Case No 1803582/2019Venue DundeeHearing 20 December 2019
Between
Mr C ToshClaimantJ M Hall Couriers LtdRespondent
Before
Employment Judge I McFatridgeDate 2 March 2021
JUDGMENT
The Judgment of the Tribunal is that the application for an extension of time to submit the ET3 response form succeeds. The ET3 form submitted by the respondent on 3 November 2019 shall be accepted. A further hearing shall be fixed in due course in order to determine the issues between the parties.
REASONS
Introduction
[1]The claimant submitted a claim to the Tribunal in which he claimed that he had been unfairly dismissed by the respondent. He also claimed various monetary amounts which he considered he was due following the E.T. Z4 (WR) termination of his employment. The respondent did not submit a response during the statutory period. During this period however information came to light to the effect that the respondent had moved to East Leeds Airport, Church Fenton, Tadcaster LS24 9SE. The claim form was re-served on them at that address. The respondent did not submit a response during the initial statutory period but on 27 November 2019 the Tribunal received an e-mail from the respondent in which they indicated that they had completed the online Tribunal ET3 on 3 November but following telephone conversations with the Tribunal office they understood the Tribunal office did not have any note of this. They were able to forward a copy of the response which had been submitted. They made a request that the response be accepted late. On 4 December 2019 the Tribunal wrote to both parties asking if they wished to make any representations regarding the issue of whether or not to accept the ET3 late. No response was received from either party.[2]The matter was referred to me today. It would appear from the terms of the respondent’s e-mail that they did complete an online form on or about 3 November which would have been within the appropriate time limit. It would appear that this has gone astray. In my view the balance of prejudice in this case clearly favours the respondent. The ET3 they have submitted contains averments which, if proved to be factually correct, would amount to a defence to all or part of the claim. If the response is not accepted late then the respondent may face requiring to pay substantial compensation in circumstances where they would not be legally liable to do this. It is clearly in the interests of justice for an extension of time to be granted for the response form to be lodged.[1]The claimant brought claims of unfair dismissal, unlawful deduction from wages and payment of holiday pay. A subsequent application was made to amend his claim to include a claim in terms of section 47B of the Employment Rights Act 1996, which remains outstanding.[2]Following a number of case management preliminary hearings, this case was set down for a preliminary hearing in order to determine the employment ETZ4(WR) status of the claimant during his employment with the respondent. The hearing took place on the Cloud Video Platform. The claimant appeared in person and the respondent was represented by a member of their HR team, Ms Ferguson.[3]The claimant’s position was that he was an employee, failing which he was a worker. The respondent’s position was that the claimant was a self-employed contractor. In order for the Tribunal to have jurisdiction to consider the claims brought by the claimant, the Tribunal would have to be satisfied that the claimant was a worker. Although he had originally brought a claim of unfair dismissal, that claim had been dismissed on the basis that the claimant did not have sufficient qualifying service irrespective of his employment status. The claimant’s claim of unfair dismissal was the only claim which required the claimant to be an employee for the purposes of the Employment Rights Act. The remaining claims required that the Tribunal be satisfied that the claimant was a worker.[4]Therefore, the Tribunal was required to determine whether the claimant was a worker for the purposes of section 230 of the Employment Right Act 1996 (‘ERA’).[5]Although parties had been advised by the Tribunal to co-operate and lodge all relevant documents in advance of the hearing in a digital format, this was not done. At the commencement of the hearing, it transpired that the claimant had lodged some documents with a clerk to the Tribunal the previous evening, but this was sent outwith the particular clerk’s working hours and the documents had not been received by the Tribunal. There was therefore a short adjournment in order to locate the documents, which were not numbered. Ms Ferguson confirmed that she had received these documents the previous evening and that she had no objection to any of them being produced and did not intend to lodge any further documents.