Mr Bradley Rainford v Dorset Aquatics Limited — 2020

Mr Bradley Rainford and his brother were co-directors and shareholders of Dorset Aquatics Limited. After a dispute in June 2018, Bradley brought claims said to arise from his employment relationship, including unfair dismissal, notice pay, unlawful deduction from wages and arrears of holiday pay. The tribunal heard the matter as a preliminary issue and had to decide whether he was an employee or worker, and, if so, when any relationship ended.

Applying s.230 ERA 1996 and the authorities cited by the parties, including Ready-Mixed Concrete, Quashie, O'Kelly and Tallon, the tribunal found that Bradley was not an employee. It accepted that the business was a family-run company with little contractual paperwork, that Bradley and Ben set their own salaries and dividends, and that the PAYE/NIC treatment and P45/P60 paperwork were arranged by the accountant for tax reasons. The tribunal placed weight on Bradley's control over his work, his ability to decide hours and holidays, the lack of genuine mutuality of obligation, and the fact that the letter of 30 June 2018 was read as an ultimatum to step away from the business rather than a clear assertion of employee status.

The tribunal also rejected worker status. It found there was no strict requirement for personal service, little or no control by the Respondent, and that Bradley shared the business risk as a co-director and shareholder. Although it said s.230(3)(b) did not apply because the Respondent was not a customer of a business undertaken by Bradley, that did not make him a worker. Because he was neither an employee nor a worker, the tribunal held it had no jurisdiction to hear the unfair dismissal, breach of contract notice pay, unlawful deduction from wages, or arrears of holiday pay claims, and all were dismissed.