Ms C Hudson v Linda Meredith Ltd and Linda Meredith Skin Care Ltd: 2213094/2024
EMPLOYMENT TRIBUNALS
Case No 2213094/2024
Between
Ms C HudsonClaimantLinda Meredith LtdRespondent
Before
Employment Judge Nicolle
Members
Mr S McLaughlin and Ms J CameronIn person for claimantDate 15 April 2025
JUDGMENT
[1]The Claimant was not an employee within the meaning of section 230 (1) of the Employment Rights Act 1996 (the ERA).[2]The Claimant was in employment within the meaning of S 83 of the Equality Act 2010 (the EQA).[3]The Claimant was a worker within the meaning of the S 230 (3) (b) of the ERA.[4]The claim for unfair dismissal fails and is dismissed as the Claimant was not an employee.[5]The claim for wrongful dismissal, notice pay and breach of contract fails and is dismissed as the Claimant was not an employee for the purposes of pursuing a claim under the Employment Tribunals Extension of Jurisdiction (England and Wales) Order 1994 SI 1994/1623.[6]The claims for direct discrimination because of sex and religion pursuant to S 13 of the EQA and indirect discrimination on the grounds of religion pursuant to S 19 of the EQA fail and are dismissed.[7]The claim for accrued holiday pay pursuant to the Working Time Regulations 1998 succeeds and the Claimant is entitled to the gross sum of £7981.66 as an unauthorised deduction from her wages pursuant to S 23 of the ERA.
REASONS
[8]Oral reasons were given to the parties. The Claimant requested written reasons which will be provided to the parties as soon as reasonably practicable.
The Hearing
[9]The Claimant gave evidence and Lee Edwards, Director of Operations, (Mr Edwards) gave evidence on behalf of the Respondent. Stephanie Anderson, therapist (Ms Anderson) and Reshma Shah, director of RYS Hair and Beauty (Ms Shah) submitted witness statements on the Respondent’s half but were not called to give evidence. As such their witness statements carry a lower degree of probative value than would have been the case had they been so called.
The claim
[10]The Claimant is a facial specialist who was engaged by the Respondent between 8 July 2021 and 27 November 2023. An issue we have to determine is the Claimant’s status whether under S 230 of the Employment Rights Act 1996 (the ERA) that of an employee or a worker or for the purposes of section 83 of the Equality Act 2010 (the EQA) an employee.[11]The Claimant alleges sex discrimination in that it was only men who came to the conclusion that her engagement should be terminated. She named as a comparator someone called Stefan who was a hairdresser engaged at the hair salon below the premises occupied by the Respondent. She alleges discrimination on the grounds of religion and belief in that she says she was not allowed to wear a Christian cross at work saying that Mr Edwards precluded her from doing so on the ground that it might offend those of other religions.[12]The Respondent says that the Claimant ran her own therapist business, CH Treatment, had her own Clients and was engaged as a self-employed Contractor. Findings of Fact The Respondents
Findings of Fact
[13]Mr Edwards says that the First and Second Respondents are in effect the same business and that the business has migrated to Linda Meredith Skincare Limited (referred to as the Respondent). The General Service Agreement[14]The starting point is that the Claimant was engaged pursuant to what is referred to as a General Service Agreement between her and Linda Meredith Limited dated 8 July 2021 (the Agreement) for the supply of skincare treatments by the Claimant. The Agreement defines the Claimant as the Contractor on a non-exclusive basis to Linda Meredith Limited defined as the Client.[15]Relevant provisions within the Agreement include: 2.1: The Client shall supply such quantities of the Linda Meredith skincare Products and treatments (the Products). 3: Obligations of Client. To provide product and treatment training on an agreed regular basis to the Contractor at the Location. 4: Obligations of Contractor. The Contractor shall use the Products within the themed facial treatments to be made available to Clients at the Location and to maintain a suitable Public Liability Insurance policy. 8.1: Provides for termination on immediate effect if either party commits a material breach of the terms of the Agreement or otherwise may be terminated by either party giving one month’s notice. 9.1. Includes that it is expressly agreed that the Contractor is acting as an independent contractor and not as an employee and is exclusively a contract for service. 9.3: Sets out the payments initially £18 per hour on Thursdays and Friday and £20 per hour on Saturday, subject to a three day weekly threshold of £1,500, and then commission payable to the Client on treatments at 5% and Products at 10%. 9.4: The Client will be invoiced every week by the Contractor. 9.5: The Contractor will have full control over working time, methods and decision making in relation to the provision of the services in accordance with the Agreement. The Contractor will work autonomously and not at the discretion of the Client. However, the Contractor will be responsive and respectful to the reasonable needs and concerns of the Client. 9.6: That the Contractor shall have responsibility for tax and national insurance. No pension contributions. 9.8: All intellectual property is the sole property of the Client. The Claimant’s public liability insurance policy[16]The Claimant took out a policy of insurance. It is a very basic policy with a premium of under £100. It sets out a description of the services. It refers to the number of operatives as being one namely the Claimant. She says that it reflects the reality of the situation in that she did not, and could not provide a substitute. The Claimant’s personal services company[17]The Claimant set up a personal company, CH Treatments Limited, but says no transactions were undertaken through the company and she made an application to strike it off from the Companies House Register on 12 July 2022 and it was dissolved on 4 October 2022. The Claimant’s invoices[18]The Respondent included in the bundle a selection of the 110 invoices which the Claimant had issued. The Respondent says that they represent a cross section of the days and hours worked and that there was significant variation in the size of those invoices based on the hours worked by the Claimant and that is indeed borne out by the invoices. For example, on invoice number one dated 23 July 2021 the Claimant worked only on Thursday and Friday and invoiced £290.70. In contrast on invoice number 102 dated 11 September 2023 she worked Monday, Wednesday, Thursday, Friday and Saturday and invoiced £945.83.