[6]The Tribunal heard evidence from the claimant who was then cross examined by Ms Ferguson. The respondent did not lead any evidence. Findings in fact[7]On the basis of the evidence heard and documents to which reference was made, the Tribunal made the following findings in fact:[8]The claimant was engaged by the respondent in response to an online advert making reference to a requirement for self-employed contractors.[9]The claimant was engaged to deliver Amazon packages from Amazon’s depot in Dundee.[10]The claimant was required to undergo various background checks by the respondent including an alcohol test prior to being engaged.[11]The claimant was required to provide his own transport for delivering packages. He entered into an agreement with a company called ‘Hall’ to rent a vehicle. Hall is according to the language used by Ms Ferguson a ‘sister’ company to the respondent.[12]The agreement between the claimant and Hall for the hire of a van made reference to the respondent on a number of occasions, including requiring the claimant to fill in an accident form and submit it to his on site JMHC representative in the event of being involved in an accident.[13]The vehicle provided had the respondent’s livery on it.[14]The claimant was provided with a high visibility vest with the respondent’s logo to wear when carrying out his duties.[15]The claimant was required to have identification with him at all times when carrying out his duties, which had the respondent’s logo.[16]The claimant paid for fuel for the vehicle using a fuel card supplied to him by the respondent. The claimant was required to reimburse the respondent for any mileage which was for personal use.[17]The respondent generally required parties to enter into an agreement with an LLP in order to be engaged. A standard form was used by the respondent in that regard. The claimant did not sign such a form. A signature on a document bearing to be the claimant’s was made by someone other than the claimant.[18]The claimant used an app provided by the respondent to carry out his duties, which gave him details of the deliveries required.[19]The claimant was contacted by the respondent the evening before carrying out duties when he was assigned routes to be followed for deliveries.[20]The overall deliveries required to be carried out were managed by a ‘Point of Contact’ who was based at the Amazon depot.[21]The claimant generally worked six days a week and was paid a daily rate irrespective of the actual hours worked.[22]The claimant was offered the ‘Point of contact’ role with the respondent around January 2019 which he carried out for a short while and then returned to driving duties in April 2019.[23]The claimant had an email address ‘craigtosh@jmhclogistics.co.uk’.[24]The claimant was paid by bank transfer and tax and national insurance was deducted from his pay.[25]The claimant was not paid for days on which he did not work. The claimant was not paid during any holidays he took or paid in lieu of annual leave.[26]The claimant could not provide a substitute to carry out his route if he was not able to work on a particular day. The work he would have otherwise carried out was allocated to other drivers by the Point of contact. Observations on the evidence[27]The Tribunal found the claimant to a credible and reliable witness. While the claimant was (albeit briefly) cross examined by the respondent, he was not challenged on much of his evidence. In particular his evidence that his signature was forged on the ‘Declaration’ document which was said to be evidence that he entered into an LLP agreement as part of the engagement of his services by the respondent was not challenged. The claimant’s evidence had been that it was clear that the signature on the LLP agreement was very different to the signature on his van hire agreement. He also pointed out that what was meant to be his address on the LLP was misspelt. The Tribunal accepted the claimant’s evidence in both respects. The Tribunal concluded that the ‘Declaration’ document, which had originally been produced by the respondent had not been signed by the claimant. There was therefore no contractual documentation before the Tribunal in relation to the relationship between the claimant and respondent. As the respondent did not call any witnesses, the Tribunal relied on the claimant’s largely unchallenged evidence in reaching its findings in fact.
