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The case of Pimlico Plumbers v Gary Smith was all over the press last week, with some arguing that it was a landmark case in employment law.
This case involved a ‘self-employed’ plumber, Gary Smith, who wished to claim disability discrimination, holiday pay and unlawful deductions from wages by asserting that he was actually a worker.
The Supreme Court had to consider whether he had has undertaken to perform the work personally. They found that Mr Smith had the right to send a substitute to carry out a job but that person had to be under contract with the Company. The dominant feature of his contract was therefore an obligation of personal performance.
The other issue to be decided was whether Mr Smith was marketing his services to the world or whether he was an integral part of the Company. The Supreme Court held that he had some operational and financial independence but his services were marketed by the Company, and he was subject to the Company’s tight control (for example in relation to his uniform, van and ID card and the Company’s strict administrative controls and payment terms). Therefore the Company was not a client or a customer.
The overall nature of the relationship of the parties was found to be that of employer and worker and this gave Mr Smith employment rights.
Some commentators see this as evidence that tribunals and courts are keen to assert workers’ rights in the modern ‘gig’ economy, and prevent sham self-employment relationships .
Whilst there is some concern that this case will encourage contractors to bring such claims against their ‘employers’, it is important to remember that the law is still unclear and that tribunals and courts will examine in detail the specific circumstances of each case and the parties’ overall relationship.
Following the Taylor Report the government continue to consult on this issue. In time there may be legislation brought in to reduce the current uncertainty for businesses and for individuals.