TheRetailer_Autumn_2019

Employment Status… and why it matters

BEN LINDSAY EMPLOYMENT SOLICITOR sherrards

Employment rights Employment law does not cover self-employed contractors. However, their health and safety is protected. They will also have certain rights under the contract with their client. In some cases, they may be also be protected against discrimination. Workers have some employment law rights and, for example, are entitled to be paid at least the National Minimum Wage, to paid holiday and to protection against discrimination. However, they do not benefit from as many rights as employees. Employees can benefit from the widest range of rights and protections, and perhaps significantly can be protected against ‘unfair dismissal’. However, not all of these apply from ‘day 1’. Developments in this area? Watch this space for developments in this fast-moving area. In fact, just recently the Watford Employment Tribunal agreed to refer questions about the employment status of couriers working for delivery company Yodel to the European Court, and this follows a number of high-profile court decisions and settlements concerning ‘workers’ rights’. Brexit may not have an impact. However, the law is generally under review and will continue to adapt to govern the ever changing and developing world of work.

THE RISE OF THE SO CALLED ‘GIG ECONOMY’ HAS INCREASED UNCERTAINTY IN THE LAW IN RELATION TO DETERMINING THE EMPLOYMENT STATUS OF A JOB HOLDER, MEANING WHETHER THEY ARE A ‘SELF-EMPLOYED CONTRACTOR’ (A.K.A. A ‘FREELANCER’ OR A ‘CONTRACTOR’), A ‘WORKER’ OR AN ‘EMPLOYEE’. It is important to get this decision right, because different laws apply to each arrangement and true self-employed contractors do not pay tax under the ‘PAYE’ regime. For example, only workers and employees (and not self-employed contractors) are entitled to paid holiday. However, only employees can be protected against ‘unfair dismissal’. Additionally, from April 2020 (which will arrive sooner than you think!), similar considerations will apply in considering whether a private sector business’ arrangements with self or separately employed contractors are caught under new ‘IR35’ tax legislation (which, broadly speaking, will apply ‘PAYE’ requirements to self-employed contractors who, in the eyes of the law, actually work as employees). If it is asked to decide someone’s employment status (for example in an employment rights or tax dispute), a Court or Tribunal can and will consider the whole arrangement, and it will not be satisfied just by any label given to the arrangement by the contracting parties. Self-employed, worker or employee? A self-employed contractor is usually in business for themselves and is not under the supervision or control of another. A worker is usually required to do the work personally and under the supervision and control of a manager, but usually will work on a casual or irregular basis. An employee is usually required to do the work personally and under the supervision and control of a manager, and usually will work regularly or with regularity.

BEN LINDSAY //Ben.Lindsay@sherrards.com //01727 738926 //www.sherrards.com/sector/retail-and-leisure/

42 | autumn 2019 | the retailer