Legal Updates - Unfair Dismissal Agency 2007

Employment Law - Unfair Dismissal - Contract for Service - Agency

 

The employee in the case of Cairns v Visteon UK Ltd [2007], had been employed as an administrative assistant from 1998 until the 29th of May 2005. From a point around 2001, the employees services had been provided by an agency. The agency, M, had employed the employee under a contract of service. During May 2005, an issue arose as to whether the employee had falsified her timesheets. The employer used these timesheets to pay the employee through M. M conducted an investigation and concluded that the employee had not been dishonest. Even so, the employer refused to continue working with the employee, and the purchase order for her services was revoked. M then attempted to relocate the employee without any success. As a result, the employees employment was terminated by M. The employee brought a claim before the employment tribunal alleging that she had been unfairly dismissed by the employer. The main issue for consideration by the tribunal was whether the employees services had been provided under an employment contract. The tribunal concluded that, but for the existence of the contract of employment between the employee and M, it would have accepted the need to imply a contract between the employee and the employer. Despite that conclusion, the tribunal refused to find such an implied contract in the instant case. Their reasoning for this was that there was no authority to support the proposition that such a contract could be implied between an employee and end-user where there existed a contract of employment between the employee and the agency. It was also held that the agreed test of necessity for the implication of a contract of employment between the employee and the employer had not been made out. The employees claim was therefore dismissed and she then appealed to the Employment Appeal Tribunal. The employee submitted the following: The tribunal had erred in finding that the fact that there was a contract for service between M and the employee meant that there could not be a contract of service between the employee and the employer; and The tribunal had not properly considered the issue of necessity. Her appeal was dismissed on the following grounds: Where the contract between the employee and the agency was one for services, it might be possible to imply a contract of service between the employee and the end-user in order to afford the employee protection under the Employment Rights Act 1996. However, where the employee was employed by the agency, and, therefore, already protected by the Employment Rights Act 1996, there existed no reason to extend that protection to a second and parallel employer. The employee had been engaged by M under a contract of service, and her arguments in support of the implication of a contract between herself and the employer appeared to be solely founded upon the assertion that her claim for unfair dismissal would have had a greater prospect of success as against the employer. The tribunal had therefore been correct not to imply a contract of employment between the employee and the employer. In order for a contract of service to be implied by conduct on the basis of necessity, it was necessary to have demonstrated that the conduct of the employee and the employer had been consistent only with there having been a contract of service between them. In this case, however, it had been open to the tribunal to conclude that the conduct of the employee and the employer had been equally consistent with the employee's services being supplied to the employer under the terms of the contract of service between the employee and M; and the terms of the commercial contract made between M and the employer for the purchase of the employees services.

Accordingly, it was held that the tribunal had properly considered the issue of necessity.

 

If you require further information please contact us at enquiries@rtcoopers.com or visit http://www.rtcoopers.com/practice_employment.php.

© RT COOPERS, 2007. This Briefing Note does not provide a comprehensive or complete statement of the law relating to the issues discussed nor does it constitute legal advice. It is intended only to highlight general issues. Specialist legal advice should always be sought in relation to particular circumstances. 

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