[19]The invoices were initially issued by the Claimant with the Claimant’s Lloyds bank account and the second half with the Lloyds bank account of CH Treatments. The Claimant says it was solely a different account for payment of the invoices rather than payment via a company. We accept her evidence. The organisational structure[20]The Claimant was one of four facial therapists with the others being Ms Anderson, who typically worked two days a week, normally Tuesday and Wednesday or Friday, Simona on Wednesday and Friday, and Carole on Monday and sometimes Saturday. There were never more than two therapists in attendance, sometimes only one, as there are only two treatment rooms. Mr Edwards as the Operations Director would typically be on the site. It was not specified where he is based in the premises. Mr Poland would generally not be on site and therefore not as familiar with Mr Edwards on day to day operational issues. Branded uniforms[21]With effect from 28 February 2023 the Claimant together with other therapists were required to wear branded uniforms. This had been discussed and agreed by the therapists. The Claimant asked if she could have three uniforms as sometimes she worked five days a week and Mr Edwards agreed. Client bookings[22]The Respondent has an online booking system called Thresher. The individual therapists, including the Claimant have a photo on this platform. The Thresher platform is the means pursuant to which the overwhelming majority of bookings are made. There are very few walk-ins or telephone appointments.[23]The Claimant herself says her clients book her based on her reputation. She says that she has habitual five star reviews. She says that her clients would wait for her return when she is on holiday or otherwise absent rather than book with another therapist. Therefore to that extent we find that the operational basis of the Respondent’s business is that whilst there would be clients associated with the Respondent’s brand that they would develop and maintain relationships with individual therapists. Given the relatively intimate nature of the treatments undertaken the personal relationship and confidence between clients and therapists is important. Requirement to remain on the premises even when not working[24]The Claimant says that she was always required to remain on the premises even if she had no clients in case of walk-ins. However, walk-ins were relatively rare. Witness statements read but witnesses not in attendance Ms Anderson[25]Ms Anderson says that the therapists all knew they were self-employed and that she had a fairly negative opinion regarding the Claimant’s demeanour. Ms Shah[26]Ms Shah is not employed by the Respondent but is the landlady of the premises and director of RYS Hair and Beauty. She sets out in her witness statement and in subsequent emails and communications a very negative view of the Claimant’s behaviour, conduct and demeanour. However, her evidence has not been challenged in cross examination and therefore is accorded a low probative value by the Tribunal even if it were relevant, which largely it is not, to the issues we have to address. Emails regarding the Claimant’s alleged misconduct[27]There are a series of emails between Mr Edwards, Ms Shah and Mr John Pollard, Financial Director, (Mr Pollard), pertaining to the allegations Ms Shah makes regarding the Claimant’s conduct. There is no need for me to set these out in detail and it is sufficient to highlight certain key points. This process started from 13 January 2022 and continued intermittently until the Claimant’s engagement was terminated in November 2023. Matters complained of might be seen as minor issues, but had become a matter of considerable concern to Ms Shah, and concerned the Claimant’s attitude, approach to members of her hairdressing salon, argumentativeness, aggressive behaviour and toxicity.[28]Mr Mason, Managing Director of the Respondent, sent an email to Ms Shah saying that the Claimant had a full book but the flip side was her personality can be disruptive. He referred to seeking a compromise regarding the situation which had arisen.[29]In an email of 10 August 2023 Ms Shah refers to a “grave” situation with her staff as a result of the Claimant’s conduct and refers to her having an overpowering personality.[30]The Claimant was not provided with the opportunity to add meaningful input on these complaints. The Respondent ultimately came to the view that given the concerns raised by Ms Shah, and her threat of legal action as a result of her staff allegedly leaving the business as a result of the Claimant’s unreasonable conduct, that it would terminate the Claimant’s engagement based on her having brought the Respondent into disrepute. Various references were made to an investigation but in reality there was no real investigation and the Claimant was not given the opportunity during a meeting to provide her version of events. It is significant that neither of the Respondent’s witnesses had any first hand evidence of the Claimant’s alleged disruptive behaviour. Termination of the Agreement by the Respondent[31]The Respondent terminated the Claimant’s engagement with immediate effect pursuant to Clause 8.1 (b) of the Agreement. She was paid what the Respondent says was an ex gratia sum of £733.50 for bookings and commission she would have earnt in the following week had there not been an immediate termination.[32]We do not have evidence to justify any such finding that the Claimant had acted inappropriately and neither is it directly relevant for us to do so. For the purposes of this judgment we make no finding that the Claimant conducted herself in a way which could be described as hostile, aggressive or toxic or otherwise inappropriate. Wearing of a Christian cross[33]The Claimant says that in March 2022 she was asked to remove it for a social media shoot. She also refers to an undated incident when a Muslim client complained of her cross hitting her in her face. The Claimant says she found out about this complaint from something said by Mr Edwards at the case management hearing on 9 August 2023.[34]Mr Edwards says at paragraph 10 (b) in his witness statement that in line with industry practice all therapists are expected to keep necklaces inside their tunics for health and safety reasons. Clients would find it unacceptable for items of jewellery to be hanging in their faces. He says that it would be fine for the Claimant or another therapist to wear a cross but it must be kept inside the tunic. He says that the Claimant had never been asked to take it off. Mr Edwards was not materially challenged on this by the Claimant in cross examination. Sex discrimination[35]The Claimant refers to Stefan, his surname is not specified, a hairdresser in the downstairs salon who made a complaint against her. She says that he as a male was given the opportunity to have a face to face meeting regarding his complaint while she did not. That in effect represents her complaint of sex discrimination and she relies on him as a direct comparator. The Law The Claimant’s status as an employee, worker or a genuinely self-employed contractor
