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Definition of Employee

Comment 17th August 2010

 




A great deal of time and money is spent in the Courts in defining who is 'an employee' in order to decide whether an individual has statutory and/or contractual employment rights. Despite the vast body of case law that has developed around the definition contained in the Employment Rights Act 1996, the position is still unclear. Employers are seemingly able to deny people who work for them access to employment rights simply by calling them 'workers' and saying they are 'not obliged' to provide them with work. This right which is balanced in favour of employers has even been incorporated into agreements which are of no real benefit to the individuals concerned but must be signed in order to access work with that employer. The agreement is then used as evidence by the employer to show there is no ‘mutuality of obligation’; on their part to provide work or on the individual's part to accept work offered. In reality an individual may have no choice other than to sign such an agreement and in effect sign away their employment rights if they may otherwise be refused work. An example of this is in private sector healthcare where an individual can be employed through a 'bank' arrangement for many years on a regular, on-going basis without a break in continuity of service. They have some limited rights e.g. under Health and Safety and Working Time Regulations. However because their employer has designated them a 'bank worker' and not a 'bank employee' they accrue no redundancy or notice rights. Employers obviously see this as a cheap form of expendable labour whereas the individual may in every respect be as loyal, dedicated and worthy of compensation for losing his/her job as anyone designated an 'employee'.   A simple solution would be to amend the definition of an employee in the Employment Rights Act to include anyone who is directly employed by the employer to undertake work for that employer (i.e. not self-employed and not engaged through an agency or by a third party).  The individual would still need continuity of service in order to qualify, as employees do at present, for rights to claim unfair dismissal, redundancy payments etc. This change would not therefore prevent employers from taking on employees as and when required to meet short term needs or prevent individuals who genuinely want to work on a casual basis from doing so since in those latter cases the employees will still not accrue continuous service.   

Why does this matter?

This is important because it is inherently unfair that well established employment rights available to the majority are denied to some people because of an apparent loophole in the law. Also the debate on this issue in the Employment Tribunals and the appeal courts, whilst fascinating to lawyers, is an unnecessary use of public money which could be better used elsewhere.

1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet) A great deal of time and money is spent in the Courts in defining who is 'an employee' in order to decide whether an individual has statutory and/or contractual employment rights. Despite the vast body of case law that has developed around the definition contained in the Employment Rights Act 1996, the position is still unclear. Employers are seemingly able to deny people who work for them access to employment rights simply by calling them 'workers' and saying they are 'not obliged' to provide them with work. This right which is balanced in favour of employers has even been incorporated into agreements which are of no real benefit to the individuals concerned but must be signed in order to access work with that employer. The agreement is then used as evidence by the employer to show there is no ‘mutuality of obligation’; on their part to provide work or on the individual's part to accept work offered. In reality an individual may have no choice other than to sign such an agreement and in effect sign away their employment rights if they may otherwise be refused work. An example of this is in private sector healthcare where an individual can be employed through a 'bank' arrangement for many years on a regular, on-going basis without a break in continuity of service. They have some limited rights e.g. under Health and Safety and Working Time Regulations. However because their employer has designated them a 'bank worker' and not a 'bank employee' they accrue no redundancy or notice rights. Employers obviously see this as a cheap form of expendable labour whereas the individual may in every respect be as loyal, dedicated and worthy of compensation for losing his/her job as anyone designated an 'employee'.   A simple solution would be to amend the definition of an employee in the Employment Rights Act to include anyone who is directly employed by the employer to undertake work for that employer (i.e. not self-employed and not engaged through an agency or by a third party).  The individual would still need continuity of service in order to qualify, as employees do at present, for rights to claim unfair dismissal, redundancy payments etc. This change would not therefore prevent employers from taking on employees as and when required to meet short term needs or prevent individuals who genuinely want to work on a casual basis from doing so since in those latter cases the employees will still not accrue continuous service.    " />

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