The European Court has upheld the long-standing principle that parties to a dispute should be able to choose their lawyers without having to go through a tender process (or use a framework).
The gig economy, the tensions between it, and our more established ways of working are rarely far from the news these days.
Individuals are fighting for employment status and its benefits (paid holiday, right to National Minimum Wage etc.) in roles that do not necessarily fit long-established employment models. Whilst much of the coverage in the press has been about the status of delivery and taxi drivers, the issues relating to employment status are by no means limited to these industries.
Earlier this year we looked at the case of the self-employed carer who, despite being able to get someone else to perform her role when she was absent, was held to be an employee. You can find our e-briefing on this, here. More recently, a tribunal held that a peripatetic music teacher is a worker employed by one of the schools they teach in. We also covered this case in an e-briefing, that can be found here.
Employment status; what have we learnt?
- It is the day-to-day arrangements between an individual and potential employer that counts, not the label given. An individual might be called a ‘self-employed contractor’, but if they wear a company uniform and have very little control over their work then a tribunal will not necessarily accept that label;
- ‘Personal performance” is still important. If an individual can ask someone else to do their job for them, if the need arose, and the company they are working for accepts this arrangement, then often, but not always, this will be seen as a sign that the individual is neither a worker nor an employee. Obviously, as we saw with the live-in carer case referred to above, there are some exceptions to this. Generally, however, the tribunal will see an individual who does not have to carry out their work themselves as self-employed.
Employment status; what’s in the future?
- The Government has promised guidance and clarity on these issues, but they are rather distracted at the moment! Some companies, such as Hermes, the delivery company, are starting to invent their own worker categories.
- With the agreement of the GMB union, the company has created a category of workers called “self-employed plus”; delivery drivers who elect to take this title will be entitled to paid holiday, National Minimum Wage and to join a union. In return, they will have to surrender some control to Hermes and agree to take only Hermes-approved routes with their deliveries. It’s a pragmatic solution, and we wait to hear how well it has been received and whether other businesses will follow suit.
- The Government is seemingly anxious to ensure that workers are paid their holiday entitlement, and have just announced a new publicity campaign to draw workers’ attention to their entitlements. This is an issue that is not going to go away anytime soon!
And finally…Lorraine Kelly!
Even Lorraine Kelly, the queen of morning chat, has been embroiled in the employee status debate. Not surprisingly, her issue was not whether she is entitled to National Minimum Wage and paid holidays, but rather whether she had to pay a tax bill of circa £1mllion; is she an employee of ITV or a self-employed performer?
The tribunal concluded that Ms Kelly was, in fact, a self-employed performer – her love of all things breakfast and chat was merely an act! ITV did not exercise sufficient control over her, and hence she was not their employee.
The tests as to whether an individual is self-employed, a worker or employee, for tax purposes, are not identical to those used to assess employment rights, although there are marked similarities. The Government has announced that it wants to bring the tests nearer together to make it easier, but there’s nothing on the horizon as yet.
For more information on this article, please contact Alice Kinder.
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