Dr R Narayan v Community Based Care Health Ltd: 2500615/2017
EMPLOYMENT TRIBUNALS
Case No 2500615/2017
Between
Dr R NarayanClaimantCommunity Based Care Health LtdRespondent
Before
Employment Judge A M BuchananMs J Callan (instructed by Counsel) for claimantMr R Gibson - Solicitor for respondentDate 5 May 2020
JUDGMENT
ON PUBLIC PRELIMINARY HEARING It is the judgment of the Tribunal that:-[1]The claimant was not an employee of the respondent as defined in section 230 of the Employment Right Act 1996 and thus does not have the status to advance the claims of unfair dismissal and wrongful dismissal which are therefore struck out as having no reasonable prospect of success pursuant to Rule 37(1)(a) of Schedule I to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 (“the 2013 Rules”).[2]The claimant was a worker of the respondent as defined in section 230(3)(b) of the 1996 Act and thus does have the status to advance the claim in respect of unpaid annual leave whether advanced pursuant to the Working Time Regulations 1998 or pursuant to Part II of the 1996 Act.[3]The claimant was an employee of the respondent as defined in section 83(2) of the Equality Act 2010 and thus does have the status to advance the claims of sex and/or race discrimination.[4]It is not appropriate to strike out the claims of sex and/or race discrimination on the basis that they have no reasonable prospect of success pursuant to Rule 37(1)(a) of Schedule I of the 20103 Rules.[5]A Deposit Order is made pursuant to Rule 39 of the 2013 Rules in respect of the allegations of sex and/or race discrimination and that Order is issued separately.[6]A Private Preliminary hearing will be convened to make orders to bring the claims allowed to proceed on for final hearing.
REASONS
[1]By a claim form filed on 15 June 2017 the claimant advanced claims to the Tribunal of unfair dismissal, race discrimination, sex discrimination, breach of contract in respect of notice pay and unpaid holiday pay.[2]By a response filed on 14 July 2017 the respondent denied liability to the claimant and raised a jurisdictional preliminary matter. The jurisdictional matter pleaded was that the claimant was a self-employed person and as a result the Tribunal lacked jurisdiction to advance any of the claims she sought to advance.[3]On 22 September 2017 the matter came before Employment Judge Garnon on a private preliminary hearing and orders made on that day resulted in the claim being set down for a public preliminary hearing in order to determine these matters:3.1 Whether the claimant has the status to bring any of the claims in her claim form before an Employment Tribunal and, to the extent she does not, whether such claims should be struck out.3.2 If the claimant has status to advance any one or more of the claims she seeks to advance, whether any such claim or claims should be struck out, or a deposit ordered as a pre-condition of her pursuing it, on the basis that it has no, or only little, reasonable prospect of success.[5]Accordingly a public preliminary hearing came before me in order to determine those two matters which engage Rules 37(1)(a) of Schedule I to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 (Strike Out) and Rule 39 of the 2013 Rules (Deposit Order).
The hearing
[6]At the hearing I heard evidence from the claimant who was cross examined at length. I asked some questions of my own in order to clarify my understanding of certain aspects of the case. For the respondent I heard evidence from Julie Anne Mitchell who is Chief Executive of the respondent company. This witness was cross examined at length and again I asked some questions of my own in order to clarify my understanding of her evidence.[7]I had an agreed bundle before me comprising some 365 pages. Any reference in this Judgment to a page number is a reference to the corresponding page in the agreed bundle. Due to the lateness of the hour I reserved my decision which I issue now with full reasons in order to comply with Rule 62(2) of the 2013 Rules. I regret the delay in my being able so to do – this has been the result of a variety of factors but principally the pressures of other judicial business.