The Law
[36]The applicable legislation is as follows. The ERA S 230 Employees, workers etc. (1)In this Act “employee” means an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment. (2)In this Act “contract of employment” means a contract of service or apprenticeship, whether express or implied, and (if it is express) whether oral or in writing. (3)In this Act “worker” (except in the phrases “shop worker” and “betting worker”) means 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 is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual; and any reference to a worker’s contract shall be construed accordingly. (4)In this Act “employer”, in relation to an employee or a worker, means the person by whom the employee or worker is (or, where the employment has ceased, was) employed. (5)In this Act “employment”— (a)in relation to an employee, means (except for the purposes of section 171) employment under a contract of employment, and (b)in relation to a worker, means employment under his contract; and “employed” shall be construed accordingly. The EQA S 83 Interpretation and exceptions (1)This section applies for the purposes of this Part. (2)“Employment” means— (a)employment under a contract of employment, a contract of apprenticeship or a contract personally to do work. Relevant case law[37]In assessing whether an individual is an employee, the leading case is Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497, 51C. It provides for a multi-factorial test to include whether the individual is subject to the other’s control in a sufficient degree to make that other master.[38]Cases such as Nethemere v St Neots Ltd v Gardiner [1984] ICR 612 sets out there must be an irreducible minimum of obligation on each side to create a contract of service. In Hospital Medical Group v Westwood [2012] ICR 415, Maurice Kay LJ considered a submission that if a person is genuinely selfemployed that person cannot be a worker. He rejected this contention. In its marketing material, HMG referred to the individual as one of our surgeons and as such he was seen as an integral part of the undertaking.[39]So in accordance with the case law, to include cases like Pimlico Plumbers Ltd Smith [2018) ICR 1511, SC and Uber BV v Aslam [2021] ICR 657, SC, we need to consider the reality of the relationship as well as the label the parties place on it. It may be appropriate as per Autoclenz Ltd v Belcher [2011] ICR 1157, SC and Uber to look beyond the written documentation as to whether it reflects the reality of the situation.[40]We need to consider the statutory framework and the protections which it is designed to provide to individuals as well as the label the parties place on it. That does not mean the written contract should be ignored, it obviously forms an important part of the factors we have to take into account, but there is no absolute rule that terms set out in a contractual document necessarily represent the parties’ true agreement just because the individual, purportedly as a contractor, has signed it.[41]A key question is whether the relationship is one of subordination and dependent. We were referred by Mr Hulks to several cases to include Bacia v Muir EAT S/0004/05 to support the Respondent’s case that the individual must work personally and it must not be the case that the work is carried out in circumstances where the person for whom it is provided is a client or a customer of the business carried on by that person. Essentially this is a fact specific finding that does not add much to our consideration.[42]Mr Hulks asked us to also consider paragraphs 31 and 32 of the Supreme Court’s judgment in Clyde and Co LLP v Bates Van Winkelhof [2014] UKSC 32 to include paragraph 31 that S 83 (2) of the EQA does not include an express exception for those in business on their account who work for their clients or customers. Further to paragraph 13 in the Supreme Court’s judgment in Pimlico in support of the same point. The Claimant’s breach of contract claim in relation to her notice period[43]The Employment Tribunals Extension of Jurisdiction (England and Wales) Order 1994 SI 1994/1623 (the Order) is confined to those who are employees. Therefore whether the Claimant has the jurisdiction to pursue such a complaint is conditional on our finding on that issue. Claims under the EQA Jurisdiction on the grounds of time Time limit for discrimination claims[44]S123 of the EQA provides: (1) Proceedings on a complaint within section 120 may not be brought after the end of— (a) the period of 3 months starting with the date of the act to which the complaint relates, or (b) such other period as the employment tribunal thinks just and equitable. (3) (a) conduct extending over a period is to be treated as done at the end of the period; (b) failure to do something is to be treated as occurring when the person in question decided on it. (4) In the absence of evidence to the contrary, a person (P) is to be taken to decide on failure to do something— (a) when P does an act inconsistent with doing it, or (b) if P does no inconsistent act, on the expiry of the period in which P might reasonably have been expected to do it.[45]For acts extending over a period, it is relevant to consider whether a discriminatory regime, rule, practice or principle, which had a clear and adverse effect on a complainant, existed. There is a distinction between a continuing state of affairs and a one-off act with ongoing consequences.[46]Guidance was provided in analysing what constitutes conduct extending over a period in Hendricks v. Metropolitan Police Commissioner [2003] IRLR 96 to include per Mummery LJ in the Court of Appeal at paragraph 48: “the numerous alleged incidents of discrimination are linked to one another and that they are evidence of a continuing discriminatory state of affairs, by the concept of an act extending over a period”.[47]The appropriate test for a ‘continuing act’ is highlighted by Hendricks and demonstrates where the employer is responsible for an ‘an ongoing situation or a continuing state of affairs’ in Hendricks case of a period of some 11 years of police service and where the continuous acts of discrimination occurred, as opposed to a series of unconnected or isolated incidents.[48]Extension of time under s123 (3) is the exception rather than the rule Robertson v. Bexley Community Centre [2003] IRLR 434.