She appealed and the employment appeal tribunal decided in her favour — she was an employee and the employment tribunal had got it wrong. This time Stringfellows appealed and just before Christmas the Court of Appeal agreed with the nightclub and the earlier employment tribunal decision. So for the time being she is not an employee. I understand the lap dancer will be appealing to the Supreme Court, so the matter is not settled yet.
The claim illustrates the often difficult employment relationship between licensed premises and cleaners, door supervisors, DJs and even lap dancers. The legal question is whether or not the individuals are employed under a contract of employment, the implication being that if they are staff they benefit from all normal rights that flow from being employed and they can make a claim in an employment tribunal if they are not provided with those rights. In addition, the employer can also be vicariously liable for their workers’ actions.
As always, each case will be decided on the facts but there are three main indicators as to whether a contract of employment exists:
- The level of control — an employer will have control and authority over the employee — for instance, on when and how they work. The more control a business seeks to exercise over workers the more likely that a contract of employment exists.
- Mutual obligation — an employer expects an employee to work and they provide them with work. The employee expects to be given work and to be paid, they undertake said work and the employer pays them in return.
- Personal service — an individual undertakes the job personally.
The case previously mentioned shows how difficult it can be to assess if a worker is employed. The Court of Appeal decided the lap dancer at Stringfellows was not an employee, despite finding there was some control, mutual obligation and personal service.
Most importantly, the judge found, there was no obligation to pay the dancer.
The decision is relevant as it reversed the previous decision that she was an employee.
The industry has always considered lap dancers to be self-employed.
In these situations the factors that will need to be considered include: who supplies the equipment (for instance, cleaning equipment or the DJ sound system and records)? Who controls the working hours? Who personally delivers the service? Can they send a substitute? Is payment by the job or by the hour? How is payment made and to whom?
The fact that a cleaner or door supervisor may have multiple jobs with different businesses does not necessarily mean he/she is not employed on a part-time basis by each of them.
It is quite possible to be an employer where you take a worker, for instance a cleaner or door supervisor, from an agency.
Tribunals have previously decided that if a worker was under the day-to-day control of the same ‘end user’ for a significant time, that end user would be the employer and not the agency.
You may remember, in one case a few years ago, a large nightclub operator was held to be vicariously liable for the violent and criminal actions of a door supervisor whom it had engaged through an agency.
To help avoid being the employer when taking staff from an agency, you should always consider the following matters:
- Is there a clear contract between you and the agency for the service? You should ensure there is.
- Does the agency have an actual contract of employment with the agency worker? One should always be in place. It is worth checking with the agency.
- Does the agency pay the worker’s wages, NI, holiday, sick pay and tax? It would be better that this is the agency rather than you.
- Who controls the worker — the agency or just you? Ultimately, control should be with the agency.
- Do you allow any individual to be provided by the agency or do you demand specific staff? It is better that you leave the decision with the agency.
This is a complex area of law and, although problems are rare when they do arise, they can be long-winded and costly.