No minimum obligation in employee status test: NMC v Somerville

March 11th, 2022

The Court of Appeal has confirmed that there is no minimum work requirement for the employee status test. It is sufficient that the contract includes a personal service obligation, and that the other party is not a client or customer. The Court of Appeal found the Claimant was a worker entitled to holiday pay.

The Claimant, Somerville, was a barrister who sits as a tribunal chair for the Nursing and Midwifery Council (NMC). His services agreement stated that his status was as an independent contractor, and that nothing in the agreement created a relationship of employer and employee. The NMC was not obliged to request Somerville’s services, nor was Somerville obliged to provide them if requested. However, if Somerville did agree to provide services, he was to use “all reasonable endeavours” to attend for the full duration of the hearing. Somerville presented a claim for holiday pay in 2018, arguing that, despite the terms of his service agreement, in reality he was either an employee or a worker.

The Court of Appeal found that under the services agreement, Somerville was not required to personally perform any services. But once he accepted an assignment, an individual contract arose whereby he agreed to personally attend a hearing and the NMC agreed to pay a fee. This was sufficient to conclude that Somerville was a worker. There was no “irreducible minimum of obligation”, and the fact Somerville could withdraw from the agreement once he had accepted it did not impact the assessment. The fact that the parties were not obliged to offer or accept any future work was irrelevant.

The Court of Appeal here referenced last year’s landmark Supreme Court decision in Uber BV v Aslam, which found Uber drivers to be workers. The fact that individual drivers were free to work or not and owed no contractual obligation to Uber when off the app, did not preclude such a finding. In that case, the Supreme Court had identified an “irreducible minimum of obligation”, but that was in the context of identifying when the obligation to perform work arose for the purposes of determining when the drivers were engaged in “working time”. The Supreme Court was not suggesting that there must be some additional obligation to provide or accept work before an individual can be classified as a worker in the worker status test.

Recent years have seen a slow evolution in the employee status test, and no doubt the law will long continue to develop. It is an important area, which given the growing importance of the gig economy, potentially has massive implications for hundreds of thousands of individuals – as well as their would-be employers.

This blog was written by Kendal Youngblood, Solicitor at didlaw.

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