[49]The checklist of factors in s.33 of the Limitation Act 1980 is a useful guide of factors likely to be relevant, but a tribunal will not make an error of law by failing to consider the matters listed in s.33 provided that no materially relevant consideration is left out of account: Neary v Governing Body of St Albans Girls’ School [2010] ICR 473. Section 33 requires the court to take into account all the circumstances of the case, and in particular the factors set out at s.33(3). Those factors which are relevant to the claim are:(a) the length of, and reasons for, the delay by the Claimant;(b) the extent to which the cogency of the evidence is likely to be affected by the delay;(c) the promptness with which the Claimant acted once she/he knew of the facts giving rise to the cause of action; and(d) the steps taken by the Claimant to obtain appropriate professional advice once she/he knew of the possibility of taking action.[50]The Court of Appeal in Southwark London Borough Council v Afolabi 2003 ICR 800, CA, confirmed that, while the checklist in s.33 provides a useful guide for Tribunal’s, it need not be adhered to slavishly.[51]Discriminatory conduct occurring after a Claimant has submitted a claim cannot be taken into account in considering whether there has been a continuing act of discrimination (although may be relevant to the second limb of the test (just and equitable)) Robertson v Bexley Community Centre t/a Leisure Link 2003 IRLR 434, CA). Sex and religion and belief discrimination and the burden of proof[52]Under s13 (1) of the EQA read with s.9, direct discrimination takes place where a person treats the Claimant less favourably because of sex/religion and belief than that person treats or would treat others. Under s.23(1), when a comparison is made, there must be no material difference between the circumstances relating to each case.[53]In many direct discrimination cases, it is appropriate for a tribunal to consider, first, whether the Claimant received less favourable treatment than the appropriate comparator and then, secondly, whether the less favourable treatment was because of sex/race. However, in some cases, for example where there is only a hypothetical comparator, these questions cannot be answered without first considering the ‘reason why’ the Claimant was treated as she was.[54]Under s136, if there are facts from which a tribunal could decide, in the absence of any other explanation, that a person has contravened the provision concerned, the tribunal must hold that the contravention occurred, unless A can show that he or she did not contravene the provision.[55]Guidelines on the burden of proof were set out by the Court of Appeal in Igen Ltd v Wong [2005] EWCA Civ 142; [2005] IRLR 258. The tribunal can take into account the Respondent’s explanation for the alleged discrimination in determining whether the Claimant has established a prima facie case so as to shift the burden of proof. (Laing v Manchester City Council and others [2006] IRLR 748; Madarassy v Nomura International plc [2007] IRLR 246, CA). The Court of Appeal in Madarassy, a case brought under the then Sex Discrimination Act 1975, held that the burden of proof does not shift to the employer simply on the Claimant establishing a difference in status (e.g., sex) and a difference in treatment. LJ Mummery stated at paragraph 56: “Those bare facts only indicate a possibility of discrimination. They are not, without more, sufficient material from which a tribunal ‘could conclude’ that on the balance of probabilities, the Respondent had committed an unlawful act of discrimination.”[56]Further, it is important to recognise the limits of the burden of proof provisions. As Lord Hope stated in Hewage v Grampian Health Board [2012] IRLR870. “They will require careful attention where there is room for doubt as to the facts necessary to establish discrimination. But they have nothing to offer where the tribunal is in a position to make positive findings on the evidence one way or the other.” Conscious or unconscious thoughts of the alleged discriminator[57]An act may be rendered discriminatory by the mental processes, conscious or nonconscious, of the alleged discriminator: Nagarajan v London Regional Transport [1999] ICR 877, HL. In such cases, the tribunal must ask itself what the reason was for the alleged discriminator’s actions. If it is that the complainant possessed the protected characteristic, then direct discrimination is made out. If the reason is the protected characteristic, that answers the question of whether the Claimant was treated less favourably than a hypothetical comparator; they are, in effect, two sides of the same coin. per Lord Nicholls: “In every case…it is necessary to enquire why the Claimant received less favourable treatment. This is the crucial question. Was it on grounds of race? Or was it for some other reason, for instance because the Claimant was not so well qualified for the job. Save in obvious cases, answering the crucial question will call for some consideration of the mental processes of the alleged discriminator. Treatment, favourable or unfavourable, is a consequence which follows from a decision.”[58]In Shamoon v Chief Constable of the Royal Ulster Constabulary [2003] ICR 337, HL as set out by Lord Nicholls in at [11], and albeit assuming a difference of treatment (which the Claimant cannot do): “…employment tribunals may sometimes be able to avoid arid and confusing disputes about the identification of the appropriate comparator by concentrating primarily on why the Claimant was treated as she was. Was it on the proscribed ground which is the foundation of the application? That will call for an examination of all the facts of the case. Or was it for some other reason? If the latter, the application fails. If the former, there will usually be no difficulty in deciding whether the treatment, afforded to the Claimant on the proscribed ground, was less favourable than was or would have been afforded to others.” It is permissible for the tribunal to answer the hypothetical comparator question by having regard to how unidentical but not wholly dissimilar cases have been treated: Chief Constable of West Yorkshire v Vento (No.1) [2001] IRLR 124, EAT, per Lindsay J at paragraph 7; approved in Shamoon, per Lord Hutton at paragraph 81.