Veitch Penny LLP - Exeter | Crediton, Devon

Case

Dacas v Brook Street Bureau (UK) Limited
Court of Appeal - (5th March 2004)

Issues

(1) Contracts of Employment
(2) Temporary Staff
(3) Employment Agency

Facts

Mrs Dacas had worked for Wandsworth Council as a cleaner in one of its hostels. She obtained the work through the Defendant, which was an Employment Agency responsible for all the Council’s recruitment. Mrs Dacas was paid by the Agency out of payments it had in turn received from the local authority for supplying her services. At the start of the placement, Mrs Dacas had signed a written “Temporary Work Agreement”, which stated that it did not create to a Contract of Employment between herself and the Agency or the Council.

After she had worked there for about 6 years, there was an incident in which the Claimant was rude to a visitor at the hostel. The Council’s management asked the Agency for her to be withdrawn from the contract and not sent to the hostel again in future. Mrs Dacas then made a complaint to the Employment Tribunal of unfair dismissal against both the Council and the Agency.

At first instance, the tribunal took account of the Temporary Worker Agreement and found that her contract with the Agency was not a contract of service because the Agency lacked day to day control over her activities. In addition she did not have a contract of employment with the authority. Consequently, as she was not an employee she could not make a complaint of unfair dismissal.

Mrs Dacas appealed against the decision. The Appeal Tribunal found that the tribunal had been incorrect in finding that she was not an employee of the Agency. Paying her wages and having the right to terminate was sufficient control over Mrs Dacas for the tribunal to find she was employed by the Agency.

The Agency appealed against that decision at which point the Council was added as a Respondent.

Decision

The appeal would be allowed.

The Appeal Tribunal had been wrong to overturn the original decision. It found that the Agency was under no obligation to provide her with work and she was under no obligation to accept work offered to her. Likewise, it had no control over the tasks that she carried out.

From the facts of the case, the Court found that Mrs Dacas could be deemed to be an employee of the Council because it had control over her activities and because mutuality of obligation to provide and carry out work. However, as the decision rejecting the claim by Mrs Dacas against the Council had not been appealed, then this decision must stand.

However, the Court of Appeal stated that when dealing with future cases of this type in which a triangular arrangement between an individual Employment Agency and end user arose, a tribunal should not determine the status of an applicant without considering the possibility that there may be an implied Contract of Employment between the worker and ultimate end user. The Judge stated that as little as one year’s employment (enough to accrue unfair dismissal rights in a normal employment relationship) would be sufficient to be able to imply a Contract of Employment.

Comments

This is an important case for any organisation which may use temporary staff, particularly as often they are used for long periods in order to avoid the risks and obligations of an employment relationship. Consequently, the status of the worker should be determined at the outset of any such arrangement.