Contract and Employment law

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Contract and Employment law

• CONTRACT OF EMPLOYMENT

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What is the contract of employment

• The importance of the employment contract
• The distinction b/n an employee and an
  independent contractor
• Tests used by the courts/tribunals to interpreter
  this distinction
• The status of special categories of worker
• Contents of the employment contract express and
  implied terms, terms implied by statute

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What is the contract of employment

• The right to a written statement s 1 of the ERA
  1996
• Restraint of trade clauses
• Qualifying for employment rights continuity
• Changing terms of employment
• Flexible working arrangements

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Contract of employment

• Contract of employment and contract of
  self-employment fundamental importance
• Only employees qualify for employment rights
  unfair dismissal, redundancy payments, minimum
  notice on termination etc.
• Employees contract of employment or contract of
  service
• Self-employed persons (independent contractors )
  contract for services

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Types of contract

• Full - time contract
• Part-time contract
• Fixed-term contracts
• Regulations (Prevention of Less Favourable
  Treatment) 2000 and 2002 under the ERA 2002 to
  prevent employees

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The distinction b/n an employee and an
independent contractor

• Courts and tribunals may have to decide
• Tests applied
• ?control test
• ?integration/organisation test
• ?multiple test

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Who is an employee? - statutes

• Section 296 of the Trade Union Labour Relations
  (Consolidation) Act 1992 an individual who
  works or seeks to work under a contract of
  employment or under any other contract
  whereby he undertakes to do or perform personally
  any work or service for another party
• Section 295(1) of the 1992 Act and s 230(1) of
  the ERA 1996 (limited guidance in the
  legislation) an individual who has entered
  into or works under a contract of employment
• Section 230(2) in this Act contract of
  employment means a contract of service or
  apprenticeship, where express or implied, and (if
  it is express) whether oral or in writing.

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Tests developed through case law for determining
the employees status

• Control test does the person who is to be
  regarded as the employer control the employee or
  servant?
• Control extends to not just what the employee
  does, but how it is done
• If the answer is in the affirmative there is
  employer/employee relationship
• Independent contractor might be told what to
  do, but not how to do the work
• One problem interpreted strictly it results in
  skilled and professional people

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Integration test- counters the deficiencies of
the control test

• The question to be asked is how far is the
  servant/employee integrated into the employers
  business
• Fully integrated into the employers business-
  Whittaker v Minister of Pensions and National
  Insurance (1967)
• Employer could avoid tax and national insurance
  provisions, liability for accidents

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Multiple test-much wider

• The servant agrees that, in consideration of a
  wage or other remuneration, he or she will
  provide his or her own work and skill in the
  performance of services
• He or she agrees expressly or impliedly, that in
  the performance of that services, he or she will
  be subject to the others control in a sufficient
  degree by the employer
• The other provisions of the contract are
  consistent with its being a contract of service

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Multiple test wide application

• Proved to be most adaptable
• Control is always to be considered, but not as a
  sole determining factor Market Investigations
  Ltd v Minister of Social Security (1969)
• Continuous to be flexible to the changes in the
  labour environment (casual or seasonal workers)
• Mutuality of obligation OKelly v Trusthouse
  Forte plc (1983)
• Wickens in Montgomery v Johnson Underwood Ltd
  (2001)

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Multiple test all facts to be considered

• The degree of control by the employer
• Wear company uniforms
• Obey orders
• Pay all running costs
• The degree to which the worker is integrated
  into the business
• Examples Market Investigation v Minister of
  Social security (1969) etc.

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Atypical workers- application of the multiple test

• Work from home- home workers
• Casual basis work casual workers
• Agency workers

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Loaning or hiring of employees

• The courts are reluctant to find that there has
  been a transfer of employment where employees are
  loaned or hired out , unless there is consent on
  the part of the employee or there is an agreement
  which clearly states the position in the event of
  liability
• CASE LAW Sime v Sutcliff Catering
  (1990)-exception where the court declared the
  employee has become an employee of the second
  employer

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The impact of EU law

• R v Secretary of State for employment ex p
  Seymour-Smith (1999), ECJ
• Employment Relations Act 1999 qualifying period
  for unfair dismissal was reduced to one year

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Continuity periods away from work

• In order to acquire employment protection rights,
  there should be continuity of employment
• Important to consider the impact of weeks away
  from work
• Section 212 of the ERA 1996 main legislative
  provision
• Pregnancy, childbirth, sickness or injury,
  temporary cessation of work or custom or practice
  will generally count in computing the period of
  employment

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Formation of the contract of employment types
of terms

• Written statement of terms - Pt 1 of ERA 1996
  names, rate of pay, hours of work etc.
• The Trade Union Reform and Employment Rights Act
  1993 non-permanent employment, collective
  agreements etc.
• Specimen statement of terms of employment

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Terms of the employment contract

• Express terms written into the contract and
  agreed upon by the employer and the employee
• Breach of an express term of the contract may
  result in the dismissal of the employee, while
  breach on behalf of the employer , may enable the
  employee to resign and bring an action for
  constructive dismissal

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Implied terms the purpose is to make the
contract more effective (trust and respect)

• Are not written into the contract
• May arise out of the custom and practice of a
  particular industry
• Have to be read subject to any express terms
• Standard implied terms duties imposed on the
  respective parties
• Breach by the employee may result in disciplinary
  action or even dismissal
• Brach by the employer may result in legal
  proceedings before a tribunal

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Duties of the employer-implied terms

• To Pay the employee
• To provide work
• Treat the employee with mutual trust and
  confidence
• Take reasonable care for the safety of the
  employee
• Deal promptly with grievances
• Reimburse the employee for any expenses properly
  incurred while at work
• Write references

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Duties of the employee-implied terms

• Be ready and willing to work
• Use reasonable care and skill at work
• Obey reasonable and lawful orders
• Take care of their employers property
• Act in good faith mutual respect

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Statutory terms

• The equality clause equal pay s 1 Equal Pay
  Act 1970
• The right not to be unfairly dismissed s 94 ERA
  1996
• The right to be given a copy of disciplinary and
  grievances procedures implied by s 30 of the ERA
  2002
• Various provisions s 203 of ERA 1996