Status appeal on 'bank' nurse: cautionary lessons on substitution rights and mutuality
The EAT overturned a ruling that a nurse was both an employee and a worker, highlighting gaps on substitution and mutuality.
Background
In Partnership of East London Co-Operatives Ltd v Maclean, the respondent (known as PELC) is an NHS provider organisation that runs urgent treatment centres in East London. The claimant, a qualified nurse, worked regular shifts there between 2018 and 2023. The employment tribunal had decided that she was both a worker and an employee. PELC appealed, arguing that she worked through her own limited company, that neither party was obliged to offer or accept shifts, and that she had a contractual right of substitution inconsistent with personal service.
Decision
The EAT held that the tribunal was entitled to find that the contract was between PELC and the individual nurse herself rather than her company, as key documents described payment to the company as simply discharging sums owed to her personally. However, the EAT found the tribunal’s reasoning inadequate in two important respects and overturned its conclusions on worker and employee status.
First, the tribunal had inferred that there was a mutual obligation to offer and accept a reasonable amount of work, even though the written terms and evidence showed that shifts were requested and allocated monthly, with no ongoing commitment on either side. Regular working alone did not justify implying a continuous employment relationship.
Secondly, while the tribunal found that substitution would have been “impracticable”, it did not explain why. The EAT said the tribunal should have considered whether, in practice, there was a pool of pre-approved nurses who could step in and whether any restrictions meant that personal service remained the dominant feature.
The EAT therefore allowed the appeal and remitted the question of employment and worker status for reconsideration, although the finding that the contract was directly with the individual remains.
Learning points for employers
Employment status is determined by the reality of the working relationship, not contractual labels or tax status. For ad hoc shifts, employers should be clear whether there is any ongoing obligation to offer or accept work between assignments, as regular patterns of work alone rarely establish continuous employment. If a right of substitution is relied on to show self-employment, it must operate in practice, with clear arrangements for identifying and vetting substitutes. Finally, IR35 assessments are not determinative of employment law status - tribunals will look beyond tax classifications to how the relationship actually works.