You might think that after 100 years the law would be clear as to who was - and who was not - an employee. But recent developments have shown that the picture is still far from clear.
'Employment' has a meaning that must be seen in context. For the purposes of sex, race and disability discrimination, 'employment' has a wider meaning than it does in respect of 'continuity of employment' for the purpose of statutory rights under the Employment Rights Act.
The scope of 'employment' in European Directives remains uncertain. Moreover, in the context of some working arrangements, the common law choice may no longer simply be between a 'contract of service' (employment) on the one hand as to opposed to a 'contract for services' (self-employment) on the other.
So far as discrimination is concerned, Loughran v Northern Ireland Housing Executive [1998] IRLR 70, holds that the engagement of a solicitor by the Northern Ireland Housing Executive (by placing the solicitor on a panel for work) was within the definition of "employment": although not a contract of service or of apprenticeship, it was '...a contract personally to execute any work or labour...'.
Similar wording is reflected by the White Paper FAIRNESS AT WORK, in which the term 'employees' is '...generally used to cover all those who work for someone else rather than on their own account, regardless of whether or not they are strictly employed under a contract of employment'. This definition is likely to found the basis for minimum wage legislation.
But the problem is that it does not (yet) apply to employment rights generally. When looking to see whether flexible, casual, and short fixed term work (and, for that matter, 'zero hours' contracts) amounts to 'employment' the Courts attempt to reconcile conflicting principles.
First is the desire to avoid circumvention of statutory provisions intended (as a matter of public policy) to protect the weak (as in the health and safety field: Lane v Shire Roofing [1995] IRLR 493). Second is the approach which regards employment as a status, for which there must therefore be a 'qualifying condition', linked with a conventional approach requiring mutuality of obligation (whatever that may mean) before a contract of employment is recognised.
Two cases reported earlier this year gave little hope that casuals would be regarded generally as employees. They suggested that the Courts would not find a contract of employment simply from the fact of personal work done on account of another.
In the first, Cheng Un Yuen v Royal Hong Kong Golf Club [1998] ICR 131, the Privy Council looked at the situation of a caddy at a Hong Kong golf club, which had trained him and equipped him with a uniform and locker, which exercised disciplinary powers over him and established a system by which he was allocated to individual members on a rotating basis in order to carry their clubs. He was paid in cash by the Club for each round he worked, with the Club debiting the golfer for the amount paid.
However, he was free to attend for work as and when he pleased, and received no sick pay, holiday pay, or pension. Although the Labour Tribunal in Hong Kong determined that he was an employee of the Club, rather than an independent contractor to them, the Privy Council said it was wrong to regard the case as one of a choice between two alternatives.
Instead, the only reasonable view of the facts (they said) was that the arrangements between the Club and the caddy went no further than to amount to a licence by the Club to permit him to offer himself as a caddy to individual golfers on terms dictated by the administrative convenience of the Club and its members. Because he had no obligation to attend in order to act as a caddy there was between him and the Club 'no mutual obligation that the Club would employ him and that he would work for the Club in return for a wage'.
In Clarke v Oxfordshire Health Authority [1998] IRLR 125, a bank nurse was held not to be an employee. No contract of employment could exist (said the Court of Appeal) without mutual obligations lasting over the entire duration of the relevant period. However - importantly - although some mutuality of obligation was required, this 'need not necessarily and in every case consist of obligations to provide and perform work'. Payment of a retainer during periods of non-work would, for instance, be sufficient.
Two cases: two defeats for the individual worker - apparently bad news for casuals. Third time lucky, however. In Carmichael v National Power Plc [1998] IRLR 301, the Court of Appeal importantly set out the questions which an Industrial Tribunal should ask:
(i) was there agreement between the parties? (Merely putting one's name on a list of those "available for work" is unlikely to amount to an agreement: there has to be a bargain of some sort between the parties.)
(ii) what were the terms (both express and implied) upon which they agreed?
(iii) in the light of those terms, was the nature of the relationship a contract of employment (as opposed to self-employment, or some other agreement)?
Carmichael is also important for the implied terms it identifies, which lead to the agreement being one of employment. Mrs Carmichael was engaged on an express "casual as required" basis.
Those words obliged her to work whenever the employer reasonably asked her to do so: in themselves a one way obligation, resting only on the worker, not on her boss. But Ward LJ found that National Power had in the circumstances impliedly agreed on its part to provide a reasonable share of the guiding work that became available from time to time.
Chadwick LJ found both that there was an implied obligation to ensure that work would be offered to those recruited and trained as station guides before being offered to anyone not so trained, and that there was an obligation to allocate work fairly as between the station guides. These obligations arose as a necessary corollary of the acceptance by the station guides of an obligation to work as and when required, and to undergo interview and training for that purpose.
Facts will differ from case to case. In many, a casual worker may not have a continuing relationship with the provider of work. Too much should not be required: after all, employees paid by piecework may have long lay off periods between batches of work. Home workers may be the same. Intermittency of employment does not mean that there is no employment - but it may be an indication of it.
However, though facts may differ, the approach should not. The approach in Carmichael gives any casual worker, where there are arrangements for requiring her to work or where there are arrangements for providing her with work, the prospect that the relationship will be a contract of employment with all its advantages and protections. What will not change - at least before fairness at work becomes fairness in law - is the position of the casual worker who secures his work on spec, even though he may do a lot of hours for the same provider of work.
Finally, a note of warning: there is a potential appeal to the House of Lords. Legislation remains the ultimate answer.