[59]A benign motive is irrelevant when considering direct discrimination: Nagarajan at 884G-885D, per Lord Nicholls. It is irrelevant whether the alleged discriminator thought the reason for the treatment was the protected characteristic, as there may be subconscious motivation: Nagarajan at 885E H: “I turn to the question of subconscious motivation. All human beings have preconceptions, beliefs, attitudes and prejudices on many subjects. It is part of our make-up. Moreover, we do not always recognise our own prejudices. Many people are unable, or unwilling, to admit even to themselves that actions of theirs may be racially motivated. An employer may genuinely believe that the reason why he rejected an applicant had nothing to do with the applicant’s race. After careful and thorough investigation of a claim members of an employment tribunal may decide that the proper inference to be drawn from the evidence is that, whether the employer realised it at the time or not, race was the reason why he acted as he did. It goes without saying that in order to justify such an inference the tribunal must first make findings of primary fact from which the inference may properly be drawn. Conduct of this nature by an employer, when the inference is legitimately drawn, falls squarely within the language of s.1(1)(a). The employer treated the complainant less favourably on racial grounds.” Drawing of inferences[60]It is not sufficient for to draw an inference of discrimination based on an “intuitive hunch” without findings of primary fact to back it: Chapman and Anor v Simon [1994] IRLR 124.[61]The process of drawing inferences is a demanding task. If a tribunal is to make a finding of discrimination on the basis of inference, per Mummery J in Qureshi v Victoria University of Manchester [2001] ICR 863: “It is of the greatest importance that the primary facts from which such inference is drawn are set out with clarity by the tribunal in its fact-finding role, so that the validity of the inference can be examined. Either the facts justifying such inference exist or they do not, but only the tribunal can say what those facts are. An intuitive hunch, for example, that there has been unlawful discrimination is insufficient without facts being found to support that conclusion.”[62]In determining whether a Claimant has established a prima facie case, the tribunal must reach findings as to the primary facts and any circumstantial matters that it considers relevant: Anya v University of Oxford and Anor [2001] IRLR 377 (CA). Having established those facts, the tribunal must decide whether those facts are sufficient to justify an inference that discrimination has taken place.[63]The tribunal may cast its net widely to look for facts that are consistent with discrimination and may therefore give rise to a prima facie case. The tribunal may take account of circumstantial evidence, including matters occurring before the alleged discrimination (even those outside the limitation period) and matters occurring afterwards if they are relevant. However, there must be “some nexus between the facts relied on and the discrimination complained of”: Wheeler & Anor v Durham County Council [2001] EWCA Civ 844.[64]The less favourable treatment must be because of a protected characteristic and that requires the tribunal to consider the reason why the Claimant was treated less favourably in accordance with the guidance in Nagarajan. The tribunal needs to consider the conscious or subconscious mental processes which led the Respondent to take a particular course of action in respect of the Claimant and to consider whether her gender played a significant part in the treatment: CLFIS (UK) Ltd v Reynolds [2015] EWCA Civ 439. Religion and belief and wearing of a Christian cross[65]In relation to the Claimant’s religion and belief contention we are familiar with the leading authority of Eweida v United Kingdom [2013] IRLR 231, ECtHR which concerned a British Airways employee refused permission to wear a cross under the then prevailing BA policy. The ECJ ultimately concluded that the justification defence based on consistency of uniform was not proportionate and justified. Submissions Respondent[66]Mr Hulks says that the Respondent had no control over the Claimant’s working hours and she could elect not to work. She had no fixed salary and no contract of employment. They say that there was significant variation in the amount of the invoices she issued between £200 and over £900 per week. She managed her tax and national insurance.[67]They deny the existence of any form of discrimination and Mr Hulks says that in effect no evidence was given on this issue. The only requirement in relation to jewellery was that it be tucked into the therapist’s tunic as a health and safety consideration and that this was a proportionate means of achieving a legitimate aim. In relation to sex discrimination it is said that Stefan, the comparator, n does not work for the Respondent and in any event sex had no bearing on the way matters were dealt with.[68]The Respondent has no issues at all with the Claimant’s professionalism. Claimant[69]The Claimant says that at the case management hearing on 9 August 2024 Mr Pollard and Mr Edwards said that she was required to remove her cross because it could offend other religions. I will return to that in the conclusions but the Tribunal has no record of what was said during the case management hearing other than the list of issues which resulted from it. She says that her dismissal was premediated.[70]She says that she had to adhere to the salon hours of work. She submitted a document setting out 21 factors which she says are indicative of her being an employee of the Respondent, I will refer to those in part as we give our findings on the various contentions before us. Conclusions and discussion The Claimant’s status Was the Claimant working under a contract of employment for the purposes of s.230 of the ERA?[71]We have taken into account the factors as set out by the Claimant and the Respondent and conclude that the Claimant was not an employee under s.230 of the ERA. In reaching this decision we have taken account of the factors referred to below.[72]The starting point, but not the totality of our consideration, is the Agreement. That clearly provides that the Claimant is self-employed. This is not a Claimant who has the degree of subordination and perhaps lack of sophistication as the car valets in Autoclenz. We are satisfied that the Claimant would have been aware of the terms of the Agreement which on its face is unequivocal as to the nature of the relationship.