Relevant law
[28]Section 230 of the Employment Rights Act 1996 provides a statutory definition of employees and workers.[29]Section 230(1) provides that an employee means ‘an individual who has entered into or works under (or where the employment ceased, worked under) a contract of employment.[30]Section 230(2) defines a contract of employment as ‘a contract of service or apprenticeship, whether express or implied, and (if it is express) whether oral or in writing.[31]Section 230(3) defines a worker as ‘an individual who has entered into or works under (or, where the employment has ceased, worked under)(a) a contract of employment, or(b) any other contract, whether express or implied and (if it is express) whether oral or in writing whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status not by virtue of the contract is that of a client or customer of any profession or business undertaking carried on by the individual; Discussion and decision[32]The question of employment status has been considered by the Supreme Court on a number of occasions in recent years. In particular in the case of Autocleanz Limited v Belcher [2011] I.C.R. 1157, the Supreme Court found that car valeters were workers for the purposes of the National Minimum Wage Regulations 1999 reg.2(1) and the Working Time Regulations 1998 reg.2(1) and in Pimlico Plumbers and another v Smith [2018] UKSC 29, that an apparently self employed operative providing plumbing services to customers of Pimlico Plumbing, was a worker for the purposes of section 230(3) of the Employment Rights Act 1996.[33]The question of employment status is considered by adopting a multi factor approach. The specific facts of a particular case are likely to be crucial in determining whether employee or worker status is established by a claimant.[34]The provisions of section 230(3) are commonly referred to as limb A and limb B, limb A being an employee and limb B being a worker.[35]In the cases referred to above, there were written agreements between the parties which set out the rights and obligations. However, a common theme in employment status cases has been that on occasion the terms of the written agreement do not reflect the reality of the relationship. As the Supreme Court in Autoclenz stated: “17. It is common ground that the issues are(1) whether the ET was correct to find that the claimants were at all material times working under contracts of employment and were therefore workers within limb (a) of the definition and(2) whether in any event the ET was correct to find that they were at all material times within limb (b). This involves consideration of whether and in what circumstances the ET may disregard terms which were included in a written agreement between the parties and instead base its decision on a finding that the documents did not reflect what was actually agreed between the parties or the true intentions or expectations of the parties. Therefore, it is necessary to consider the intention and expectations of the parties in addition to considering any contractual document said to set out the terms of the relationship.[36]One of the fundamental questions to be considered when determining the employment status of an individual is the question of personal performance; that is whether a substitute can be provided by the individual engaged to carry out work. The ability to provide a substitute can be set out in the contractual arrangements between the parties, or may be a matter of practice. In the case of Pimlico, for instance, although Mr Smith, the claimant was contractually permitted to provide a substitute to carry out work on his behalf, that substitute had to come from the ranks of his colleagues who were engaged by Pimlico on similar terms. In that case, therefore, the provision of a substitute did not prevent Mr Smith being a worker for the purposes of section 230(3)(b) of the Employment Rights Act 1996.[37]A further important consideration, which was also relevant in the Pimlico case, is whether a putative worker is providing services to a customer or client rather than engaged in a contract for service.[38]In the present circumstances, there was no contractual documentation before the Tribunal. There was a model agreement, which required the claimant to become a member of an LLP. It appeared to the Tribunal that this arrangement was created to suggest that the claimant was part of a separate company which provided services to the respondent. It did not reflect the reality of the situation. In any event, the claimant had not signed the agreement. While it may be well be the case that the claimant’s pay was channelled through this LLP by the respondent, the claimant was completely unaware of the arrangements. It was clear that the reality of the situation, and the expectation of the parties, was that the claimant would provide services directly to the respondent.[39]While that model agreement made reference to the provision of a substitute, this did not reflect the reality of the situation. Even if the claimant was bound by the terms of this agreement, any substitute would be required to have gone through the same vetting procedure as the claimant. Instead it was similar to the Pimlico Plumbers case where any substitute would be more in the form of swapping shifts with colleagues.[40]The Tribunal therefore had no hesitation in finding that the claimant was required to provide personal service in carrying out his duties which was consistent with an employment relationship.[41]The Tribunal’s decision in this regard would have been same had the claimant signed the ‘declaration’ agreement.[42]The Tribunal then went on to consider the extent to which the respondent exercised control over the way in which the claimant carried out his duties.[43]The Tribunal did hear that there was a manual which was provided to the claimant, although it did not have sight of a copy of that document. The claimant gave evidence that this manual set out standards that the claimant and his colleagues were required to adhere to in carrying out their duties. His evidence was that if the standards were not met, then no further work would be offered.[44]There was no dispute that the claimant was advised of his duties the evening before he was due to carry them out and advised of the route he was required to take. The claimant was paid a daily rate for carrying out his duties and while he was not obliged to accept the work, it was clear that there was sufficient mutuality of obligations between the parties to at the very least create an umbrella contract which governed the claimant’s work for the respondent.[45]The Tribunal also considered the financial reality of the relationship. The claimant was paid a daily rate and while he was required to provide his own transport, it was clear that the provision of that transport was inextricably related to the respondent. There was a cost associated with the use of the transport by the claimant, but in the Tribunal’s view, the claimant could not make a profit by carrying out his work more effectively or at different time. Again, it seemed to the Tribunal that the financial reality of the relationship was consistent with that of an employment relationship.[46]Having considered the facts of this case, the limited documentation available and the authorities referred to above, and applied a multi factor approach when analysis the circumstances, the Tribunal concluded that the claimant was employed by the respondent under a contract of service with the respondent, and was therefore a worker of the respondent for the purposes of section 230(3)(b) of the Employment Rights Act 1996.[47]The case should now be listed for a further Preliminary Hearing to determine what further steps are required in order to list the case for a final hearing and in particular consider the claimant’s outstanding application for amendment to his claim.
