Quasie v Stringfellow
Last summer’s Quashie v Stringfellow Restaurants Ltd case highlighted the importance of distinguishing between employed and self employed workers.
Ms Quashie worked as a lap dancer for Stringfellows. She took the company to an employment tribunal claiming unfair dismissal, alleging that she had the right to do so because she was an employee. The tribunal found that she was not an employee and therefore could not claim unfair dismissal.
Ms Quashie's work was governed by a club agreement, house rules, a welcome booklet, the licence for the operation of the premises and a rota. She supplied her own outfits and paid a fee to the club for use of its facilities. Customers paid the club for the dancers' services, with the club deducting commission, a house fee and fines (eg for being late) and paying the remainder to the dancers. Ms Quashie was required to provide her work personally. She could not provide a substitute.
The club exercised a degree of control over Ms Quashie. She was required to abide by the house rules, which included: having to work one Saturday and Monday twice a month; attending Thursday meetings; complying with a dress code; and being told what to do on stage. If she did not work for more than four weeks she had to re-audition. If she was on the rota, she would be fined if she did not attend.
On analysis of the documents and the working relationship between Ms Quashie and Stringfellows, the case was overturned by the Employment Appeal Tribunal (EAT), deeming she was indeed an employee.
More recently however, Stringfellows appealed and won the decision at the Court of Appeal, which overturned the EAT ruling. “The fact that the dancer took the economic risk is also a very powerful pointer against the contract being a contract of employment. Indeed, it is the basis of the economic reality test,” the appeal court noted.
The case provides a useful and important reminder about the issuing of correct contractual paperwork. With a contract of service, an employer is able to influence the hours worked, the location and how work is carried out. The employer must also provide any necessary equipment. In addition, the worker must undertake all work themselves, and be given a detailed wage slip. In return, the worker will receive employment rights that can be challenged in an employment tribunal, subject to the situation and length of service.
On the other hand, a self employed worker is typically provided with a contract for providing a service. With this there is no obligation for the company to use their services. The self employed worker should use their own equipment and may choose where to work ie at their own premises or at those of the company. They should not be integrated within the company. With the agreement of the company, they should be able to choose the hours/days they work and may also provide a substitute if necessary.
The worker should invoice the company directly and also manage their own tax and National Insurance contributions. It is at their own risk as to whether or not they get paid, chasing non-payment through the small claims court if necessary. In addition they need to arrange their own insurances where appropriate, and are able to work for a number of companies without restriction.
On Wednesday 27 February, Louise Williamson, partner at Meades Contractors will continue the firm’s series of informative contractor workshops for 2013. The event, called ‘Meades Contract Review Workshop: An Essential Guide For Contractors’, is being held at Lion Court Conference Centre, Council Chambers, 25 Procter Street, Holborn, London WC1V 6NY. Registration is from 6pm, with the programme scheduled to finish at 8.30pm. The evening is a must for anyone looking to learn if their contract is being caught by IR35.
To find out more about the evening and other PCG events, visit www.pcg.org.uk/events