Merchant

• Jurisdiction: Antigua and Barbuda
• Court: Industrial Court (Antigua)
• Judge: Lewis, P.
• Judgment Date: 27 July 1978
• Docket Number: No. 2 of 1978
• Date: 27 July 1978

Industrial Court

Lewis, P.; Clarke, J. (Vice President); Caines, J. (Member)

No. 2 of 1978

Merchant

and

British American Insurance Co. Ltd.

Appearances:

T.H. Kendall, Solicitor for employee/claimant

W. Archibald, Solicitor for employer/respondent

Labour Law - Termination of Employment — Dismissal.

Labour Law - Termination of Employment — Compensation

Labour Law - Termination of Employment — Payment in lieu of vacation leave.

Introductory:

Lewis, P.

1 The employer/respondent is a limited liability company carrying on the business of insurers in this State. The claimant was at one time employed by the company as one of its agents, and on the 7 ^th April, 1970 entered into an agreement with the company to perform the duties set out in the agreement on the terms therein specified.

2 The agreement entered into between the claimant and the company (hereinafter called “the agreement”) was in writing and a photostat copy thereof was attached to the claimant's memorandum and filed in this court. The agreement which was admitted in evidence as exhibit C.L.A.1. arranged for the claimant to be remunerated by means of commission in accordance with clause 9(A) to (F) thereof.

3 It was pleaded by the claimant that his contract with the company was terminated on 20 ^th December, 1976. This is not denied by the company which in paragraph 5 of its memorandum states that on 13 ^th December, 1976 it gave the claimant one week's notice to terminate his services on 20 ^th December, 1976.

4 The claimant contends that he was unfairly dismissed on this date and claims: (a) pay in lieu of holidays for thirteen weeks and (b) compensation for unfair dismissal.

5 The company made it abundantly clear that in terminating the claimant's employment it did so under clause 10(3) of the agreement which provides that “either party shall have the right to terminate this contract (i.e. the agreement) upon one week's notice to the other.” The company admits that it did not give the claimant a written statement of the precise reason for the termination of his employment as required by section C10 of the Labour Code although the claimant asked for such a statement, and the reasons given by the company's Manager in examination in chief for not supplying the statement were: (a) he was very pressed with work at the time and (b) he did to think it was necessary for the claimant to have such a statement. Further, in cross-examination he gave a third reason which was that he “was not familiar with the terms set out in the Labour Code about giving a dismissed employee reasons for his dismissal.”

6 In paragraph 2 of his memorandum the claimant pleads that “some of the claimant's terms of employment are contained in “the agreement but on the other hand the company pleaded in paragraph 2 of its memorandum “that the full and only terms of the agreement are recorded in “the said agreement. It is obvious therefore that the parties are not ad idem on the question whether or not the agreement contained all the claimant's conditions of work. In fact, it was submitted by the Solicitor for the claimant that by virtue of the Antigua Labour Code (hereinafter called “the code”) certain conditions of employment had to be implied in the agreement.

Was the Claimant an Employee?

7 The Solicitor for the company submitted that the claimant was not an “employee” within the meaning of the definition of the word in the code; that the code contemplated an employee as being a person who received a basic wage, and no basic wage was either contemplated by the agreement or paid thereunder; and finally that the claimant was paid by means of commissions and consequently the money he thus received did not constitute “wages” within the meaning of this word.

8 The word “employee” is defined in section A5 of the code, as meaning “any person who enters into or works under, ……. a contract with an employer, personally to perform any services or labour, whether the contract be oral or written, expressed or implied………….”

9 In this connection it is relevant also to ascertain the meaning of the terms “employer” and “employment contract” appearing in the said section of the code.

10 “Employer” is defined as meaning “any person, including any of his representatives who contracts for…… the services or labour of an employee and the term includes any body of persons corporate or incorporate.(?) The respondent being a corporation falls within this definition.

