Duty free?
A recent case means councils could be held responsible for their ALMOs’ employees, says Stuart Jones
The recent case of Leeds City Council v Woodhouse and Others shone the spotlight on councils’ duties towards the employees of their arm’s-length management organisations. In the case, Mr Woodhouse was an employee of an ALMO owned by Leeds Council. He alleged that in the course of his work, council employee Mr Chapman made racially derogatory comments about him and so he issued race discrimination proceedings against Mr Chapman, the ALMO and the council.
The employment tribunal found that Mr Woodhouse was a contract worker and that the council was, for the purposes of section 7 of the Race Relations Act 1976, his principal employer. It concluded that the correct test to be applied in these circumstances is whether the work being done by the individual is for the benefit of the third party and whether the discrimination is in relation to that work.
When the council and Mr Chapman appealed that decision to the Employment Appeal Tribunal, they argued that the tribunal had constructed the words ‘work for’ too widely. Yet the appeal tribunal agreed with the original judgement, holding the council to be Mr Woodhouse’s employer.
In an area where there is a surprising dearth of case law, this decision points to an expansion of protection to workers employed by ALMOs where there is no direct employment relationship with the council. As such, the decision should be considered by councils that have set up ALMOs; they may be liable for discrimination claims from workers who are not actually their employees.
Stuart Jones is a partner in the employment team at Weightmans
Stuart.jones@weightmans.com
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Readers' comments (4)
Bill caddick | 14/05/2010 9:53 am
Shock Horror and D'Oh. The Councils web site says that its ALMO's are "........ wholly owned by Leeds City Council". The legal fees paid and officer time could have been a good way to start making the savings needed in public expenditure - good example of ALMo's loosing sight of their reason for existence. It must be costing LA's a fortune to have these local Government QUANGO equivalents - no wonder sensible councils have been closing them down. Rocket science it isn't
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Smarter Than The Average Bear | 15/05/2010 1:54 am
This is the same principle that I and other citizens of Leeds have protested about regarding Education Leeds and the practice of employing staff who they say are not employed by them but by Education Leeds, and as a consequence have created unfair and unethical situations within our school and education establishments; not to mention their interference in the voluntary sector under the guise of Education Leeds and Barnardos. This is yet again the self same turning their back and saying they are not responsible, when even jack down the street can read and understand what 'wholly owned by Leeds City Council' means. Prayers for Michael to win this case speedily and the people whoever and where ever they are, who allowed this fiasco to go on so long, need to be taken to task, removed from post if they are still there, and a few tens of thousands off their salaries for such incompetence.
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Blue | 16/05/2010 0:20 am
Bill - well put... There's still a full hearing to go... Just imagine how much more £££ this is going to cost... E&D at it's best
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Mr Green | 16/05/2010 8:54 am
Duty Free? ...Something to Declare!
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