The issue of employment status continues to remain a hot topic in the press, particularly in the gig economy with the likes of Uber drivers and Pimlico Plumbers operatives being ruled to have worker status. In the education sector, a tribunal has, this month, found that a Visiting Music Teacher (VMT) engaged under a contract through which she rented teaching space from the school and under which she was paid directly by parents, was a worker of the school rather than an independent contractor.
Worker status is an intermediate category status that lies between an employee and a genuinely self-employed contractor. In order for someone to be deemed to be a worker, there needs to be a contract for personal service, where the other party to that contract is not a customer or client of the individual’s business. There also needs to be “mutuality of obligation”: in other words, an obligation to provide work and an obligation on the individual to do the work provided.
Why does it matter? Workers have basic rights that are not afforded to self-employed contractors: they are, for example, entitled to the minimum wage, paid holiday, and are protected from unlawful discrimination and detrimental treatment for blowing the whistle. Whether or not an individual is a worker depends on an analysis of the particular working arrangements in place.
Facts and analysis
The school had in place a number of arrangements with the VMT (the claimant) which the judge acknowledged were redolent of self-employed status:
- The claimant invoiced parents direct and was not paid by the school
- Under the claimant’s contract for services with the school, the Claimant paid a nominal fee to the school for hire of facilities
- The claimant had a contractual right to send a substitute
- The claimant took the financial risk in the event of non-payment of invoices and liaised with parents directly on these
- There was no obligation for the school to provide the claimant with pupils
- The claimant had control over when and what she taught (albeit see below in relation to timetabling)
- The claimant did not enjoy all the benefits that employed members of staff do (albeit again, see below)
- The claimant was permitted to teach private (external) pupils at the school
- The claimant described her VMT work on her annual tax return as self-employment and marketed her services as a ‘freelance soprano and music teacher’
The question of whether or not there was personal service, was (in the judge’s own words) ‘very close to the dividing line’. The judge concluded that the claimant was entitled to send a substitute (one of the issues that determines personal service), but she also found that the claimant’s right to send a substitute was fettered in a number of ways:
- The claimant’s contract stated that she could send a substitute ‘when necessary’, not, as the judge put it, ‘just when the VMT felt like it’
- The substitute needed to be of sufficient competence (including having a basic DBS check and safeguarding training)
- The school had a limited right to approve the substitute (this only consisted of basic DBS checking and safeguarding training, and such approval had never been refused)
Of those three, the most important was the first: the judge considered that its existence pointed strongly towards a requirement for personal service. Had the VMT been free to provide a substitute at any time, albeit one that was sufficiently competent and DBS-checked, the outcome might have been different.
Turning to whether or not the school was a customer or client of the claimant’s business, the judge relied on the following factors in finding that the school was not a client of a business run by the claimant (and was in fact part of the school’s business):
- The claimant was not permitted to negotiate her rate with parents and the school set a rate for late payment
- The school held itself out as offering tuition (for example VMTs were identified in the school’s Music Department information as providing part of the Department's 'offer')
- The school allocated pupils to the claimant
- The school exercised a limited degree of control over the structure and scheduling of the lessons (for example setting a length of lesson that matched with the school’s timetable, stipulating that younger pupils did not miss the same lesson each week, and not allowing sixth formers to miss lessons at all)
- The claimant was integrated into the school to a certain degree (she was listed as a member of staff on the school’s website and documents (albeit in a list distinguished from the school’s teaching staff), had a school email address, was allowed to use some of the school’s equipment, received a free school lunch, was insured by the school and was expected to attend the school’s music department AGM)
- The claimant benefitted from access to suitable teaching spaces (but was not allowed in all areas of the school), and had the use of a school computer and printer
- The claimant was required to follow a number of the school’s policies and procedures as set out in its Music Department Handbook (for example, the absence procedure if pupils did not arrive at their lessons within a set period of time, and a requirement to keep an attendance register and write pupil progress reports)
- In addition to the agreement between the claimant and the school, the school had in place separate terms and conditions for the provision of instrumental lessons with its parents, which set out various ‘expectations’, for example, when payments of the invoice were due and the notice parents had to provide to discontinue lessons
Finally, the judge considered ‘mutuality of obligation’ and was satisfied that there was a minimum level of mutuality of obligation.
Interestingly, the judge distinguished between the claimant’s different roles (providing individual tuition, ensemble work and other ad-hoc services). The claimant was a ‘worker’ when providing individual tuition, but not when leading ensembles or providing other ad-hoc services (such as her involvement in school performances or chaperoning on school trips).
The decision is a decision of the Employment Tribunal, so it is not binding on other Tribunals. Nevertheless, it provides an indication of how Tribunals could approach such cases. The status of a school’s VMTs will depend on the specific arrangements that particular school has in place and the specific arrangements in place with each individual VMT. The judgment does not therefore confer worker status on every VMT that works in every school, by no means, but it should not be ignored. Schools would be well advised to review their current arrangements in light of the judgment and to assess the likely status of their VMTs.
If you require further information about anything covered in this briefing note, please contact Hugh Young, or your usual contact at the firm on +44 (0)20 3375 7000.
This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.
© Farrer & Co LLP, March 2019