ESM7040 - Case Law: Market Investigations Ltd v Minister of Social Security
[1969] 2QB173
Point at issue
Whether an interviewer, who was engaged on a casual basis, was employed under a series of contracts of service or under a series of contracts for services.### Facts
Market Investigations Ltd was a market research company. It employed a small number of full-time interviewers but, for the most part, drew on a panel of casual interviewers and the case concerned this latter group.
The facts found included the following
- all interviewers were issued with or had access to the company’s ‘Interviewer’s Guide’ which outlined interviewing techniques
- there was no obligation to accept work when it was offered
- interviewers were usually asked to work for two or three days during a 10 or 14 day period
- interviewers were free to work for other firms during this period
- the company did not allow interviewers to send a substitute without prior permission of the company
- on some occasions a briefing meeting was held prior to the start of the assignment
- during a period of 81 weeks Mrs Irving worked for 61 full days and 8 half days and was paid on a daily basis plus expenses
- on the first few assignments Mrs Irving was accompanied by one of the company’s supervisors
- the contract did not provide for time off, holidays or sick pay
- the company thought they could not dismiss Mrs Irving in the middle of an assignment
- the mutual intention was for contracts for services.
Decision
The Minister of Social Security decided that Mrs Irving did work under a contract of service and the company appealed against that decision. Cooke J held that Mrs Irving was employed under a series of contracts of service.### Commentary
There are several features of the case and of Cooke J’s judgment which merit comment.
Firstly, the following extract from pages 184 and 185 of the judgment sets the standard to be applied in determining status and this extract has been quoted with approval by later, and higher, courts
“The fundamental test to be applied is this: ”Is the person who has engaged himself to perform these services performing them as a person in business on his own account?” If the answer to that question is ‘yes’ then the contract is a contract for services. If the answer is ‘no’ then the contract is a contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of the considerations which are relevant in determining’ [whether there is a contract of employment] ‘nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases. The most that can be said is that control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor; and that factors which may be of importance are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task.”
It still remains the case that the fundamental question to be answered in determining employment status is whether the individual in question is performing the services as a person in business on his or her own account. Also each case has to be considered on its own merits.
Secondly, it confirmed that control may no longer be the decisive factor and it contains an excellent summary of the comments in earlier cases about control (but see the comments of the Privy Council in the later case of Narich Pty. Ltd v Commissioner for Pay-roll Tax at ESM7090)
Thirdly, Cooke J mentions the first ‘contract of service’ condition which MacKenna J put forward in the Ready Mixed Concrete case (see ESM7030). That condition is concerned with consideration and personal service. It should be noted that in the Market Investigations case one of the findings of fact was that a substitute could not be sent without the prior approval of the company. Interestingly, this factor was not commented on by either the judge or counsel for the appellants. Clearly, it must have been thought that this fact did not remove the requirement for personal service.
Fourthly, another finding of fact was that each interviewing arrangement was a separate engagement, each of which was of very short duration. Nevertheless, the court held that on each occasion there was a separate contract of service. This provides support for the view that a short-term casual engagement can be a contract of service.
Fifthly, Cooke J commented on the absence of sick pay and holidays at page 187 as follows:
“The fact that there is no provision for sick pay and holidays is merely a reflection of the fact that the contract is of very short duration. If a man engages himself as an extra kitchen hand at a hotel for a week in the holiday season, there will be no provision for sick pay and holidays, but the contract will almost certainly be a contract of service.”
Where a short-term contract is concerned, then the absence of employment rights, such as sick pay and holiday pay, will be of no consequence in determining employment status.