The claims
[8]The claims advanced to the Tribunal by the claimant are:8.1 a claim of unfair dismissal pursuant to sections 94/98 of the Employment Rights Act 1996 (“the 1996 Act”) and the status required by the claimant to advance this claim is that of “employee” as defined in section 230(1) of the 1996 Act8.2 a claim of wrongful dismissal relying on the provisions of the Employment Tribunals Extension of Jurisdiction (England and Wales) Order 1994 and the status required by the claimant to advance this claim is again that of “employee” as defined in 8.1 above.8.3 a claim of unpaid holiday pay advanced either under Part II of the 1996 Act or Regulations 14 and 16 of the Working Time Regulations 1998 (“the 1998 Regulations”) for which the status required by the claimant is that of “worker” as defined either in section 230(3) of the 1996 Act or Regulation 2 of the 1998 Regulations8.4 claims of race discrimination and sex discrimination advanced pursuant to the Equality Act 2010 (“the 2010 Act”) for which the status required by the claimant is that of “employee” under the wider definition set out in section 83(2) of the 2010 Act. Submissions[9]I briefly summarise the written submissions which are held on the Tribunal file and the oral submissions made to supplement such submissions. Respondent10.1 It was submitted that the claimant was at all times a self-employed person and therefore out of scope in respect of the required definition for any of the claims advanced. It was submitted that the claimant is a qualified medical practitioner and was an intelligent contracting party and that she had knowingly and willingly entered into a contract with the respondent under which she was self-employed. Reference was made to three distinct concepts: personal service, control and mutuality of obligation.10.2 Personal Service. It was submitted that the intention of the parties at the outset of their arrangement and throughout their relationship was one of self-employment as was evident from the Rules for Duty Doctors, the GatDOC Service Manual and the Terms and Conditions of Engagement document. It was submitted by reference to Pimlico Plumbers Limited –v- Smith 2017 EWCA Civ 51 that the right of the claimant to appoint a substitute was limited only by the need to show that the substitute was a qualified medical practitioner registered with the respondent as a duty doctor and thus inconsistent with the requirement for personal service.10.3 Considerable reliance was placed on the decision in Suhail –v- Herts Urgent Care UKEAT/0416/14. While it was accepted that no two cases are entirely the same, the facts of that case bore a striking resemblance to the facts of the claimant’s case. It was submitted that whilst there was no written substitution clause or personal service clause in the claimant’s case, the work could be carried out by any qualified GP and did not have to be done by the claimant personally. The claimant decided when and where RESERVED JUDGMENT Case Number: 2500615/2017 she wanted to work and custom and practice showed that she could provide a substitute to the respondent from the pool of approximately 70 out of hours GPs registered with the respondent. Thus there was no requirement for personal service and therefore the claimant did not fall within any of the definitions required to be satisfied if she was to advance any of the claims to the Tribunal. In oral submissions, it was noted that the claimant appears to have had two customers of her business. Reference was made to page 205 and the claimant’s medical defence union membership in which she is described as an “Independent GP (Locum or Private Work)” and that is sufficient to remove any suggestion the claimant is a worker. In any event the right to substitute in this case removes any suggestion of a requirement to do the work personally.10.4 Control. It was submitted that the claimant had complete autonomy as to how she organised and performed her work once on shift. The respondent did not tell or show or control the way in which the claimant worked – she exercise complete clinical independence. Without a sufficient degree of control there can be no contract of employment. A self-employed person is not required to submit to the same controls or supervision as an employee and they determine their own working hours and days. This is precisely what happened in the case of the claimant.10.5 Mutuality of Obligation: the obligation on the employer to provide work and the obligation on an individual to accept work is indicative of whether a contract is in existence at all. This question is relevant to the consideration both of employee status and worker status. It was submitted that there was no mutuality of obligation. The respondent was not obliged to offer work and the claimant was not obliged to accept it. The claimant viewed which shifts were on offer on the respondent’s Rotamaster system and elected those she wished to work. She could hand shifts back at any time if that suited her. Occasionally she did not accept work for