13 Employment 1 The contract of employment
Definition
1.1 An employment relationship exists where one person (the employee) supplies skill and labour to another (the employer) in return for payment.
1.2 Distinguish Employee from Independent Contractor. (Contract of Service vs Contract for Services.)
Determining status
1.3 An Employment Tribunal (ET) may apply one or more of the four tests listed below, note that no one test is likely to be conclusive Ready Mixed Concrete v Minister of Pensions:
(a) Control test.
(b) Integration Test:
Is this party fully integrated into the organisation?
(c) Multiple Test:
ET looks at all the relevant factors. Now the most widely used test it considers:
(i) Method of payment: periodic and prolonged, or lump sum?
(ii) Method of selection and termination of relationship;
(iii) Organisation of the work: can the individual choose hours and methods of working, or delegate?
(iv) Provision of tools and equipment and;
(v) Deduction of tax and N.I.
(d) Mutuality of obligations test.
2 Terms
2.1 Express terms
(a) No requirement for formal written contract.
(b) Under Employment Rights Act 1996 (ERA 1996) employer must provide written particulars to employee within 8 weeks of starting employment. Note this is not a contract but will constitute strong prima facie evidence of the contractual terms.
Particulars must include inter alia:
· Details of remuneration and procedure for calculation.
· Hours and place of work
· Holidays and holiday pay
· Situation if unable to work (sick pay/leave)
· Length of notice
· Disciplinary and grievance procedures.
Any change to the particulars must be notified within one month.