Ms M Randall v Miss B Gurney and others: 3307287/2020
EMPLOYMENT TRIBUNALS
Case No 3307287/2020
Between
Ms M RandallClaimant(1) Miss B Gurney (2) Merali’s Limited (3) Fordover Services LimitedRespondent
Before
Employment Judge A.M.S. GreenMr M Sprack - Counsel for claimantDate 23 June 2021
JUDGMENT
The Tribunal does not have jurisdiction to hear the claims.
REASONS
[1]For ease of reading I have referred to the claimant as Ms Randall, the first respondent as Miss Gurney, the second respondent as Merali and the third respondent as FSL. I also use the acronym “SPH” when referring to Scottish Provident House.[2]I conducted a remote public preliminary hearing via the CVP platform. We worked from a digital bundle. The following people adopted their witness statements and gave oral evidence:a. Ms Randall;b. Miss Gurney;c. Mr M Merali;d. Ms W De Sanchez.[3]The representatives provided written representations which they expanded upon with closing oral submissions.[4]In reaching my decision, I have considered the oral and documentary evidence. The fact that I have not referred to every document produced should not be taken to mean that I have not considered it.[5]Ms Randall must establish her case on a balance of probabilities.
The claims
[6]Ms Randall presented a claim form to the Tribunal 21 July 2020. She claims the following:a. ordinary unfair dismissal;b. age discrimination;c. a redundancy payment;d. notice pay;e. holiday pay;f. arrears of pay;g. “other” payments;h. unlawful deduction from wages;i. failure to provide itemised payslips.[7]In respect of calculating payments due, her claim is predicated upon not receiving the National Minimum Wage and the sums claimed must be adjusted to reflect that fact.
The issues
[8]On 3 January 2021, Employment Judge Lewis directed that there would be a public preliminary hearing for further case management and to determine the following issue: to decide if Ms Randall was an employee of, or a worker of Miss Gurney, Murali or FSP, and if so, when. The parties’ respective positions[9]Ms Randall’s position is that for the relevant period (i.e. 1990 to April 2020):a. Miss Gurney engaged her to work as an employee within the meaning of Employment Rights Act 1996, section 230 (1) and (3) (a) (“ERA”); orb. Miss Gurney engaged her to work as a worker within the meaning of ERA, section 230 (b).[10]Miss Gurney’s position is that Ms Randall was, at all times, an independent contractor and her claims should be struck out under rule 37 of the rules of procedure as having no reasonable prospect of success.[11]Merali and FSP’s position is that she was not employed by them or Miss Gurney. She was not a worker. She was an independent contractor, engaged by Miss Gurney and her claims must, therefore, fail.
Findings of fact
[12]Having considered the evidence, I make the following findings of fact.[13]Ms Randall is Colombian. She has family in Colombia whom she regularly visits for prolonged periods of time (i.e. for several months a year). In 1990, on her own admission, she did not speak English particularly well. Over the years, her English improved and when I heard evidence at the hearing, she did not require the services of an interpreter and she spoke and understood English well.[14]Miss Gurney, an employee of FSP, first met Ms Randall in 1990 at a bus stop. Because there was a bus strike at the time, they took a taxi together and talked about the possibility of Ms Randall undertaking cleaning work at SPH. FSP is a not-for-profit organisation that provides maintenance and cleaning services for tenants at SPH. The cleaning services are restricted to the common parts of the building. FSP charges the tenants for the cleaning work of the common parts of the building. The tenants separately arrange for their offices to be cleaned. Prior to meeting Ms Randall, Miss Gurney had been responsible for cleaning the common parts of SPH and had performed this work personally. She no longer wanted to do that work and it was fortuitous that she met Ms Randall who was willing to perform cleaning work in the common parts of the building.[15]A verbal agreement was reached between the two women. It was agreed that Ms Randall would clean the common parts of SPH Monday to Friday at any time between 7 PM and 8 AM. In return, Miss Gurney would pay her £55 per week. This increased to £55.70 per week from 2010. These working and remuneration arrangements were never reduced to writing. There was conflicting evidence about what else, if anything, was agreed at the time. Miss Gurney’s evidence was that there was a detailed conversation in 1990 about Ms Randall’s employment status to the effect that she would be selfemployed, responsible for her own tax and national insurance and would be free to provide substitutes. I cannot accept this for the following reasons:a. On her own admission in her oral evidence, Miss Gurney said that she had no training in HR matters or employment law. It seems implausible that she would be able to address these issues about status with such precision and understanding without the requisite background knowledge.b. The conversation took place over 30 years ago. Memories fade and recall is infallible over such a period of time. This is particularly the case with Miss Gurney. Occasionally, when she was giving her evidence, she became confused and contradicted herself. She told the Tribunal that she was taking medication for anxiety and had been doing so since 2020 and this impacted on her powers of recall. Set in that context, it is implausible that she would be able to remember the precise terms of the agreement with Ms Randall.[16]The only thing, which can be said with any certainty is that Miss Gurney no longer wanted to perform the cleaning work at SPH, and she agreed the basic arrangements with Ms Randall namely, when she would come in, what needed to be done and how much she would be paid. It is what happened in the subsequent years that determined the nature of the working relationship.[17]Ms Randall was paid by cheque drawn from Miss Gurney’s personal bank account. Ms Randall has provided a schedule of cheque payments [104]. Miss Gurney sometimes paid Ms Randall in cash. Miss Gurney was not reimbursed the cost for paying Ms Randall by FSP. FSP paid Miss Gurney her monthly salary out of which she paid Ms Randall. Merali had no role to play in this arrangement because it is a dormant company.[18]Income tax and national insurance was not deducted from the payments made to Ms Randall throughout the time that she worked as a cleaner. On her own evidence, she admitted that she never received a P60 from Miss Gurney, FSP or Merali. She also told the Tribunal that she had other part-time work as an employee for different employers and had received P 60s and tax codes from HMRC. She never queried why tax and national insurance been deducted or why she had not received P 60s in respect of her work at SPH.[19]Throughout the time that Ms Randall was cleaning at SPH she only dealt with Miss Gurney although she occasionally saw Mr Merali. Her contact with him was limited to exchanging pleasantries.[20]There is no dispute between the parties that Ms Randall came into SPH Monday to Fridays to clean the common parts of the building from late 1990 until 15 April 2020. What is disputed is the extent to which Miss Gurney or FSP controlled the manner in which the work was performed, whether Ms Randall was personally obliged to do the work and if she had the right to offer a substitute.[21]I find that Ms Randall was not subject to Miss Gurney’s control for the following reasons:a. In the first five years when Ms Randall was cleaning at SPH, she would come into work before 9 AM. In her own words, Miss Gurney said that initially she wanted to supervise her. However, after approximately a couple of weeks she was happy with the work being performed. The obvious inference to be drawn from this was that after that period of time, there was no need for Miss Gurney to supervise the work. Thereafter, Ms Randall was left to her own devices to do the work at any time, Monday to Friday between 7 PM and 7 AM. Ms Randall’s evidence on this point under cross-examination coincided with what Miss Gurney said. Ms Randall said: I knew what I had to do, Betty did not have to supervise, initially she had to supervise me when I started. When Ms Randall was cross examined and asked whether Miss Gurney had control over how she carried out her work, she replied that she [i.e. Ms Randall] was responsible for her job.b. On 16 November 2017 Miss Gurney wrote to Ms Randall [86]. In her letter, she told Ms Randall that she had noticed of late that some parts of the building were not cleaned properly and she listed several tasks for Ms Randall to perform. The letter was signed “Betty”.c. On 9 January 2019, Miss Gurney wrote another letter to Ms Randall [88] in similar terms about the quality of the cleaning and listed several tasks for her to perform. The letter was signed “B Gurney”.d. On 9 January 2019, Miss Gurney wrote to Ms Randall [89]. She said: I have written to you on several occasions regarding the cleaning at Scottish Provident House. It