When an employee is not an employee

For the purposes of the Equality Act 2010 is an employee someone who has entered into a contract where they agree to do work personally?

No – Held the Employment Appeals Tribunal in Alemi v Kady Mitchell and Orton Bushfield Medical Practice.

The Issue

In the recent case of Dr Alemi v Kady Mitchell (1) and Orton Bushfield Medical Practice (2) (UKEAT/0042/20/AT) Dr Alemi appealed to the Employment Appeals Tribunal (EAT) against the decision of the Employment Tribunal (ET), that for the purposes of section 83(2) of the Equality Act 2010 (EqA 2010) he was an employee of the practice.

Section 83(2)(a) EqA 2010 defines employment as ‘employment under a contract of employment, a contract of apprenticeship or a contract personally to do work.

The above definition is in contrast to the definitions under section 230 of the Employment Rights Act 1996 (ERA 1996).  The most relevant definition to this case under the ERA 1996 is section 230 (b) which provides that a worker (not an employee) ‘is an individual who has entered into, or works under (a) a contract of employment, (b) any other contract whether express or implied and whether oral or in writing whereby, the individual undertakes to do or perform personally any work or services for another party to the contract, in which the other party has the status of a client or customer. This is known as a limb (b) worker.

The Facts

Dr Alemi is a locum Doctor working since 2017 at the Orton Bushfield Medical Practice. The claimant in the ET case was Kady Mitchell, a practice nurse employed by the same practice. Miss Mitchell alleged that Dr Alemi subjected her to sex discrimination and sexual harassment.  She held him and her employer liable for his actions on the basis that he was an employee or agent of the practice.

The definition of employment under the EqA 2010 is considered when allegations of discrimination are made in order to determine the statutory protections to which that person is entitled to. The ET considered the definition described above and held that for the purposes of section 83(2) EqA 2010, Dr Alemi was an employee of the practice.

Dr Alemi appealed the decision on the grounds that the ET Judge applied the wrong test and disregarded relevant authority and factual considerations. Dr Alemi argued that there was no contract between him and the practice as the contract was between him and his service company.  He was therefore not an employee even though he was performing work personally.

The EAT concluded that the ET Judge made a distinction between an employee under the EqA 2010 and a limb (b) worker, believing that the EqA definition was broader than that of a limb (b) worker as it only required a contract to do work personally. This could include a contract between a person who is in business on their own account and undertakes work for their clients or customers provided they are required to perform the work personally.

The EAT did not agree with this distinction and considered that there was no substantial difference between these definitions and the definition under the EqA 2010 was no broader than that of a limb (b) worker. Therefore those who are genuinely in business on their own account and work for their own clients or customers are excluded from the definition of employee for the purpose of the EqA 2010, akin with the definition of a limb (b) worker.

The EAT concluded that the ET Judge erred in law by believing that in order to be an employee under section 83(2) EqA 2010 all that was necessary was that Dr Alemi had entered into a contract with the practice where agreed to do work personally. The error in law was fundamental to the decision reached and therefore the appeal succeeded.

Points to take away from the case

There is no significant difference between the definition of an employee in the extended sense for the purposes of EqA 2010 and a limb (b) worker, as both exclude those who are genuinely in business on their own account and undertake work for their clients or customers. The definition under the EqA 2010 is no broader than that of a limb (b) worker.