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Does your business use ‘Self Employed’ individuals?

Is your business protected?

The Court of Appeal has ruled that a plumber who signed an agreement with a company describing himself as self-employed was in fact a worker.

The individual was required to wear a company uniform, use a van leased from the company and needed to work a minimum number of hours a week.

He could, however, choose when he worked, which jobs he took and was required to provide his own tools and equipment. He also handled his own tax and insurance.

One point that swayed the court’s decision was that the claimant had a requirement to provide his services personally. His agreement did not provide an express right to substitute someone else to do the work.

What does this mean for you?

  • You could be at risk of claims for holiday pay backdated up to 2 years per employee
  • You could be at risk for unlawful deductions from wages if you are paying below NMW

How you can protect your business

You should review any agreements you have in place to ensure you are legally compliant to avoid potentially complex and costly claims.

  • What do your self-employed agreements say?
  • Do they have an ‘unfettered right to substitute’?

If not, then your self-employed contractors could be ruled as ‘workers’ and be entitled to various statutory benefits and payments.

If you would like any further advice or support please contact Hallidays HR team on 0161 476 8278 or hr@hallidays.co.uk.

Posted 25th August 2017

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