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A new court ruling could mean that some people who are considered self-employed by the organisations they work for may be, depending on their working practices, entitled to additional rights.
The Court of Appeal has today agreed with an employment tribunal ruling that Gary Smith, a plumber who worked as a self-employed contractor for the London-based firm Pimlico Plumbers, should be entitled to rights such as the national minimum wage, paid holiday, and the ability to bring claims for unfair dismissal.
This decision was based on the fact that Smith had worked exclusively for Pimlico Plumbers for six years and was effectively unable to work for anyone else. Given these arrangements, Smith was classed by the tribunal as a worker – despite the fact that he was VAT-registered and paid tax entirely on a self-employed basis.
However, the Court of Appeal also agreed with the tribunal’s view that Smith and other individuals in a similar position could not be classed as employees, which would confer even greater rights.
Smith took his case to the tribunal after suffering a heart attack and trying to reduce the length of his working week from five days to three. He claimed that Pimlico Plumbers turned down his request and effectively dismissed him.
The firm’s founder, Charlie Mullins, said that his plumbers’ contracts had now been amended to take the ruling into account.
The issue of what rights freelance and self-employed workers are entitled to has become more prominent in recent months thanks to the introduction of several “gig economy” businesses such as Uber and Deliveroo.
In October, Uber drivers in England and Wales won an employment tribunal case that ruled they should be classed as workers and therefore entitled to the likes of holiday pay and the minimum wage. Uber has since launched an appeal of the decision.
In today’s Court of Appeal ruling, however, one judge stressed that the law with regard to contractors and freelancers was currently in a state of flux.
Lord Justice Underhill wrote: “Although employment lawyers will inevitably be interested in this case, they should be careful about trying to draw any very general conclusions from it.”
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Darren Fell, CEO of Crunch, said: "We welcome the government's commitment to adopt the recommendations from the Taylor report. We would however, urge caution that any response does not introduce more red tape, or reduce the ability for entrepreneurs to employ people flexibly."