Mrs Michelle Clare Bennet (1) Mr David Clare (2) v Secretary of State for Business & Trade — 2025

The claimants, who were married to each other, were directors of Top Drawer Components Limited and shareholders/directors of its parent company, Sanderhill Limited. After Top Drawer Components Limited entered winding up, they applied to the Insolvency Service for statutory redundancy payments. The Respondent refused the applications on the basis that they were not employees, and the Tribunal identified the single issue as whether they were employees of the company at the material time.

The Tribunal accepted that the claimants undertook substantial work for the company and provided personal service. It also accepted that there had been written statements of employment, but found those documents did not reflect the reality of the relationship, including as to hours, pay and disciplinary procedure.

The Tribunal found that the claimants were not guaranteed regular pay, their remuneration fluctuated with the company's financial position, they prioritised payment of other employees, and they exercised ultimate control over their own hours, tasks and remuneration. Taking account of the lack of mutuality of obligation, their high degree of control, irregularity of pay, and their roles as directors and shareholders, the Tribunal found they had not proved employment status at the time of insolvency. The redundancy claims were therefore dismissed.