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Recrutiment & Employment Confederation

Joint employment – does it work? The case of United Taxis v Comolly and another

Business advice

This is a guest blog by Hannah Morrison - Brabners

The issue of “joint” or “dual” employment under UK law is problematic. Whilst it is a recognised concept in some jurisdictions (notably in the USA), the idea that someone can have two employers in respect of the same job does not sit comfortably under UK law, as demonstrated by the recent case of United Taxis Ltd v Comolly and another.

Facts of the case

The case concerned a taxi driver, Mr Comolly, and a taxi operator, United Taxis. United Taxis is a co-operative owned by member-shareholders. One such member-shareholder was Mr Tidman.

Member-shareholders such as Mr Tidman paid a monthly fee in return for access to the taxi work made available by United Taxis. The only way for a non-shareholder driver (such as Mr Comolly) to carry out taxi work for United Taxis’ customers was by being engaged through one of the member-shareholders.

And so Mr Comolly was engaged via Mr Tidman to drive United Taxis' passengers. After their business relationship came to an end, Mr Comolly brought various claims in the Employment Tribunal (“ET”). Mr Comolly alleged that he was either an employee or a worker of United Taxis and/or Mr Tidman and therefore one or both of them were liable for his claims.

The ET took the view that Mr Comolly was simultaneously an employee of Mr Tidman and a worker of United Taxis.

Both United Taxis and Mr Tidman appealed to the EAT.

The appeal

In considering the issue of joint employment, the EAT referred to an 1826 legal principle that “a servant cannot have two masters”, and emphasised the practical difficulties raised by the idea of a person having two employers in relation to the same job.

The EAT observed that whilst this does not necessarily mean that joint employment can never work as a concept, the EAT was not aware of any legal authority which discusses how these problems could be overcome or which confirms that dual employment is actually “legally possible”.

In any event, the EAT concluded that in this case there was no contractual relationship between Mr Comolly and United Taxis.

In relation to Mr Tidman, the EAT found that Mr Comolly was a worker of Mr Tidman, but there was an insufficient degree of control exercised by Mr Tidman over Mr Comolly to establish an employment relationship.  

So, does joint employment work?

The joint employment model is becoming increasingly popular in the recruitment sector, typically whereby a recruitment agency and a service provider or umbrella company will both employ a worker with a view to obtaining VAT and/or other advantages. Whilst the two employers may seek to clearly apportion responsibilities and liabilities between themselves in the contract, this does not mean that HMRC and the courts will necessarily accept that the employment of the individual in question is so neatly delineated.

In May, the Employment Agency Standards Inspectorate (EASI) issued a notice setting out its understanding of the joint employment model. Whilst EASI’s view is that a joint employment model could, in principle, work from a regulatory perspective, there are concerns over whether such a model is compatible with the Conduct Regulations. EASI also acknowledged that this is only their regulatory view and it should not be considered as legal advice on the joint employment model.

Whilst we are not aware of any reported cases which have considered this specific model of joint employment, the case of Mr Comolly, and many cases before it, make clear that in UK law the idea of being employed by two entities in relation to the same job is fraught with complexity and in some cases is simply not legally possible. Therefore, any arrangement which purports to offer advantages through the adoption of such a model should be treated with caution.