A potentially landmark Court of Appeal judgment handed down recently has serious implications for the so-called gig economy.
The court held that a plumber who worked as a contractor for the firm Pimlico Plumbers was entitled to certain employment rights not usually afforded to contractors.
The contractor, Gary Smith, worked for the company for six years and was described in the agreement as a ‘self-employed operative’. Under the contract he wore Pimlico’s uniform, used a company-branded van leased from the firm and worked a minimum number of weekly hours.
Mr Smith claimed unfair dismissal and disability discrimination after he was dismissed after seeking to reduce his hours following a heart attack. But Pimlico argued he was not entitled to such protection as he was not an employee.
The original tribunal held that Mr Smith could claim disability discrimination as a ‘worker’ (people classed as workers are entitled to certain employment protections and benefits that also include the right to the national minimum wage and paid annual leave).
Pimlico appealed, first to the Employment Appeal Tribunal (EAT) and most recently in the Court of Appeal, but both the EAT and the Court of Appeal upheld the tribunal’s ruling.
Gaby Hardwicke Employment Law Services Partner Paul Maynard commented: “Increasingly the key issue in these type of cases is whether the individual is required to provide the services personally (in which case he will be a worker) or whether he had the right to send a substitute in his place (in which case he will not be). The Court of Appeal has given welcome guidance on the extent to which ‘employers’ can place a fetter on the right of substitution.”
In related news, the Department for Business, Innovation and Skills has just published its 2015 Employment Status Review, which sets out the current system of employment status, the position of certain atypical workers and options for reform. It provides useful general information for businesses.