up to 3 weeks at a time. There was no mutuality of obligation. In addition the claimant was free to leave at any time: she was not obliged to give any notice of her intention to cease to work with the respondent. In oral submissions it was submitted that this matter was the key feature of this case and was patently lacking.10.6 It was submitted that if the fundamental test of whether the claimant was performing services in business on her own account was applied, then it was clear the claimant was indeed in business on her own account. Detailed reference was made to 14 factual matters which pointed in that direction. There was no mutuality of obligation between the claimant and the respondent and that prevented an employment relationship. The claimant had her own business and was a professional person and worked with the respondent as her client or customer. That factor militates against worker status. Furthermore the right of substitution militates against a contract of personal service.10.7 Reference was made to the allegations of sex and race discrimination and in particular the explanation which the respondent has sought to advance now that that claim has been further particularised. It was submitted the claims were of direct discrimination and had no reasonable prospect of success. The claimant had disclosed no arguable case in law in respect of direct discrimination. The claimant has not demonstrated a causal link between a protected characteristic and any alleged wrongful conduct on the part of the respondent. In the alternative it was submitted that it was appropriate for a deposit order to be made. The claim for direct discrimination was flawed first by reference to an actual comparator rather than a hypothetical comparator as originally pleaded, secondly as one of the three pleaded detriments could not amount RESERVED JUDGMENT Case Number: 2500615/2017 to a detriment at all and thirdly by it being clearly shown that the circumstances of the unnamed actual comparator were materially different from those of the claimant. In oral submission, it was noted that a claim of indirect discrimination had not been pleaded and the claim of direct discrimination should not be allowed to go forward.10.8 Reference was made to the relevant statutory provisions and (in addition to those referred to above) to the following authorities: The first issue Ready Mix Concrete –v- The Minister of Pensions and National Insurance 1968 2QB Carmichael –v- National Power 1999 1WLR 2042 James –v- Redcat (Brands) Limited 2007 IRLR 296 Clyde & Co LLP –v- Van Winkelhof 2014 IRLR 467 Cotswold Developments –v- Williams 2006 IRLR 181 Haswani –v- Jivraj 2014 UKSC 40 Redrow Homes (Yorkshire) Limited –v- Wright 2004 EWCA Civ 469 Bacica –v- Muir 2006 IRLR 35 Yorkshire Window Company Limited –v- Parkes UKEAT/0484/09 Uber BV –v- Aslam 2017 IRLR 4 Independent Workers’ Union of Great Britain –v- Roofoods t/a Deliveroo 2016 Montgomery –v- Johnson Underwood Limited 2001 EWCA 318 Stephenson –v- Delphi Diesel Systems Limited 2003 ICR 471 Byrne Bros Limited –v- Baird 2002 IRLR 96 Windle –v- Secretary of State for Justice EWCA Civ 459 Market Investigations –v- Minister of Social Security 1969 2QB 173 The second issue Ezsias –v- North Glamorgan NHS Trust 2007 EWCA Civ 330 Balls –v- Downham Market High School & College UKEAT/0343/10 Anyanwu –v- South Bank Students Union & South Bank University 2001 IRLR 305 A -v- B and C UKEAT/0450.08 Croke –v- Leeds City Council UKEAT/0512/07 Sivanandan –v- Independent Police Complaints Commission UKEAT/0436/14 Van Rensburg –v- Royal Borough of Kingston upon Thames UKEAT/0095/07 Claimant11.1 It was submitted that in determining employee status, the starting point is whether the agreement between the claimant and the respondent was intended to be an exclusive record of their agreement. If not, all other relevant exchanges can be considered. It was also necessary to consider if there was mutuality of obligation and a requirement to do work personally. In oral submissions it was noted the claimant had RESERVED JUDGMENT Case Number: 2500615/2017 worked for the respondent for 14.5 years with only short gaps of up to three weeks. The ability to substitute had been over-egged and exaggerated by the respondent in submissions. The claimant stated that she did not need to request work: it was given to her and when the pre-populated sheet was sent to her setting out her shifts for the next period, she was obliged to work them. Thus the claimant is an employee notwithstanding the existence of her limited company which is not a determinative factor.11.2 In respect of worker status, it was submitted that the question to be asked was whether there was a contract in existence and, if so, the claimant is a worker: Gilham – v- Ministry of Justice 2017 ICR 404. In respect of the 1998 Regulations, these implement the Working Time Directive and therefore the decision of the Supreme Court in Ministry of Justice -v- O’Brien 2013 ICR 499 should be applied. The respondent was not in the position of a client