appears that the cleaning is not done properly as per the cleaning schedule. Please note that if you don’t do the cleaning properly, as per the schedule enclosed I will have to get someone else to do the cleaning. The letter was signed “B Gurney”.e. Miss Gurney accepted under cross examination that whilst she did not think she would have signed the first letter “Betty” she was not suggesting that the letter was not genuine. She accepted that she was giving specific instructions to Ms Randall on both occasions about how to do the cleaning. It had fallen below an acceptable standard.f. It might be suggested, at first glance, that this correspondence incontrovertibly leads to a finding that Miss Gurney was exercising control over how Ms Randall performed her tasks. I do not think such a conclusion can be justified. First, Ms Randall was not subject to any performance management, appraisals or disciplinary action during the time that she worked at SPH. There was no evidence of that. Secondly, in Ms Randall’s oral evidence, she confirmed that, generally, Miss Gurney was pleased with her work and it was only towards the end of the relationship that she told that she was not doing very well and they would be getting another cleaner. She said that she did the work for many years without any complaint. These were isolated incidents over 29 years where Miss Gurney felt it necessary to remind Ms Randall about the requisite standard of the work that she had to perform.g. There is no evidence to suggest that she was prevented from working for anyone else at the time that she worked at SPH. Indeed, she had part-time employment with other employers.[22]Turning to the right to provide substitutes, I find that not only did Ms Randall have an unfettered power she regularly exercised it. I justify this conclusion for the following reasons:a. There is no dispute, that during the 29 years that Ms Randall was working at SPH that when she took extended time off to return to Colombia to visit her family, other people, particularly Ms De Sanchez and/or a man called Carlos, would cover her work. Both of these people where Ms Randall’s friends. She introduced them to Miss Gurney before they provided cover during Ms Randall’s absences. In her oral evidence, Ms Randall suggested that Miss Gurney was required to approve Ms De Sanchez and Carlos before accepting them to provide cover. However, she said nothing about this in her witness statement. This is a material averment of fact which she has made to suggest that she was an employee or a worker. I would have expected something to have been said about this in her witness statement. Furthermore, her witness statement was prepared with the help of a lawyer who would, no doubt advised on the key adminicles of evidence that must exist for a claimant establish employment or worker status. Such averments are conspicuously absent. In the absence of such a material averment of fact in her witness statement, I do not attach any weight to what she said as it only came out under cross-examination. It points to embellishment. I believe that the arrangement was that Miss Gurney trusted Ms Randall to find an appropriate person to cover for her and it was not conditional upon Miss Gurney approving the choice.b. In her oral evidence, Ms De Sanchez confirmed that she had no direct dealings with Miss Gurney. Everything was arranged by Ms Randall. This contradicts what she says in her witness statement where she says that she did have direct dealings with Miss Gurney. In her oral evidence she also claimed that she could only cover for Ms Randall once Miss Gurney had approved of the arrangement. She says nothing about this in her witness statement. That is a material omission which, when taken with the contradictory evidence regarding direct dealings with Miss Gurney, undermined her credibility. I give Ms De Sanchez’s evidence little weight.c. Ms Randall would arrange for cover when she took extended time to return to Colombia. In her evidence, she confirmed the procedure that she followed for this. She would tell Miss Gurney that she needed to take time off for her holidays. Miss Gurney told her to find someone to cover for her. Ms Randall was clear that she had to find someone to cover her work. When she found cover, they would do the work instead of Ms Randall and would be paid for that work. She also eventually admitted under cross-examination that Miss Gurney did not make it a precondition of having to meet and approve the proposed cover before they were engaged. She would ask Ms Randall who was going to cover for her.d. Ms Randall knew that if she did not provide cover, Miss Gurney would find someone else and Ms Randall would not have work to return to after taking time off. This is entirely plausible because, in her own evidence, Ms Randall needed to take at least two months off each time that she returned to Colombia. It was, therefore, essential that she found someone else to do the work in her absence over such an extended period. Furthermore, FSP was a small business that employed no more than four people, and it did not have the resources to provide internal cover during Ms Randall’s absences. Finally, Miss Gurney did not want to do the work. Had she done so, she would never have retained Ms Randall in the first place and was content with the arrangement whereby Ms Randall sourced substitutes to do the work.e. Ms Randall regularly returned to Columbia. The substitutes performed the work and were paid accordingly. This was not a one-off arrangement but an established and regular practice that played out over many years.[23]I also heard evidence about integration into FSP’s organisation. I find that Ms Randall was not integrated for the following reasons:a. She had no direct meaningful dealings with FSP. She communicated directly with Miss Gurney.b. Although Miss Gurney was an FSP employee there is no evidence to suggest that she was acting as their agent when she retained Ms Randall.c. Ms Randall was not provided with a uniform and cleaning equipment by Miss Gurney, FSP or Merali. She wore her own clothes to do the work and Miss Gurney paid for cleaning materials and equipment out of her own resources and did not back charge the cost to FSP. The cleaning materials and equipment were kept in a cupboard in SPH for Ms Randall, and others, to use when they came in to clean the common parts of the building.d. She was not subject to any FSP disciplinary or performance management procedure.e. She was never paid for taking holidays.f. She took very little sick leave and when she did, she did not receive sick pay. Applicable law[24]Most statutory employment rights are conferred on employees or workers. Employees are those who work or worked under a contract of employment, meaning a contract of service or apprenticeship, whether express or implied and whether oral or in writing (section 230(1) &(2) ERA). A worker is defined by section 230(3) as an individual who has entered into or works under (or, where the employment has ceased, has worked under):a. A contract of employment (defined as a “contract of service or apprenticeship”) (section 230 (3) (a) ERA); orb. Any other contract, whether express or implied, and (if 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 (section 230 (3) (b) ERA) (known as a “limb b worker”).[25]With the possible exception of those receiving work-related training, it remains an essential requirement that there must be some kind of contractual relationship between the Ms Randall and Miss Gurney and/or Merali and FSP. Consequently, if Ms Randall was genuinely and wholly self-employed she cannot advance her claims in the Tribunal. The Tribunal will not have jurisdiction.[26]It is clear from section 230(3)(a) that all employees are workers. However, the second limb of the definition is of much wider scope and includes some people who are nominally self-employed.[27]For Ms Randall to lay claim to worker status she must first show that there is a contract with the “employer”. To be a worker, she must “do or perform personally” the work or services required under the contract. Personal performance is generally considered necessary for a contract of employment. To qualify as a worker, Miss Gurney and/or Merali and FSP must not be a client or customer of any professional business undertaking carried on by Ms Randall. This was designed to exclude, for example, a barrister who contracts with the client to perform personal services as part of his or her profession or plumber in business on his or her own account who does the work personally.[28]I am reminded that in Byrne Bothers (Formwork) Ltd v Baird and Ors 2002 ICR 667, the EAT gave guidance and held that the intention was clearly to create an intermediate class of protected worker made up of individuals who are not employees but equally could not be regarded as carrying on a business. Accordingly, the essence of the intended distinction must be between, on the one hand, workers whose degree of dependence is essentially the same as that of employees and, on the other, contractors who have a sufficiently arm’s-length and independent position to be treated as being able to look after themselves.