[1]The Claimant was not an employee of the Respondent, as per the definition in the Employment Rights Act 1996 section 230(1).[2]The Claimant was not a worker of the Respondent, as per the definition in the Employment Rights Act 1996 section 230(2).[3]The Claimant therefore does not have the standing to bring the claims as contained in her ET1.[4]The Claimant’s claims of Unfair Dismissal; Wrongful Dismissal; Failure to provide a written statement of reasons for dismissal; Unlawful deductions from wages; Holiday pay; and Failure to provide an itemised pay statement, are therefore dismissed.
REASONS
[1]The claim form was presented on 7 May 2024 and contains claims of:a. Unfair Dismissal;b. Wrongful Dismissal;c. Statutory redundancy payment;d. Failure to provide a written statement of reasons for dismissal – s92/93 Employment Rights Act 1996 (“ERA”)e. Unlawful deductions from wages;f. Holiday pay;g. Failure to provide an itemised pay statement: s8 / 11(2) ERA.[2]The Respondent in its Response denies the claims. It avers the Claimant was not an employee or a worker, but rather a self-employed contractor. As such, it denies the Tribunal has jurisdiction to hear all of the claims the Claimant wishes to advance.[3]The claim in respect of statutory redundancy payment was previously withdrawn by the Claimant.[4]The case was automatically listed for two days, later extended to three, and was due to start on 24 October 2024. Due to the Respondent’s owner and its main witness, Joleigh Wynter, being unavailable, the final hearing was postponed and day one was converted to a Preliminary Hearing to discuss the issues and make Case Management Orders. A hearing was listed for 11 February 2025 to decide the preliminary issue of employment status. Evidence[5]The Tribunal was provided with a bundle of documents of 257 pages. Where pages from that bundle are referred to this judgment, they are noted in square brackets, e.g. [1].[6]The Tribunal heard oral evidence from the Claimant on her own behalf, and from Mr Joleigh Wynter on behalf of the Respondent. Both witnesses gave evidence by reference to a written witness statement and each of them was subject to cross-examination.[7]References to witness statements are designated as witness initial followed by paragraph number, e.g. [MF 1] for the Claimant’s witness statement, paragraph one.[8]One piece of late evidence was submitted by the Respondent. This was a Companies House print out of when the Claimant’s company was incorporated. This wasn’t referred to in submissions and it is not clear what the relevance of this is.
Findings of Fact
[9]The Tribunal has only made limited findings of facts, only in relation to the issue of the Claimant’s employment status.[10]The Respondent is a hair salon specialising in curly hair.[11]Ms Wynter is the director of the Respondent.[12]The Claimant was due to start working for the Respondent on 22 September 2020, however the national lockdown because of the COVID-19 pandemic meant that she did not start until 14 June 2021. She did have a few trial days before this date.[13]Ms Wynter obtained a template contract from the Hairdressers’ Association website and adapted this to use to confirm the business relationship between the Respondent and the Claimant [64 – 74]. This was sent to the Claimant on 12 June 2021.[14]Ms Wynter, on behalf of the Respondent, took advice from her HR advisers, Peninsula, on 13 June 2021 as to whether the template would be appropriate for the self-employed arrangement that she intended to put in place, and was advised that the contract that was initially being looked at was not suitable.[15]On 13 June 2021, the Claimant returned a signed copy of the purported contract to the Respondent [89, 75 – 83][16]Ms Wynter, on behalf the Respondent, met with the Claimant on 14 June 2021, to discuss the terms under which the Claimant would work from the Respondent’s salon. There is a WhatsApp message from Ms Wynter to the Claimant on 13 June 2021 [89] arranging to meet on the following day. It is more likely than not that this meeting did happen.