Background
[1]The claimant submitted an ET1 on 27 June 2019, claiming unfair dismissal and various monetary amounts. A case management preliminary hearing took place on 28 February 2020 before Employment Judge McFatridge. The claim of unfair dismissal was dismissed due to lack of qualifying service. At the case management preliminary hearing the claimant indicated that he considered himself to be a whistleblower and that he had a claim under this heading which the Tribunal had jurisdiction to deal with. Employment Judge McFatridge noted that it was unclear from the ET1 what the public interest disclosure claim was. The claimant was informed that if he wished to seek E.T. Z4 (WR) to amend his claim to include a claim relating to public interest disclosure, then he should do so within 14 days. The claimant subsequently confirmed that he wished to amend his claim to include a claim of detriment contrary to section 47 of the Employment Rights Act 1996 (ERA).[2]A further case management preliminary hearing took place on 2 April 2020. At that hearing it was noted that the claimant had applied to amend his claim and some details of that claim were set out in the further particulars. Employment Judge McFatridge explained to the claimant that the definition of a protected disclosure is a technical one and, before the Tribunal could consider whether or not to accept the claimant’s application to amend, full specification of this claim would be required. The claimant was advised that he required to provide full details of when the disclosures were made, to whom and in what form. He was informed that he should also set out information which he considers to have been disclosed in the public interest and which of the categories in section 43(B)(1) ERA applies. He confirmed that, to assist the claimant, the matters would be set out in more detail in orders. Orders were then issued requiring the claimant to provide the following information within 14 days ‘In respect of the proposed claim under section 47B of the Employment Rights Act a)(i) what was the content of the disclosure which was made,(ii) which of the categories in subparagraphs (a)-(f) of section 43B(1) is said to be applicable,(iii) in what form, when and to whom was the disclosure made, b) in relation to any complaint under section 47B (detriment) what was the act or the nature of any failure to act on the part of the respondent said to have been done on the ground that a protected disclosure had been made (i) What was the nature of the detriment said to have been suffered as a result (ii) in the view of the claimant what factor or factors are said to establish or tend to show any causal connection between the making of the disclosure and any act or failure to act on the part of the employer.’[3]Further information was provided by the claimant, in response to the order.[4]In response to a)(i) of the order, he stated ‘Various disclosures regarding malpractice and deliberate falsehoods to the direct financial detriment of drivers and infringement of basic human rights, all with a reasonable belief that the disclosure was in the public interest.’[5]In response to b)(i) of the order he stated ‘When attempting to work for another company, I was informed that “Amazon” would not employ me and I was effectively “blacklisted” from the depot, with no explanation or right of appeal. It is my belief that there had been a communication in respect of this from JMHC logistics, preventing me from obtaining work with another company, directly due to my concerns regarding their conduct.’ This allegation did not appear in the original ET1.[6]A preliminary hearing took place on 21 October 2020 to deal with the issue of the claimant’s employment status. Employment Judge Jones decided that the claimant was a worker.[7]A further case management preliminary hearing took place on 3 December 2020. At that hearing the claimant confirmed he wished to proceed with his application to amend his claim, so as to include a claim under section 47B ERA. The respondent’s representative confirmed that the respondent objected to the claimant’s application to amend. Employment Judge McFatridge directed that a preliminary hearing be held to determine whether or not the claimant’s application to amend should be accepted. The parties were referred to in the case of Selkent Bus Company Ltd v Moore 1996 ICR 836.[8]The case then called for a preliminary hearing to determine whether the claimant’s application to amend his claim should be allowed. At the preliminary hearing each party made a short submission setting out their position.