More aid for agencies

Craigie v Haringey Council

Hot on the heels of the decision in James v Greenwich Council, another Employment Appeal Tribunal (EAT) has rejected the idea of implying a contract of employment between an agency worker and the end user in Craigie v Haringey Council.

Instead, it said that tribunals should only do so when it was necessary to reflect the “business reality” of what was actually happening on the ground.

Basic facts

Mr Craigie signed an agreement with the agency, Aptus, on 9 November 2004. A few days later (on 15 November), he started work as an Estates Services Officer for Haringey council.

His contract with the agency explicitly stated that he was not an employee; that it would pay him £4.85 per hour; that he was entitled to four weeks’ holiday from them; that he could join the agency pension scheme; and that he would not be paid when he was not working. It also stated he was not obliged to accept an assignment, but that if he did not, the contract would terminate.

He applied for a permanent job with the council in June 2005 stating that his present employer was Aptus / Haringey. The council made a provisional offer in August, but withdrew it in November when a manager drew attention to his sickness record. He claimed unfair dismissal from the council.

Tribunal decision

The issue for the tribunal was whether Mr Craigie had an implied contract with the council or not. It said that in this case, it could not find the necessary mutuality of obligation required.          

It pointed to the fact that Mr Craigie was entitled to refuse work offered by the council (or indeed the agency), and that the council was, in turn, entitled to end his work placement without any contractual repercussions. The fact that he had worked for the council for over a year, and that it exercised a high degree of practical control over his working arrangements, was not enough to “create a contract of employment in the absence of mutuality of obligation to provide and to perform the work”.

In addition to that, the tribunal could not find any reason to imply a contract of employment between them “in order to give business reality” to the situation, since it had been going on for over a year without any difficulty. It was only when the council withdrew the job offer that the problems started.

EAT decision

The EAT agreed with the tribunal. It said that although the council did exercise a high degree of control over what Mr Craigie did, that simply reflected the reality of his job as an Estates Services Officer.

The EAT sympathized with Mr Craigie that although his contract with the agency stated that he did not have to accept an assignment, it would terminate if he did not. However, it could not see how a clause in a contract between him and the agency imposed some sort of obligation on the council.

It also decided that the tribunal was entitled to find there was no need to infer a contract of employment.  It was clear that the Court of Appeal in Dacas v Brook Street Bureau (UK) Ltd, 2004) was not suggesting that such an “inference could readily be made”.

Likewise, in Cable & Wireless Plc v Muscat, 2006 the Court of Appeal had emphasised that “in order to imply a contract to give business reality to what is happening, the question is whether it is necessary to imply such a contract.” In this case, the EAT said it was not.

Again, the court sympathised with Mr Craigie and said that legislation was needed to change the status of long term agency workers.