More Bad News for Practice Principals
Key Contact: Jon Lawley & Claire Knowles
Following hot on the heels of Rattan V Hughes (in which the court of appeal decided that principals are responsible for the treatment of their associates) comes the case of Sejpal v Rodericks in which the Employment Appeal Tribunal has held that an associate can fall within the statutory definition of a “worker” and thereby become entitled to make claims relating to discrimination – and statutory sick pay and holiday pay.
To be classified as a worker, an associate must have entered into a contract with the principal and must have agreed to perform services personally.
Therefore, if an associate provides services as part of a business or profession, they are in most cases going to fall within the definition of a worker.
To establish a contract, there has to be what is known as “mutuality of obligation” – in other words an obligation to provide and pay for work on the one hand and an obligation to carry out the work on the other hand.
Most associate agreements contain wording to the effect that a principal may (but is not obliged) to introduce patients to an associate and that the associate may but is not obliged to accept those patients for treatment.
On the face of it therefore such clauses, one might assume, would strike a dagger through the heart of associates wishing to claim worker status.
Unfortunately, that is not the case.
In employment law, probably more than any other area, there is less focus by the courts on the wording of agreements and instead, the focus is on the actual situation in the practice.
And the reality is that principals must have patients for associates to treat – or the associate would not stay – and there is an obligation upon associates to accept those patients – or the principal would be giving notice to terminate the agreement.
So, the requirement for a contract is satisfied.
So far as the question of personal service is concerned, again, principals may believe there is some relief in the form of locum clauses which allow the associate, in certain circumstances, to appoint a locum – and in most cases the agreement will say that the locum has to be satisfactory to the principal as well as complying with regulatory requirements.
Case law on the question of the appointment of a locum or substitute states that the clause, properly construed (again against the background of the reality of the situation in the practice) means that the associate should be entitled to appoint a locum of their choice, with no qualifications to that right whatsoever, and for the associate never to appear at the practice again.
That is not the reality in dental practices.
Therefore, in the vast majority of cases, an associate will legally be a worker and entitled not only to the right to make discrimination claims, but also for statutory sick and holiday pay which could prove extremely costly indeed for practice owners.
An examination of the case law surrounding employee status would lead one to the conclusion quite quickly, that associates (and other self-employed persons in dental practices) are in fact employees.
The benefits of self-employed status for principals are being eroded by increasing risks both in terms of claims by patients which they may not be insured against, and by claims by associates themselves.
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