Telesales staff win fight over who their real employer was
Three telesales workers were told they were employed by a company in liquidation, but the tribunal found their real employer was Flawless Makeover Studios Ltd. The case highlights the importance of written contracts and consistent payment records.
1 min read · Last updated 18 May 2026
Case details
- #employer-identity
- #telesales-staff
- #corporate-structure
- #unreliable-witness
- #written-contract
- #pension-scheme
Key facts
- Mrs Bradley and Ms Atkin had written contracts identifying Flawless Makeover Studios Ltd as their employer.
- The claimants were paid from Global Business Sales Ltd's bank account but were told it was 'money from a different pot'.
- Ms Chippendale, director of both companies, told claimants on 4 April 2022 that they were employed by Global, which was in liquidation.
- The tribunal found Ms Chippendale an unreliable witness and the claimants truthful.
- The tribunal concluded the claimants were employed by Flawless Makeover Studios Ltd at all material times.
Timeline
-
Mrs Bradley starts employment
Mrs Bradley commenced employment with Flawless Makeover Studios Ltd as a Telesales Manager.
-
Payment source changes
Claimants noticed that their wages were being paid from Global Business Sales Ltd's bank account, but were reassured it was just a different pot.
-
Ms Atkin returns to work
Ms Atkin started a second period of employment with a contract identifying Flawless Makeover Studios Ltd as employer.
-
Mrs Taylor starts employment
Mrs Taylor responded to an advert for Flawless Makeover Studios Ltd and began work as a telesales executive.
-
Employment terminated
Ms Chippendale came to Middlesbrough and told the claimants they were employed by Global Business Sales Ltd, which was in liquidation, and terminated their employment without notice.
-
Preliminary hearing
Employment Judge Sweeney heard evidence on the identity of the employer.
-
Judgment issued
The tribunal found that the claimants were employed by Flawless Makeover Studios Ltd at the date of termination.
The legal issue
The tribunal had to decide which company was the true employer of three telesales staff when their employment was terminated, after the director claimed they worked for a different company that was in liquidation.
The outcome
The tribunal ruled that all three claimants were employed by Flawless Makeover Studios Ltd at the date of termination.
Key reasons:
- The claimants had written contracts naming Flawless Makeover Studios Ltd as their employer.
- The director, Ms Chippendale, was found to be an unreliable witness, while the claimants were truthful.
- Payments from another company's bank account were explained as 'money from a different pot' and did not change the employer.
No compensation was awarded at this preliminary stage; the case will proceed to a full hearing on the merits of the unfair dismissal claims.
Lessons & takeaways
- Your written contract is strong evidence of who your employer is, even if payments come from a different company.
- If your employer changes, you should receive a new contract or clear written notice of the change.
- Directors who give inconsistent or evasive evidence may damage their company's case in tribunal.
- If you are told you work for a different company without warning, seek legal advice immediately.
When your employer isn't who you think
Three telesales staff were shocked when their director told them they were actually employed by a different company – one that was about to go into liquidation. The claimants had worked for years under contracts naming Flawless Makeover Studios Ltd as their employer, and their pay came from another company's bank account only because of internal accounting arrangements.
What the tribunal found
The tribunal heard that the director, Ms Chippendale, gave unreliable evidence and contradicted her own company's pleaded case. The claimants, by contrast, were truthful and consistent. Their written contracts were clear, and there was no evidence of a TUPE transfer or any change of employer. The tribunal concluded that Flawless Makeover Studios Ltd was their employer at all times.
What this means for similar claims
This case shows that tribunals will look at the reality of the employment relationship, not just payment arrangements. If you have a written contract, it carries significant weight. Employers cannot simply claim you worked for a different company after the fact, especially if they have given you no notice of any change. The case also highlights the importance of credible witness evidence – unreliable directors may undermine their own case.
Similar cases
Pregnancy dismissal claim survives employer identity dispute
A former employee's pregnancy-related unfair dismissal claim against Wales England Care Ltd was allowed to proceed after the tribunal identified the correct employer, dismissing claims against a dissolved company and a liquidated one.
Pre-school staff made redundant: who was the real employer?
Four pre-school employees claimed unfair dismissal after redundancy, but the tribunal first had to decide who their employer was – the management committee, the church council, or individuals.
Managing Director with 21 years' service: tribunal decides which company was her employer
A preliminary hearing determined that a managing director who worked across four group companies was employed only by the first respondent. Claims against the other three were dismissed for lack of jurisdiction.
Covert recordings and protected disclosures: tribunal dismisses civil servant's claims
A long-serving HMRC civil servant who covertly recorded meetings with his manager had his unfair dismissal and whistleblowing claims dismissed after the tribunal found a fair trial was impossible.