Levy McCallum Ltd v Middleton

A camel is not a horse, just because you want it to be one

Levy McCallum Ltd v Middleton,
Employment Appeal Tribunal,
9 August 2005

Levy McCallum Ltd was considering making some of its staff redundant. Middleton, an account director, offered to accept redundancy, and then supply the company with services as a self-employed consultant.

Levy McCallum agreed, but five months later it terminated the arrangement and Middleton complained to a tribunal, alleging unfair dismissal. To succeed, he had to establish that he remained an employee during his self-employed period. The tribunal found that some elements of the relationship pointed to him being employed while others suggested he was self-employed.

Balancing all the relevant factors, the tribunal held that Middleton had remained an employee, despite the fact that both parties had genuinely believed he was self-employed.

Levy McCallum appealed to the Employment Appeal Tribunal (EAT), arguing that the intention of the parties should have been the deciding factor.
The EAT, however, dismissed the appeal, saying: “If parties agree to create a horse but instead create a camel, the fact that they intended to create a horse and even call what they have created a horse is of little assistance in determining whether it is, in fact, a horse.”

If there is still some real ambiguity after the parties’ intention has been taken into account and the case is relatively finely balanced, only then should the parties’ intention be a decisive factor.

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