Employment Law Case Reports
The Employment Appeal Tribunal (EAT) has held that a reduction in headcount is not always necessary for there to be a redundancy situation.
Ms Fauchon worked as a bookkeeper. There was not only a downturn in business but the employer introduced SAGE, an accountancy software package, which reduced the number of hours Ms Fauchon was needed to work. The employer asked Ms Fauchon to decrease her hours, she refused and the employer dismissed her.
The Tribunal held that the slump in business led to her dismissal as there was a diminishing need for bookkeeping. She was redundant. The lack of a reduction in the number of employees did not matter.
The employer appealed on the basis that the case of Aylward v Glamorgan Holiday Home Ltd (EAT/0167/02) held that there must always be a reduction in headcount for redundancy to apply.
The EAT upheld the Tribunal’s decision that Ms Fauchon was dismissed by reason of redundancy. It held that Aylward should not be followed as it was inconsistent with Court of Appeal observations. Therefore a reduction in headcount is not always required for it to be a redundancy situation.
The Employment Appeal Tribunal decides that a lapdancer is an employee, not self-employed.
Whether a person employed or self-employed is important, because it affects various employment rights, including holiday pay, maternity pay, redundancy payments, rights on transfer of employment and the right to bring an unfair dismissal claim. Only employees can bring claims for unfair dismissal.
Ms Quashie, a lapdancer, brought a claim for unfair dismissal to an employment tribunal. She failed at the first hurdle, because the tribunal decided that she was not an employee. She appealed to the Employment Appeal Tribunal (EAT).
HH Judge McMullen found that, for there to be an employment relationship, the cases establish that three essential elements must be present:
a requirement for the employee to perform the service personally (and not, for example, through a substuitute);
a sufficient degree of control by the employer; and
a mutuality of obligation, whereby the employer must supply work and the employee do work.
If any one of these three elements is missing, the individual cannot be an employee.
The employment tribunal decided that this relationship ticked the first two boxes. Miss Quashie was required to perform personally and there was sufficient control by Stringfellows over how she provided her services, because she was required to comply with strict ‘club rules’. The employment tribunal found, however, that there was not the necessary mutuality of obligation to sustain an employment relationship.
The EAT disagreed. Ms Quashie was employed when she was not working because she had contractual obligations to attend work, to notify Stringfellows of holidays and to attend weekly meetings without pay. Hence Ms Quashie was entitled to bring an unfair dismissal claim.
This decision is likely to affect the employment rights of thousands of dancers across the UK in an industry previously largely free of employment regulation.
Cases on employment status continue to be complex and fact-specific. This case is particularly useful in exploring what ‘mutuality of obligation’ really means.
Age Discrimination: Seldon v Clarkson Wright & Jakes  UKSC 16
Mr Seldon became a partner of the Kent firm of solicitors, Clarkson, Wright & Jakes in 1971 and was made an equity partner in 1972. In 2005 Mr Seldon and the other partners signed a partnership agreement which provided for a compulsory retirement age of 65.
Mr Seldon became 65 in January 2006. Realising that he needed to work beyond his planned retirement date for financial reasons, he asked not to be retired. The partners did not agree and compulsory retired Mr Seldon.
Mr Seldon alleged that his retirement from the firm was an act of direct age discrimination. The firm claimed that Mr Seldon’s treatment was justified because of a number of “legitimate aims.”
In the Supreme Court, Lady Hale said that the identified aims, namely (i) ensuring that associates are given the opportunity of partnership after a reasonable time, thereby ensuring that they do not leave the firm (ii) facilitating the planning of the partnership and (iii) limiting the need to expel partners by way of performance management were legitimate.
The Supreme Court has remitted the case back to the Employment Tribunal to decide whether choosing the age of 65 years for retirement was a proportionate means of achieving these legitimate aims.