[9]The claimant submitted that the facts he relies upon in his detriment claim were contained in the ET1, the detriment claim was simply a relabelling of those facts. He stated that the respondent was aware of the disclosures and these were made were in the public interest. The application to amend was submitted at the earliest opportunity. Any delay in bringing this matter forward was simply due to the respondent challenging that he was not a worker. If the application was refused, he would be deprived of a suitable remedy.[10]The respondent submitted that the first indication they had that the claimant wished to add a whistleblowing claim was at the case management preliminary hearing on 28 February 2020. No explanation has been provided by the claimant to indicate why he did not raise this matter previously, or why the facts relating to this claim were not mentioned in the ET1. Despite the fact that the claimant has been asked to provide details of his claim, the respondent remained unclear as to the basis for the claim. The application to amend should therefore be refused.
Relevant law
[11]Employment Tribunals have a broad discretion to allow amendments at any stage of proceedings, either on the Tribunal’s own initiative or on the application by a party. Such a discretion must be exercised in accordance with the overriding objective (which is set out in the Employment Tribunals Rules of Procedure) of dealing with cases fairly and justly. Although various principles apply specifically to the assessment of an application to amend, the need to comply with the overriding objective underlies the application of those principles.[12]In Selkent Bus Company Limited v Moore 1996 ICR 836 guidance was given as to how Tribunals should approach applications to amend. The EAT confirmed that any application to amend a claim must be considered in light of the actual proposed amendment, so that the Tribunal may understand and give consideration to the purpose and effect of the amendment. It is important therefore that the application sets out the terms of the proposed amendment in the same degree of detail as would be expected had it formed part of the original claim, that is to say, such as to give fair notice to the other party of the case which it is to meet.[13]In approaching the question of whether to allow an application to amend, Tribunals must have regard to all the relevant circumstances and in particular to any injustice or hardship which would result from the amendment or a refusal to allow it (Cocking v Sandhurst (Stationers) Limited and another 1974 ICR 650, NIRC).[14]Accordingly, when determining whether to grant an application to amend Tribunals should carry out a careful balancing exercise of all the relevant factors, having regard to the interests of justice and to the levels of hardship that would be caused to the parties by granting or refusing the amendment. In Selkent the then President of the EAT, Mummery P, explained that relevant factors would include:-(i) Nature of the amendment - i.e. is the amendment, for example, one involving the correction of clerical or typographical errors, the addition of factual details to existing allegations and or the addition or substitution of other labels for facts already pled? Alternatively, is the amendment one which involves the making of entirely new factual allegations that change the basis of the existing claim? In other words, whether the amendment sought is a minor matter, or a substantial alteration pleading a new cause of action.(ii) Applicability of time limits – if a new claim or cause of action is proposed to be added by way of amendment, the Tribunal should consider whether that claim/cause of action is out of time and, if so, whether the time limit should be extended.(iii) Timing and manner of the application – an application should not be refused simply because there has been delay in making it, as amendments may be made at any stage of the proceedings. Delay in making the application is however, a discretionary factor. It is relevant to consider why the application was not made earlier and why it is now being made: for example, the identification of new facts or new information from documents disclosed on discovery.[15]The above is not an exhaustive list. There may be additional factors to consider in any particular case, but the above basic factors should form part of the Tribunal’s consideration.