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KBB installers – check your employment status

Are you employed without knowing it? The employment status of sub-contracted KBB installers is not as clear cut as you might think so here’s your checklist…

Are you part of the ‘gig’ economy without even realising it? Believe it or not, if you’re a self-employed KBB installer, you might have more in common with taxi and fast-food delivery drivers than you might think…

A few months ago, we highlighted a recent case where a former sub-contractor for Sharps Bedrooms was bringing a legal case against them that argues he should have full employee rights such as sick and holiday pay because he did the vast majority of his work for them and they control much of what he does and when. That case begins in mid-April.

This concept of a sub-contractor being legally seen as an employee first rose to prominence following landmark tribunals that ruled for Uber drivers but against Deliveroo drivers

So how are you supposed to know if you are potentially on the wrong side of the law? What is the checklist you need to consider when reviewing not just your status but also those you get work from.

Currently there are three categories into which individuals providing their services may fall – employees, workers or self-employed independent contractors. And, as you would expect, you may have vastly varying rights and obligations depending upon which of the three categories you fall into.

There are actually legal definitions of ’employee’ and ‘worker’ that come from the Employment Rights Act 1996 (ERA) but, as you would also probably guess with anything legal, those definitions are open to interpretation…

An ’employee’ is an individual who has entered into, or works under, a contract of employment – which is pretty clear cut. However, a ‘worker’ is someone who has entered into, or works under, a contract of employment or another contract – whether express, implied, oral, or written – under which the individual commits to personally perform work or services for the other contracting party.

What all this legalese tells you is that while it’s pretty easy to define an employee it’s difficult, in practice, to distinguish between contractors and workers – especially given there is no specific definition for contractor in the ERA.

So, while contractors will not be working under a specific contract of employment, they may be working under another form of contract and this could fall under the ‘worker’ definition.

And this is the grey area that many of the high profile cases are to be found.

For example, in the recent dispute between Deliveroo and its drivers, the company said that drivers were self-employed and providing services under supplier agreements, but the drivers claimed to be workers and therefore entitled to rights such as collectively negotiating pay and working conditions.

But in this case, unlike Uber, the drivers lost and the Supreme Court said that no employment relationship existed between them and Deliveroo.

So let’s look at the reasons why as it can help anyone else in a similarly ambiguous situation assess their own status.

Firstly, Deliveroo was under no obligation to provide work to the drivers and the drivers were not obliged to accept jobs. Secondly, no penalties were applied if drivers did not accept a certain percentage of jobs or make themselves sufficiently available; and, lastly, drivers weren’t required to perform the work themselves – they had an essentially unfettered right to substitute a different driver for a job.

 

CHECKLIST

So, with all that in mind, here are the things you need to consider to determine whether an individual is a contractor and not an employee or worker…

  • Does a contract exist between the supposed worker and the supposed employer?
  • Is the dominant purpose of the contract to personally provide services and perform work or is it to achieve a particular objective and the provision of personal services is incidental to achieving it?
  • Is the individual required to perform the work personally or could they substitute an alternative person to do it?
  • Is the company obliged to provide work to the individual and are they in turn obliged to perform that work?
  • What is the degree of control the company can exert over the individual?
  • How much is the individual integrated into the company?
  • What proportion of the individual’s total work is done for that company?

It is common in kitchen, bedroom and bathroom installation for both retailers and fitters to be perfectly happy with the subcontractor relationship they have. It suits them both to operate in the way they do, however that does not mean they are immune to getting into a dispute in the future.

It is then that any potential status as a ‘worker’ could come under scrutiny and both sides would be advised to assess their status as soon as possible in case this happens.

Thank you to David Murphy, an employment law partner, and Joseph Cannon, an employment law associate, from Fox Williams LLP for their help

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