Employment & Pensions Blog: Court of Appeal rules a paid ‘volunteer’ was actually a worker - Groom v Maritime and Coastguard Agency

Since the boom of the gig-economy in the wake of the 2007/08 financial crisis, there has been a very noticeable increase in the number of employment status cases being heard by the courts. Whether that’s ‘workers’ arguing they are actually employees, or ‘self-employed’ arguing they are workers. The Supreme Court’s decision in the Uber case (2021), that the drivers were workers rather than self-employed, has done much to further the increase.  

In the recent case of Groom v Maritime and Coastguard Agency, the Court of Appeal looked at two competing decisions from the Employment Tribunal and Employment Appeal Tribunal to determine whether Coastguard Rescue Officers (CRO) that had the option of claiming payment to “cover minor costs caused by your volunteering, and to compensate for any disruption to your personal life and employment” were legally workers or volunteers.

Background

The Maritime and Coastguard Agency is responsible for conducting and coordinating civil maritime search and rescue. Its Coastguard Rescue Service is made up of 108 employees and 3,500 volunteer CROs. Mr Groom was one of their volunteers based at Bembridge on the Isle of Wight from 1985, until his position was terminated following a disciplinary hearing in May 2020. 

Prior to the disciplinary, Mr Groom asked to be accompanied to the hearing by a trade union representative, but he was told that he didn’t have the right to be accompanied because that right only applies to workers and employees, and not to him as a volunteer. 

It is true that the right to be accompanied under the Employment Relations Act 1999 technically only applies to workers and employees, and Mr Groom brought an Employment Tribunal claim on the basis that he was actually a worker and should have been given the right to be accompanied.   

Employment Tribunal

The Employment Tribunal followed the approach taken by the Supreme Court in Uber v Aslam and started with the documents in place at the time. There were clear references to the relationship between the CROs and the Agency being a purely voluntary one and whilst the Code of Conduct did specify that a CRO should “be professional and loyal to His Majesty’s Coast Guard and abide by the Code of Conduct” and follow certain safety or training requirements, the degree of control the Agency had over the CROs was not significant. 

Mr Groom argued one of the reasons he was a worker was because he was paid for some of the work he did. Under the Handbook, CROs were entitled to be paid ‘compensation’ for specific activities, but the Tribunal found that the compensation wasn’t automatic, many volunteers didn’t claim it, HMRC had previously concluded that CROs weren’t workers, and there was insufficient evidence to suggest that the voluntary relationship both parties had entered into had been changed by virtue of the fact compensation was paid.

The Tribunal therefore found that there was no overarching contract between the Agency and Mr Groom, he was a volunteer and therefore did not have the right to be accompanied to the disciplinary hearing.  

Mr Groom appealed to the EAT.

Employment Appeal Tribunal (EAT)

The EAT disagreed with the Tribunal’s findings and upheld Mr Groom’s appeal.

The EAT drew the distinction between the activities Mr Groom agreed to carry out for free, and those he agreed to carry out in return for the promise of compensation. The EAT held that there was plainly was a contract in place when Mr Groom agreed to carry out certain activities in return for the promise of remuneration, but this did not necessarily mean there was a contract in place for the activities that Mr Groom agreed to carry out purely for free. 

Therefore, according to the EAT, Mr Groom was a worker during the time he carried out activities in return for compensation, and he was just a volunteer when carrying activities for free. 

The Agency appealed to the Court of Appeal.

The Court of Appeal

The Court of Appeal agreed with the EAT  and dismissed the Agency’s appeal. 

The Court of Appeal found:

• The fact the documents referred to the CROs as volunteers did not override the factual reality.
• The right to remuneration/compensation was imbedded in the documents, and Mr Groom was a ‘worker’ every time he carried out activities that carried the promise of payment.
• The right to remuneration was regarded by the parties as contractually binding, and there was an intention to create legal relations, which together formed a standard wage/work bargain.
• There didn’t have to be one overarching contract covering all the activities that Mr Groom did. There could be a worker relationship only during the paid activities. 

Comment 

This case will be particularly important for those working in the charity, social housing and public sectors where volunteers are actively encouraged to help deliver services in the local community. The key takeaways are:

• Describing people are ‘volunteers’ doesn’t mean they really are, particularly if the nature of the relationship in reality is quite different. 
   
• Payments to ‘volunteers’ matter, because any entitlement to remuneration that goes beyond reimbursement of out-of-pocket expenses can create a worker relationship. In this case, payments designed “to cover minor costs caused by your volunteering, and to compensate for any disruption to your personal life and employment and for unsocial hours call outs” were treated as remuneration conducive to contractual rights. 
   
• Mutuality of obligation between the parties can exist in a limited form. The case confirms that mutuality of obligation need not be continuous. It can arise only during a specific engagement so long as both sides have obligations during that period. In this case, once Mr Groom had agreed to carry out the activities, he was under an obligation to carry the activities out and the Agency was obligated by the promise of compensation.

In view of the Court of Appeal’s decision, organisations who rely on volunteers to deliver their services or sell their product should review the documentation and arrangements they have in place with their volunteers. If the individuals are actually workers, this could have significant ramifications for things like holiday pay and National Minimum/Living Wage. 

Should you require any assistance, our Employment Team is happy to assess the employment/worker status risks arising out of existing volunteer arrangements or those you are considering implementing.