[16]The hardship and injustice test is a balancing exercise. As noted by Lady Smith in Trimble and another v North Lanarkshire Council and another EATS0048/12 it is inevitable that each party will point to there being a downside for them if the proposed amendment is allowed or not allowed. It will therefore rarely be enough to look at the downsides or ‘prejudices’ themselves. These need to be put in context, and that is why it is important to look at all the surrounding circumstances. Discussion & Decision[17]In considering the application to amend, the Tribunal considered each of the factors set out in Selkent and reached the following conclusions. Nature of the amendment[18]The claim which the claimant seeks to introduce by way of amendment is that he was subjected to a detriment, contrary to s47B ERA, as a result of making a protected disclosure under s43B ERA. The detriment asserted is that ‘When attempting to work for another company, I was informed that “Amazon” would not employ me and I was effectively “blacklisted” from the depot, with no explanation or right of appeal. It is my belief that there had been a communication in respect of this from JMHC logistics, preventing me from obtaining work with another company, directly due to my concerns regarding their conduct.’ This factual allegation did not appear in the original ET1.[19]The amendment accordingly seeks to substantially change the basis of the existing claim, making new factual allegations and pleading an entirely new cause of action. Applicability of time limits[20]The proposed new claim was brought substantially outwith the normal time limits for raising that claim. The amendment seeks to introduce a new cause of action in relation to events which occurred in or around April 2019, approximately a year before the application to amend was made.[21]Claims under s47B ERA should be brought within 3 months of the date of the act complained of or, where this is not reasonably practicable, within such further period as the Tribunal considers reasonable.[22]The Tribunal concluded that it was reasonably practicable for a claim under s47B ERA to have been submitted timeously. An ET1 was lodged on 27 June 2019. That ET1 could have included a claim under s47B ERA. Timing and manner of the application[23]The Tribunal considered why the application was being made at this stage.[24]The Tribunal did not receive any satisfactory explanation as to why the detriment claim was not raised in the ET1 submitted on 27 June 2019. In addition, the Tribunal did not accept that the advancement of this claim was dependent upon the Tribunal’s judgment in relation to worker status, particularly given that the possibility of this claim was mentioned at the first case management preliminary hearing in February 2020.[25]The Tribunal also noted that, despite the direction and orders of the Tribunal following the case management preliminary hearings which took place on 28 February and 2 April 2020, the claimant had not provided the specification which would be required to pursue his claims: in particular the precise terms of the disclosure(s) which the claimant states he made, and the basis upon which he asserts he had a reasonable belief that the disclosure was made in the public interest, are not clear from the terms of the proposed amendment. As a result the claims are not set out in the degree of detail which would be required to give the respondent fair notice of the case it may be required to meet. If the application were permitted, further particulars and/or case management preliminary hearings would be required to determine the precise terms of each disclosure the claimant asserts he made, and the basis upon which he asserts he had a reasonable belief that each disclosure was made in the public interest. Conclusions re Application to Amend[26]The Tribunal noted that, whilst the claimant would be prejudiced if he is not able to proceed with this element of his claim, the respondent would also be prejudiced if the claim was allowed to proceed, given that the length of the hearing would necessarily increase, as would the documentary evidence and number of witnesses required. The claim the claimant seeks to add by way of amendment is an entirely new claim which is considerably out of time. No satisfactory explanation was advanced for why it was not brought sooner. The claimant has been given ample opportunity to properly particularise his claim and was informed that full specification of this claim would be required before the Tribunal could consider whether or not to accept the claimant’s application to amend. The respondent would be prejudiced if the claims were allowed to proceed at this stage: further case management would be required before the claims can proceed, so that the precise terms of the disclosures the claimant relies upon are identified prior to any final hearing, as well as the basis upon which he asserts that he had a reasonable belief that each disclosure was made in the public interest. Taking into account the above factors, and considering the balance of hardship and injustice between the parties, the Tribunal conclude that the application to amend the claim to include a claim under s47B ERA should be refused.[27]The case should now be set down for a one day final hearing in respect of the claim of unauthorised deductions from wages in respect of the van bond and the claim for holiday pay.