Veitch Penny LLP - Exeter | Crediton, Devon

Case

Byrne Bros (Formwork) Ltd v Baird & Others

Issues

(1) Employment Relationship
(2) Pay and Benefits
(3) Contractual Terms of Subcontractors
(4) Holiday pay not included

Facts

It was held by the Employment Tribunal that the Applicants were workers within Regulation 2(1) of Working Time Regulations 1998.

The Applicants were self employed carpenters who worked under Standard Form Sub-contracts for the Respondent. They worked exclusively for the Respondent at the site in question up to Christmas and carried on working after New Year. In accordance with the Contracts they had signed, they did not receive any pay in respect of the period between Christmas and the New Year.

The Applicants commenced proceedings in the Employment Tribunal claiming entitlement to holiday pay for the Christmas and New Year period under the Working Time Regulations 1998. It was agreed that their entitlement would depend on whether they were "workers" within the definition of the Regulations and which defined "worker" as someone who had entered into or who works under:

(a) A Contract of Employment or
(b) Any other contract whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the Contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual".

The Employment Tribunal held that the Contracts entered into by the parties did not reflect the reality of their working relationship and that the Applicants were accordingly entitled to be regarded as workers under the Regulations.

The Respondents appealed.

Decision

The appeal would be dismissed.

It was clear that under the second limb (b) of the definition, the Applicants were workers here as they were obliged "perform personally any work or services" for another (namely the Respondent)".

The Applicants had been there for a significant and indefinite period and were paid on a time basis, despite being self employed, and they had the same degree of dependence as an employee would have in such circumstances.

Comments

This case illustrates the extensive scope of the meaning of "worker" under the Working Time Regulations 1998. There was also a clause in the Sub-contractors' Contracts which allowed him to provide a substitute for himself, but this needed to have the employer's prior permission. This was held to be fatal to the employer's argument that he was not a worker who would provide the services personally and so come within the Regulations.