Salih v Vista Plc (t/a Joe Bananas) [1995] UKEAT 241_95_0112

EAT
Salih v Vista Plc (t/a Joe Bananas)
[1995] UKEAT 241_95_0112 · 1995-10-24

JUDGE CLARK :

This is an appeal by Mr Salih against a decision of the London (South) Industrial Tribunal, following a hearing held on 7th December 1994, that he was not an employee of the respondent, and consequently that it had no jurisdiction to entertain his complaint of unfair dismissal. There was no legal representation before the Industrial Tribunal, the appellant appeared in person, and the respondent was represented by Mr Potts, a Human Resources Consultant, who also appeared before us. In this appeal the appellant was represented by Counsel, Mr Kelly.The appellant commenced these proceedings by an originating application date 27th June 1994, contending that he had been unfairly dismissed following a period of continuous employment commencing on 27th May 1992 and ending with his summary dismissal on 26th June 1994.In their Notice of Appearance dated 4th July 1994 the respondent admitted the dismissal, and contended that such dismissal was by reason of the appellant's gross misconduct in that he was guilty of theft of stock. No point is taken in that pleading as to the appellant's continuity of employment.On 6th September 1994 Mr Potts wrote to the Industrial Tribunal. First he contended that the dates of employment set out by the appellant in form IT1 were incorrect. He asserted that the start date was 16th April 1992 and that the appellant was summarily dismissed on 26th May 1994. The letter went on to state, in relation to the dates of employment given by the appellant:
"Section 8:
1. The Applicant was a casual worker to whom the Respondents were not obliged to offer work and who was not obliged to accept it when work was offered.2. In practice work was offered on a regular basis but the Applicant did not accept work to the extent of 16 hours a week during 19 weeks of his period of employment.3. The Applicant does not therefore qualify to bring a claim of unfair dismissal because he was not continuously employed for 2 years during which he worked at least 16 hours a week or during which he was employed under a contract which normally involved 16 hours of work a week."Accordingly it was the respondent's case that there had been a 19 week break in the employment, and thus the appellant was unable to show 2 years continuous employment ["the qualifying period"] for the purpose of Section 64(1)(a) of the Employment Protection (Consolidation) Act 1978 . The respondent sought a preliminary hearing on this jurisdictional issue.By letter to the parties dated 10th October 1994 the Regional Office of Industrial Tribunals directed that a preliminary hearing be held, limited to the following issue:
"Whether the applicant is disqualified from the right not to be unfairly dismissed by the provisions of Section 64(1)(a) of the Employment Protection (Consolidation) Act 1978 (as amended) regarding a minimum period of continuous employment (two years)."
The appellant took legal advice from solicitors, who wrote a letter on his behalf to the Regional Office dated 6th December 1994, under the Legal Aid Green Form Advice Scheme. That letter is directed, in our view, solely to the issue of the qualifying period.On this basis the parties attended the hearing on 7th December 1994. However, that hearing took a quite different course from the one directed in the Tribunals' letter of 10th October 1994. Mr Potts referred to a summary of the Court of Appeal decision in O'Kelly v Trust House Forte PLC in an Industrial Relations briefing publication, but not the full report at [1983] ICR 728 , as authority for the proposition that Mr Salih had not been employed by the respondent within the meaning of Section 153(1) of the 1978 Act. As appears from the Tribunal's extended reasons that submission succeeded and the complaint was dismissed on the basis that the appellant was not an employee. In paragraph 22 the Tribunal say:
"22 That being so , the Tribunal was not required to consider the provisions of Section 64(1)(a) and Schedule 13 of the Employment Protection (Consolidation) Act 1978 ."
In this appeal Mr Kelly takes two points. First, he says, as a matter of procedural fairness this Industrial Tribunal should not have considered a jurisdictional point that had not earlier been raised in terms, at a preliminary hearing which had been limited to a quite different point, namely the qualifying period. Secondly, on the substance of the Tribunal's decision, he argues that in any event the Industrial Tribunal misdirected themselves as to the correct test in relation the question of employment under Section 153(1). We think that both submissions have force.It seems to us, particularly where an applicant is unrepresented, that it is unfair to him to expect him to deal with a different point to that which he has come to meet, and as to which he did not have prior notice enabling him to take legal advice.There is also a danger that the Tribunal itself will not properly direct itself as to the issues raised by the new point. This is what we think happened here.On the facts as found by the Tribunal the appellant began working for the respondent as a waiter/barman on 16th April 1992 and was dismissed on 26th May 1994. He was one of 30 "casual" workers used by the respondents. The Tribunal found that there was no obligation on casual staff to work, nor on the respondent to provide work; indeed at one time during the relevant period the appellant found full-time employment at a shop in Croydon. Basing themselves on their understanding of O'Kelly v Trust House Forte they held that there was no mutuality of obligation between the parties and that therefore the appellant was not an employee of the respondents.We think that this is a misreading of O'Kelly's case, and does not comprise the correct test to be applied to the question of whether a person is employed under a contract of service.We deal first with the proposition that an absence of mutual obligations to provide and perform work necessarily imports the absence of a contract of service. In Airfix Footwear Ltd v Cope [1978] ICR 1210 , a decision of the Employment Appeal Tribunal (Slynn J presiding) the applicant was engaged by the respondent company as an outworker, working from home assembling shoe parts. The Industrial Tribunal held that she was an employee. On appeal the company contended that there was no mutuality of obligation between the parties to provide and perform the work, and thus no contract of employment could exist. Looking at all the factors considered by the Industrial Tribunal, the Employment Appeal Tribunal concluded that it was open to that Tribunal to find a contract of service between the parties and dismissed the appeal.The decision in Airfix was considered by the Court of Appeal in Nethermere (St Neots) Ltd v Gardiner [1984] ICR 612 and was approved. See per Stephenson LJ at page 626H; and Dillon LJ at page 634C.Thus, in our judgment, the basis on which this Industrial Tribunal reached its decision that no contract of service existed was wrong in law.What then is the correct approach for a tribunal to take? A number of tests have been formulated by the Courts, starting with the test formulated by Mackenna J in Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497 .We think that the proper approach for the Industrial Tribunals to take is to set out under various heads the factors consistent with or inconsistent with a contract of service. This is what the Industrial Tribunal did in O'Kelly v Trust House Forte , with the approval of the Court of Appeal. See per Ackner LJ pages 739G - 741H. It will then be for the Industrial Tribunal, having reviewed all the factors in the case, to reach a conclusion. This Industrial Tribunal, in our judgment, failed to carry out that necessary exercise, but based its decision solely on the mutuality of obligations factor.It follows that this decision cannot stand. The appeal will be allowed and the case remitted to a fresh Industrial Tribunal. It will be for the Tribunal to direct precisely what issues are to be decided at the remitted hearing, and to notify the parties in advance as to those issues.Order for the appellant's Legal Aid taxation.