Pimlico Plumbers v Smith
The Employment Appeal Tribunal (“EAT”) held in this case that a plumber was not an employee but was a worker when engaged by a plumbing and maintenance company.
Although the Claimant wore the company’s uniform and drove a van with their logo, the written agreements gave the impression he was in business on his own account.
The Claimant was paid against receipt of invoices, personally accounted for tax and was VAT registered. He was required to provide his own tools, equipment and materials and maintained his own insurance. Although required to work a minimum number of weekly hours, he could choose particular working hours and could reject particular jobs. Pimlico was under no obligation to provide work if none was available.
In upholding the decision that he was not an employee, the EAT held the employment tribunal had been entitled to have regard to the Claimant’s financial risk, the degree of autonomy as to quotations and how work was carried out. It was also of significance that both parties acted as though the Claimant was self-employed.
The EAT also upheld the decision that the Claimant was a ‘worker’, largely because it was envisaged that he would provide personal service. It was reaffirmed that an unqualified right to provide a substitute negates personal service but that where prior consent to a substitute is required the right is not unfettered.
There was no express provision which permitted substitution and, it was held, the most Pimlico Plumbers was willing to tolerate was a form of job-sharing or shift swapping without any legal obligation, which was insufficient to amount to an unfettered right of substitution.
In Practice
There are many cases concerning employment status but this judgment sets out nicely the factors a tribunal will look at. “It was clear from the evidence that the Claimant was not an employee, but the finding of him being a worker meant that he was entitled to some rights, including, importantly, holiday pay”, saysEmployment Associate Paul Burton. Those wishing to avoid a self employed contractor being classed as a ‘worker’ and therefore entitled to holiday pay, for example, must ensure that there is a suitably worded ‘substitution clause’ in the contract.
At Frettens, all of our solicitors offer a free initial meeting or chat on the phone to answer your questions. If this article raises issues for you or your business, please call us on 01202 499255 and Kate or Paul will be happy to discuss it with you.
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