[73]We then considered those factors which were arguably inconsistent with the terms of the Agreement Pay[74]The Claimant received payments gross on the invoices issued. No tax or employee national insurance contributions were deducted and the Claimant was responsible for her own tax return. This is therefore a factor which is consistent with a self-employed relationship. The business model[75]We find that the business model is largely consistent with the Claimant being self-employed. Client bookings was largely based on the reputation and relationship with individual therapists and this is consistent with self-employed status. We find very little evidence that there would be unknown individuals passing by or phoning up and being assigned to whichever of the therapists was available. It is an individualised booking arrangement with a relationship based on the therapist’s personal reputation and client rapport with them. Products[76]The Respondent supplies the Products and specifies the protocols that are used by the therapists giving the eponymous Linda Meredith facials. We find the Claimant was engaged because she had been trained, and was already experienced and skilled in the use of these Products and the protocols for their use. The requirement to use the Products was explicit in the Agreement. The Respondent supplies the Products and also presumably holds the relevant licences. Whether personal service was required or provision of a substitute permitted[77]We find that the relationship was one requiring personal service to be provided. There is no delegation or substitution clause in the Agreement. We find that any suggestion that the Claimant could have provided a substitute appropriately skilled facial therapist, who had the requisite insurance policy, to be fanciful. There is no evidence of such substitution taking place and given the personal nature of the relationship between therapists and clients we find that it would have been unrealistic. To what extent was there a degree of control and integration?[78]There are some factors which we find point to integration; namely wearing branded uniforms and the occasion when the Claimant and Mr Pollard went up the street pre-Christmas with goody bags and leaflets and selling buy five get one free packs of treatments. Nevertheless we do not consider that they are sufficient to establish an employment relationship. The degree of supervision We find that in reality the Claimant, in terms of how she followed the protocol and undertook her treatments, was acting under her own supervision. There is no evidence that Mr Edwards intervened in the treatments and that has not been suggested and would be in our view be unrealistic. The Claimant said she was supervised by Linda Meredith not sure if that is the individual or the corporate but we have rejected that level of supervision simply no evidence to suggest that that level of supervision actually took place. Further factors relied on by the Claimant Freedom to will determine working days or hours[79]The Claimant says that she had no freedom to decide her working days or hours. We find that within a broad remit she had a degree of flexibility. She did not work the same four days each week, her days of work varied significantly as shown by the invoices, sometimes five days others and other weeks only one or two days. Mr Edwards says that if the Claimant asked to go home early he would not have objected but there is no evidence that the Claimant did so. We accept the Claimant’s evidence that she was required to be at the premises for all or most of her working days. We find there was a degree of flexibility but nevertheless reject the Respondent’s argument that the Claimant effectively had carte blanche to vacate the premises at her own volition. The Claimant says she did not have any control over the client base or bookings[80]We find that clients came to the Claimant on the online Thresher booking portal based on her personal reputation. The Claimant says that she was required occasionally to undertake stock takes and clean the room[81]We find that whilst indicative of a degree of integration that they would equally be consistent with someone who was self-employed or a worker given the limited staff and a maximum of two therapists being in attendance. The Claimant says that she was instructed to call clients repeatedly from a call list and to go through all the clients on the paper database and transfer them to the computer system[82]No evidence was given on these matters and therefore it would be incorrect for us to place much reliance on matters on which the Respondent’s witnesses have not been cross examined.[83]This also applies with the Claimant’s reference to teaching the Linda Meredith branded techniques to other hotels outside the UK. The Claimant did not rent her room[84]Whilst a factor it is not in itself sufficient to give rise to an employment relationship. Nor is the Claimant not paying for the stocks she used. S.83 of the EQA[85]We find that the Claimant was an employee for the purposes of S83 of the EQA on the basis that she had a contract personally to do work and this involves a wider definition of employee than under S230 of the ERA. Was the Claimant a “worker” under S230 of the ERA?[86]We find that the Claimant was a worker under s.230 (3) of the ERA on the basis that whilst she was not engaged under a contract of employment she was in our opinion performing work personally or services for another party to the contract whose status is not by virtue of the contract matter the client or customer of any professional business undertaking carried on by the individual.[87]While the preamble to the Agreement states that Linda Meredith Limited is the Client and the Claimant a Contractor it is necessary for us to have regard to the reality of the relationship. Linda Meredith is a member of Linda Meredith Limited and in principle it is difficult to see how a businessowner can be a client of their contractor. In practice the Claimant was engaged as a therapist and her professional business undertaking was the delivery of facial therapy. In this context neither Respondent company can in our view be regarded as a lient within the intended meaning of s. 230 (3) (b) of the ERA. In the case of a professional facial therapist the words client or customer must refer to people receiving facial treatments. Unfair dismissal[88]Given finding that the Claimant was not an employee this claim fails. Breach of contract[89]The breach of contract claim in respect of the Claimant’s notice period is predicated on the existence of an employment relationship which we have found did not exist and therefore fails. Accrued holiday[90]This is a claim pursuant to the Working Time Regulations 1998 (the WTR) and succeeds given finding that the Claimant was a worker. In effect this then becomes a deduction from wages pursuant to the ERA which for the purposes of unauthorised deductions from wages applies to the wider category of workers. Direct discrimination because of sex[91]We find that the material circumstances of Stefan are not the same as the Claimant’s in accordance with S123 of the EQA. We know very little about his status but the primary issue is that he was not engaged by the same legal entity. In any event we would not have found that there was evidence to infer that there was any difference of treatment and that difference of treatment was on the grounds of the Claimant’s sex. The claim of