John Bowers QC analyses the impact in the employment status of ministers of religion against the background of the Supreme Court decision in The President of the Methodist Conference v Preston  UKSC 29
Until recently, the courts had generally held that ministers of religion were not employees. Those authorities were revisited by the House of Lords in Percy v Church of Scotland Board of National Mission  2 AC 28, which took a new approach to the employment status of ecclesiastical office holders and the significance of the spiritual nature of a minister’s duties. Lord Nicholls stated that holding an office did not necessarily preclude the existence of a contract to provide services, and remarked that it was “time to recognise that employment arrangements between a church and its ministers should not lightly be taken as intended to have no legal effect” (at 26).
The decision in Preston
Having regard to the decision in Percy, both the Employment Appeal Tribunal and the Court of Appeal held that Ms Preston, a Minister of the Methodist Church, was an employee of the Church within the meaning of section 230 of the Employment Rights Act 1996. The Supreme Court however, held that she was not.
Lord Sumption confirmed that, as was held in Percy, there is no presumption against contractual intention in the case of ministers of religion. The spiritual nature of a minister’s duties will form part of the background against which the parties’ intentions fall to be construed. However, the question of whether a minister works under a contract of employment must be determined by reference to the manner of his engagement, and the character of the rules governing his service with the particular church.
The constitution of the Methodist Church provides that a minister enters a lifelong commitment on ordination, has no right to unilaterally resign and is entitled to a stipend even during retirement or illness. The duties of a minister are unilaterally determined by the Methodist Conference. Lord Sumption concluded that a Methodist minister’s ordination could not therefore be analysed in terms of contractual formation. Ms Preston’s rights and duties as a minister arose under the Church’s constitution rather than any contract.
Ms Preston had accepted a 5 year ministerial post with the Redruth Circuit of the Church prior to her resignation. It was argued that this appointment constituted a special arrangement, analogous to the one which the House of Lords held to be contractual in Percy. The Court rejected that submission on the basis that because the Methodist Conference could move ministers between circuits at any time, no fresh engagement arose on the appointment of a minister to a position on a circuit. Ms Preston was said to be serving as a minister in Redruth “pursuant to the life-long relationship into which she had already entered … when she was ordained” (at 23). Lady Hale, dissenting, disagreed on this interpretation of the Redruth arrangement.
The impact of Preston
The judgment of the Supreme Court emphasises the importance of carefully considering the constitution, rules and practises of a particular church before advising on whether a contract of employment exists between it and its minister. Lord Sumption criticised the Employment Appeal Tribunal and the Court of Appeal’s failure to fit Ms Preston’s supposed contract of employment within the framework of the Methodist Church’s constitution.
A church’s arrangements for its ministers may provide that certain duties will be carried out by the ministers and that accommodation and a stipend will be given to them. Without more, the existence of those arrangements will not resolve the question of whether there is a legally binding contract between a minister and his church. Lord Sumption highlights the need to ascertain whether the parties intended to create legal relations. As Lord Sumption explains, the decision in Percy did not render the spiritual nature of the minister’s duties irrelevant to the determination of that question.
It is anticipated that this decision, in clarifying the law, may lead to new claims being brought by ministers in a variety of Churches. A link to the Judgement is here.