Breaking service

Vernon v Event Management Catering Ltd (IDS 835)

To claim employment rights such as unfair dismissal, casual workers have to show that they have employee status and that they have at least one year’s continuous service.

In Vernon v Event Management Catering Ltd (IDS 835), the Employment Appeal Tribunal (EAT) held that any week in which a casual worker works under a contract of employment (irrespective of how many days) must count towards their continuity of service.

Basic facts

Mr Vernon started working for the company at the age of 16 for two or three days a week as a casual worker. Although the casual workers’ handbook stated that there was no obligation on the company to provide work, nor on him to accept, he worked regularly and accepted whatever work it offered.

After an incident in June 2006 with another employee, however, he was told he would not be offered any more work. He claimed automatic unfair dismissal, arguing that the company had failed to comply with the statutory dismissal procedure. He also complained that he had not been given notice or a statement of terms and conditions of employment.

To succeed with any of these claims, however, Mr Vernon had to show that he was an employee with at least one year’s continuous service.

Relevant law

Section 212(1) of the Employment Rights Act (ERA) 1996 states that: 
"Any week during which the whole or part of which an employee's relations with the employer are governed by a contract of employment counts in computing the employee's period of employment."

Section 212 (3)(c) of the ERA provides for continuity if the employee is: 
"absent from work in circumstances such that, by arrangement or custom, he is regarded as continuing in the employment of his employer for any purpose."

Tribunal decision

The tribunal found, as a matter of fact, that Mr Vernon had worked every week over the three years he had been with the company, apart from two weeks’ holiday in 2005. He had not been paid as such during that time because it was “rolled up” in his ordinary pay (a practice now deemed illegal).

It said that his status as an employee plus his continuity of service could be established in one of two ways. Either by showing that he had a global or overarching contract giving him employee status for the whole period, even when he was not working; or by relying on section 212(1) of the ERA to establish that he had a contract on the individual days that he worked.

The tribunal decided there was no global contract because there was no “mutuality of obligation” to offer and accept work to keep the contract alive when he was not working.

However, it said that when he was at work, he did have a contract as he was under the control of the managers and had to work the designated hours in specified locations. But it decided, strangely, that section 212 (1) did not apply because the company still had no obligation to offer future work and Mr Vernon could turn them down even if it did.

EAT decision

The EAT disagreed. It said that “it seems to us that in every week where the claimant worked as an employee, for however long, that week must count under s212(1). His relationship is then governed by a contract of employment. The subsection could not be clearer.”

It then had to decide whether, under section 212(3), his two week holiday had broken his continuity of service. It said that it had not, arguing that “it would be a curious result if as a consequence of taking holiday under the Working Time Regulations the employee was destroying the rights which he would otherwise have had.”

The appeal was therefore upheld.