[29]Drawing this distinction in any particular case will involve all or most of the same considerations that apply when distinguishing between a contract of employment and a contract for services but with the boundary pushed further in the individual’s favour. Factors to consider could include the degree of control exercised by the “employer”, the exclusivity of the engagement and its typical duration, the method of payment, what equipment the “worker” supplied on the level of risk undertaken. Factors such as the individual having business accounts prepared and submitted to HMRC, being free to work for others, being paid at a rate that includes an overheads allowance and not being paid when not working cannot be relied on to support the contention that he or she is running a business and that the person for whom the work is performed as a customer of that business.[30]Although the courts have moved away from using the ‘control test’ as the sole means of identifying a contract of employment, it remains an essential part of the ‘multiple test’ approach advocated in Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance 1968 1 All ER 433, QBD, and subsequent decisions. In Montgomery v Johnson Underwood Ltd 2001 ICR 819, CA, the Court of Appeal held that control is a separate factor, no less vital to the creation of an employment relationship than mutuality of obligation. Thus, since the tribunal had made a finding of fact that there was no control of the claimant by the employment business which supplied him to the client, he could not be its employee. And in UPVC Designs Ltd t/a Croston Conservatories v Latimer and anor EAT 0431/07 the EAT allowed an appeal against a tribunal’s finding that a worker was an employee of the company on the basis that the tribunal had failed to address whether the company had a sufficient right to control her work. While acknowledging that control was not a ‘bright line test’, since there were clearly some kinds of work where the scope for control was limited, the EAT nevertheless held that the question of control was one which must be addressed and evaluated. It was not sufficient to conclude, as the tribunal did in the instant case, that a contract of employment exists solely on the basis of mutuality of obligation between the parties. Since the company could not require the worker to follow up a specific client lead, to work at particular times or to come into work to help at peak periods, it could not control her in important respects. Accordingly, the tribunal’s decision could not stand.[31]An absence of day-to-day control over work does not preclude an employment relationship — White and anor v Troutbeck SA 2013 IRLR 949, CA. In that case the claimants had agreed to manage and maintain the house and grounds of T’s small farm estate and had signed an agreement to that effect which referred to them as being ‘employed’ by T, a Panamanian company owned by a Nigerian family. The tribunal, however, decided that they could not be employees because T had delegated the day-to-day running of the farm to the claimants. The EAT overturned that decision, noting that there was nothing unusual or inconsistent with the concept of employment in circumstances where an absentee owner requires someone to be responsible for maintaining and managing the property. In its view, the tribunal had misunderstood the control test as formulated in Ready Mixed Concrete. The question was not whether T exercised day-to-day control over the claimants’ work but whether it had, to a sufficient degree, a contractual right of control over them. On the facts of the case, it was clear that T retained a sufficient degree of control in that, for example, it decided on maintenance that required expenditure and gave instructions concerning the upkeep of the house and grounds. The EAT substituted a finding that the claimants were employees. On further appeal, the Court of Appeal held that the EAT had correctly set aside the tribunal’s decision. Viewed in the round, the parties’ relationship evinced the principal elements of employment: the claimants worked, in return for a reward plus annual holiday pay, at a workplace designated by T and for its continuing benefit. Furthermore, T retained a degree of control over the claimants’ work that was sufficient to preclude them operating as independent contractors.[32]In a more general sense, therefore, control requires that ultimate authority over the purported employee in the performance of his or her work rests with the employer. However, indirect control, which exists by virtue of an employer’s right to terminate the contract if the worker fails to meet the required standards of skill, integrity and reliability, is not by itself sufficient. Some element of more direct control over what the worker does is needed.[33]Mutuality of obligation is now generally regarded as a necessary element of the contract of employment (Carmichael and Another v National Power plc 1999 ICR 1226, HL). This is usually expressed as an obligation on the employer to provide work and a corresponding obligation on the employee to accept and perform the work offered. Relevant considerations include whether there are any notice requirements and whether a worker is free to leave at any time in favour of alternative work. If there is no mutuality of obligation between the parties, then it is highly unlikely that there will be a contract of employment in existence.[34]Another factor pointing to employment is the incidence of income tax and national insurance contributions; deductions at source points to employment; gross payment suggests self-employment. However, this factor is not generally regarded as strong evidence and the opinion of HMRC on a worker’s employment status for tax purposes will never be conclusive as to his or her status for employment law purposes. Payment of tax and national insurance on a “self-employed” basis is not conclusive proof of a contract for services (Enfield Technical Services Ltd v Payne; BF Components Ltd v Grace 2008 ICR, 1423, CA) just as being part of the PAYE scheme and paying employees’ national insurance contributions is not conclusive evidence that a worker works under a contract of service (O’Kelly and others v Trusthouse Forte plc 1983 ICR 728, CA).[35]The parties’ stated intention as to the status of their working relationship in law may be a relevant factor but the courts will always look at the substance of the matter, even if the parties expressly agree on a label with the approval of HMRC.[36]In Pimlico Plumbers v Smith [2017] EWCA Civ 5 the Court of Appeal had to determine whether a plumber engaged on a self-employed basis was a worker for the purposes of rights under ERA, holiday pay, unlawful deduction from wages and disability discrimination. It held that he was a worker because he had to provide personal service although there was a conditional right to provide a substitute. The level of integration into Pimlico Plumbers’ business and control by Pimlico Plumbers over Mr Smith was inconsistent with being self-employed. Mr Smith normally had to be available to take on a minimum of 40 hours’ work a week. He was subject to restrictive covenants including a three-month non—compete restriction. He had to wear a uniform and drive a Pimlico Plumbers branded van.[37]The Court of Appeal provided a helpful review of relevant authorities on personal service (paragraphs 75 to 83) and summarised the relevant principles as follows:a. An unfettered right to provide a substitute is inconsistent with an undertaking to provide services personally.b. A conditional right to provide a substitute may or may not be inconsistent with personal performance. It will depend on the degree to which the right is limited or occasional. By way of example, a right to substitute: i. Only when the contractor is unable to carry out the work is consistent with personal performance (subject to any exceptional facts); ii. Limited only by the need to show that the substitute is as qualified as the contractor to do the work whether or not that entails a particular procedure, is inconsistent with personal performance (subject to any exceptional facts); and iii. Only with the consent of another person who has an absolute and unqualified discretion to withhold consent is consistent with personal performance.[38]The Master of the Rolls commented that the test for determining whether an individual is a limb (b) worker or self-employed does not involve any single touchstone. Relevant factors might include:a. Subordination (also referred to as control).b. Are there are number of discrete separate engagements?c. Do obligations continue during the breaks and work engagements (sometimes called an umbrella contract)?d. The extent to which the individual is integrated into the putative employer’s business.[39]The Court of Appeal’s decision was upheld by the Supreme Court (2018 ICR 1511, SC).