Poor Contract Drafting Leaves the Door Wide Open to Employment Disputes

Inept and non-professional drafting of contracts is an open invitation to employment disputes. That was certainly so in a case where a property manager’s contract left substantial room for doubt as to whether he was employed or self-employed.

The man was, under the terms of a written…

Feb 22, 2022

The man was, under the terms of a written contract, for many years engaged by a company to provide site management services in relation to two blocks of flats. He lodged Employment Tribunal (ET) proceedings against the company but, in order to succeed in his claim, he first had to establish that he was employed, within the meaning of Section 230(1) of the Employment Rights Act 1996 (ERA).

He pointed out, amongst other things, that the contract granted him the right to 28 days’ paid annual leave. The company provided him with most of the tools he needed to do his job and had honoured the contractual requirement to give him 30 days’ notice of termination. He was provided with a company mobile phone and the contract was silent as to whether he was entitled to substitute someone else to perform his role.

In arguing that he was nevertheless self-employed, the company emphasised that he invoiced for his work on a monthly basis, that no pension arrangements were made for him and that neither tax nor National Insurance Contributions were deducted from his pay. He had a number of other clients, ran his own sign manufacturing business for a time and enjoyed a wide discretion as to when and how he went about his work.

Ruling on the matter, the ET noted that the contract was poorly drafted without any thought having been given to his status. It did not, for example, deal with many of the particulars of employment required by Section 1 of the ERA. Taken as a whole, it was not consistent with the provisions of a contract of employment.

On the limited evidence available, the ET was not satisfied that the company exercised a sufficient degree of control over him and his work to give rise to an employment relationship. On balance, it found that he was self-employed and in business on his own account. That ruling was fatal to his claim.

Cooling Off Periods and Retraction of Oral Resignations – Guideline Ruling

Large employers often have ‘cooling off’ policies in place which address the common situation of employees orally announcing their resignation in a stressful moment and subsequently having second thoughts. As an Employment Tribunal (ET) ruling showed, however, such polices, once adopted, must be honoured. The case concerned a supermarket worker who was under strain at home due to her onerous caring responsibilities for sick and elderly relatives. During an understaffed night shift, she became…

Employers – Knee-Jerk Reactions to Fractious Situations Can Cost You Dear

When employees query the contents of their wage packets, terse conversations can ensue. As one case showed, however, knee-jerk reactions to such situations are a positive invitation to Employment Tribunal (ET) proceedings. The case concerned a hotel worker in her probationary period. She considered that her first payslip was about £1,000 short. She had been paid in accordance with the hotel’s payroll system, but that system had not been explained to her. Her initial reaction was to place a…

EAT Rejects Unauthorised Deduction from Wages Claim

The Employment Appeal Tribunal (EAT) has rejected an appeal against the dismissal of an employee’s complaint that unauthorised deductions had been made from his wages because he did not receive an additional day’s pay or a day off in lieu when he worked on bank holidays. The employee’s contract of employment stated that he could be required to work on bank holidays, and that he would be paid at double time for those days and given an alternative day of leave in lieu. When he worked on a bank…