MUTUALITY OF OBLIGATION
31 July 2012
Can a person working under a succession of individual contracts be an employee?
Yes, says the Employment Appeal Tribunal (EAT) in Drake v Ipsos Mori UK Ltd , reversing an Employment Tribunal (ET) decision that had held there was no contract because there was no 'mutuality of obligation'.
Daniel Barnett’s Employment Law Bulletin reports:
The Claimant worked on an 'assignment by assignment' basis for the Respondent from 2 February 2005 until 5 November 2010. He claimed that each individual assignment was a contract of employment so giving him sufficient continuity of service to bring a claim for unfair dismissal. The Respondent's case was that even though the Claimant was a worker for the purposes of employment legislation he was not an employee. The Employment Judge had held that the assignments did not amount to separate contracts of employment because any assignment could be terminated on either side without its being completed there was 'no mutuality of obligation' and hence no contract. The EAT relying mainly on Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance held that there was a contract in place and sufficient mutuality whilst the Claimant was actually undertaking an assignment for the Respondent. Contrary to the EJ's decision the fact that the assignment could be brought to an end did not mean that there was no contract in existence while the assignment was continuing. The EAT was influenced by the fact that the respondents own handbook referred to the assignments as being contracts. The decision therefore is primarily based on its own facts, however the reasoning in it provides an interesting review of the legal requirements for a contract of service as opposed to a contract for services.
DEATH IN SERVICE BENEFIT
8 August 2012
Can the estate of an employee who was unlawfully dismissed, and died shortly after, bring a claim for loss of a death in service benefit?
Yes, said the EAT in Fox v British Airways . Loss of a death in service benefit is a real loss to the employee and is recoverable by his estate.
Daniel Barnett’s Employment Law Bulletin reports:
Mr Fox died within days of being dismissed. His estate argued that his dismissal was unfair and discriminatory and brought a claim for both. The compensation in question was the value of the death in service benefit enjoyed by Mr Fox whilst in employment. The Respondent argued, and the ET agreed, that the loss of the death in service benefit was not a loss to Mr Fox but to Mr Fox's beneficiaries. Accordingly it was not recoverable by Mr Fox's estate which could only claim in respect of losses suffered by him. The only loss suffered by Mr Fox was the loss of comfort of knowing his relatives would receive a payout in the event of his death. The ET valued this loss at £350, comparable to the loss of statutory rights.
CIPP Policy News Journal
12/04/2013, Page 54 of 362
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