[40]In Uber BV and ors v Aslam and ors 2021 ICR 657, SC, the Supreme Court dismissed Uber’s appeal against an employment tribunal’s decision that Uber drivers are ‘workers’ under S.230(3)(b) ERA and the equivalent provisions in the Working Time Regulations 1998 SI 1998/1833 and the National Minimum Wage Act 1998. Uber drivers own their own cars and are free to choose when they make themselves available to accept bookings by logging in to the smartphone app. Uber’s position on the legal relations between it, the drivers and passengers is that it is merely a technology platform facilitating the provision of private hire vehicle services as an agent for the drivers. An employment tribunal rejected that characterisation, relying on Autoclenz Ltd v Belcher and ors 2011 ICR 1157, SC to look beyond the written documentation that purported to show that the drivers were independent contractors. Uber appealed without success to the EAT, the Court of Appeal and, finally, the Supreme Court. The Supreme Court pointed out that Lord Clarke’s judgment in Autoclenz makes clear that whether a contract is a ‘worker’ contract is not to be determined by applying ordinary principles of contract law. The Court in Uber expanded on the rationale for that approach. It pointed out that it was critical to understand that the rights asserted by the claimants were not contractual rights but were created by legislation. Thus, the task for the tribunal was primarily one of statutory interpretation, not contractual interpretation. Furthermore, that interpretation should give effect to the purpose of the legislation, which is to give protection to vulnerable individuals who have little or no say over their pay and working conditions because they are in a subordinate and dependent position in relation to a person or organisation who exercises control over their work. In the Court’s view, it would be inconsistent with the purpose of this legislation to treat the terms of a written contract as the starting point in determining whether an individual falls within the definition of a ‘worker’. To do so would reinstate the mischief which the legislation was enacted to prevent.[41]As for the result on the facts before it, the Court emphasised five aspects of the tribunal’s findings that justified its conclusion that the claimants were working for and under contracts with Uber. First, where a ride is booked through the Uber app, it is Uber that sets the fare and drivers are not permitted to charge more than the fare calculated by the Uber app. It is therefore Uber which dictates how much drivers are paid for the work they do. Secondly, the contract terms on which drivers perform their services are imposed by Uber and drivers have no say in them. Thirdly, once a driver has logged onto the Uber app, the driver’s choice about whether to accept requests for rides is constrained by Uber, including by the imposition of a penalty if a driver declines or cancels too many trip requests. Fourthly, Uber exercises significant control over the way in which drivers deliver their services, such as by use of a ratings system that may lead to warnings and eventual termination for the driver. Finally, Uber restricts communications between passenger and driver to the minimum necessary to perform the particular trip and takes active steps to prevent drivers from establishing any relationship with a passenger capable of extending beyond an individual ride. Drivers are therefore in a position of subordination and dependency in relation to Uber such that they have little or no ability to improve their economic position through professional or entrepreneurial skill. In practice, the only way in which they can increase their earnings is by working longer hours while constantly meeting Uber’s measures of performance.[42]Although the final result in the Uber case was fact-specific, the decision changes the way in which all courts and tribunals must now approach the question of employment status, and generally makes it easier for ‘worker’ status to be established in similar cases. Post-Uber, courts and tribunals will focus squarely on the practical reality of the working relationship and be much less concerned with any inconsistency with the written documentation. Autoclenz held that the written agreement is only a part of the factual context in which the status of the working relationship should be determined. Uber has now gone further and established that the written agreement is not even the starting point for determining employment status. The key question in such cases should now be whether the relationship is one of subordination and dependence, having regard to the legislative purpose of protecting those who have little or no influence on the terms under which they work. Discussion and conclusions[43]I find that Miss Randall was neither an employee or a worker. She was truly self-employed for the following reasons.a. there was no requirement for personal service;b. there was no mutuality of obligations; andc. there was a lack of control.[44]Ms Randall did not undertake to provide her own work and skill (i.e. the requirement for personal service). She was able to provide a substitute which he did on several occasions. This was an unfettered right. She did so without any restrictions (e.g. prior approval from Miss Gurney). The fact that she was not retained for the personal quality of her work is amplified when one remembers that she took prolonged periods of time off work to return to Colombia to visit her family. She was not paid when she was away. She was not reliant upon Miss Gurney approving her absences. She simply told her when she was going away and was required to find cover for her during her absence. If she failed to do that, she knew that she would be unable to return to work at SPH. All that was required was the common parts of SPH had to be cleaned. Ultimately it did not matter who did the work. In practice it was Ms Randall, Ms De Sanchez or Carlos. Miss Gurney no longer wanted to do the work and she paid for other to clean out of her own wages.[45]Apart from an initial period of a couple of weeks where there was a modicum of supervision, Ms Randall had autonomy as to how she performed her cleaning duties on a day-to-day basis. She simply had to ensure that the work was done Monday to Fridays. For the first five years, she came in to SPH before 9 AM. Thereafter, the work had to be performed between 7 PM and 8 AM. She was not supervised or managed. She was not subject to any performance reviews or disciplinary procedures. The fact that latterly, Miss Gurney felt it necessary to write to Ms Randall pointing out deficiencies and reminding her of her tasks does not, in itself, point to a level of control required to establish employee or worker status. Nor is this the situation that arose in Troutbeck. It bears all the hallmarks of an independent contractor who was retained to provide services which must be performed to a requisite level of standard. If the contractor fails to meet the requisite standard, the client is within its rights to bring that fact to the contractor’s attention and require it to remediate the position. When Miss Gurney wrote to Ms Randall that is what she was doing. She was the client, and Ms Randall’s work was found wanting and she was reminded of the tasks that needed to be performed and the level of performance necessary to be satisfactory. Apart from this, there were never any meetings to discuss performance over the 29 years that Ms Randall did the work.[46]There was no evidence of mutuality of obligation. There was no evidence to suggest that Miss Gurney offered work to Ms Randall which she had to accept. Ms Randall simply performed the work for which she was paid. If she did not want to do the work (e.g. because she wanted to take time off to return to Colombia) she provided a substitute. Ultimately, the arrangement was terminable by Miss Gurney when she wrote to Ms Randall to tell her that if she did not improve, she would get someone else in to do the cleaning.[47]There are other factors which point to a genuinely self-employed status which are as follows:a. Ms Randall did not receive a regular wage or salary. She was simply paid for the work that she did without deduction of tax and national insurance. The money came out of Miss Gurney’s wages.b. Ms Randall wore her own clothes and was not provided with a uniform.c. It cannot be said that there was any level of integration in FSP’s organisation.[48]The dominant purpose of the contract was cleaning the common parts of SPH rather than an obligation personally to perform work. Ms Randall was essentially carrying out a business undertaking. Miss Gurney was the customer. It cannot be said that Merali was a customer because it is a dormant company. It cannot be said that FSP was a customer because there was no direct relationship between Ms Randall and FSP and no evidence to suggest that Miss Gurney was acting as its agent. Miss Gurney simply wanted someone else to do the cleaning work which she had previously performed, and she shared part of her wages with whoever did the work to achieve that outcome. She was never reimbursed for that by FSP.[49]As Ms Randall was truly self-employed, it follows that the Tribunal has no jurisdiction to hear her claims.
