Nadine Quashie claimed that she was unfairly dismissed by Stringfellows when they bagged her for alleged drug related instances.
First of all she lost the case. Then she appealed and won. Now she has lost it again as the appeals court said that the previous appeals court had no right to reverse the previous decision.
It has big implications both for employment law and IR35.
Nadine used to work as a lap dancer at Stringfellows but was sacked in 2008. She claimed for unfair dismissal. She lost that case in 2010.
IR35 Appeal Won
However, she won on appeal when her counsel said that the commissions she got and the fees and fines she could potentially get showed that the relationship between herself and the club was one of employment.
They successfully argued that there was a major degree of control over how she performed her work. There were also mutual obligations.
The Appeal Judge agreed with this and he ruled that Nadine was effectively an employee of Stringfellows.
Re-Appeal by HMRC
Stringfellows appealed this as they argued that he Appeal Judge had no right to overrule the previous verdict as it had been arrived at correctly and in the correct manner. So there were no grounds to overturn the ruling.
Their QC argued that the club was not obliged to pay Nadine and so that did not meet the terms of a contract of employment.
The agreement between Stringfellows and the dancers referred to them as independent contractors.
All Stringfellows did was to provide an opportunity for the dancers to meet clients and charge them for their services.
Stringfellows were not obliged to pay them anything at all.
Nadine and the other dancers negotiated her own contracts with the customers for the fees. She and the other dancers took a risk that they might lose money on a particular night if they did not receive enough fees to cover the costs incurred.
The appeals judges agreed with the conclusions of the original tribunal. However, they said that even if they hadn‘t agreed with them, the first appeals tribunal could not throw out the verdict. That’s because it was properly arrived at The first appeals tribunal could not insert their own interpretation of what type of contract Nadine had with Stringfellows in contracts to the original tribunal.
Good News for IT Contractors
So, that‘s bad news for Nadine Quashie – although she may keep the battle alive by appealing again.
Of course, what is bad for Nadine is not necessarily so for IT Contractors.
Every time there is a ruling that freelancers of any sort do not have a contract of employment with a client is good news for those who do not want to be seen as having a contract of employment and be caught by IR5.
We will do further analysis of what this means for contractors in a later article.