Employment status

In the UK we have three tiers of employment:

• Employee
• Worker
• Self-employed
   

We know that young professionals will grab (almost) any opportunity that passes them by with the main aim of making money and little regard to what status they hold but they may be entitled to more than just a pay cheque.

Take for example any of the gig-economy cases (Uber, Deliveroo, City Sprint, Pimlico Plumbers etc).  All of these cases examined ‘employment status’ and have all had a similar trend; the individuals were deemed to be workers, not self-employed and were therefore entitled to certain rights that weren’t being given to them by their employers.

Employees sit at the top because they have all the rights, workers have some but not all and self-employed have almost none;  the table below sets out some of the rights each tier has.

As the table above shows, it’s important for the individual and organisation to understand what employment status there is, in order for them to properly comply with their obligations.

So what is the difference between an employee, worker and self-employee?  Well there is no single test; instead there are a number of factors that need to be considered.  We have listed a few, below.

Our thoughts

We are seeing a rise in claims made by individuals who had been treated as self-employed when, in fact, they should have been a worker or even an employee.  

This type of claim can be very difficult, awkward and expensive to defend.  It is therefore very important that at the outset of your engagement with individuals, the correct documentation and understanding is in place to define their status.  It is no longer a defence to say ‘well we have always done it this way’, we have a contract that says they are self-employed or they were happy to work like that.

Equally, if you are an individual who has been treated as self-employed and think that you tick some of the boxes for worker or even employee, you may have a claim for this and holiday and sick pay.

Follow the link to read the rest of our: 20 Legal things series.