Introduction
[50]Vexatious conduct can apply both to the bringing or conducting of the proceedings, and, as appropriate, to conduct by either a claimant or respondent. Instances of a specific finding of vexatious conduct are fairly rare, as the finding tends to be one of unreasonable conduct, even where there is shown to be an improper motive present. An example is Keskar v Governors of All Saints Church of England School [1991] ICR 493, EAT, where costs were awarded against a claimant in a discrimination case on the basis that he was 'motivated by resentment and spite in bringing the proceedings', and that there was 'virtually nothing to support his allegations of race discrimination'. The ground on which the award was made was unreasonable conduct, but it could as easily have been vexatious conduct. It does not matter, however, what particular label is put on it; if the conduct of the party or their representative justifies an order for costs, its decision will be upheld even if the EAT would have used a different label from that used by the tribunal. In Beynon v Scadden [1999] IRLR 700, EAT, an employment tribunal categorised a union's behaviour as vexatious and unreasonable on the ground that its pursuit of a case on behalf of the claimants was both without merit and done with the collateral purpose of achieving union recognition from the respondent, and awarded costs against the claimants. The EAT upheld the award and the grounds on which it was made even though it would itself have categorised the conduct as simply unreasonable rather than vexatious.[51]The terms 'abusive' and 'disruptive' in the context of the bringing or conducting of proceedings are not defined in the rules but have a straightforward meaning that will be applied by tribunals. Abusive bringing or conducting of proceedings will be close to vexatiousness in many cases and connotes the use of tribunal litigation for something other than, or in a way other than, its intended use within the judicial system. Abusive and disruptive conduct in this context may also be apt to cover gratuitous insults or unsubstantiated slurs which have no justification in the context of the litigation, directed by one party to another during a hearing, or in correspondence. 'Disruptive' may cover excessive prolixity and time wasting, unduly lengthy or aggressive cross-examination of witnesses, calling unnecessary witnesses, and failing to respect the tribunal's attempts to manage the claim and maintain an orderly hearing. The grounds for a finding that there has been abusive or disruptive conduct will be all the stronger if a party has continued their behaviour in the face of a warning from the tribunal that it considers it to be unacceptable.[52]Tribunals have a wide discretion to award costs where they consider that there has been unreasonable conduct in the bringing or conducting of proceedings. Every aspect of the proceedings is covered, from the inception of the claim or defence, through the interim stages of the proceedings, to the conduct of the parties at the substantive hearing. Certain common examples relied upon as alleged unreasonable conduct are knowingly pursuing a hopeless claim, the unreasonable refusal of an offer to settle and where a claim has been withdrawn late in the day after costs have needlessly been incurred.[53]Where a party makes an offer to settle a case, which is refused by the other side, costs can be awarded if the Tribunal considers that the party refusing the offer has thereby acted unreasonably (Kopel v Safeway Stores plc [2003] IRLR 753, EAT). It is important to recognise, however, that the principle applicable in matrimonial proceedings by virtue of the decision in Calderbank v Calderbank [1975] 3 All ER 333, CA, namely, that a party can protect himself against costs in a case involving a money claim by making an offer marked 'without prejudice save as to costs', with the result that a failure by the other side to beat the offer will normally mean that an award of costs will be made against that party—does not apply as such in proceedings before employment tribunals. As Mitting J pointed out in Kopel, not only must a true Calderbank offer be accompanied by a payment into court, as to which there is no provision in the tribunal procedure, but (citing Lindsay J in Monaghan v Close Thornton Solicitors EAT/3/01, [2002] All ER (D) 288 (Feb)) if the Calderbank principle became widely applied, it would run counter to the whole legislative basis for awarding costs in tribunals. In employment tribunals, therefore, it does not follow that a failure by a party to beat a Calderbank offer will, by itself, result in an award of costs against him. In Kopel, Mitting J stated that the tribunal 'must first conclude that the conduct of an appellant in rejecting the offer was unreasonable before the rejection becomes a relevant factor in the exercise of its discretion under [r 76(1)(a) of the 2013 Rules]' (see also Anderson v Cheltenham & Gloucester plc UKEAT/0221/13 (5 December 2013, unreported). On the facts of that case, the EAT upheld a tribunal's award of £5,000 costs against the claimant where she had failed in her unfair dismissal and sex discrimination claims, and had not only turned down a 'generous' offer to settle the case but had persisted in alleging breaches of the provisions of the Human Rights Convention prohibiting torture and slavery, which the tribunal categorised as 'frankly ludicrous' and 'seriously misconceived'. In the circumstances, the EAT held that the tribunal was entitled to find that the rejection of the offer was unreasonable conduct of the proceedings justifying the award of costs that was made.[54]When considering whether to award costs in respect of a party's conduct in bringing or pursuing a case that is subsequently held to have lacked merit, the type of conduct that will be considered unreasonable by a tribunal will obviously depend on the facts of the individual case, and there can be no hard-and-fast principle applicable to every situation. In general, however, it would seem that the party must at least know or be taken to have known that their case is unmeritorious. In Cartiers Superfoods Ltd v Laws (which was decided under the 1974 rules, when the only grounds for awarding costs were whether the claimant or respondent to any proceedings had acted frivolously or vexatiously), Phillips J considered that, in order to determine whether a party had acted frivolously, it was necessary 'to look and see what that party knew or ought to have known if he had gone about the matter sensibly'. On the facts of that case, the EAT held that if the employers had taken the trouble to inquire into the facts surrounding the alleged misconduct for which the employee had been dismissed, instead of reacting in a hostile manner with threats and false statements that the employee was guilty of dishonesty, they would have realised that they had no possible defence at all to the claim, except as to the amount of compensation.[55]Rule 76(1)(b) also follows a two-stage test. The Tribunal has a duty to consider making an order where this ground is made out but there a discretion whether actually to award costs. Whether or not the party has received legal advice or is acting completely alone may be an important consideration when deciding whether or not to make a costs order against him or her.[56]It was well established under previous versions of the Rules of Procedure that the term ‘misconceived’ could cover unmeritorious claims brought by employees who, possibly because they are unrepresented, are unaware of the legal position and genuinely believe that their employers have committed illegal acts against them. This continues to be the case under the current Procedure Rules, and of course the same will apply to unmeritorious responses put in by unrepresented employers, since now a Tribunal merely has to decide whether or not a claim had reasonable prospects of success. The effect of this is also to emphasise that the test for whether the claim had no reasonable prospect of success is objective, not subjective (Vaughan v London Borough of Lewisham [2013] IRLR 713).