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Does Unofficial Work Prior to a Formal Start Date Count Towards a Period of Continuous Employment? Your Questions Answered!

In the recent case of Mr R O'Sullivan v DSM Demolition Ltd, the EAT considered the issue of whether unofficial work prior to a formal start date counted towards a period of continuous employment.

By way of background, Mr O'Sullivan needed two years' continuous employment to pursue a claim for unfair dismissal against DSM Demolition Ltd. The dispute turned on his start date. DSM maintained the start date was 2 November 2015. Mr O'Sullivan claimed it was 26 October 2015.

Section 211(1) (a) of the Employment Rights Act 1996 provides that a period of continuous employment begins "with the day on which the employee starts work". This means the start date of work under a contract with the employer. The employment tribunal found that Mr O'Sullivan had done work on site in the week of 26 October 2015.

However, it also found that a Statement of Terms had been drawn up with a 2 November 2015 start date, Mr O'Sullivan had been put on payroll with effect from that date, and had only begun completing worksheets from that date. DSM's client was not charged for Mr O'Sullivan's work in the week of 26 October. Further, Mr O'Sullivan had been paid £100 in cash in hand for the week in question and had not complained to the Respondent about his pay.

The EAT held the tribunal was entitled to conclude that Mr O'Sullivan had worked in the week of 26 October 2015 under an 'unofficial' arrangement, and not under a contract of employment.

In reaching their decision, the EAT considered and applied the previous case of Koenig v Mind Gym Limited, in which Langstaff J stated: "Work outside a contract of employment, though it might have some relationship to it, cannot count. At times it may be difficult to see precisely where the dividing line is. That is the task of the Employment Judge."

In Koenig v Mind Gym Limited, the Claimant was dismissed by the Respondent. However, according to her written contract of employment, she lacked sufficient continuity of service to bring an unfair dismissal claim. She appealed to the EAT on the basis that she had sufficient continuity of service by virtue of the fact that she had attended a meeting with a client of the Respondent before her contractual start date, which should have been regarded as work under her contract of employment.

The EAT dismissed the appeal, holding that the employment tribunal was entitled to conclude that there was no contract of employment operating on the date of the client meeting, that the Claimant was not obliged to attend the meeting and had not attended in the capacity of an employee of the Respondent.

In summary, on 15th May 2020, in Mr R O'Sullivan v DSM Demolition Ltd, the EAT concluded that the Claimant had worked in the week of 26 October 2015 under an unofficial arrangement and not under a contract of employment with the Respondent. The result was that Mr O'Sullivan fell short of the necessary qualifying period for his claim. From a practical perspective, it is important to note that each case will turn on its own facts, however this is important confirmation that 'unofficial' arrangements made with employees will not count towards continuous employment and employers are therefore protected from unfair dismissal claims in such circumstances.

If you need advice or have any queries about an employment matter, please contact Paul Chamberlain or another member of the employment team  at JMW Solicitors LLP on 0345 646 0342.

This note is for general guidance only and should not be used for any other purpose. It does not constitute, and should not be relied upon as legal advice.

JMW Solicitors is a Limited Liability Partnership. The copyright in this note is owned by JMW. Any reproduction of this article should be credited to JMW. All rights reserved.