London Employment Solicitor: January 2013

Friday, January 11, 2013

Lessons from LapDancers

Many businesses try to avoid liabilities as employers by taking on workers on a freelance or self-employed contractor basis. They then carefully draft contracts to justify that status. There’s always a risk though that the worker will claim employment rights anyway, saying that the main employment tests of ‘mutuality of obligation’, ‘control’ and ‘personal service’ are satisfied.

In Stringfellow Restaurants Ltd v Quashie in the Court of Appeal, Ms Quashie was a lap-dancer who was dismissed by Stringfellows. The Club argued that she was not an employee and could not therefore claim unfair dismissal.

The Employment Appeal Tribunal took the view that Ms Quashie provided the services personally (she could not send in a substitute) and that even though she was only engaged per shift, she worked under an 'umbrella contract' with the expectation of future shifts, and so there was sufficient mutuality of obligation for an employment relationship to arise. Furthermore Stringfellows exercised ‘control’ over her because they imposed disciplinary fines on lap-dancers who breached their rules.

However the Court of Appeal took the view that even though there were mutual obligations of some kind in place when she was actually working, she was still not an employee because she negotiated her own fees with clients and took the economic risk of being out of pocket on any particular night.

This case emphasises the need for careful drafting if you want to avoid employment liabilities arising by calling workers ‘self-employed’ instead. The differences in view of the EAT and Court of Appeal show how problematic this question can be, even for rather less exotic businesses than Stringfellows.

James Carmody

RECULVER SOLICITORS

Tel: 0207 324 6271 | Fax: 0207 477 2276 | info@reculversolicitors.co.uk

12-16 Clerkenwell Road, London EC1M 5PQ

www.reculversolicitors.co.uk | www.kent-employment-solicitors.co.uk | www.croydon-employment-solicitors.co.uk

Reculver Solicitors Ltd (Company No. 6910066) | Solicitors: James Carmody*, Carol Aylott, Kate Henry.

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Friday, January 4, 2013

Heads up for 2013

Heads-Up for 2013:

Happy New Year! Here is a brief heads-up for developments in Employment Law in 2013:

· The Enterprise and Regulatory Reform Bill is shuffling through parliament. Worryingly, this will enable Tribunals to impose financial penalties against employers of up to £5,000 where there are ‘aggravating features’. It will also permit employers to have "protected conversations" with employees about severance, but that is unlikely to be much different to ‘without prejudice’ conversations now.

· From the 1^st February 2013 Tribunal limits will go up, with a week's pay for statutory redundancy payments and basic award for unfair dismissal increasing from £430 to £450, and the maximum award for compensatory awards in unfair dismissal going up from £72,300 to £74,200

· The much-criticised Employee-shareholder contracts announced by George Osborne in the Autumn will be introduced (see reculversolicitors.co.uk/1019.htm )

· In March 2013 unpaid parental leave will increase to 18 weeks (from 13 weeks up to the 5^th birthday). The limit on how much parental leave can be taken a year is 4 weeks. Take up of this right appears to have been low so this change is unlikely to make much difference in practice.

· In March 2013 CRB checks will change to ‘Disclosure & Barring Service’ checks and will be portable between employers, and which will save fluffing around getting repeat CRB / DBS checks every time someone changes jobs when they work with children or vulnerable adults.

· In April 2013 the collective consultation period will reduce to 45 days where 100 or more redundancies are proposed. For most employers though who do not make more than 20 redundancies, there will still not be a prescribed consultation period.

· In April 2013 the HMRC will introduce ‘Real-time information’ for payroll (see hmrc.gov.uk/rti/index.htm) which is likely to vex employers and accountants alike.

· In April 2103 the Statutory maternity, paternity, adoption pay will increase apparently by a princely 1% from £135.45 pw. Statutory sick pay will also go up.

· In the summer 2013 it seems that fees for bringing employment tribunal claims may be introduced. Presumably unemployed claimants (ie most claimants) will get dispensation from the fees, and the already over-worked Tribunal service will have another layer of administration to contend with. Whether this idea will be quietly dropped in the same way as no-fault dismissals (see reculversolicitors.co.uk/1023.htm) remains to be seen.

We will keep you updated on these and other developments throughout the year.