither party was contractually obliged to offer or accept any monthly shifts, and shifts were bid for and allocated ad hoc. Its further inference that each party had nevertheless agreed to provide or undertake a reasonable minimum amount of work was inadequately supported. Regular work over a number of years did not, without further identified facts, justify that conclusion. Its conclusion that the claimant was a worker only each time she accepted work also created an unresolved conflict with an apparent finding of employee status throughout the relationship.

4. Ground 3 succeeded. The tribunal’s conclusion that substitution was impracticable was central to its finding of personal service, but it did not adequately explain why qualification, registration and background-check requirements made the asserted substitution right incapable of practical operation. The fact that no substitute had been used was relevant but not determinative.

5. The findings that the claimant was a worker and an employee were quashed. Directions were to be given for submissions on the consequential order.

• Employment Appeal Tribunal: Allowed the respondent’s appeal on the mutuality-of-obligation and personal-service grounds, quashing the findings of worker and employee status; dismissed the challenge to the finding that the claimant contracted personally with the respondent.
• Employment Tribunal: Found that the claimant was both a worker and an employee of the respondent.