In yet another case about a worker’s employment status, the Employment Appeal Tribunal (EAT) considered in Lancashire and South Cumbria NHS Foundation Trust v Moon whether an Associate Hospital Manager (AHM) was working under contract and met the statutory definition of a “worker” or whether she was an office holder. The EAT agreed with the tribunal that nothing in section 23(6) under the Mental Health Act prevented an AHM from being a worker.
Basic facts
The Trust, a specialist Mental Health Foundation Trust and a health care provider for patients detained under the Mental Health Act (MHA), appointed Ms Moon to the role of Associate Hospital Manager (AHM) under an “honorary contract” for a fixed term of three years under section 23(6) of the MHA. As such she was authorised to decide, along with two other managers, whether individual patients who had been detained on mental health grounds should be discharged.
She claimed that after blowing the whistle, she was subjected to a detriment (poor treatment) contrary to section 47B of the Employment Rights Act 1996 (ERA) and victimisation contrary to sections 27 and 39 of the Equality Act 2010. To succeed, she had to prove first that she was a worker under section 230(3) of the ERA and, secondly, that she was employed under a contract personally to do work under section 83(2)(a) of the Equality Act 2010.
Relevant law
Section 230(3) ERA states that a worker is someone who either (a) works under a contract of employment, or (b) “any other contract … whereby the individual undertakes to do … personally any work or services for another party … whose status is not … that of a client or customer of any profession or business undertaking carried on by the individual”.
Section 83(2)(a) Equality Act states that employment means “employment under a contract of employment … or a contract personally to do work”.
Section 43K(1)(a) ERA states that a worker includes an individual whose terms of work are in practice “substantially determined” by the person for whom they work.
Tribunal decision
The tribunal rejected the Trust’s argument that as they could not appoint an individual who was already an executor director of its board or an existing employee it would undermine the independence required of an AHM if she was appointed under a contract to provide her services personally to the Trust. The tribunal held that there was nothing in section 23(6) which prevented Ms Moon from being appointed under a contract.
Noting that Ms Moon was expected to make herself available for a minimum number of sittings per year and had to undergo training and participate in appraisals, the tribunal was satisfied that there was a “mutuality of obligation” between the parties. in other words, the Trust had to offer her work and she had to accept it. Furthermore, she provided her services personally and was not in business on her own account. As such, she constituted a “limb (b)” worker under section 230(3) ERA.
Having regard to the need to adopt a statutory interpretation, as per the decision of the Supreme Court in Uber v Aslam (ELR 717) when determining employment status, the tribunal held that the fact Ms Moon’s contract was described as “honorary”” should not be interpreted in a way which would deny her statutory rights to protection from being victimised under the Equality Act and the right not to be subject to a detriment for whistleblowing under section 47B of the ERA.
She was also a worker “in employment” under a contract personally to do work as per section 83(2)(a) of the Equality Act as she provided services which she could not delegate. Although she was an independent decision-maker whom the Trust could not direct or control, it was still able to determine when and how she carried out that role.
If it was wrong about that, however, the tribunal held that she was still a worker under section 43K(1)(a) ERA firstly because she was an individual working for the Trust and secondly, because the terms on which she was engaged to do the work were in practice substantially determined by the Trust itself.
The Trust appealed, arguing that that Ms Moon was an officeholder and there had been no intention to establish a contractual relationship between the parties.
EAT decision
Dismissing the appeal, the EAT agreed with the tribunal that nothing in section 23(6) prevented an AHM from being a worker, whether expressly or impliedly. Just because they were independent when it came to making a decision about whether a patient should be discharged did not strip them of employment rights.
Section 23(6) operated simply to define the class of persons who could be authorised to exercise statutory power. The rights and obligations of Ms Moon’s role, on the other hand, were contained in her agreement with the Trust rather than established by statute. The tribunal was, therefore, entitled to conclude that there was a contractual relationship between the parties.
Comment
The case confirms that whether someone is appointed as an office holder or under a contract of employment will very much depend on the particular facts of the case.