Following the recent trend of 'gig economy' cases, in Pimlico Plumbers Limited and Another v Smith, the Court of Appeal has held Mr Smith was a worker.
Following the recent trend of 'gig economy' cases, in Pimlico Plumbers Limited and Another v Smith, the Court of Appeal has held that despite being self-employed for tax purposes, the Respondent, Mr Smith was a worker and his working situation fell within the definition of ‘employment’ in the Equality Act 2010 (the EA) during the period that he worked for Pimlico Plumbers Limited (Pimlico Plumbers). This entitled Mr Smith to bring claims in respect of discrimination, holiday pay and arrears of pay.
Mr Smith, a plumber, entered into an agreement with Pimlico Plumbers. He accounted for his own income tax, VAT and social security contributions as if he was self-employed, and provided all his own tools, equipment and materials for performance of the work. Mr Smith could reject particular jobs and Pimlico Plumbers had no obligation to provide him with work.
When Pimlico Plumbers terminated Mr Smith’s agreement he brought claims for unfair dismissal, wrongful dismissal, entitlement to pay during medical suspension, holiday pay, arrears of pay, direct disability discrimination, discrimination arising from disability and failure to make reasonable adjustments, which, as a self-employed individual, he was not entitled to bring.
At first instance it was held that Mr Smith was not an ‘employee’. However, it was held that Mr Smith was a ‘worker’, in particular, because:
This meant he was entitled to bring claims of direct disability discrimination, discrimination by reason of failure to make reasonable adjustment and holiday pay.
Pimlico Plumber's appeal to the Employment Appeal Tribunal was dismissed, so they brought a further appeal in the Court of Appeal.
The Court of Appeal agreed that Mr Smith was a worker and stated that this case "puts a spotlight on a business model under which operatives are intended to appear to clients of the business as working for the business, but at the same time the business itself seeks to maintain that, as between itself and its operatives, there is a legal relationship of client or customer and independent contractor rather than employer and employee or worker".
The key points to take away are that:
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