Connolly v Whitestone Solicitors UKEAT/0445/10
EAT holds that there must be a deliberate intention to misrepresent an individual's status before it can be found that a contract is illegal. Mr Connolly was offered employment by Whitestone Solicitors but requested to be treated as self-employed for tax purposes and was paid against invoices that he submitted. He subsequently left and made claims, including unfair dismissal, on the basis that he was an employee.
Public policy dictates that employees cannot sue for unfair dismissal if their employment was based on an illegal contract. Therefore a central issue in this case was whether his contract with the firm was illegal or not.
The EAT held that, although it had legitimate concerns about the legality of the contract (especially as both parties to it were solicitors), the contract would only be illegal if one of the parties had tried to conceal the true nature of their relationship from HM Revenue. There was no evidence that Mr Connolly had claimed self-employed status while knowing that he was not entitled to it. The claim was remitted...
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