direct sex discrimination fails and is dismissed. Direct discrimination because of religion and belief[92]It is important for us to look at what is recorded in the case management order and the list of issues at 19 (a) telling the Claimant to remove her cross on one occasion in 2023. It is not specified as to and the circumstances. We consider, that to be a surprising omission. The Claimant’s witness statement refers to an a photoshoot in March 2022 when she was allegedly told by Mr Edwards that she needed to remove her cross so it was not visible. However, that is not a matter in the list of issues. Mr Hulks understandably says it would be incorrect for us to consider a matter which is not in the list of issues and we accept his position. It would have been known to the Claimant at that time. Further it is surprising, and we acknowledge that the Claimant is a litigant in person, that she did not put questions to Mr Edwards regarding her allegation that he required her to remove her cross for the photoshoot in March 2022.[93]As such we are not in a position to draw and inference as to whether that event took place and, if so, whether it was to avoid causing offence to those of other religions as opposed to the Respondent’s position that there was a health and safety issue, and whilst health and safety would not apply to a photoshoot, the Respondent may, albeit we have not heard evidence on this, have wished to portray a consistent brand and expect the therapists to look in the same manner in the photoshoot as they would be if they were undertaking treatment.[94]In any this alleged event was in March 2022, and would be a one off act and not a continuing course of conduct, and therefore is significantly out of time and no basis has been put forward by the Claimant as to why it would be a just and equitable for us to extend time. So for all of those reasons this element of the claim fails.[95]The Claimant says that she only became aware of a complaint from a Muslim client regarding her Christian cross dangling over their face at the case management hearing on 9 August 2024. We do not know when the alleged incident took place and therefore it may very well be out of time.[96]We have insufficient evidence to draw an inference that such a request was as a result of the complainant’s religious faith, as opposed to the Respondent’s position that the Claimant was told to keep her necklace under her tunic for health and safety reasons.[97]Whilst the Claimant referred to photos of other therapists with visible jewellery we did not consider that their circumstances were the same given that the only observable jewellery was a covered wedding band.[98]We do not find any grounds upon which to infer that this represented an act based on the Respondent not wishing to cause offence to other religions but rather that it was part of a corporate policy of health and safety and a common brand image. We would have found that this represented a legitimate, proportionate and justified approach. Final conclusions[99]We find that the Claimant was a worker under the ERA, was in employment for the purposes of s.83 of the EQA, had an entitlement as a worker to accrued holiday pay under the WTR but all other claims fail and are dismissed.
Remedy
[100]The Tribunal’s case management order dated 6 March 2025 included the following: a) The Claimant must provide to the Respondent and the Tribunal by 4 PM on 20 March 2025 a schedule setting out the dates upon which she took holiday/annual leave, what her total number of working days was in the last 12 months of her engagement, but for completeness in each consecutive 12 month period of her engagement or part thereof, what her average rate of pay was in the last 12 weeks of her engagement or if she considers more appropriate what her total pay was in the last 12 months of her engagement. b) The Respondent must provide to the Claimant and the Tribunal by 4 PM on 20 March 2025 a schedule setting out its position in relation to the issues and those referred to as to how and over what period the Claimant’s entitlement to accrued holiday pay should be calculated together with such information which it considers is relevant to this issue and to facilitate my calculation of the appropriate holiday entitlement. c) Unless the parties request otherwise the Claimant’s entitlement to holiday pay will then be calculated by me without a further hearing and a judgment promulgated accordingly.[101]The Claimant provided significant supporting documentation and the Respondent provided submissions attached to an email dated 22 April 2025. Brief summary of the relevant law regarding entitlement to accrued holiday pay[102]Holiday pay claims are brought as claims for unlawful deductions from wages under the ERA. These claims must be brought within 3 months of the date of the underpayment. Where there is a series of deductions, the claim must be brought within 3 months of the last deduction in the series.[103]The Deduction from Wages (Limitation) Regulations 2014 SI 2014/3322 (the Regulations) act to limit awards for holiday pay brought under an unlawful deduction from wages claim to a maximum of 2 years before the date the claim was brought.[104]Since the date on which the judgment was originally promulgated my attention has been brought to the Watford Employment Tribunal’s decision dated 7 January 2025 in Afshar and ors v Addison Lee Ltd (3306435/20). The tribunal held that the 2-year backstop on wages claims in S 23 (4A) of the ERA is unlawful. It observed that the provision had been introduced by the Regulations under powers set out in S2 (2) of the now repealed European Communities Act 1972. The tribunal was concerned that the government had applied the 2-year backstop to all wages claims and not just those related to EU-derived holiday pay in order to avoid infringing the principle of equivalence. In the tribunal’s view, Parliament did not envisage that S2 (2) could lawfully be used to limit primary domestic rights that were not derived from EU law, particularly those of such fundamental importance as the right not to suffer unlawful deductions from wages. Such a change would have required primary legislation. The tribunal concluded that S 23 (4A) of the ERA was ultra vires and of no effect. As a first instance decision the tribunal’s judgment is clearly not binding on me but I understand an appeal has been lodged with the EAT. Given this judgment I do not consider it appropriate to a limit the Claimant’s entitlement to accrued holiday pay to the last 2 years of her engagement with the Respondent. Nevertheless, the Respondent may take the view that it wishes to defer the payment of accrued holiday for the period prior to the 2 year backstop until the EAT has given judgement on this case. Such a deferral would however be subject to the accrual of interest as referred to below.