The approximate annual cost of replacing volunteers with paid staff across the UK would be £16.4billion; they are a resource many organisations, and not just charities, can ill afford to lose. 

 A recent Court of Appeal case, however, is a useful reminder of the employment status of volunteers and the risks of getting it wrong. It’s the case of Maritime and Coastguard Agency v Groom, a case we reported when it was decided by the Employment Appeal Tribunal in May 2024. 

Learning point

Any volunteer who receives any sort of remuneration or payment (over and above reasonable expenses) for their volunteering activities is at risk of being a worker and so being entitled to worker rights.

Case highlights

Mr Groom was a Coastguard Rescue Officer (CRO) with the Maritime and Coastguard Agency (MCA) from 1985 until 2020.  His position was terminated following a disciplinary matter. The relationship between MCA and the CROs was governed by three documents: a volunteer handbook, a code of conduct and a remuneration document. 

Throughout these documents, the CROs were described as volunteers, and it was reiterated that there were no contracts of employment and no mutuality of obligation between the MCA and the CRO. The remuneration document described how CROs could claim payment for certain activities. These payments were described as ‘compensation for any disruption to personal life and employment’  

CROs were not automatically given these payments; they had to claim for them.  Around two-thirds of CROs did this regularly.  When these payments were claimed, the CRO received a payslip itemising their hourly remuneration and their expenses and each year they received a P60.

The question of his employment status was triggered when Mr Groom requested that he be accompanied by a union official at his disciplinary appeal hearing in July 2020. The MCA declined this request on the grounds that Mr Groom was not a worker and hence did not have the right to be accompanied. He was unsuccessful at his disciplinary appeal and brought a claim against MCA; his aim, he alleged, was not to win compensation but rather to clarify the status of CROs. 

The employment tribunal dismissed his claim, concluding he was not a worker given the absence of any contractual obligation to provide work or services.  However, the EAT reversed this decision as we reported in our blog post. They concluded that a contract for services arose in respect of each of the activities Mr Groom undertook and for which he was entitled to remuneration under the remuneration document. 

Court of Appeal decision

The judges dismissed the appeal against the EAT decision and confirmed the following:

• Mr Groom was a worker under the Employment Rights Act 1996, each time he carried out activities for MCA.
• Whilst he was not obliged to carry out these activities, when he did agree to do so, Mr Groom had to follow reasonable instructions and could (but didn’t have to) claim remuneration. This did, the Court concluded, demonstrate a clear intention to ‘create legal relations’ and as such a contract was created.
• There was, however, no overriding contract during the periods when Mr Groom was not carrying out activities for MCA.
• The payment structure within the remuneration document went beyond reimbursement of volunteer expenses. 

Takeaway points

Volunteers have very few employment rights. By contrast, workers have key entitlements, not least the right to be paid the national minimum wage for the work they carry out and the right to paid holiday and rest breaks. An organisation which confuses the two faces the risk of claims under National Minimum Wage Regulations and/or Working Time Regulations 1998.

Volunteers are entitled to be reimbursed for reasonable expenses for costs incurred during their volunteer activities. This usually relates to expenses such as travel costs. It does not include any further payments, or benefits in kind or any sort of remuneration.

Remuneration might not just be cash or a direct payment. It may include anything which represents a benefit in kind beyond reasonable expenses. 

The Government guidance on eligibility for the NMW notes: ‘Voluntary workers may not receive benefits in kind apart from reasonable subsistence for their voluntary role or reasonable accommodation for their voluntary role. Subsistence payments must be solely for the purposes of providing subsistence and not provide an income on top of subsistence.'

Organisations that use the title of volunteer but still reward these ‘volunteers’ with any sort of payment which goes beyond reimbursement of expenses are at risk. The fact that the volunteer is not obliged to carry out their volunteering activities, nor the organisation obliged to provide these activities, will not necessarily preclude a contract of employment if there is a payment process which goes beyond that of expenses. 

How can we help

Review and strengthen your volunteer arrangements: We can audit your volunteer policies, procedures and day-to-day practices to ensure they do not inadvertently create an employment relationship. This includes identifying any forms of remuneration, written or informal, that could give rise to contractual obligations.

Provide clear, compliant volunteer documentation: Our team can prepare or update volunteer agreements and supporting documentation to eliminate ambiguity around status and ensure your organisation is fully protected.

Identify and manage areas of risk: We regularly support charities of all kinds, faith-based organisations and housing associations that have unintentionally created risk through payments, vouchers or ‘thank you’ gestures to volunteers such as customer/tenant committee members. We can help you pinpoint these issues early and take practical steps to manage them proactively. 

Contact a member of our employment and pensions team or our charities team for further information.