Analysis of Adam's Relationship with BWM

1.Adam: Body Works Mechanics (‘BWM’)

The issue with respect to Adam is whether he has the status of an employee with BWM when he is described as ‘self-employed’ in the written agreement with BWM. The law applicable in this case is contained in a number of authorities in employment law, which relate to ascribing status to employees. A number of authorities have clarified the law regarding employment status and these authorities are discussed to determine Adam’s employment status with BWM, which is relevant to law dissertation help.

Authorities indicate that it is not necessary that just because employees are termed as ‘self-employed’ in employment contracts, that they will not be considered to be employees of the employer. In Autoclenz v Belcher, a recent case on employment status, the court held that an individual can only be considered to be self-employed if he is working on his own account and has some business interest in the work. In the case, it was particularly observed that just because an employer describes an employee as self-employed and then imposes on the employee certain requirements that are obligations of an employee, the true nature of the contractual relationship is that of employer and employee.

Even if there is no agreement of employment between an employer and an employee, the relationship of employer and employee can be made out. Thus, if there are certain conditions of employment made out in the relationship between the two entities, the relationship of employer and employee will be made out. These conditions were explained in Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance, where the court observed that a contract of service exists where the following conditions are met:

“(i) the servant agrees that, in consideration of a wage or other remuneration, he will provide his own work and skill in the performance of some service for his master; (ii) he agrees, expressly or impliedly, that in the performance of that service he will be subject to the other's control in a sufficient degree to make that other master; (iii) the other provisions of the contract are consistent with its being a contract of service."

The control test as is explained in the above paragraph from the judgment can determine the employment status by ascertaining the level of control that the employer exercises over the employee. If the employer guides or controls the actions of the employees, including the time and place for the performance of actions, then it is more likely that there is a relationship of employer and employee made out by the courts.

The employee is not required to establish day-to-day control of the employer, as long as there is some control by the employer. The terms of work for Adam are that he works with the company for 5 days a week, although he can take a leave on a particular day if he arranges for a replacement mechanic. These conditions of work indicate that Adam is subjected to a degree of control by BWM.

Adam is also providing personal service to the company, which comes within the scope of the dominant purpose test, where if the personal service is the dominant feature of the contract with the employer, a relationship of employer and employee is made out. Adam is required to work for the company by providing his personal services, and in case he takes a day off, he is to provide a replacement who will provide the same service. Finally, Adam is not marketing his services to any other clients, which comes within the scope of the integration test. Adam can work with other garages, but he is aware of mechanics being dismissed by BWM if they provided their services to other employers, which means that the clause allowing him to work with other employers is not really applicable.

To conclude, the authorities discussed with relevance to control test, dominant purpose test and integration test, all suggest that Adam is an employee of BWM and the description in the contract as ‘self-employed’ is irrelevant to deciding his rights under the employment laws.

2. Kai: Cake Creations (‘CC’)

The issue involved here is whether the failure to provide a reference to Kai is actionable by Kai. Authorities relating to the failure of employers to give proper or correct reference letters will be discussed to determine the claim that Kai has against the company.

The right of employees to fair and accurate references has been upheld by the court in TSB Bank plc v Harris. In TSB Bank, the court held that if the employer gives an inaccurate reference to the employee, then the employer can even be held liable for constructive dismissal. Authorities discussed here indicate that inaccurate reference letters are those that involve some falsehood against the employee or which contain allegations against the work of the employee, where such allegations have not been verified and properly investigated.

An employer has a duty of care to the employee to provide an accurate reference regarding his work, and if the employer provides a negligent reference, then he breaches this duty, and the employee has redress against the breach if, as a consequence, the employee lost an opportunity to work somewhere else. From the decision in Hedley Byrne & Co, it has been inferred that if the employer makes a false or negligent statement in the reference letter for the employee, then the employee can have an action for breach of duty of care because there is a duty of care upon referees and employers not to make negligent misstatements.

If the employer includes certain claims in the reference letter, which are in the nature of complaints, but these claims were not investigated before the employee was terminated or before such claims were made in the reference letter, then the employee can claim unfairness in the reference letter. The principle behind this approach has been explained in Jackson, where the court observed that there is a need to provide “fairness in the form of some procedural mechanism which might permit the ex-employee to challenge an adverse opinion.” Thus, the problem with reference letters that include claims or complaints against the employee, where such claims were not the subject matter of any investigation in the company itself, is that the employee is denied an opportunity to challenge the claims. This goes to the root of fairness that is involved in such procedures.

where the court has observed that there is a need to provide “fairness in the form of some procedural mechanism which might permit the ex-employee to challenge an adverse opinion.” Thus, the problem with reference letters that include claims or complaints against the employee, where such claims were not the subject matter of any investigation in the company itself is that the employee is denied an opportunity to challenge the claims. This goes to the root of fairness that is involved in such procedures.

