Stringfellow Restaurants Ltd v Quashie
Ms Quashie worked intermittently for 18 months as a lap dancer for two clubs, Stringfellows and Angels, in London, owned by Stringfellow Restaurants Ltd. Dancers’ working patterns operated using a rota system and they had to work both Saturdays and Mondays every second weekend and one night per week at the Angels club.
Failure to attend without prior arrangement meant a dancer would be suspended the following week. Dancers could take holiday when they wanted, but they had to complete a holiday booking form in advance for the rotas. There was a club agreement (which stated that a dancer was an independent contractor) and a set of house rules, neither of which Ms Quashie received, although she did receive a booklet entitled “Welcome to Stringfellows: the Cabaret of Angels”, which contained the same material as the house rules.
Nothing in the rules prevented a dancer working at another club, as long as they were not booked to dance at one of Stringfellows clubs (although it was found that some dancers, including Ms Quashie, were under the impression that management would not be happy if they danced elsewhere). Dancers were encouraged, but not obliged, to buy their costumes from an approved supplier.
Dancers were required to pay an up-front “tip-out” fee each night (for the “house mother”, who looked after the dancers’ in terms of make-up and minor dress repairs among other things, DJ, hairdresser and other club facilities) and were paid by customers using “heavenly money”. From that money, Stringfellows deducted commission fees, a house fee and fines (for missing or being late for a shift, dance or meeting) and the remaining money, if any, was given to the dancers the next time they came to the club.
On 9 December 2008, Ms Quashie was told she would no longer be permitted to work for Stringfellows after allegations that she had become involved with drugs on the premises.
Ms Quashie brought an unfair dismissal claim. Stringfellows argued that she was not an employee and so the tribunal did not have jurisdiction to hear her claim.
The tribunal held that Ms Quashie was not an employee as there was no relevant mutuality of obligation. Ms Quashie appealed and the Employment Appeal Tribunal (EAT) found in her favour. The EAT found that there were mutual obligations in that she had to attend work in accordance with the rota and when she did Stringfellows had to give her the opportunity to dance. Stringfellows appealed.
The Court of Appeal upheld the appeal and restored the original tribunal decision. The key finding was that Stringfellows was not under any obligation to pay Ms Quashie anything: she paid Stringfellows to be able to dance at the club (and often ended up earning nothing once commission, fees and fines had been deducted) and she was paid by the customers.
In that regard, Ms Quashie took the economic risk of not being paid, which was “a very powerful pointer against the contract being a contract of employment”. This was further supported by the fact that Ms Quashie accepted in the terms of her contract that she was self-employed, and so she conducted her affairs on that basis (for example by paying her own tax), and she did not receive sick pay or holiday pay.
This case helpfully illustrates the factors a court or tribunal will take into account when determining employment status. The key factor here was the lack of obligation to pay Ms Quashie, as well as the express contractual arrangements. Although parties cannot, by agreement, fix the status of their relationship, there was nothing which indicated that the agreement in place did not reflect the reality of the relationship.
Sandra Wallace, partner, DLA Piper
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