[17]Ms Wynter’s evidence was that, at the meeting, the written contract was dispensed with, and a new, verbal contract was agreed between the Claimant and Ms Wynter, acting on behalf of the Respondent. Ms Wynter came across as an honest and credible witness, and the Tribunal accepts her evidence on this point. This is the more likely version of events and is supported by the fact that no subsequent members of staff, such as the Claimant’s twin sister, Cynthia, signed a contract [155].[18]Bookings were done via the booking system called Ovatu. The Ovatu system was accessed via the Respondent’s website. The way the booking system worked was, when booking an appointment, clients selected the date and time they wanted and then selected the Claimant as their preferred stylist. The Claimant’s had an extension of the Respondent’s booking system that allowed her to manage her own clients. The Claimant accepted in cross examination the bookings are made this way through the Respondent’s website, but said that the clients were not her clients, but rather client of the Respondent. Ms Wynter gave convincing evidence that bookings were made through the system on the website, and that respective clients book directly with their chosen stylist. The Tribunal accepts this is the more likely version of events, and that would make people booking appointments clients of the stylist, not the Respondent.[19]Payments for an appointment could either be made online, or at the salon using the salon’s card machine, or at the salon in cash. If payments were made at the salon via card, the salon retained a proportion of the payment and paid the balance out to the stylist each week.[20]In relation to the Claimant, Ms Wynter, acting on behalf of the Respondent, agreed with the Claimant that the Claimant would take home £47.00 for a Curl Talk Cut; £55.00 for a Curl Talk Experience and £35.00 for a dry cut. This is supported by the record of payments made to the Claimant at [253 – 257] and was not disputed by the Claimant.[21]The price to a customer was £160.00 for a Curl Talk Experience and £120.00 for a Curl Talk Cut by a head stylist [219] (which is how the Claimant was described). The amounts paid to the Claimant were not 35% of each cut/service, which is what was specified in the contract. The fact that the Respondent and the Claimant agreed and adopted a different pricing structure for renumerating the Claimant is further persuasive evidence that the initial contract was dispensed with at the meeting on 14 June 2021 and a new agreement was made between the parties.[22]The Claimant was responsible for her own tax calculation and payment [244 – 245]. She accepted this cross examination.[23]Around the end of July 2023, the Claimant bought a trolley to store her own products and equipment on. This trolley was grey whereas the other four trolleys used in the salon were black. On 30 July 2023 there was a WhatsApp message exchange [121 – 122] between the Claimant and Ms Wynter in which Ms Wynter said “fine if you would like to get another one for yourself but needs to match the rest otherwise looks odd”. Ms Wynter then sent the Claimant a link to the same style of black trolley that she had already purchased four of for the salon. The Claimant responded “Ok that’s fine” [122].[24]In January 2024, issues arose between Ms Wynter and the Claimant’s twin sister (Cynthia) who also worked at the salon as a stylist. Cynthia had started working from the salon after the Claimant did. The exact nature of the dispute is irrelevant for the issues before this Tribunal. As a result of this, the relationship between the Respondent and the Claimant’s twin sister broke down, and the Claimant’s twin sister was asked to no longer continue working out of the salon.[25]On 2 February 2024, the Claimant was told in a phone call that it “would not make sense” for her to continue working out of the salon as well. The Claimant says this was a dismissal of her by the Respondent.[26]Claimant sent an email to Ms Wynter at the Respondent on 11 February 2024 asking for “clarification” and asking the Respondent to “outline the contractual obligations for both of us”.