[57]In Scott v Inland Revenue Commissioners 2004 ICR 1410, CA: Lord Justice Sedley observed that ‘misconceived’ for the purposes of costs under the Tribunal Rules 2004 included ‘having no reasonable prospect of success’ and clarified that the key question in this regard is not whether a party thought he or she was in the right, but whether he or she had reasonable grounds for doing so. The Court of Appeal held that the employment tribunal’s decision in this particular case not to award costs against S should be reconsidered, as it was not clear that the tribunal had directed its attention to the questions of whether S’s case was doomed to failure or, if it was, from what point.[58]In Hamilton-Jones v Black EAT 0047/04: B instituted tribunal proceedings against a number of parties, including H-J. In due course, the employment tribunal determined that H-J had never been B’s employer and, accordingly, that he should not have been a party to the proceedings. Despite this, it refused H-J’s application for a costs order to be made against B on the basis that B had a genuine belief that H-J was his employer. On appeal, the EAT held that the tribunal’s decision could not stand. It understood why B — a layman without any legal experience — might not understand the true employment situation. His decision to issue proceedings against H-J was not therefore ‘vexatious’ (a word that connoted a degree of malice or ulterior motive). However, for the purposes of the ‘misconceived’ rule, that was not the point: the tribunal was simply required to assess objectively whether the claim had any prospect of success at any time of its existence. This it had not done. There had been no rational basis for B’s belief (even if genuinely held) that H-J had been his employer, meaning that the claim against that respondent had been misconceived from the outset. The EAT remitted the matter to a different tribunal to decide whether costs should be awarded on this basis.[59]Rule 78 (1) sets out how the amount of costs will be determined. The Tribunal Rules provide that such an order is in respect of costs incurred by the represented party meaning fees, charges, disbursements, and expenses.[60]It is important to recognise that even if one (or more) of the grounds is made out, the Tribunal is not obliged to make a costs order. Rather, it has a discretion whether or not to do so. As the Court of Appeal reiterated in Yerrakalva v Barnsley Metropolitan Borough Council 2012 ICR 420, CA, costs in the employment tribunal are still the exception rather than the rule. It commented that the Tribunal’s power to order costs is more sparingly exercised and is more circumscribed than that of the ordinary courts, where the general rule is that costs follow the event, and the unsuccessful litigant normally has to foot the legal bill for the litigation. In the employment tribunal, by contrast, costs orders are the exception rather than the rule. If the Tribunal decides to make a costs order, it must act within rules that expressly confine its power to specified circumstances, notably unreasonableness in bringing or conduct of the proceedings.[61]It is not unreasonable conduct per se for a claimant to withdraw a claim. I remind myself that in McPherson v BNP Paribas (London Branch) 2004 ICR 1398, CA the Court of Appeal observed it would be unfortunate if claimants were deterred from dropping claims by the prospects of an order for costs on withdrawal in circumstances where such an order might well not be made against them if they fought on to a full hearing and failed. It further commented that withdrawal could lead to a saving of costs and the tribunal should not adopt a practice on costs that would deter claimants from making “sensible litigation decisions”. On the other hand, the Court was also clear the tribunal should not follow a practice on costs that might encourage speculative claims, allowing claimants to start cases and to pursue them down to the last week or two before the hearing in the hope of receiving an offer to settle, and then, failing an offer, dropping the case without any risk of costs sanction. The critical question in this regard was whether the claimant withdrawing the claim has conducted the proceedings unreasonably, not whether the withdrawal of the claim is in itself unreasonable.[62]If a party allows preparations for the hearing to go on too long before abandoning an untenable case that party may be liable for costs on account of their conduct.[63]In order to deter an un-meritorious claim, respondents may write to the claimant warning them that they will apply for costs if they persist with the claim. Alternatively, they may apply to the Tribunal for a preliminary hearing if they believe that the claim has no prospects of success. The fact that a costs warning has been given is a factor that may be considered by the Tribunal when considering whether to exercise its discretion to make a costs order. The absence of a warning may be a relevant factor in deciding that costs should not be awarded. A costs warning is not, however, a precondition of making an order.[64]The extent to which a party acts under legal advice might be a relevant factor for a tribunal considering making a costs (or preparation time) award against that part. In Abrahams v Royal National Throat, Nose and Ear Hospital EAT 183/82: A made a late withdrawal of his race discrimination claim and the employment tribunal ordered him to pay £500 costs for acting vexatiously and unreasonably. In setting aside this decision, the EAT held that there was no evidence that A had acted other than in good faith, so the tribunal must have been wrong to find his conduct ‘vexatious’. Furthermore, he had originally been supported by the Commission for Racial Equality, had then waited for ACAS to try to conciliate, and had eventually taken advice from a Citizens Advice Bureau before withdrawing his complaint. In the circumstances, the EAT did not think he had acted ‘unreasonably.[65]In considering whether to make an order for costs, and, if appropriate, the amount to be awarded, the Tribunal may have regard to the paying party’s ability to pay. It is not obliged to do so; it is permitted to do so. The Tribunal is not required to limit costs to the amount that the paying party can afford to pay. However, we remind ourselves that in Benjamin v Inverlacing Ribbon Ltd EAT 0363/05 it was held that where a Tribunal has been asked to consider a party’s means, it should state in its reasons whether it has in fact done so and, if it has, how this has been done. Any assessment of a party’s means must be based upon evidence before the Tribunal.[66]Although tribunals have power to make wasted costs orders against representatives, there is still a principle that a party may themselves be rendered liable to pay costs because of the way their representative conducts the proceedings. An example of the type of situation that can give rise to an award of costs against a party on account of the conduct of a representative is afforded by Beynon v Scadden [1999] IRLR 700, EAT. On analogy with the position when assessing whether to strike out a claim because of a representative's conduct, what is done in a party's name by a representative is presumptively, but not irrebuttably done on their behalf (Bennett v London Borough of Southwark [2002] EWCA Civ 223).[67]Rule 80 gives the power to make an order against a party’s representative known as a “wasted costs” order. Wasted costs means costs incurred as a result of any improper, unreasonable or negligent act or omission on the part of the representative, or which, in the light of any such act or omission occurring after they were incurred, the Tribunal considers it unreasonable to expect the party to pay (rule 80(1)). Wasted costs orders can only be made against a ‘representative’. This is defined by rule 80(2) as ‘a party’s legal or other representative or any employee of such representative, but it does not include a representative who is not acting in pursuit of profit with regard to the proceedings’. A legally qualified representative will not constitute a representative if he or she is not acting in pursuit of profit. Rule 80 (2) expressly provides that a representative acting on a contingency or conditional fee arrangement is considered to be acting in pursuit of profit. Thus, a wasted costs order can be made against such a person. Rule 81 provides that a wasted costs order may require the representative to pay the whole or part of any wasted costs of the relevant party. It may also disallow any wasted costs otherwise payable to the representative and order the representative to repay his or her client any costs that have already been paid. The amount to be paid, disallowed, or repaid must in each case be specified in the order. Note that there is no limit to the amount of wasted costs that can be ordered by an employment tribunal.