Appeal No.	 EAT/550/98

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 25 January 1999

Before
THE HONOURABLE MR JUSTICE CHARLES
MR W MORRIS
MRS R A VICKERS

MR S HIDLE	APPELLANT

HI-DRIVE PLANT SERVICES	RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised

	APPEARANCES

For the Appellant	MS S L BELGRAVE
(of Counsel)
6 Equtable Street
Rochdale
OL11 1JQ	
For the Respondents	MR C KENNEDY
(of Counsel)
Messrs Halliwell Landau
Solicitors
St James Court
Brown Street
Manchester M2 2JF	

	MR JUSTICE CHARLES:     The parties to this appeal are a Mr Hidle and the Respondent is Hi-Drive Plant Services.  The appeal relates to a decision of an Industrial Tribunal following a hearing on 25 February 1998 and their Extended Reasons dated (I think) 14 April 1998.  That decision was that:

“The decision of the tribunal was that the respondent employed less than 20 employees at the date of the alleged discrimination and, therefore, the applicant’s claim under the Disability Discrimination Act 1995 should fail.”

	As is apparent from that decision it was a decision as to a preliminary point.  The focus of the decision is as to the date when the employment was terminated.  It was a date in November 1997 and not to an earlier date, which was agreed before us as being 25 September 1995, when Mr Hidle was suspended.  

	The main point taken on the appeal is that the Tribunal did not apply the correct test in determining the meaning of employment, as defined by section 68 of the Disability Discrimination Act 1995.  That is notwithstanding the fact that that section is referred to in paragraph 6 of the Extended Reasons and the definition in that section is set out therein.  The definition is in the following terms:

“ ‘employment’ means, subject to any prescribed provision, employment under a contract of service or of apprenticeship or a contract personally to do any work, and related expressions are to be construed accordingly.”

	A similar definition is included in the Sex Discrimination Act and the Race Relations Act and those definitions have been the subject of earlier authority.  We have been referred to those by Counsel for both sides and we are grateful to them for the help they have given us.  We take first the case of Quinnen v Hovells [1984] IRLR 227, although it is not the first in time, which is a decision of this Tribunal when Waite J was the President.  That was a case relating to sex discrimination and under the description of the facts at page 227 the following paragraph appears:

“Mr Quinnen made a complaint to an Industrial Tribunal alleging discrimination and unequal treatment contrary to the Sex Discrimination and Equal Pay Acts.  The Industrial Tribunal ruled that they had no jurisdiction to entertain the claim, holding that their powers under the two Acts arose only when the discrimination or unequal treatment complained of was accorded to employees involved in a master and servant relationship under a contract of service and had no application to the self-employed.”

	The headnote identifies the decision reached and again, reading part of that, it is in the following terms:

“The inclusion in the definition of ‘employment’ in s.82(1) of the Sex Discrimination Act of a third limb covering employment under a ‘a contract personally to execute work or labour’ was intended to enlarge upon the ordinary connotation of ‘employment’ so as to include persons outside the master-servant relationship.  The concept of a contract for the engagement of personal work or labour lying outside the scope of a master-servant relationship is a wide and flexible one, intended by Parliament to be interpreted as such.  Its application to particular circumstances will depend very much upon the facts of each case.”

	That authority refers to two earlier cases to which we were also referred, namely Hugh-Jones v St John’s College, Cambridge [1979] ICR 848, where the relevant decision appears in the headnote and the passages at 852 B, 852 G and 853 B - C of the judgment and the case of Tanna v Post Office [1981] ICR 374.  Again, the decision in that case is summarised in the headnote and the most relevant passages of the judgment, for present purposes, are at 377 A/B and 377 D.

	We were also referred to Mirror Group Newspapers v Cumming [1986] IRLR 26, which is again a case concerning sex discrimination and the meaning of employment.  It is a decision of the Court of Appeal.  The ratio of that decision appears at paragraph 36 of the judgment and provides an indication as to when persons who might, in other contexts be described as being self-employed, would fall within the definition of employment within the Sex Discrimination Act and the Disability Discrimination Act.  Paragraph 36 is in the following terms:

“However, I do accept Mr Irvine’s alternative submission that the phrase in its context contemplates a contract whose dominant purpose is that the party contracting to provide services under the contract performs personally the work or labour which forms the subject matter of the contract.  In the course of oral argument before us, Mr Beloff conceded that a single obligation to provide personal services in a contract is not of itself sufficient to bring the contract within the phrase; you have to look at the contract as a whole to see the extent to which that obligation colours the contract, which goes a long way towards accepting the ‘dominant purpose’ test.  In my judgment, we have to look at the agreement as a whole, and provided that there is some obligation by one contracting party personally to execute any work or labour, you then have to decide whether that is the dominant purpose of the contract, or whether the contract is properly to be regarded in essence as a contract for the personal execution of work or labour, which seems to me to be the same thing in other words.”

	The question that we have to decide, reading the Extended Reasons in a fair and common-sense way, is whether the Tribunal asked themselves the question as demonstrated by those authorities, and in particular paragraph 36 in Mirror Group Newspapers or whether in effect they fell into the error that the Tribunal in the Quinnen case fell into by excluding persons from the definition because, in their opinion, they were self-employed.

