Employment status: EAT upholds decision that cyclist dropped from Olympic training programme was neither an employee nor a worker

Published 6 agosto 2020

A professional cyclist who participated in a training programme run by British Cycling was neither an employee nor a worker.

THE FACTS

At a young age, Ms Varnish was selected for training programmes run by the British Cycling Federation (known as “British Cycling”), which is a non-for-profit organisation that promotes and controls the sport of cycling in the UK.   She was later selected for their Olympic Podium Programme. Under its agreement with Ms Varnish, British Cycling agreed to develop a performance plan with her and to provide her with a package of services, benefits and other support to enable her to devote her time to training.   These services included coaching support, clothing and equipment, and access to facilities. In return, Ms Varnish agreed to comply with the performance plan, train as required, attend training camps, enter competitions, maintain her health, wear team clothing and comply with certain standards of behaviour. She was dropped from the programme for performance reasons, and brought claims in the employment tribunal, including claims of discrimination and unfair dismissal. At a preliminary hearing, the employment tribunal held that she was neither a worker nor an employee, and so could not bring these claims.

In reaching its decision, the employment tribunal first considered whether Ms Varnish had been an employee. It applied the established tests for employee status to the facts in Ms Varnish’s case. These tests are:

1. Is there an obligation on the “employer” to provide work and on the individual to perform such work (“mutuality of obligation”)?
2. Is the individual required to provide services personally (“personal service”)?
3. Does the “employer” exercise sufficient control over the way in which the individual carries out the service (“control”)?

In addition, the other elements of the contract must be consistent with an employment contract.

First, the employment tribunal held that there was no mutuality of obligation. Referring to a “wage/work” bargain, under which an employee provides work in return for a wage, the employment tribunal held that she did not provide work or services to British Cycling, nor did it pay her. The employment tribunal characterised the arrangement as Ms Varnish’s commitment to train with the aim of being selected to compete with the British Cycling team. She was not providing work or services to British Cycling. To give her the best chance of competing with the cycling team, British Cycling offered her the services set out above. The employment tribunal did not consider these to be wages (though it acknowledged that “wages” do not necessarily have to be salary but can be benefits).     

In relation to personal performance of services, the employment tribunal agreed that performance must be provided by Ms Varnish. However, since she was not provided with “work” by British Cycling she was not providing services, so this test was not met.

The “control” test was met. However, as the other two tests were not met, Ms Varnish was not an employee.

The employment tribunal also considered that there were other aspects of the contract with British Cycling (such as the tax position) that were not consistent with a contract of employment.

The employment tribunal then considered if Ms Varnish was a worker and concluded that she was not. “Workers” personally perform services, and Ms Varnish was not performing any services for British Cycling.

Ms Varnish appealed to the EAT. The EAT dismissed her appeal. It found that the employment tribunal had asked the right questions and had considered and weighed up all the relevant factors, and that its reasoning was not irrational.

WHAT DOES THIS MEAN FOR EMPLOYERS?

Employment status continues to be a live issue before the employment tribunals. This case is an interesting consideration of employment status and an example of an employment tribunal looking at the full picture of the relationship when reaching its decision. The question of whether or not an individual is an employee or a worker is always very fact specific. The EAT commented that, in this case, if the contractual provisions and balance of services provided to and from Ms Varnish and British Cycling were different, it would perhaps have reached a different answer.

Varnish v British Cycling Federation (t/a British Cycling) UKEAT/0022/20/LA