11 “Employment contract” is defined as meaning “any contract, whether expressed or implied, and whether written or oral, where under it s agreed that one person (the employee) will perform certain services for another (the employer)………..”

12 It will be noted that in these definitions the word “services” occurs either by itself or in juxtaposition to the words “or labour”; so that in a case where a person offers his services to another and that other person accepts such services on terms agreed between the offeror and the offeree, the resulting agreement is an employment contract and the relationship of an employer and employee is thereby created.

13 How then do these three expressions “employee”, “employer” and “employment contract” relate to the agreement with which these proceedings are concerned? On looking at the agreement it becomes readily apparent therefrom that in consideration of the mutual covenants therein contained the parties have assumed certain duties and obligations to each other.

14 In clause 1 of the agreement the claimant is authorised to represent the company and to solicit applications for insurance on its behalf. In clause 2 the claimant agrees that in carrying out his business as agent he will be governed by the ethics of the Life Insurance profession and will so conduct himself as not adversely to affect the “business, standing or reputation of himself or the company.” In clause 3 the company undertakes to supply the claimant with all the insurance manuals rate books and necessary information pertinent to his duty as agent of the company.”

15 These are some of the obligations contained in the agreement which are binding on the company and the claimant. They show that the claimant has authority to act on behalf of the company as its agent and that the company undertakes to assist the claimant to carry out his work as agent by supplying him with the materials necessary for the performance of his duties.

16 Clause 4 shows that the company exercises to a marked degree the right to control its agents. This is a test in law to determine whether or not the relationship of employer and employee exists. A further point to be noticed in relation to this question of control is that an agent is allocated a particular area in which to work. This allocation is obviously done by the company and the agent is not free to work where he likes. This point is made in the evidence of the company's Manager who stated in answer to a question in cross-examination that the claimant worked Ain part of the city and in the south of the island.” This was of course before he left the company's employment in 1976, for Mr. Richardson went on to state; “Mr. Benjamin was doing this area in 1977. He was transferred to this area and another agent took his place.” Mr. Richardson also sated at the beginning of his evidence in chief that he supervised the claimant's work - another incident of the control exercised by the company over the claimant.

17 The terms of the agreement which we have quoted conclusively establish in our opinion that the claimant was an “employee” within the meaning of this word as defined in the code, for the agreement is undoubtedly one in which the claimant contracted personally to perform “services or labour” as an insurance agent for and on behalf of the company.

18 This is our understanding of the admission on this particular aspect of the case contained in paragraph 2 of the company's memorandum and we find it difficult to understand how, in the light of this admission, it could be contended that the claimant was not an employee of the company.

Was the Employee in Receipt of a Basic Wage?

19 We now pass on to consider the submission that the code contemplates an employee as being a person who is in receipt of a basic wage, and, because of the fact that the agreement makes no provision in specific terms for payment of such a wage it was submitted that the claimant was not an employee. Now it will be observed that in the definition of an “employee” no reference is made to wages. This is not surprising, for although it is possible that an employee may perform work for an employer gratuitously, it is highly improbable that he would. So unlikely indeed is such a situation that it was not thought necessary to include in the definition of “employee' a statement that his services or labour should be for reward. It was taken for granted that this would be so in the majority of cases.

20 What the definition of the employee does require is that a person should work under a contract with an employer in order to create the relationship of employer and employee, but this relationship would not ordinarily be created unless there is in the agreement between the two parties some provision for remuneration to be paid to the person performing the services or labour, i.e. to the employee. This is entirely different form saying that the code lays down that a person does not become an employee unless he is paid a basic wage.

21 The word “wages” is defined in section A5 of the code as meaning “any money or other thing paid or contracted to be paid, delivered, or given at periodic intervals, as recompense, reward, or remuneration for services or labour done or to be done.”

22 The words “or other thing” in this definition clearly indicate that the remuneration paid for services or labour does not consist exclusively of money. It may be for example,...