The employment rights of casual workers have provoked much case law. Where do employers and workers stand?

The term “casual worker” is used to cover a variety of workplace relationships and there is commonly some uncertainty as to the rights attaching to such workers.

Confusion can arise because the extent of employment rights for casual workers will depend upon the nature of the relationship between the business and the worker. In some cases, the worker will be an employee, in others a worker without formal employment status. Alternatively the worker may be an agency worker or a self-employed contractor who is working on his own account.

It is important to be able to identify the status of the worker as this will affect the worker’s rights and the obligations of the business when engaging the worker. However the large number of cases that have been through employment tribunals and the higher courts on this issue illustrates the difficulties that arise in this area.

Is the worker an employee?

Whether an individual is an employee is determined by a number of factors. In approaching the question it can sometimes assist to remember that although the employment relationship has been overlaid by much law over the years it has its origins in the master and servant relationship. Depending upon the circumstances, there is usually a need to consider various matters in detail. Nevertheless the essential elements which are said to form the “irreducible minimum” of a contract of employment are:

• the worker must provide provide his services personally, ie he can not provide a substitute or subcontract his services;
• there must be a sufficient degree of control exercised over the worker by the employer, for example control over how the work is done, the place of work and the hours worked;
• there must be a mutuality of obligation between employer and employee, ie an obligation to provide work and an obligation to do it.

This final requirement of “mutuality of obligation” means that often a casual worker will not be an employee beyond the immediate assignment or current work being undertaken. This was the case in Carmichael and Leese v National Power plc [2000] IRLR 43, where the House of Lords held that two ‘casual as required’ guides at a nuclear power station were not employees. The guides were not obliged to take work if offered and the company was under no obligation to offer it. This meant that when not actually working they had no contractual relationship with the tour guide operator and although they had worked for the company for more than five years with hours increasing gradually up to 25 hours per week, the guides’ claim for unfair dismissal failed.

This case did not need to address the issue of the status of the workers whilst actually working, but it has become increasingly clear in later cases, that for the purposes of their time at work, the three essential elements of the employment relationship would have been met. The workers were providing personal service, they were under the control of the company, and at least for the time when agreed work was being undertaken there was mutuality of obligation, in that the company was providing work and the workers were doing it.

Successive short-term contracts of service

Even though a casual worker may be able to establish that he is an employee whilst working, this does not mean that he will be regarded as a true employee as without a greater degree of mutual obligation he is simply engaged on a series of short-term contracts with breaks in between.

A worker may however establish a full employment relationship if there is deemed to be an “umbrella” or “global” contract operating between the worker’s stints at work. This can arise where dealings between the parties lead to expectations that the employee will be provided with work. In Nethermere (St Neots) Ltd v Gardiner and anor 1984 ICR 612 part-time home workers sewed pockets onto trousers using machines provided by the company but had no fixed hours for working, were only paid according to the amount they did and were not obliged to accept any particular quantity of work. The arrangement came to an end following a dispute over holiday pay and it was held that the long-standing relationship between the homeworkers and the company had developed into a global contract obliging the company to provide and pay for work and the workers to accept the work provided.

Another possibility is for any absences from work to be classed as temporary cessations of work under section 212 of the Employment Rights Act 1996 . For this to occur there must be a suspension of all or part of business operations meaning that the employer does not require the services of one or more of its employees for a temporary period. This of course is applicable to the seasonal nature of football clubs. Educational establishments are another example and in Cornwall CC v Prater I.R.L.R. 362 a teacher who worked for many years as a home tutor teaching children who were unable to attend school was to be regarded as having been continuously employed by the local authority. Although it had not been obliged to offer her work and she had not been obliged to accept it, the individual contracts were held to be contracts of service and the periods between contracts during school holidays amounted to “temporary cessations of work”.

Contractual terms

It is possible to exclude the possibility of long-term employment status by a clear express term, as was the case in Stevedoring and Haulage Services Ltd v Fuller and ors 2001 IRLR 627 where the Court of Appeal held that a casually employed docker could not be an employee as the contract expressly stated that there was no mutual obligation as to the provision and acceptance of work.

Employers should however be warned that Tribunals will look at the substance of the relationship between the parties and will look behind a contract that misrepresents or conceals the parties’ true intentions. Pulse Healthcare Ltd v Carewatch Care Services Ltd EAT 0123/12, concerned carers who worked for a company providing critical care services to a patient suffering from severe disabilities. The carers were engaged under ‘zero hours’ contracts which expressly provided that there was no obligation to offer any work. However the Employment Appeal Tribunal held that the written contracts did not reflect the true position and that they were employed under “global” or “umbrella” employment contracts. This demonstrates that workers engaged on zero hours contracts can sometimes be full employees even when there are clear contractual provisions stating that no mutuality of obligation exists.

Part-time workers and agency workers

It is important to be aware that under the The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 a part-time worker must not be treated less favourably than full-time workers. If agency workers are engaged they also have rights under the Agency Workers Regulations 2010, including the right after a 12-week qualifying period to the same pay and basic working conditions as equivalent permanent staff as well as access to collective facilities and to information about employment vacancies from day 1 of their engagement.

Rights of a worker

Even if a worker does not qualify as an employee important individual rights depend on being a “worker”. This expression includes not only those under contracts of service, ie employees, but also those under contracts by which they undertake to perform work personally (other than as provider of a business or professional service). Irrespective of length of service, a worker is entitled to the following:

• Protection against deductions from wages
• Protection from discrimination on the grounds of race, sex, disability, part-time status, sexual orientation and religion or belief
• National minimum wage rights
• Working time rights including holiday pay and rest breaks
• The right to be accompanied at disciplinary and grievance hearings
• Whistleblowing protection
• Possibly Statutory Sick Pay, subject to conditions and eligibility

Rights of an employee

The following rights are only available to employees, but apply regardless of the employee’s length of service:

• Time off for trade union activities and public duties
• Time off for employee representatives and occupational pension scheme trustees
• Time off for dependants
• Time off for antenatal care, ordinary and additional maternity leave, and protection against dismissal for pregnancy
• Protection against dismissal on grounds of health and safety, trade union activities, asserting a statutory right and other prohibited grounds
• Right to repayment of certain guaranteed debts on an employer’s insolvency
• The right to receive a written statement of main terms and conditions of employment and an itemised pay statement

Certain rights are also available to employees if they have a certain period of continuous employment. These include, for example:

• The right to written particulars of employment – qualifying period of one month
• The right to written reasons for dismissal – qualifying period of one year for employees employed before 6 April 2012 and two years for those employed on or after 6 April 2012
• The right to claim unfair dismissal – one year for those employed before 6 April 2012 and two years for those employed on or after 6 April 2012
• The right to claim a statutory redundancy payment and to paid time off to look for work when being made redundant – two years
• The right to statutory maternity pay, paternity pay and paternity leave – 26 weeks ending with the 15th week before the expected week of childbirth
• The right to statutory adoption leave and pay – 26 weeks
• The right to parental leave – one year
• The right to request flexible working – 26 weeks