Community Based Care Health Ltd v Narayan (EAT)
The EAT has ruled that a GP providing out-of-hours medical services was a worker and entitled to benefit from relevant statutory employment protections, such as the right to paid holiday and protection against discrimination, notwithstanding the fact that she was paid through a limited company.
Here, the relevant individual was engaged as a "duty doctor". Whilst she was not entitled to be provided with or accept work under her contract, had flexibility as to holiday and did external locum work through an agency, she generally provided her services at a single practice on the basis of a regular rota. From October 2015, she set up a limited company and provided its bank details to the Company, into which the Company made regular payment. The individual's limited company accounted for tax on the payments made to it. When the Company ceased to offer her further work, she brought numerous employment claims, including for unfair dismissal, discrimination and holiday pay.
The Employment Tribunal dismissed her claim for unfair dismissal on the basis that she could not be an employee because there was no mutuality of obligation between the parties. However, the judge was satisfied that she was a worker, and therefore entitled to bring claims for unpaid holiday pay and discrimination, due primarily to the fact that she was required to work personally for the Company and provided regular services over a long period of time.
The EAT agreed with this assessment, adding that the fact that she was paid through a Company was not fatal to this assessment. In its view, the nature of the provision of GP services, which had to be delivered by an individual who met stringent qualification and performance requirements, meant that the "employment" relationship was between the individual who met those criteria, as opposed to an "inanimate corporate entity". It also distinguished other cases in which GPs were found to have been marketing services to multiple medical service providers, rather than delivering stable services to a single provider over a period of time.
This judgment demonstrates that Tribunals will take a granular, factual and practical approach to questions of employment status; technicalities such as contractual terms which fail to represent the reality of the relationship or complicated payment mechanisms which artificially obscure the true picture will not be determinative. In particular, this decision reiterates that the use of a limited company intermediary does not necessarily prevent an individual from claiming employment rights against an end user where they provide services: (i) personally; and (ii) to an end user who cannot properly be described as their client or customer.