Employees, Workers or Independent Contractors?

Braine & Others v The National Gallery

The 27 claimants were 'educators' engaged by the gallery to deliver talks, lectures, workshops and occasionally other projects. Each assignment was individually assigned to an educator based on their availability, experience and expertise, and educators were remunerated at fixed rates for each assignment. Educators were under no obligation to accept any assignment, and the gallery was under no obligation to offer assignments. In 2017 the gallery implemented a reorganisation which, for the claimants, marked the end of these working arrangements.

The claimants made claims for unfair dismissal, holiday pay, age discrimination and failure to consult on redundancy, arguing that they had been employees working under an umbrella contract of employment and were therefore entitled to employees' rights.

The gallery argued that the claimants were independent contractors in business on their own account, not employees or workers, and therefore not entitled to any such rights.

A preliminary hearing considered the status of six lead claimants used as test cases, and whether they retained this status in between assignments or only while on an assignment.

The Employment Tribunal's Decision

The Tribunal first considered whether there was any overarching employee or worker contract in place, and found that there was none. If the claimants were employees or workers then they held this status only when on an assignment. The Tribunal acknowledged the longevity of the arrangements, the frequency of repeat bookings and the existence of written agreements setting out a framework for the parties' relationship in between assignments. However there was no obligation in between assignments to accept or offer work and so no overarching employee or worker contract could be inferred.

The Tribunal then found that during assignments the claimants were not employees. There were fundamental differences between the terms of their arrangements and the terms which governed the relationships between the gallery and its salaried staff, and the purpose of these arrangements was clearly to avoid employment obligations on either side. Both parties benefitted from the resulting level of flexibility which an employment arrangement would have made impossible.

However the claimants also were not independent contractors in business on their own account. A number of factors demonstrated an inequality of bargaining power between the parties, which made it clear that these were not arm's length commercial arrangements between businesses. Factors included the probationary period, supervision and control imposed by the gallery on the educators' work, the extent to which educators were integrated into the gallery's operations, that the gallery set the remuneration and forbade the educators to keep tips, the supply of materials, facilities and support to educators, that educators could recover expenses and that the gallery retained IP in the educators' work. The Tribunal also noted that there was no right or practice of educators appointing substitutes to fill in for them or swapping assignments with one another, and so the assignments were clearly agreements for personal services.

The Tribunal therefore found that the claimants were workers, and so they were entitled to pursue claims for holiday pay and discrimination but not unfair dismissal or failure to consult on redundancy. The case will now proceed to hearing the merits of those claims.  

What Can You Learn From This Case?

It is vital to consider whether individuals engaged by your business are employees or workers in order to establish what rights, if any, they are entitled to. This case usefully sets out a number of factors to apply when making this assessment.

In particular, individuals are likely to be workers where personal service is required and your arrangements involve a high level of control and integration of the individuals but not the mutual obligations necessary to an employment relationship.

For more information, please contact Katie Hurst in our Employment Law team on 0121 227 3751, or complete the form below.