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Case Study highlights the importance of knowing where you stand early on, say Thomas Mansfield
Case Study highlights the importance of knowing where you stand early on, say Thomas Mansfield
A recent case report has addressed the troublesome question of the difference between the employee and the self-employed person.
Surrey,
UK,
Ukraine
(prbd.net)
06/12/2011
A recent case report has addressed the troublesome question of the difference between the employee and the self-employed person.
The employment solicitors, London ( http://www.thomasmansfield.com/index.php?option=com_content&view=article&id=235 ) -based Thomas Mansfield, have focused again on the importance for businesses of establishing clear status in advance of any contract, particularly when engaging self-employed people.
The report details the case between Mr. Johnson-Caswell and MJB (Partnership) Ltd, bringing to light the tensions between employment and self employment in the FSA regulated financial services sector. MJB argued that the element of control by the FSA over Johnson-Caswell diluted the extent of its own control over him; the result being that he was not its employee.
The argument points towards the significance of a written contract and the imperative need for its implementation to avoid such disputes and crucial assistance of an employment solicitor ( http://www.thomasmansfield.com/ ) . Johnson-Caswell entered into a written agreement with MJB that stipulated that MJB engaged Johnson-Caswell as a ‘self-employed’ sales consultant.
The case was further complicated because both MJB provided training to Johnson-Caswell in order for him to become a fully fledged financial advisor. However in its defence, MJB argued that Johnson-Caswell was not undertaking work specifically for them, but rather working for selected clients, as a self-employed person. This was despite both parties benefitting from a shared commission per client. Such a mutually beneficial relationship was enough to suggest employment status.
When giving judgment, in addition to the agreement between the parties, the employment judge considered mutuality of obligation. The decisive outcome was that because MJB provided assistance, training, supervision and payment of commission in relation to work secured by Johnson-Caswell that he was its employee and not ‘self-employed’ as it alleged.
The judge reminded employment lawyers that one should not focus too heavily on the agreement but also to have regard to the larger picture at play.
A practical stance should still be taken with the implementation of a clearly defined agreement between the parties but that is not the only aspect to consider. The courts will also look at how the relationship operates in practice. Of importance is that external regulation (in this case by the FSA) does not detract from the control that the employer has over the individual. All businesses would be wise to have written agreements in place but this should in no way detract from the day to day practical reality of the relationship between the business and the individual.
Should an employment dispute arise then this can always be attended to with an appropriately drafted compromise agreement ( http://www.thomasmansfield.com/index.php/compromise-agreement ) . ThomasMansfield LLP offers professional advice whatever your area of employment disagreement, which can cut both costs and time in an employment tribunal.
For further information please contact:
Nita Newsome
ThomasMansfield LLP
Ground Floor,
Christopher Wren Yard,
119 High Street, Croydon,
Surrey CR0 1QG
Telephone: 0845 6017756
E-mail: nita.newsome@thomasmansfield.com
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About
Thomas Mansfield Solicitors, winners of the Innovation Award at the Law Society’s Excellence Awards 2009, are specialists in Employment Law and can provide sound and knowledgeable advice on all legal matters regarding employment, including unfair dismissal, break of contracts and compromise agreements. For more information please visit http://www.thomasmansfield.com
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