[68]Rule 80 is based on the wasted costs provisions that apply in the civil courts, with the definition of ‘wasted costs’ being identical to that contained of the Senior Courts Act 1981, section 51(7). Accordingly, the authorities applicable to wasted costs in the civil law generally are equally applicable in the employment tribunals (Ratcliffe Duce and Gammer v Binns (t/a Parc Ferme) EAT 0100/08 and Mitchells Solicitors v Funkwerk Information Technologies York Ltd EAT 0541/07). The two leading authorities analysing the scope of section 51 and the circumstances in which such orders can be made are Ridehalgh v Horsefield and other cases 1994 3 All ER 848, CA, and Medcalf v Mardell and ors 2002 3 All ER 721, HL. In the Mitchells Solicitors case, the EAT confirmed that these cases are ‘sources of essential assistance’ for employment tribunals in the matter of wasted costs.[69]A three-stage test is applied:a. Has the legal representative acted improperly, unreasonably, or negligently?b. If so, did such conduct because the applicant to incur unnecessary costs?c. If so, is it in the circumstances just to order the legal representative to compensate the applicant for the whole or any part of the relevant costs?[70]In Ridehalgh, the Court of Appeal emphasised that even where a court and, by extension, a Tribunal, is satisfied that the first two stages of the test are satisfied (i.e. conduct and causation) it must nevertheless consider again whether to exercise the discretion to make the order and to what extent. It still has a discretion at stage 3 to dismiss the application for wasted costs where it considers it appropriate to do so. For example, if the costs of the applicant would be disproportionate to the amount to be recovered, issues would need to be relitigated or questions of privilege would arise.[71]The concept of “improper” covers, but is not confined to, conduct that would ordinarily be held to justify disbarment, striking off, suspension from practice or other serious professional penalty.[72]The concept of “unreasonable” describes conduct that is vexatious, designed to harass the other side rather than advance the resolution of the case.[73]It was stated that the concept of “negligent” should be understood in a nontechnical way to denote failure to act with the competence reasonably to be expected of ordinary members of the profession. However, in Persaud v Persaud and Others [2003] EWCA Civ 394 the Court of Appeal held that there must be something more than negligence for a wasted costs jurisdiction to arise. There must be something akin to an abuse of process if the conduct of the legal representative is to make him liable for a wasted costs order.[74]The purpose of civil procedure is to enable the court to do justice; namely, to decide controversies fairly and in accordance with the law and the true facts. The processes established by the rules, such as issuing claims and defending claims, obtaining disclosure or adducing witness testimony, are meant to enable the parties to advance their cases and assist the court to bring litigation to a satisfactory conclusion. Procedural rules are designed to promote fairness, but no rules can be drafted with such specificity or detail to guarantee that they are never exploited to divert the process from its aim of doing justice. By analogy this must also extend to the Tribunal. In relation to the wasted costs jurisdiction, the concept of abuse of process arises. In A-G v Baker Lord Bingham CJ explained that abuse of process consists in: using [the court’s] process for a purpose or in a way significantly different from its ordinary and proper use.[75]A legal representative should not be held to have acted improperly, unreasonably, or negligently simply because he or she acts on behalf of the parties whose claim or defence is doomed to fail. It is the duty of advocates to present their client’s case even though they may think that it is hopeless and even though they may have advised their client that it is. It is for the judge and not the lawyers to judge it. In Ratcliffe Mr Justice Elias (as he then was) stated that the notion that a wasted costs order can be made against a lawyer simply because his client is pursuing a hopeless case it is entirely erroneous. Such conduct does not of itself demonstrate that there representative has acted improperly or unreasonably. Clients frequently insist on pursuing a case against the best advice of their lawyers.[76]Similarly, other aspects of litigation that lead to unnecessary costs should not readily be blamed on the representatives.[77]Even if a legal representative can be shown to have acted improperly, unreasonably or negligently in presenting a hopeless case, it remains vital to establish that the representative thereby assisted proceedings amounting to an abuse of the courts process (thus breaching his or her duty to the court) and that his or her conduct actually caused costs to be wasted. In Ratcliffe Mr Justice Elias observed that where a wasted costs order is concerned, the question is not whether the parties acted unreasonably. The test is more rigorous. A wasted costs order should not be made merely because a claimant pursues a hopeless case and his or her representative does not dissuade him or her from doing so. The distinction therefore is between conduct that is an abuse of process and conduct falling short of that.[78]In Wentworth-Wood v Maritime Transport Ltd UKEAT/0184/17 (17 January 2018, unreported), Simler J set aside orders for costs against the claimants and wasted costs against their solicitors which had been made by an employment judge following the striking out of various multi-handed claims, holding that the judge had failed to have regard to the well-established principles applicable to both types of order and had failed to give adequate reasons for her decision. So far as the wasted costs order was concerned, Simler J emphasised (at para 30) the need, referred to in Ridehalgh and Medcalf, for courts and tribunals to approach the question of wasted costs orders with real care and to bear in mind that, from the point of view of the lawyer, the wasted costs jurisdiction is penal. Making such an order should, therefore, be a last resort. According to Simler J, the judge in Wentworth-Wood did not identify or adopt the three-stage approach in Ridehalgh; did not allude to the constitutional position of the solicitors; wrongly equated mere negligence with unreasonable conduct; made no attempt to identify the breach of duty owed by the solicitors that was relied on as akin to an abuse of process; failed to consider what costs had been caused to the respondent by what particular breach of duty; and failed to address the question posed by the third limb of the Ridehalgh test as to whether it was just to make the order in the circumstances of the case (see paras 35–36). In addition, she failed to give any reasons for rejecting the solicitors' written submissions as to why the costs should not be ordered.[79]Although it may be rare for a wasted costs order to be made on the ground that a representative was negligent in not advising the claimant to abandon a claim, the EAT has held that there is not an absolute bar on making such an order, provided that the causative link is established between the negligence and the extra costs incurred by the receiving party (Robinson v Hall Gregory Recruitment Ltd UKEAT/0425/13, at para 20). So where an order is sought on such a basis, the respondents must show, and the tribunal must find:(a) that the representative was negligent;(b) that if the advice to abandon had been given, the claimant would in fact have abandoned the claim; and(c) if the claim had been abandoned, the amount of the costs that are attributable to the fact that it was not abandoned.