[105]Under the WTR workers are entitled to a minimum of 5.6 weeks’ paid annual leave (consisting of 4 weeks’ basic leave and 1.6 weeks’ additional leave).[106]Regulations 13, 13A and 14 of the WTR give workers the right to payment in lieu for any outstanding statutory holiday entitlement upon termination.[107]If an employee/worker wants to claim unpaid holiday pay, then he or she will have to be clear about the days upon which they were absent on annual leave and was not paid.[108]In circumstances where the weekly rate of pay varies it should be calculated based on the average rate of pay in the 12 weeks prior to the calculation date in accordance with sections 221 (3) and (4) of the ERA.[109]In Main v Spa Dental Ltd [2024] EAT 200 the EAT noted that an employment tribunal has no express power to award interest accruing before judgment on compensation of the sums which it awards under the WTR and the ERA. Nevertheless, the EAT agreed with the tribunal that Regulation 30 of the WTR is framed in terms that do not preclude an award to compensate a claimant for the financial effect of the delay in receiving the payments due. Where such loss was found, the tribunal must award the necessary compensation. If that was in the form of a percentage rate of interest (as would be usual, the tribunal must make a reasoned decision as to the appropriate rate, which might or might not be 8% (the rate that applies in discrimination cases and in relation to post-judgment interest), and as to the applicable period. Supporting evidence submitted by the Claimant[110]The Claimant says that in the last 12 months of her engagement with the Respondent she earned £36,912.47.[111]The Claimant has provided a list of all of the dates from July 2021 until November 2023 upon which she took annual leave. It is not necessary for me to repeat them as it is sufficient to say that she has fulfilled the requirement as referred to in paragraph 106 above to provide clarity upon which days she took annual leave and was not paid.[112]The Claimant was paid at a rate of £20 an hour on weekdays and £22 an hour on weekends.[113]The Claimant has provided a sample of the relevant invoices for the period during which she claims accrued holiday entitlement. I am satisfied that they represent an accurate record of the Claimant’s working hours. The Respondent’s submissions[114]The Respondent calculates its holiday entitlements on a calendar basis and does not allow holiday to be carried over from previous years.[115]Hourly rates were negotiated with the Claimant which took into account holiday pay. If she had been an employee, her hourly rates would have been less, normally approximately £2 per hour less, and the Respondent requests that this is taken into consideration.[116]The respondent has submitted detailed calculations for what it considers to be the Claimant’s entitlement to holiday pay in 2021, 2022 and 2023 and these have been taken into account in the calculations below.
Conclusion
[117]The Claimant seeks accrued holiday entitlement for the 29 months of her engagement in the gross sum of £10,613.15. In view of the Watford Employment Tribunal’s judgment in Afshar I do not consider it appropriate that the 2 year backstop pursuant to the Regulations is automatically applied.[118]Given that the Respondent did not recognise that the Claimant was an employee or worker I do not consider it appropriate to limit her entitlement to holiday to the last year of her engagement. The Claimant was not given the opportunity to take holiday and therefore I do not consider it appropriate to apply by analogy the Respondent’s position to what would have been the case had she been recognised as an employee. Further, I do not consider it appropriate that any element of the sums paid to the Claimant should reflect any attribution for holiday pay whether at £2 per hour or otherwise.[119]I have accepted, and do not propose to deviate from, the dates provided by the Claimant as the days upon which she took annual leave as set out in her email of 10:19 on 14 March 2025. Whilst these dates may not have been communicated to the Respondent that is understandable given the parties then prevailing understanding that no entitlement existed to paid holiday.[120]The Claimant’s engagement with the respondent commenced on 8 July 2021. This gives an entitlement of 12 days’ annual leave entitlement and at the daily rate of £144, but as set out in paragraph 119 below reduced pro rata by 20% to reflect the Claimant working an average of 4 days per week, giving an entitlement of £288.[121]The claimant issued 17 invoices in 2021. Therefore 46 days/17 weeks = 2.7 days average per week (out of a total of 5 = 2.7/5 = 54%). Therefore her 2021 invoices of £7069/46 days worked = £156.68 per day which x 12 days x 54% = £968.46.[122]The claimant issued 49 invoices in 2022. Therefore 176 days/49 weeks = 3.6 days average per week (out of a total of 5 = 3.6/5= 72%). Therefore her 2022 invoices of £29,266/176 days worked = £166.28 per day which x 28 days x 72%= £3352.20.[123]The claimant issued 44 invoices in 2023. Therefore 154 days/44 weeks = 3.5 days average per week (out of a total of 5= 3.5/5= 70%). Therefore her 2023 invoices of £25,793.50/154 days worked = £167.49 per day which x 25.67 days x 70% = £3009.63.[124]This gives an accrued gross figure of £7310.29.[125]I consider it appropriate that interest is awarded to the gross accrued sum for accrued holiday entitlement of £7310.29 at an interest rate of 8% from a midpoint of halfway through the Claimant’s engagement i.e. 19 September 2022 until 23 May 2025. This gives a figure for interest £1.60 x 816 days = £1305.60 and an overall sum of £8615.89. In reaching this decision regarding entitlement to interest I take account of the fact that the Claimant was not provided with the opportunity to take paid holiday entitlement and had wrongly been categorised by the Respondent as being self-employed when the Tribunal has found that the facts of her engagement were consistent with her being a worker.[126]The Claimant is entitled to the gross sum of this £8615.89 as an unauthorised deduction from her wages pursuant to S 23 of the ERA. Employment Judge Nicolle Dated: 15 April 2025 (and with the section on remedy reconsidered pursuant to Rule 68 of the Employment Tribunal Procedure Rules 2024 to reflect the Respondent’s submissions on the calculation of accrued holiday entitlement dated 22 April 2025 which had not been seen by me at the time the original judgment was promulgated). 28 May 2025 ………...................................................................... ………......................................................................