Automated Summary
Key Facts
The Employment Appeal Tribunal dismissed an appeal by Mr. M Stojsavljevic and Mr. T Turner against a tribunal finding that they were not employees or workers under the Employment Rights Act 1996 or the Equality Act 2010. The case centered on whether the Claimants, as franchisees of DPD Group UK Limited, had an unfettered right to substitute drivers under their franchise agreement. The Tribunal had concluded that the Franchise Agreement reflected the true agreement between the parties, and that the Claimants had the right to substitute drivers as they chose, without restriction. The EAT confirmed that the Tribunal had properly considered the facts and law, including applying the principles from Autoclenz Ltd v Belcher and Uber B.V. v Aslam, and that the Claimants' right to substitute drivers was unfettered, making them independent contractors rather than employees or workers.
Issues
- The central legal issue was whether the Employment Tribunal correctly determined that the Franchise Agreement between the claimants and DPD Group UK Limited represented the true agreement between the parties, as required by the principles established in Autoclenz Ltd v Belcher and others [2011] ICR 1157, SC. The claimants argued that the Franchise Agreement did not reflect the reality of their relationship, as they had always intended to personally perform the services, and could only use other drivers with the Respondent's approval.
- The main legal question was whether the claimants had an unfettered right to substitute drivers under the Franchise Agreement, which would determine whether they were employees or workers. The claimants argued that they could only use drivers approved by DPD Group, creating a fetter on their right to substitute, while the Respondent argued they had an unfettered right to use any driver who met the contractual requirements, including temporary cover drivers.
Holdings
The Employment Appeal Tribunal dismissed all three grounds of appeal, upholding the Tribunal's finding that the claimants (Mr. Stojsavljevic and Mr. Turner) were not employees or workers for the purposes of the Employment Rights Act 1996 or the Equality Act 2010. The court determined that the claimants had the right to substitute drivers under their franchise agreements, which negated any obligation for personal performance. The Tribunal's conclusion that the franchise agreement reflected the true agreement between the parties was upheld, and the claimants' reliance on Autoclenz and Pimlico Plumbers was rejected.
Legal Principles
- The court applied the principle of 'substance over form' as emphasized in Uber B.V. and others v Aslam and others [2021] UKSC 5. This principle holds that the true nature of the relationship should be determined by substance rather than form, and written agreements cannot be taken as conclusive evidence of the parties' true agreement.
- The court applied a purposive approach to determine the true agreement between the parties, as established in Autoclenz Ltd v Belcher and others [2011] ICR 1157, SC. This approach requires courts to look beyond the express terms of a written agreement to determine the true relationship between parties, particularly in employment status cases.
Precedent Name
- Autoclenz
- Uber
- Tanton
- Pimlico Plumbers
- Ready Mixed Concrete
Cited Statute
- Equality Act 2010
- Employment Rights Act 1996
Judge Name
Mrs Justice Ellenbogen DBE
Passage Text
- The tribunal found franchisees could substitute drivers as long as minimum requirements were met, without fettering their right to substitute.
- The tribunal found neither claimant was an employee or worker under the ERA or Equality Act 2010.
- The tribunal found that the claimants' practice of using other drivers didn't affect their contractual right to substitute drivers.