New EAT case poses danger

A recent decision by the Employment Appeal Tribunal (EAT)
could have significant implications for all agencies placing PAYE
temporary workers with clients. The EAT held that a Temp who had worked
as a cleaner for a hostel through the agency Brook Street was an
employee of Brook Street and was therefore entitled to pursue a claim
against them for unfair dismissal.

Temps assigned by an agency to work for a client are not usually
considered employees of either the agency or the client. As a result
temps do not have full employment rights such as the right not to be
unfairly dismissed, to maternity and parental leave, to redundancy
payments, to statutory notice nor to any new rights to be introduced
under the Employment Act 2002.

Although the temp’s contract said that she was not an employee of
Brook Street or the client, and that she was to work under the control
of the client, the Court determined, as a matter of fact, that she was
an employee of Brook Street. The legal arguments involved are quite
complicated but the result is that all temp agencies should review their
contract terms and procedures to minimise exposure to employer
obligations in respect of their temps as there could be serious cost and
administrative implications.

Although it is understood that the judgment is being appealed it
must be borne in mind that the judgment was passed by the president of
the EAT, Justice Burton, who was also the presiding judge in the PCG
Judicial Review. As such he is highly respected and this is clearly an
authoritative decision.

For further information or to assess your potential liability to
such claims please contact Lawspeed on 01273 236236 or by email to

To be kept up to date with this and other current issues which have an effect on your company and industry register for Agencyzone, Lawspeed’s free newsletter service.

Call Now Button