	We have concluded, on a fair reading of the Extended Reasons, that this Tribunal did fall into that error, notwithstanding the fact that they referred to and set out section 68.  We are of that view primarily because in the middle of their fact-finding paragraph, which is paragraph 5, they say this:

“Mr M. Burgon, Mr G. Walker, Mr D. Gosling and Mr P. Bullock had supplied services over an irregular period of time to the respondent.  However, they had been paid through invoice and are currently self-employed.”

	That indicates to us that the Tribunal thought that because in their view they were properly described as “self-employed” they fell outside the section.  If we have misunderstood the thinking of the Tribunal, in our view it is nonetheless the case that their reasoning does not demonstrate sufficiently clearly that they did ask themselves the right question and apply the correct approach.  We have therefore concluded that either because they erred in law by asking themselves the wrong question, or because they have failed to set out clearly that they asked themselves the right question and why they reached the conclusion that they did, their preliminary decision should not stand.

	That is not necessarily the end of the matter.  It was urged upon us, on behalf of the Respondents, that whether the relevant date was the date of suspension or the date of dismissal, it was open to us to find on the facts found by the Tribunal, and the documents that were before us and were before the Tribunal, that if the Tribunal had asked themselves the right question at both dates they would have come to the same answer.

	We are unpersuaded by that argument.  In particular, it is to be remembered that in Quinnen it is said that each case must be decided in the circumstances of that case.  In his submissions on behalf of the Respondent Mr Kennedy advanced a number of practical difficulties, which could be described as “where does one draw the line”, or “how does the small employer decide on a day-to-day basis whether he is covered by the Act or not”.  These difficulties undoubtedly exist but they lead to the need to consider the circumstances of each case carefully, asking the correct question.  We do not feel that we are in a position to do that.

	That is still not an end of this appeal because, on behalf of the Respondent, it is submitted that if the matter returns for determination by the Tribunal and it is found that the Act applies, the Applicant is doomed to failure.  Mr Kennedy advanced arguments before us based upon the medical information available at the relevant time, that there could not have been discrimination, even if it were accepted (which in any substantive case it would not be accepted), the Applicant was suffering from a disability as defined.  That argument was advanced by reference to section 5 (1)(a) which is in the following terms:

“For the purpose of this Part, an employer discriminates against a disabled person if - 
(a)  for a reason which relates to the disabled person’s disability, he treats him less favourably than he treats or would treat others to whom that reason does not or would not apply; and
(b)  he cannot show that the treatment in question is justified.”

	As to the first limb Mr Kennedy submitted that, as it was not known at the relevant times that the Applicant suffered from a disability, he became his own comparator and that he would fall at that hurdle.  If that is wrong, he said, the Applicant would fall at the second hurdle in 5(1)(b) and further, and in any event, he submits that the findings in the unfair dismissal case (particularly those at page 3 sub-paragraph (h) and page 4 paragraph (8) of the Extended Reasons) provide the answer to the factual issues that would also arise under the Disability Discrimination Act 1995.  

	We see some force in these points, but in our judgment it would be wrong to disregard the fact that the issues under the Disability Discrimination Act 1995 were not before, and were not dealt with, by the Tribunal in the unfair dismissal case.  That was dealing with a separate piece of legislation.  We accept the submission made, on behalf of the Applicant, that it would be surprising if the Disability Discrimination Act 1995 did not have a life of its own and could not found a remedy, notwithstanding that a person was found not to have been unfairly dismissed.

	We have therefore concluded that this is not a case in which we should decide that the matter should not be remitted to the Tribunal for reconsideration.  Having regard to, for example, the approach set out in Dobie v Burns International Security Services (UK) Ltd [1984] ICR 812, it seems to us firstly, that there might be a separate point under the Disability Discrimination Act and secondly, the issues that the Tribunal have decided do not relate to the substantive claim under the Disability Discrimination Act and in the circumstances of this case it would not be right for us to, in effect, impose a decision upon the Applicant as an Applicant for relief under that Act at this stage.

	However, we would add that there appears to be force in the points made, on behalf of the Respondents, that the Applicant will not be able to establish discrimination or to establish facts entitling him to relief under the Disability Discrimination Act 1995 and we make the point that, if the Applicant makes the litigation decision to continue with those proceedings and fails on the basis of facts already found in earlier proceedings, he will run the risk that he may be ordered to pay the costs of those proceedings.

	Finally, we would recommend that the Tribunal do not hear the case under the Disability Discrimination Act in two parts, as was done originally, by taking a preliminary point as to the application of the Act.  We make no criticism of the identification and determination of that preliminary point.  With the wonderful benefit of hindsight, it now appears to us that it would be sensible to deal with the whole case in one go, so that the points advanced to us that no substantive remedy arises under the Act, even if it applies, can be dealt with by the Tribunal at the same time as it deals with the application of the Act.

	After hearing submissions, we think that on that basis we will simply remit the case under the Disability Discrimination Act 1995 to a Tribunal and indicate that it should be heard by a full Tribunal, if the Applicant decides to pursue his case.