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Postmasters Deemed Not Workers As They Are Not Required to Render Personal Service

on Friday, 06 May 2022.

The Employment Tribunal focused on the requirement of 'personal service' when determining whether or not the claimants were 'workers', and if so, entitled to holiday pay.

In the recent Employment Tribunal decision of Baker and others v Post Office Ltd, a group of postmasters claimed they were workers and therefore entitled to holiday pay under the Working Time Regulations 1998 (WTR 1998). As a preliminary issue, the Tribunal addressed the claimants' employment status.

What Is a 'Worker'?

Under the WTR 1998, a 'worker' is defined as someone who enters into or works under:

  • a contract of employment; or
  • 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

The legislation also makes it clear that the party should not be a client or customer of the individual.

What Was the Question for the Tribunal?  

There are 120 claimants in this claim. The Tribunal based its decision on ten sample claimants who were each engaged on one of three types of contractual terms. In respect of the WTR 1998 definition above, all parties agreed the postmasters were not engaged under contracts of employment. The question was therefore whether they instead met the 'limb b' definition of worker status.

What Factors Did the Tribunal Take into Account?

The Tribunal made some findings of fact that the postmasters were under the control of the Post Office and integrated into the Post Office's business. However, the Tribunal also remarked that these factors could be present in contractual relationships other than employment relationships. It therefore went on to consider whether the postmasters were required to personally perform the work or services under their contracts. The postmasters argued that despite their contracts stating personal service was not required, this did not reflect reality.

What Did the Tribunal Decide?

The Tribunal found the postmasters were not required to render personal service under their contracts. This meant they did not meet the 'limb b' definition of the worker status test. They were therefore not workers.

In reaching its decision, the Tribunal took account of the following:

  • postmasters frequently delegated to assistants, in respect of whom the Post Office had only a limited right of veto
  • the postmasters were responsible for ensuring that services were provided whether by themselves or an assistant - some postmasters voluntarily offered personal service, but were not required to do so
  • whilst the Post Office set branch opening times, it was up to the postmaster to determine how their branch was staffed during those times
  • postmasters were not required to undergo training and there were no real disciplinary procedures in place

Why Is This Case Important?

This case is a first instance decision, so not binding on other Tribunals. However, it provides a useful demonstration of the importance placed on the requirement to provide personal service in order to meet the 'limb b' definition of worker status. Organisations may wish to consider their own requirements in respect of personal service, in order to ensure they enter into appropriate contracts with those who work on their behalf.

For more information, please contact Rory Jutton in our Employment Law team on 0117 314 5286, or complete the form below. 

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