Legal Updates

Performing work for different companies related to the employer does not automatically generate an employee-employer relationship

April 22, 2025
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A CFO of a discount store chain, who was fired from his job, demanded that six companies included in the chain, for which he performed bookkeeping and financial management work, be recognized as his employers.

The Labor Court rejected the employee's claim against the six companies of the chain group and held that the mere provision of services to third parties does not establish an employee-employer relationship.  The determination of a person's status as an employee is made on the basis of the 'mixed test' at the center of which is the integration test.  The positive aspect of this test examines the degree of integration of a person and the work he has done in the organizational system of the business or workplace.  There is no legal prohibition on an employer to include in the definition of an employee's job that he will perform tasks from various tasks as well as for 'third parties'.  Here, the chain's corporate structure was such that only one company employed the employees.  The employee held a senior staff position as CFO and naturally dealt with cross-cutting issues related to the other companies in the group.  However, it is not a matter of joint employment by all six companies and the entry in the pay slip according to which he was employed by one company reflects the identity of the real employer.  Therefore, the employee's claim against the companies in the group was rejected.

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