The Law
[27]The relevant law on what constitutes an employee, a contract of employment and a worker is found in the Employment Rights Act 1996, the Working Time Regulations 1998 and the Equality Act 2010. Employee status[28]The Employment Rights Act 1996 section 230(1) defines an ‘employee’ as: “an individual who has entered into or works under … a contract of employment.”[29]Section 230(2) of the Employment Rights Act 1996 provides that a ‘contract of employment’ means: “a contract of service or apprenticeship, whether express or implied, and (if it is express) whether oral or in writing.” Worker status[30]The Employment Rights Act 1996 Section 233(3) provides: “A worker is defined as an individual who has entered into or works under either a contract of employment or, 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 professional business undertaking carried out by the individual.”[31]Regulation 2(1) of the Working Time Regulations 1998 has the same definition of a worker as found in the Employment Rights Act 1996 above.[32]The definition of a worker can therefore be broken down into 3 elements:a. there must be a contract;b. there must be a requirement to carry out personal services; andc. the work done must be for another party to the contract who is not a client or customer of the individual’s profession or business undertaking.[33]In O’Kelly & others v Trusthouse Forte plc [1983] ICR 728 CA Sir John Donaldson confirmed that, in approaching the question of whether a Claimant was an employee and also the question of whether a Claimant is a worker in the alternative, a Tribunal must “consider all aspects of the relationship, no single factor being in itself decisive and each of which may vary in weight and direction, and having given such balance to the factors as seems appropriate, to determine whether the person was carrying on business on his own account”.[34]The Tribunal must therefore consider all relevant factors in the relationship between the parties, including the degree of control exercised by the Respondent over the Claimant (for example: whether the Claimant was under a duty to obey orders; who had control over working hours; supervision; the mode of working; and who provided any equipment). However, the Tribunal should take note of the fact that many employees, by virtue of their skill and expertise, may be subject to very little control. The Tribunal must also take account of organisational matters, such as the degree to which an individual is integrated into the employer’s organisation, whether there is an existing disciplinary procedure which is applicable to the individual and whether the individual is included in any schemes such as for occupational benefits. The Tribunal must also have regard to the economic reality of the relationship between the parties and whether the Claimant can be said to be in business on her own account or whether she worked for another who takes the ultimate risk of loss or profit.[35]Other factors to be considered by the Tribunal include: whether there was a requirement for personal performance or whether the Claimant could send a substitute or sub-contract the work; whether there was mutuality of obligation between the parties such as an obligation on the employer to provide work and on the employee to do it; and the Tribunal must also consider whether there were any other factors consistent with the existence of an employment relationship.[36]In Autoclenz Ltd v Belcher [2011] UKSC 41, [2011] ICR 1157 the Supreme Court held that the relative bargaining power of the parties must be taken into account in deciding whether the terms of any written agreement in fact represent what was agreed. The true agreement will often have to be gleaned from all the circumstances of the case, of which the written agreement is only a part.[37]In the course of submissions, the Tribunal was referred to case law by both parties, as follows: Respondent: Bacica v Muir [2005] WL 3157671 (Employment Appeal Tribunal decision) Claimant: Gorman v Terence Paul (Manchester) Limited [2019] 2410722/2019 (Employment Tribunal decision)[38]The Tribunal took these cases as guidance but not in substitution for the statutory provisions. Deliberation[39]As per the findings, the Tribunal is satisfied that the written contract which the Claimant signed was dispensed with at the meeting between the Claimant and Respondent on 14 June 2021. The written contract is not an accurate reflection of the working relationship between the parties, and the conduct of both parties bears this out. The Tribunal therefore has to decide what was the nature of the verbal agreement that was made between the parties. Was it an agreement that created an employee - employer relationship, or was it an agreement that the Claimant would be a selfemployed contractor?[40]The Claimant has relied on the Gorman case in support of her employed status, arguing that the facts of that case and her situation are the same or similar, such that the Tribunal could conclude that she was an employee (which was the finding of the Gorman case). The Tribunal, however, finds that there are substantial differences between the Claimant’s circumstances and that of Ms Gorman.