Answer 3 - Distinguishing Employees And Independent Contractors

Question 1

What case initially demonstrated the control test?

Answer 1

Yewens v Noakes, saying “a servant is a person subject to the control of his master as to the manner in which he shall do his work” - servant = employee

Question 2

What case gave a slightly different slant on the control test?

Answer 2

Walker v Crystal Palace FC, the focus was on whether the employer had the right to control the background arrangements for the work (holiday entitlements etc)

Question 3

What was the decision in Walker v Crystal Palace FC?

Answer 3

That the clubs control even extended to not allowing the player to live in a public house - deemed it was a contract of employment

Question 4

What case developed the integration test?

Answer 4

Stevenson Jordan and Harrison v MacDonald and Evans

Question 5

What did Lord Denning state in the Stevenson Jordan and Harrison case?

Answer 5

“Under a contract of service, man is employed as part of the business whereas under a contract for services, his work, although done for the business, is not integrated into it but is only accessory to it”

Question 6

What is an example which disproves the integration test?

Answer 6

It is now common for hospitals to but in the services of cleaners who are under contract to someone else and the cleanliness of hospitals is clearly essentials - work of an independent contractor could be integral part of a business

Question 7

What cases show the inadequacies of the integration test?

Answer 7

Tilson v Alston Transport Ltd and Smith v Carrillion

Question 8

What is the multi factor approach and what cases use it?

Answer 8

The multi factor approach is where the court take into account all possible relevant factors before making their decision. The cases are market investigations v minister of social security and Ready Mixed Concrete v Minister of Pensions and National Insurance

Question 9

What factors did cooke J determine in the in the market investigations case?

Answer 9

Whether or not the worker provides a personal service control, whether the employer provides his own tools and other factors such as whether the worker hires his own helpers

Question 10

What did cooke j summarise the test in market investigations as?

Answer 10

“Is the person who has engaged himself to perform these services performing them in business on his own account?”

Question 11

What did Mackenna J determine in the ready mixed concrete case?

Answer 11

That there were 3 conditions for a contract of service

1) the employee undertakes to provide his or her own work or skill to the employer in return for a wage or other payment
2) that the employer agrees to be subject to the employers control to a sufficient degree
3) that the other provisions of the contract are consistent with it being a contract of service

Question 12

What did the Express and Echo v Tanton case show?

Answer 12

That the judgements in market investigations and ready mixed concrete pull in different directions and are not consistent with eachother

Question 13

Paragraphs

Answer 13

Development of tests
Problems with application of tests
Benefit of employee

Question 14

What happened in the express and echo v tanton case?

Answer 14

Delivery driver drove the companys van on the route laid down by the company, conformed to all instructions and was getting a fixed fee decided on by the company. Had a substitution clause in his contract which said if he was unwilling or unable to work he’d have to find cover for himself

Question 15

What was the decision in express and echo v tanton and how did it show the inconsistencies of ready mixed concrete and market investigations?

Answer 15

The court of appeal relied on the decision in Ready Mixed Concrete and held that personal service was essential for a contract of employment and that this factor was lacking because of the substitution clause, however if the court had applied the “in business on his own account” test from market investigations it most likely wouldnt have come to this outcome

Question 16

What is another problem in applying the multi factor approach?

Answer 16

Substitution clauses. The decision in the tanton case is dangerous as it hands dishonest employers an easy way of avoiding the responsibilities inherent in the employer/employee relationship

Question 17

What case showed how substitution clauses can be used to avoid the responsibilities an employer owes an employee?

Answer 17

Staffordshire Sentinel Newspapers v Potter

Question 18

What happened in staffordshire sentinel newspapers v potter?

Answer 18

In the year after tanton case the company introduced a substitution clause in the contract and due to this it was deemed he could not possibly be an employee due to the requirement of personal service

Question 19

What is the argument on substitution clauses?

Answer 19

That they are a shame and are out in by an employer to avoid obligations which would be incurred towards an employee

Question 20

What happened in consistent group ltd v kalwak?

Answer 20

The court of appeal rejected the employer adding a substitution clause as a sham and said a contract can only be a sham if both parties intend to deceive

Question 21

What happened in the the autoclenz case?

Answer 21

It disproved the opinion in kalwak. It deemed that a contractual obligation could be found as a sham not only where both parties intend to deceive but also where the facts indicate that the substance of the contract is different from what has been formally stated

Question 22

Why is the difference between an employee and an independent contractor important?

Answer 22

Employees enjoy certain benefits that are not available to independent contractors

Question 23

What are some of the benefits available to only employees?

Answer 23

Unfair dismissal rights
Statutory redundancy payment
Sick pay
Paternity leave and pay
Paid time off to look for a job where made redundant