[80]It was previously unclear how tribunals would approach the wasted costs regime introduced by the 2013 rules. The cases on the matter have established that a wasted costs order requires a high standard of misconduct on the part of a representative. Accordingly, acting on a client’s instructions, even in a hopeless case, will not incur liability for costs in the absence of an abuse of process. The case law confirms that it will be very difficult to succeed in a wasted costs application against a representative is a number of stringent conditions must be satisfied, including showing an abuse of the court. An abuse of the court includes such matters as issuing or pursuing proceedings for reasons unconnected with success in the litigation; pursuing a case known to be dishonest; unknowingly making incomplete disclosure of documents. Discussion and conclusions[81]I am satisfied that Ms Randall was properly and timeously notified of the applications for costs against her. Both RL and RFB had reason to believe that Mr Sprack was representing her and were justified in submitting the applications to him. He sent and received documents on her behalf. He referred to Ms Randall as his client in correspondence. The wasted costs application[82]The wasted costs jurisdiction is not engaged, and the application is dismissed for the following reasons:a. I do not believe that Mr Sprack acted improperly. The evidence does not point to conduct that would ordinarily be held to justify his disbarment or other serious professional penalty.b. There is nothing to suggest that Mr Sprack acted unreasonably. He was not acting to harass the other side rather than advancing the resolution of the case. Indeed, there is evidence that he was seeking settlement which would resolve the case. How he communicated and whether he explained the offers to Ms Randall is another matter.c. I do not think that Mr Sprack acted negligently as understood by the Court of Appeal in Persaud. Mr Sprack was not using the Tribunal process for a purpose or in a way significantly different from its ordinary and proper use. There is no evidence of abuse of process. There were, undoubtedly deficiencies in the service that he provided in the following respects: i. He did not make Ms Randall aware in his retainer letter that she might be at risk of a costs award against her. There is little evidence that he advised her of the significance of the several cost warning letters that were sent. It was not enough simply to say that the applications would fail. He needed to explain why to enable Ms Randall to make an informed decision about whether to accept the offer. ii. He advised that there could be an age discrimination claim and acknowledged that this was not particularised. The claim should have been particularised in the ET1 or in separate particulars of claim as required by Chandhok. However, Ms Randall read the claim form and approved it. He should, however, at least have provided further information when it was requested by the other side. Given that the age discrimination claim was not particularised, he could not meaningfully quantify injury to feelings when valued at £8,800. iii. He did not explain the rationale of the offer to settle for £2,500. iv. He withdrew the claim against Merali at the open preliminary hearing when he knew that the claim had difficulties as far back as July 2020. He should not have waited until the eleventh hour to withdraw the claim.d. These deficiencies might amount to negligence in the non-technical sense but following Persaud a higher standard applies to engage the wasted costs jurisdiction.[83]Mr Sprack should not be held to have acted improperly, unreasonably or negligently simply because he acted on behalf of Ms Randall whose claim was doomed to fail. It was his duty to present her case even though he might have thought that it was hopeless and even though he may have advised Ms Randall that it was. Indeed, he believed the case had some prospect of success as set out in his preliminary advice. It was for the Tribunal to judge the merits of the claim. Following Ratcliffe, the notion that a wasted costs order can be made against a lawyer simply because his client is pursuing a hopeless case is entirely erroneous. Such conduct does not of itself demonstrate that the representative has acted improperly or unreasonably. Clients frequently insist on pursuing a case against the best advice of their lawyers. The costs application[84]In her skeleton argument, Miss Egan states that Merali and FSL rely upon two elements in support of their application for costs to be awarded against Ms Randall namely:a. The claims had no prospects of success. I agree with Miss Egan. The evidence before me at the open preliminary hearing was sufficient for me to conclude that Ms Randall was truly self-employed. Therefore, objectively, the claims had no reasonable prospect of success for the reasons given in my reserved judgment. The claim was misconceived.b. Ms Randall acted unreasonably in rejecting an offer of settlement worth more than her claim. I disagree with Ms Egan. Ms Randall did not act unreasonably in rejecting an offer of settlement worth more than her claim because she had not, in my opinion, been properly advised by Mr Sprack how the offer of £2500 had been quantified. Had she been so advised, it is possible that she would have accepted the offer.[85]Only the first limb of the application is engaged. This opens the gateway to the Tribunal to exercise discretion as to whether to award costs. I am not minded exercising discretion to make an award of costs against Ms Randall for the following reasons:a. She is not a sophisticated litigant. She is a native Spanish speaker and English is not her first language.b. She entirely relied upon Mr Sprack for his advice on complex legal matters. Given her personal circumstances that was a reasonable thing to do.c. For the reasons given above, there were deficiencies in the quality of the service that was provided to Ms Randall by Mr Sprack which, in my opinion, deprived her of the ability to make properly informed choices about how she would continue to conduct or even if she would conduct litigation against the respondents from the outset. She was not warned in the retainer letter of the risk of costs being awarded against her. She should have been. There is little evidence, because of the paucity of attendance notes, about what exactly she was advised of in relation to the offer to settle and why the offer should be rejected. She placed her absolute confidence in Mr Sprack to help her and to advise her. Had she known of the risk of costs and had she been properly advised of the reasons underlying the costs warning letters that had been sent by RL and RFB she could have taken an informed decision about whether to accept the offer to settle. She was deprived of that option and did not, in my opinion, make an informed choice to continue with the litigation. It would be unfair to blame her for Mr Sprack’s failings.[86]This is an unfortunate case. I am troubled by the fact that Mr Sprack did not keep attendance notes and/or follow up advice based on all of the conversations that he had with Ms Randall from the outset of his retainer. Speaking as a solicitor appointed to practice in England & Wales in 1993 and in Scotland in 1995 the importance of attendance notes cannot be over emphasised. From the very first day when I started my Articles, it was drummed into me and my fellow Article Clerks to write accurate attendance notes after every meeting and every telephone call we had with clients or with the other side in contentious or non-contentious business etc... Indeed part of our training involved the supervising partner regularly reviewing our attendance notes and our keeping an up-to-date file (“file hygiene”). Attendance notes serve several purposes. They provide an accurate record of what was said and to whom. They provide an accurate record of advice given and instructions received. If there is ever a dispute about what was advised or what instructions were given, a properly drafted attendance note is important contemporaneous evidence to resolve such a dispute and, in certain circumstances, essential in successfully defending claims of professional negligence or allegations of acting outside the client’s authority. Had Mr Sprack exercised better “file hygiene” by writing and keeping attendance notes that sufficiently detailed all the advice that he gave and the instructions that he received, matters in this case could have been very different.