[41]In that case, bookings were handled by the Respondent and Ms Gorman was given a list of appointments that she was expected to undertake. This is not the manner in which the Claimant operated. Bookings were made via the Respondent’s online booking system in which clients selected which stylist they wanted to have their appointment with. In other words, the Respondent’s Ovatu system was merely a portal by which clients booked directly with the Claimant.[42]The Tribunal is satisfied that the Respondent did not have control over the Claimant’s clients. The Respondent did not assign appointments to the Claimant and there was no obligation on the Claimant to undertake appointments that had not been booked directly with her.[43]The Tribunal further accepts that there was no obligation for the Respondent to provide work for the Claimant. The Claimant only made money from clients that had booked directly with her. The Tribunal is satisfied that this shows there was no mutuality of obligation such as would be seen in an employee-employer relationship.[44]Furthermore, the Tribunal accepts the evidence of Ms Wynter that the Claimant could substitute others to perform her work if she wished. Ms Wynter was convincing and believable when she said that the Claimant and the Claimant’s sister Cynthia did swap and cover each other’s work as need arose. An example of this was when the Claimant and Cynthia went to Sweden to visit their mother after their mother unfortunately had a stroke. Cynthia came back earlier and covered some of the Claimant’s bookings.[45]The Tribunal found Ms Wynter to be a credible and convincing witness. The Tribunal accepts Ms Wynter’s evidence that the Claimant had the freedom to work wherever she wanted and for whoever she wanted, and was not tied to the salon. Ms Wynter said that she was “sure she [the Claimant] did work outside the salon” was believable on this point. Freedom to work elsewhere would indicate that the Claimant was a self-employed contractor and not an employee.[46]The Tribunal also is satisfied that the Claimant provided her own tools for the job that she had to do. The Claimant accepted this in cross-examination and this was also the evidence of Ms Wynter. This again is indicative that the Claimant was a self-employed contractor and not an employee or worker (Bacica v Muir). If the had been an employee, she could have reasonably expected the respondent to provide the tools of the job for her. This was not how the arrangement worked in practice.[47]The documents at [195 – 199] and [253 – 257] were agreed by both parties to reflect the final six months of the Claimant’s time at the salon. The Claimant accepted that that she had no bookings in the majority of November because she chose to take the time off (in order, completely understandably, to visit her mother in Sweden who was unwell at the time).[48]The Tribunal is satisfied there is no set pattern of work within the last six months of the Claimant’s time at the salon. The Claimant worked sometimes on for days but sometimes on three. She usually worked on a Saturday, but this was not always the case. The Tribunal is satisfied that there was no requirement on the Claimant for her to attend the salon on set days at set times. This is different to the Gorman case, where the Claimant did have set work hours and days. The Tribunal finds that the Respondent did not exercise the level of control over the Claimant that would be required if the Claimant was an employee. There was freedom for the Claimant to choose her own hours.[49]The Tribunal finds that this was an arrangement that suited both parties. The Claimant was able to take time off when she wanted and was able to set her own hours. The Respondent did expect the Claimant to make use of her station within the salon, but this is not sufficient for the Tribunal to infer that the Claimant was an employee. It was simply that, if the Claimant was not going to use her station, the Respondent would have a financial incentive to offer it to someone who would.[50]The Tribunal does not accept that the Respondent’s comments about the trolley that the Claimant had purchased amount to control of the level required to find employee status. The Tribunal is satisfied that the Respondent asked the Claimant to use a trolley that was the same as the others already bought in order to maintain a smart and uniform image at the salon where the Claimant, the Respondent and the other stylists worked. The Claimant never challenged this.[51]It is of note that the Claimant bought her own trolley. If the Claimant truly believed she was an employee, then there would be no reason for her to supply her own equipment. The fact that she went out and bought a trolley for her own products indicates that she believed she was a self-employed contractor and responsible for providing her own equipment and aids to her workstation.[52]The Tribunal is also satisfied that the mere rendering of a service personally does not make a person a "worker", as per Bacica v Muir. The fact that the Claimant provided her own equipment, worked hours of her choosing, was able to not work when she chose not to, and was responsible for our own tax payments lead the Tribunal to conclude that the nature of the arrangement between the Claimant and the Respondent was that the Claimant was a self-employed contractor.[53]The Tribunal is therefore satisfied the Claimant was not an employee as per the definition in the Employment Rights Act 1996 s.230(1), nor a worker as per s.230(2). She therefore does not have standing to bring the claims set out at the beginning of this judgement.