or customer of the claimant’s business. The claimant ran no risk in her so-called business and thus even if not an employee she was a worker.11.3 In respect of the requirement to work personally reference was made to Pimlico Plumbers (above). It was submitted that the claimant was working under a contract of employment when the matter was properly analysed by reference was made to Drake-v Ipsos Mori UK Limited 2012 IRLR 973. In the alternative it was submitted that the claimant was a worker within section 230(3) of the 1996 Act and has the required status to advance her claims under the 2010 Act relying again on the decision in Pimlico Plumbers Limited (above).11.4 It was submitted that the power to strike out should be applied only in rare circumstances particularly where the central facts are in dispute and it will be exceptional to strike out where an issue to be decided is dependent on conflicting evidence. That was the case in this matter and the allegations should proceed to trial.11.5 In respect of deposit orders, it is not wrong for a Tribunal to make a provisional assessment of credibility but the matter must be put to a full Tribunal to test evidence where matters are in dispute. The Law12.1 I set out briefly the legal provisions in question. The terms “employee” “contract of employment” and “worker” are defined in subsections 230(1) (2) and (3) of the1996 Act: “(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) “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 RESERVED JUDGMENT Case Number: 2500615/2017 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.” That definition of “worker” is also adopted for the 1998 Regulations. For the purposes of the 2010 Act the definition of “employment” is to be found in section 83(2) in these terms: “Employment” means employment under a contract of employment, a contract of apprenticeship or a contract personally to do work”.12.2 I have reminded myself that in considering whether or not a person is an employee a so called balance sheet approach is not acceptable. I must look at the reality of the relationship between these parties. I remind myself of the guidance of Mummery J in Hall v Lorimer [1994] IRLR 171 namely that in determining whether an individual carried on business on his own account, it was necessary to consider many different aspects of the person’s work activity and that this was not to be done by way of a mechanical exercise of running through items on a check list to see whether they were present in or absent from a given situation. Mummery J continued “the object of the exercise is to paint a picture from the accumulation of detail……. it is a matter of evaluation of the overall effect of the detail which is not necessarily the same as the sum of the individual situation”12.3 I have reminded myself of the decision of the Supreme Court in Autoclenz –vBelcher 2011 UKSC 41 and the words of Lord Clarke:
The Law
[18]As Smith LJ explained in the Court of Appeal at para 11, the classic description of a contract of employment (or a contract of service as it used to be called) is found in the judgment of MacKenna J in Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497, 515C: "A contract of service exists if these three conditions are fulfilled.(i) The servant agrees that, in consideration of a wage or other remuneration, he will provide his own work and skill in the performance of some service for his master.(ii) He agrees, expressly or impliedly, that in the performance of that service he will be subject to the other's control in a sufficient degree to make that other master.(iii) The other provisions of the contract are consistent with its being a contract of service. … Freedom to do a job either by one's own hands or by another's is inconsistent with a contract of service, though a limited or occasional power of delegation may not be."[19]Three further propositions are not I think contentious: i) As Stephenson LJ put it in Nethermere (St Neots) Ltd v Gardiner [1984] ICR 612, 623, "There must … be an irreducible minimum of obligation on each side to create a contract of service". ii) If a genuine right of substitution exists, this negates an obligation to perform work personally and is inconsistent with employee status: Express & Echo Publications Ltd v Tanton ("Tanton") [1999] ICR 693, per Peter Gibson LJ at p 699G. iii) If a contractual right, as for example a right to substitute, exists, it does not matter that it is not used. It does not follow from the fact that a term is not enforced that such a term is not part of the agreement: see eg Tanton at p 697G.
The Law
[1]The claimant was ordered to pay a deposit of £750.00 following a preliminary hearing held on 22 November 2017. The Order was sent to the claimant on 27 February 2018. The claimant has failed to pay this deposit. The complaints of race and/or sex discrimination are therefore struck out under rule 39(4) of the Employment Tribunals Rules of Procedure 2013.[2]The preliminary hearing (case management) fixed for 26 March 2018 is still listed.