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Supreme Court Gives Ruling in Employment Rights Case

The Supreme Court has recently given its judgment in an important case concerning the employment rights of those working in the so called ‘gig economy’. 

Case Details

The case concerned Gary Smith, who worked as a plumbing and heating engineer for Pimlico Plumbers from August 2005 to April 2011. He had requested to work reduced hours following a heart attack, but the company refused to agree to this. He brought a claim to the employment tribunal in August 2011 alleging that he had been unfairly dismissed, that an unlawful deduction had been made from his wages, that he had not been paid for a period of statutory annual leave and that he had been discriminated against by virtue of his disability.

Appeal Dismissed

The employment tribunal decided that Mr Smith had not been an employee under a contract of employment, and therefore that he was not entitled to complain of unfair dismissal. Mr Smith did not challenge this finding. However, the tribunal also found that Mr Smith (i) was a ‘worker’ within the meaning of s.230(3) of the Employment Rights Act 1996, (ii) was a ‘worker’ within the meaning of regulation 2(1) of the Working Time Regulations 1998, and (iii) had been in ‘employment’ for the purposes of s.83(2) of the Equality Act 2010.

As a result, Mr Smith could legitimately proceed with his other three complaints and directions were made for their substantive consideration at a later date.

Pimlico Plumbers appealed this decision to an appeal tribunal and then to the Court of Appeal, but were unsuccessful. They consequently appealed to the Supreme Court, which has now unanimously dismissed the appeal. It found that the employment tribunal was entitled to conclude that Mr Smith qualified as a ‘worker’ and therefore his substantive claims can proceed to be heard.

Reaction to the Decision

The case has attracted a great deal of attention and comment.

Director of think-tank the Resolution Foundation, Torsten Bell, said that the judgment could have ‘significant implications’ for many workers who are currently treated as self-employed contractors and therefore don’t receive employment rights such as that National Minimum Wage, sick pay or paid holidays.

“The Court judged that the level of control the firm applied to Mr. Smith, including limits on his right to have someone else fill in for him, was sufficient for him to be reclassified as a ‘worker’ with extra employment rights,” he explained. “This could have wider implications for other firms who exercise a degree of control over their self-employed contractors.”

“Today’s judgment should also remind us that issues related to the so-called ‘gig-economy’ stretch well-beyond new app-based services to more traditional occupations like plumbing, couriering and hairdressing,” he added. “The onus is now on the Government to follow up on its consultation following on from the Taylor Review and ideally to enforce as well as clarify the law on employment status, rather than relying on the Courts to do all the heavy lifting.”

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