Jess Varnish to tell tribunal she was wrongfully sacked by British Cycling

The 28-year-old was dropped from the Great Britain cycling team in April 2016, less than a month after she criticised coaches for mistakes made in qualifying for the Rio Olympics

The allegations made by Varnish prompted others to come forward (Getty)

Both sides in the Jess Varnish versus British Cycling/UK Sport dispute spent the first day of their employment tribunal reading each others' paperwork, with Varnish's camp receiving 4,000 pages of documents from their opponents on Sunday.

The huge amount of documentation is understood to be a sign of how robustly cycling's governing body and the elite funding agency intend to defend themselves against Varnish's compensation claim at the Manchester Employment Tribunal this week.

The 28-year-old was dropped from the Great Britain cycling team in April 2016, less than a month after she criticised coaches for mistakes made in qualifying for the Rio Olympics.

She says being cut was punishment for speaking out and has claimed British Cycling's then-technical director Shane Sutton bullied riders and told her to "go and have a baby".

British Cycling maintains she was dropped because she was not quick enough but an internal investigation later found that Sutton had used sexist language, before an independent inquiry accused him of presiding over a "culture of fear".

On Tuesday, more than two and a half years after being told her GB career was over, Varnish will start a two-step process to win damages for wrongful dismissal and sex discrimination.

To do that she must first convince the tribunal she was an employee of British Cycling and UK Sport. The case is scheduled to finish next Monday and if she loses, it is probably the end of the road, unless her lawyers are willing to remain on a no-win, no-fee basis for an appeal.

But the implications of defeat are no less daunting for British Cycling and UK Sport, who currently dish out tax-free grants of around £25,000 to more than 1,000 athletes every year.

In a recent BBC interview, UK Sport chief executive Liz Nicholl said: "Our approach to supporting athletes has been similar to a student grant - a performance award that enables them to train - with no pay-back.

"Obviously, we may be forced to change some things but regardless of that we will absolutely look at what is the best relationship for (athletes) and for the system of public funding."

The legal arguments are expected to be based on recent 'gig economy' disputes, most notably those involving Pimlico Plumbers and Uber, which have seen self-employed contractors gain either employee or worker status.

James Watkins, an employment lawyer at Taylor Wessing, said: "A key battleground will be the level of control exerted over her by UK Sport and British Cycling as a funded athlete."

It is understood Varnish's team will try to make the case that a funded athlete has obligations to its national governing body and UK Sport which make their arrangement more like an employer/employee relationship than a student's with a local authority.

For example, athletes are obliged by UK Sport to make a number of promotional appearances for the National Lottery. In fact, in the build-up to London 2012, UK Sport handed over some of these appearances to a £10million joint venture with the British Olympic Association and the local organising committee called 'Team Visa'.

Varnish in action (Getty)

If the tribunal accepts this argument, Lewis Silkin associate lawyer Sam Minshall believes "it could provide the necessary spark for other athletes to pursue similar claims" and for UK Sport and the governing bodies to accept that athletes are employees.

But Minshall did sound three notes of caution for any athlete tempted to follow Varnish's example: one, each employment case is "highly fact-specific"; two, winning a tribunal can take a long time and a lot of money; and three, there are clear tax implications to becoming an employee.

That last point is to the forefront of UK Sport's thoughts, as a Varnish win could see athletes having to pay tax, while they and the sports they fund must find money for holiday and sick pay and pensions - a burden that would mean less money for athletes and/or fewer athletes on funding.

Varnish's camp, however, dismiss this, saying it should be easy to negotiate a tax exemption for athletes' grants, while still ensuring they have the same legal protections as employees.