Demands for clearer gig economy laws have intensified after the Supreme Court ruled that a former Pimlico Plumbers engineer was a worker rather than self-employed.
In a landmark gig economy case, Pimlico Plumbers has lost a legal battle in which they claimed that Gary Smith, who worked for the company for six years, was self-employed.
However, despite paying self-employed tax and being VAT registered, the company was told that Gary Smith, a plumber who had been with the company for six years, was entitled to benefits such as holiday and sick pay.
As a result of the ruling, an employment tribunal can now examine Mr Smith’s action against Pimlico as a worker, including a claim that he was unfairly dismissed.
Matthew Taylor, who chaired a government-commissioned review on the gig economy which concluded that all work in the UK’s economy should be “fair and decent” and that the classification of people who work for platform-based companies, such as Deliveroo and Uber should be changed to dependent contractors, said the ruling may prompt companies to look again at the tax status of their workforce, in order to prepare for a potential reform of the tax treatment of contractors by HM Revenue & Customs (HMRC).
At Beavis Morgan, we understand the challenges faced by business owners. We work with many small and medium sized businesses (SMEs) across a wide range of industry sectors, guiding them though the various stages of business life from start up to exit and all the challenges in between.
Should you require a review of your business’ payroll records and any contracts with self employed consultants, please get in touch with us. Our employment experts will provide guidance on whether or not we feel your company is at risk of challenge by HMRC under the employment regulations.