NMWM04150 - Status: example of court consideration: 3

National Minimum Wage Compliance Officer of the Inland Revenue v Mr T Hewitson and Mrs A Hewitson t/a Executive Coach Catering Services (ECCS) (EAT/489/01)

This case concerned the work of stewards engaged by Executive Coach Catering Services (“ECCS”) on coaches operated by National Express. The stewards performed various duties, including collecting tickets, giving information and assistance to passengers and selling refreshments on the coaches. It was this latter aspect of the work, which was found to take up most of the stewards’ working time, and which formed the crux of the case.

The employment tribunal found that the stewards were workers but the employment appeals tribunal overturned this.

The employment appeal tribunal held that because the stewards paid for the refreshments from their own money and retained the profits of their sale the stewards were carrying on a business of supplying catering services to ECCS. ECCS were therefore clients or customers of the stewards.

The judgment stated that;

“In our opinion, the Tribunal should have asked itself whether the stewards were providing services, and if so, what was the contractual relationship between themselves and ECCS. It is clear that the Tribunal found, and indeed was bound to find, that the stewards were providing services. What they were doing was providing the catering services and stewarding services that ECCS had contracted to supply to Durham Transport Services and which Durham Transport Services was contracted to supply to National Express. Prima facie, when someone purchases services from another, in common parlance, he can be regarded as a customer of the other. The terms ‘customer’ and ‘client’ in Section 54 of the Act are not used as terms of art. In our opinion, ECCS is a customer or client of the stewards, as it receives the benefit of the service provided by the stewards’ business, and is described as such in the Stewards Agreement. They provided, as we have said, the stewarding and catering services to ECCS, which ECCS was itself bound to supply to Durham Transport Services. On that analysis, as it seems to us and having regard to the fact that the major part of the contract, both in terms of time and in terms of remuneration related to the catering, and having regard to the facts that the stewards were performing, personally, catering services for ECCS pursuant to a business undertaking carried on by the stewards, that ECCS was a client or customer of that business undertaking. As such, it seems to us on the material findings, the Tribunal should have held that the stewards were not workers within the meaning of Section 54(3)(b) of the Act, by reason of the fact that they were outside Section 54(3)(b). They were carrying on, as we have said, a business undertaking for reward for ECCS, and were clients or customers of ECCS.“