What do a golf caddy, a church organist and a stripper have in common? Why, their employment status of course! At least, so says the High Court in the latest judgment to be delivered in the long running saga of Stringfellows stripper Nadine Quashie.
Avid followers of LAWmail will recall that in May 2011 we reported that the Employment Appeals Tribunal had delivered a key judgment on employment status, deciding that a lap dancer working at Stringfellows was an employee and not self-employed.
Nadine Quashie had sued the strip club chain for unfair dismissal following her sacking for suspected involvement in drug use in the club. However, before Ms Quashie’s case could be heard, the tribunal had to decide whether or not she had the right to claim unfair dismissal. Unsurprisingly, Stringfellows argued that she was self-employed and therefore did not have standing to sue. The tribunal agreed and the claim was struck out.
The disgruntled Ms Quashie then took her claim to the EAT which decided that she was, in fact, an employee. The panel was particularly persuaded by the argument that Ms Quashie had an “umbrella contract” linking each night of employment. Every night that Ms Quashie was on the rota to dance, she was required to do so and, equally, Stringfellows were obliged to allow her to dance. The EAT held that this created sufficient mutuality of obligations for an employment contract to be formed.
That, however, was not the end of the story. Stringfellows appealed the EAT judgment to the High Court which reversed the decision of the EAT and found that Ms Quashie was self-employed all along. The High Court again focussed on the question of mutuality of obligations, defining this as the obligation on the employee to work and the obligation on the employer to provide and pay for that work.
The Court took the view that there was insufficient mutuality of obligations between Stringfellows and Ms Quashie. While Stringfellows were obliged to let dancers perform, they were not obliged to pay them anything for their work. Lap dancers negotiated prices with customers and relied solely on these third parties for earnings. They took their own economic risk each night and could conceivably earn nothing , or even end up owing the club money, once they paid the club, DJ, hairdressers etc. from their earnings. As a result Stringfellows could not be said to have an obligation to pay for work.
The case serves as a useful reminder of what factors the courts will take into account when deciding questions of employment status and highlights that employers should ensure that contracts are clearly written and reflect what happens in reality.