Cotswold Developments Construction Limited v Williams, EAT, 21 December 2005
Mr Williams, a carpenter, worked regularly for Cotswold Developments Construction (Cotswold). When dismissed, he brought tribunal complaints of unfair dismissal and non-payment of holiday pay, among other things. The tribunal had to decide whether he was an ’employee’ (in which case he was entitled to bring all of his claims), a ‘worker’ (entitled to claim holiday pay but not unfair dismissal) or neither (so that all the claims would fail).
The tribunal found that Williams was a worker under the definition in the Working Time Regulations 1998 (WTR) because he was engaged under a contract that required him to perform the work that he did for Cotswold personally. However, it held that he was not an employee, because of a lack of ‘mutuality of obligation’ – ie, Williams was able to turn down work offered by Cotswold, and sometimes there was no work available to offer him. So although Williams was able to claim holiday pay, his complaint of unfair dismissal was rejected. Both parties appealed.
The Employment Appeal Tribunal (EAT) allowed the appeal and sent the case back for rehearing. For someone to be an employee, it said, it is not necessary for the employer to be obliged to offer work; a commitment to pay for any work that is done would be enough. Nor does a right for an employee to turn work down deprive a contract of mutuality of obligation. The question is simply whether there was some minimum (or at least some reasonable) amount of work which the claimant had obliged himself to do. If an agreement to do at least some work was not present, however, then the claimant would fail the employment status test, and would fall outside the WTR definition of worker.
This case goes some way towards clarifying the employment status of casual workers. If the agreement makes it clear that there is no obligation to accept even a minimum amount of work, then it will not be a contract of employment, nor will it give rise to rights under the WTR.