In Cox v Sun Alliance Life Limited, the employer provided a reference letter with specific complaints against the employee but these complaints were not investigated, leading the court to hold the reference letter to be unfair. Similarly, reference to unverified facts and uninvestigated claims against the employee were held to be unfair in Jackson. Non-disclosure of facts and claims against the employee and then using these in the reference letter can also amount to a violation of the Data Protection Act 1998 as held by the court in AB v A Chief Constable.

Applying the law discussed above to the facts of this case, unfairness on the part of the company while providing the reference letter to Kai is prima facie made out. First of all, the company made a false claim with reference to Kai that when the company actually recorded a 25% increase in orders since Kai joined, CC claimed in the reference letter that Kai’s work was subpar. Secondly, the company alleged in the reference letter that Kai was head of marketing when actually Kai was appointed as the driver of the company. Thirdly, Clarisse has heard rumours that when Kai is delivering cakes, he stops off in the pub for an alcoholic drink and then he drives, although she has never asked Kai about whether he does drink and drive. This means that in actuality, no investigation into the claims or allegations has been made in the company, whereas the reference letter clearly mentions that since Kai’s arrival “at the company, the standard in cake delivery has fallen and we know that he engages in illegal behavior by drinking and driving on the job. We are unable to recommend him for future employment.” These allegations were not verified at all by the company before they were noted in the reference letter. Therefore, as per the authorities discussed above, these claims are unfair. Finally, Kai suffered an economic loss due to this inaccurate and unfair reference letter, which as per the authorities entitles him to claim breach of duty against the company.

To conclude, the reference letter is based on false and negligent claims and this allows Kai an action in breach of duty and constructive dismissal.

3.Grace: ‘Talk 4 Less’

The issue in this case is whether Grace can claim that she has been wrongfully dismissed for making a protected disclosure. Part IV A of the Employment Rights Act 1996 relates to unfair dismissal of employees who have made a protected disclosure. Section 103A specifically provides that a dismissed employee shall be regarded as unfairly dismissed if the reason or the principal reason for her dismissal is a protected disclosure made by her.

Section 43B, in Part IVA of the Employment Rights Act 1996, provides certain rules with regard to employee disclosure. Section 43B provides that if a worker reasonably believes disclosure of information is in the public interest and may be related to inter alia, a criminal offence, or a failure to comply with any legal obligation, there is a qualifying disclosure. Employees can make disclosures to their employer or to some other person who has responsibility in such cases. There must be reasonable belief with the employee as to the veracity of the information as Sections 43G and 43H ERA 1996 impose strict rules about making disclosures.

In this case, Grace is an accountant with the company for the past 3 years. She is a worker within the meaning of the Act, which means that the provisions regarding disclosure are applicable to her. As such, she may also be under an obligation to make the disclosures if she reasonably believes that the conditions of Section 43B are attracted in the case.

Although employees are required to make disclosures to their employers, it is not necessary that such disclosures are always to be made to their employers, as Section 43C(2) allows disclosures to be made to their employer if the procedure which the employer has authorized has been followed. For the purpose of making disclosures, if the disclosure is made to a class of persons prescribed for the purpose by the Secretary of State, and the matter falls within the remit of that person, then the disclosure is deemed to be made properly. In this case, the disclosure was made to the protected disclosures prescribed person, the Secretary of State for Business, Innovation and Skills.

The provisions of the Employment Rights Act 1996 protect employees who have made the disclosure under a reasonable belief about the substantial truth of the allegations, have not acted for personal gain, have acted reasonably, and also have disclosed the same information to the employer or another prescribed person. Public interest may not always be involved in such a disclosure as held by the court in Chesterton v Nurmohammed, wherein the Court of Appeal limited the scope of the public interest test and held that it is not necessary that the overarching motive for disclosure is public interest.

The question of whether whistle-blowers have been unlawfully victimized by the employer has been addressed in some authorities. If an employee has made a protected disclosure, and then the principal reason for dismissal is the disclosure, then the employee can claim wrongful dismissal. If the disclosure materially influences the treatment of the employee, then the relevant provisions of the Employment Rights Act 1996 are attracted in the case and the employee can claim unfair dismissal.

In this case, applying the law to the facts of the case, it may be said that prima facie, unfair dismissal is made out. Grace has worked as an accountant in a telecommunications company for the past 3 years and she has noticed money missing from a big client’s account that Billy was responsible for. She has reasonable belief that Billy has taken the money from the client’s account for his own personal use and she contacted the protected disclosures prescribed person, the Secretary of State for Business, Innovation and Skills, to inform them about Billy’s conduct. The investigation by the Secretary of State for Business, Innovation and Skills also upheld Grace’s claims against Billy. As the primary reason for her dismissal is the protected disclosure made by her, the case of her unfair dismissal is made out.

Billy’s conduct. The investigation by the Secretary of State for Business, Innovation and Skills also upheld Grace’s claims against Billy. As the primary reason for her dismissal is the protected disclosure made by her, the case of her unfair dismissal is made out.