Is your contractor actually a worker?

Ruling: Self-employed contractor a worker with employment rights

Plastering Contractors Stanmore Ltd v Holden

In this case, an employee accepted £200 in exchange for becoming a self-employed subcontractor. The EAT held he was actually a worker with entitlements under the Employment Rights Act 1996 (ERA) and Working Time Regulations 1998 (WTR).

The Claimant, H was employed as a general laborer from 1997 to 2001.He accepted a one off payment in 2001 to become a self-employed contractor. He was added to the company’s database and he was referred to construction sites upon requests for services. On site he worked under the instruction of the site supervisor and was paid by how much work he completed. The rates of pay were non-negotiable and he was paid based on the supervisors record of his work.

With the exception of his safety boots, which were his own, all other PPE, equipment and transport was provided by the Company. He worked exclusively for the company until May 2013 when he stopped forking without notice.

H had become frustrated waiting at home for referrals to work on site. He took up another position and brought a claim for unpaid holiday pay.

The company disputed his claim stating that they were not under an obligation to provide H with work, he didn’t have to accept work and he was entitled to send a substitute. They stated he was not a worker. The Employment Judge disagreed, he stated he was a worker and for 16 years he had been offered work with an expectation of him turning up for work during working hours, he had been integrated into the workforce.

The company appealed, their appeal was dismissed by the EAT who stated that there was sufficient    mutuality of obligation. With regard to the ability to send a substitute it was found there was no express provision permitting this. The EAT found there was sufficient integration and control for H to be a worker.

Just because an employee agrees to change their status will not necessarily prevent a finding that their status has not changed. The Tribunal will look at the realities of the  relationship,

Remember, employees can bring a claim seeking holiday pay for a 12 year period under the ERA, rather than the WTR which limits to the last holiday year.