The recent case of Pimlico Plumbers Limited v Smith has been used to consider the question of the employment status of a plumber engaged by a plumbing and maintenance company.
Mr Smith claimed unfair dismissal, wrongful dismissal, entitlement to pay during medical suspension, and failure to provide a statement of employment particulars. In order to succeed with these claims, it was necessary for him to be considered to have been an “employee”.
Mr Smith was required to wear Pimlico Plumbers Limited’s uniform, and drove a van with the company’s logo. These would indicate his status as an employee. However, the written agreement between the parties gave the impression that he was in business on his own account, and, therefore, self-employed.
Mr Smith was paid following the company’s receipt of invoices provided by him, personally accounted for his own tax, and was VAT registered. He was required to provide his own tools, equipment and materials, and maintained his own insurance.
Although he was required to work a minimum number of weekly hours, he had the option to choose his particular working hours, and could reject particular jobs. The company was under no obligation to provide work if there was none available.
The Employment Tribunal decided that Mr Smith was not an employee, and therefore they did not have jurisdiction to hear these claims. This decision was upheld by the Employment Appeals Tribunal (EAT).
The EAT considered that the Employment Tribunal had been entitled to have regard to Mr Smith’s financial risk, the degree of autonomy in relation to quotations for his work, and how work was carried out. It was also important here that both parties acted as though Mr Smith was self-employed.
Mr Smith also brought claims for direct disability discrimination, discrimination arising from a failure to make reasonable adjustments, holiday pay, and claims for unauthorised deductions from his wages. In order to have been successful in these claims, Mr Smith needed to have been considered to be a “worker”, not an “employee”.
The Employment Tribunal held that Mr Smith was a “worker” for the purposes of bringing these claims, and this was confirmed by the EAT following the company’s appeal.
The reason for the EAT’s decision in this respect was mostly because it was envisaged that Mr Smith would provide a personal service. Mr Smith did have a right to provide a substitute to carry out work, and, usually, an absolute and unfettered right to provide a substitute would negate personal service. However in this case, the right was not absolute, and Mr Smith had to obtain prior written consent from the company for any substitute.
There was no express provision in Mr Smith’s agreement with the company which permitted substitution and the EAT held that the most the company was prepared to tolerate was a form of job-sharing or shift swapping, without any legal obligation. This was insufficient to amount to an unfettered right of substitution.
Whether a Claimant is an “employee”, a “worker”, or self-employed can often be key to deciding whether their claims will succeed of fail. However, the application of the test of a Claimant’s employment status is often a difficult one.
In this case, the Tribunal found that the Claimant was not an employee, but because the company maintained some control over the way in which the Claimant worked, he was considered to have been a worker.
This can be a complicated area, and it is important that potential Claimants obtain the right advice before taking action against their employers. Each case will be determined based on its own facts.
If you have been dismissed by your employer, or discriminated against for any reason, including your race, sex or disability, and your employer will not agree on your employment status, please contact the dedicated employment department at Michael Lewin Solicitors, and we will be happy to discuss your situation with you.