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Dentist's right to substitute others for himself undermines 'worker' claim, rules EAT

A dentist did not qualify as an employee or even as a 'worker' under employment law because he could have supplied locums to do his work and still fulfil his contract, the Employment Appeals Tribunal (EAT) has ruled.

Georges Sultan-Darmon was a dentist with a contract to work at Community Dental Centres (CDC), which provided him with facilities and imposed certain conditions on his work that were related to NHS dental schemes.

He sued CDC, claiming unlawful deductions were taken from his wages. An Employment Tribunal first had to rule on whether he was entitled to take that case, given his employment status. It found that he did not qualify as an employee, but did qualify as a worker.

Workers enjoy less protection under employment law than employees, and usually operate under a contract of employment. Workers still have a number of rights under the law.

The EAT disagreed, though, and said that Sultan-Darmon could not take the wages claim because he was neither an employee nor a worker. He could not have 'worker' status because under the terms of his contract he could choose not to work and employ another dentist to do his work for him, the EAT said.

"[Sultan-Darmon] was not a 'worker' as he did not 'undertake to do or perform personally any work or services' as required by section 230(3) [of the Employment Rights Act] because there was no obligation on [him] to do work as he could delegate his duties," the EAT said.

Sultan-Darmon had a contract with CDC which stipulated that he would be a "a self-employed independent contractor dentist with full clinical freedom and accepting full clinical responsibility" under the deal.

The contract said that Sultan-Darmon would operate outside of the direct control of the CDC except for an audit to ensure certain standards were met.

The Employment Tribunal found that many of the characteristics of the contract and the way in which Sultan-Darmon actually worked supported the view that he was independent and self-employed.

"I was not satisfied that there was in fact a sufficient mutuality of obligation here," that first ruling said. "The respondent undertook to introduce patients to the claimant but there was no guarantee that any particular number of patients would be introduced or even the claimant would necessarily get his fair share as compared with other dentists engaged in other same terms and conditions. Furthermore there was no obligation upon the claimant ... to treat any patient who he decided he did not wish to treat."

"Although as a matter of commercial common sense it was in the interest of the respondent to introduce patients to the claimant and it was in the interests of the claimant to treat those patients, there was no legal obligation on either side which was sufficiently clearly enforceable to amount to a mutuality of obligation," that ruling said.

The EAT agreed with that analysis, which was what the Employment Tribunal used to decide that Sultan-Darmon was not an employee of CDC. But the EAT said it should have been extended to the question of whether he was a worker.

"Surprisingly the Employment Judge did not rely on [the same] conclusions when later deciding if the Claimant was a 'worker' but instead, when dealing with the issue of worker-status," said the EAT ruling. "There is an obvious inconsistency between these two conclusions because either the first (but unchallenged) conclusion that [Sultan-Darmon] was an 'employee' is wrong or the second conclusion that he was not a 'worker' is wrong."

"The crucial point is that the Employment Judge cannot simultaneously conclude in different parts of their decision first that there was and second that there was not an obligation to perform services personally," it said. "We are therefore driven to the conclusion that the failure of the Employment Tribunal to take into account these earlier findings ... amounts to an error of law."

A crucial factor in the EAT finding that Sultan-Darmon was not a worker was the fact that he could choose not to work and hire someone else to do his work and still fulfil his contract. This, it found, meant that he did not qualify for protection as a worker because

"We stress that the absence of mutual obligation is not merely a question of consistency within the judgment because under his contract with the [CDC Sultan-Darmon] was plainly entitled to decide for himself whether to turn up and to provide dental services," it said. "It is noteworthy that [Sultan-Darmon's] right not to do so did not depend solely upon whether he was unable to do this but it also depended on whether he was willing to provide those services.  In other words, [he] had a discretion whether to attend at [CDC's] premises."

"So it follows that the absence of any legal obligation on [Sultan-Darmon] which was sufficiently clearly enforceable to amount to a mutuality of obligation, [Sultan-Darmon] by virtue of the 2002 agreement was not a 'worker' under the second limb of section 230(3) [of the Employment Rights Act]. "In other words the 2002 agreement did not entail an undertaking on the part of [Sultan-Darmon] 'to do any work or perform personally any work or service'."

The EAT said that previous cases made it clear that "an unfettered right of a contractor to send a substitute to do his or her work shows that the contractor is neither a 'worker' or an 'employee'."

In previous cases tribunals have found that clauses allowing a person's duties to be performed by someone else were sometimes inserted into contracts as a device to evade responsibility for employees or workers.

The EAT found that this was not true in this case, though.

"In consideration of the fact that the EAT considered whether this arrangement was a sham and was satisfied that it wasn't, this case is a good example of the benefits of having a substitution clause in contracts of this type," said Ben Doherty, an employment law specialist at Pinsent Masons, the law firm behind OUT-LAW.COM.

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