Mr D Nokes v D Nokes Engineering Limited and 1 other — 2024

The claimant was the sole director and shareholder of the first respondent, an engineering company he had set up on his accountant's advice. The first respondent had been dissolved by the time of the hearing with no application to restore it to the register, so the claim proceeded only against the Secretary of State for Business and Trade. The Secretary of State's position was that the claimant had not in fact been an employee of the first respondent and so no payments could be made from the National Insurance Fund under section 182 of the Employment Rights Act 1996.

Applying the Ready Mixed Concrete test, Employment Judge Edmonds concluded that there was no mutuality of obligation and no relevant control by the first respondent over the claimant: in reality it was the claimant who sourced third party contracts and decided whether to accept them, and any control was exercised by the third party companies. While personal service was present, that alone was not sufficient. The judge found that the arrangement had been set up for tax purposes, with no contract of employment, no board minutes, no holiday arrangement and no documentation of termination, and that neither side had in reality treated the relationship as employment.

On that basis the judge held that the claimant was not an employee of the first respondent and the claims against the Secretary of State therefore failed. The claims against the first respondent could not proceed as the company had been dissolved. All four complaints (unauthorised deductions from wages, breach of contract / notice pay, holiday pay and redundancy payment) were dismissed as not well-founded, and it was unnecessary to determine the time limit issue.