Case 8000281/2024 · Employment Tribunal
EMPLOYMENT TRIBUNALS (SCOTLAND) Case No: 8000281/2024 Held in Glasgow via Cloud Video Platform (CVP) on June 2024 Employment Judge J D Young Mrs Lorraine Campbell
The claimant presented claims for a redundancy payment and notice pay. The respondent stated that it had no objection to the claim. The principal issue was whether the claimant, who had been the respondent’s majority shareholder and later sole shareholder/director, was also an employee entitled to a redundancy payment. The tribunal heard evidence from the claimant and considered payroll, tax, share transfer, P45 and P60 documents, together with correspondence from the claimant’s accountants.
The tribunal found that the claimant began working for the company in January 2018 on a part-time administrative basis and later took on full-time responsibility as the business was affected by COVID. It accepted that she was paid through payroll, received payslips and P60s, had pension contributions made to NEST, took holidays, and was not self-employed or engaged in any other capacity. Applying section 230 ERA 1996 and the approach in Neufeld, the tribunal held that shareholder and director status did not prevent her being an employee on the facts found.
The tribunal found that the company ceased trading at the end of January 2024 after the bank withdrew support, and that the claimant’s employment therefore terminated by reason of redundancy within section 139(1) ERA 1996. It found that she had six complete years’ service and that, using the statutory weekly pay cap of £643, her redundancy payment was £5,787.
The tribunal also found that the claimant was dismissed without the requisite notice under section 86 ERA 1996. It assessed that claim as one month’s net pay, being £2,407.62. The tribunal noted that the notice claim was a precursor to a possible claim on the insolvency fund under section 166, but that the award for notice pay was made against the respondent.
| Claim type | Issue or finding | Outcome | Protected characteristic | Award |
|---|---|---|---|---|
| Redundancy | The tribunal found the claimant was an employee despite being a majority shareholder and, from 9 September 2021, sole shareholder/director, and held that her employment ended by reason of redundancy when the business ceased at the end of January 2024. | Upheld | — | £5,787 |
| Breach of contract | The tribunal held that the respondent failed to give the requisite notice of termination and awarded one month’s net pay as notice pay. | Upheld | — | £2,408 |
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