Shulmans wins employee ruling

Leeds-based Shulmans has won a ground-breaking emp-loyment law case in the Court of Appeal.
As a result of the win, the controlling shareholder of a company is now recognised for the first time as an employee.
The ruling means controlling shareholders are now entitled to the same rights as employees.
The Court of Appeal ruled in favour of Shulmans' client Peter Bottrill who is seeking to recover money from the Department of Trade and Industry which was owed by a company when it became insolvent.
Bottrill successfully claimed employment rights in an industrial tribunal, but the Department of Trade and Industry has pursued the case to the Court of Appeal – and lost again.
Bottrill set up engineering firm Magnatech UK, based in Barnsley, in 1994, but it went into liquidation.
The Court of Appeal ruled that other factors, such as the wording of the contract of employment, how the individual was paid and the level of control, should all be taken into account when deciding a person's employee status in a company.
Ian Dawson, a partner in employment law at Shulmans, says the decision is likely to affect a “substantial number” of businessmen and women whose companies become insolvent.
He adds: “The decision will help to clarify the law in this area and enable other individuals in a similar position to receive their statutory entitlements.”