The issue of employment status is like a well oiled soap-opera – we’re often left wondering what the next instalment will be. Well, the wait is over following the Supreme Court’s decision in the case of Pimlico Plumbers Ltd and Mullins v Smith, published earlier this week.
Mr Smith was a plumber, who was engaged by Pimlico Plumbers Ltd (Pimlico) for around five years. Pimlico ended the engagement shortly after Mr Smith suffered a heart attack. Mr Smith bought claims for unfair dismissal, wrongful dismissal, entitlement to pay during medical suspension, holiday pay, unlawful deduction from wages and disability discrimination.
Before the employment tribunal was able to decide on the merits of any of these claims, they first needed to decide whether Mr Smith was an employee, a worker or a self-employed contractor. The result of this preliminary issue would then determine whether these claims could run at all.
The employment tribunal decided that, based on the facts of this case, Mr Smith was not an employee, but he was a worker. This means that the only claims which remain from Mr Smith’s list of claims are disability discrimination, holiday pay and unlawful deductions from wages.
Mr Smith appealed the employment tribunal decision that he was not an employee to the Employment Appeal Tribunal. This decision was upheld and Mr Smith did not pursue this any further.
Pimlico appealed the finding of worker status all the way to the Supreme Court. However, the decision has been upheld throughout each appeal stage that Mr Smith was a worker and therefore had all of the associated rights.
The reason for each stage of the court system upholding this decision was very fact specific, as all employment status cases are. The main points to note from this case are that:
- While Mr Smith could swap work with other ‘Pimlico Plumbers’ and had the right to bring in external contractors with Pimlico’s consent, he did not have an unfettered right to send a substitute in his place. The ‘dominant feature’ of the contract was Mr Smith’s obligation to provide personal service.
2. There was also a provision in the company manual which stated that Mr Smith should complete a minimum of 40 hours work per week. This shows a degree of control which Pimlico had over Mr Smith, suggesting that he was not in business of his own accord.
A couple of other points which pointed to Mr Smith being a worker were things such as the requirement for him to wear a Pimlico uniform and drive a Pimlico van.
This latest instalment is not particularly ground breaking, and hasn’t delivered the cliff hanger we’ve all been waiting for. As with many employment status cases, it turned on its own facts. However, it does serve as a reminder of the need to have very clear contractual clauses in place when looking to engage a self-employed contractor, and also the need for there to be genuine freedoms for the contractor to provide services of their own accord.
Employment status will continue to be a live topic, given the nature of the gig economy and the Government commitment to introduce new laws dealing with this issue, so companies should be mindful of how to ensure individuals are engaged in the way it is intended. While we all enjoy watching a good soap opera, we certainly don’t want to become part of one!