The EAT ’s decision in Archer-Hoblin v MacGettigan has provided authority in relation to substitution clauses in a contractors agreement. In this case there was a substitution clause in the Claimant’s contract but the Tribunal judge accepted the Claimant’s argument that he would never send a substitute. Therefore, it was accepted that he was a worker for the purposes of the Working Time Regulations 1998 and so his claim for holiday pay succeeded. However, this decision was overturned by the EAT which upheld the following principles:-
- The construction of substitution clauses must be carried out applying ordinary principles of construction. If the substitution clause is clear and unambiguous, its meaning and effect are to be determined in accordance with its terms. In this case, the clause provided an unrestricted right of substitution inconsistent with an obligation to perform work personally within the meaning of the WTR.
- The reality of the situation would be relevant when determining whether or not the clause was a sham. When considering this, the intention and practice of the parties should be considered.