GIG Economy – New Court Decision

On the 29th November a UK based window Salesman won a decision in the European Court of Justice which is being hailed as a landmark decision.

Conley King worked for a window company on a self-employed basis, between 1999 and 2012, before being dismissed from the firm. His case centred around his ‘employment status’. He argued that he was in fact a ‘Worker’ and therefore entitled to holiday pay for the period he was engaged by the Window Company.

The Company in question argued against this, claiming that Mr King, “worked as a Self-Employed Salesman under an arrangement that suited him.” They said, “We would like to reiterate that at no point was he prevented by us from taking any time off for holiday or otherwise, as there was no requirement for him to request it or for us to agree to it.” 

This however was not deemed a strong enough argument to prevent Mr King from being awarded ‘Worker’ status.

In the UK courts it was determined that Mr King should be considered a Worker and had therefore brought a claim for £27,000 worth of holiday pay, which he believed he was entitled to, whilst working for the firm over the 13 years.

The European Court was asked to decide whether EU law allowed him to claim for this entire period and they decided that there was no time limit for his claim, setting a precedent for further cases.

WHAT DOES THIS MEAN?

The new finding means that Employers who often use staff on Self-Employed contracts could face large limitations if the status of the worker is challenged at a later date.

It is estimated that about 1 million people are employed in this type of capacity, and are classed as independent contractors, meaning they do not have the right to redundancy payments and no right to receive minimum wage, paid holiday or sickness benefit (SSP). Based upon the recent case if someone could successfully argue that they should receive Worker status then they might be able to claim the above payments back to the start of their employment / engagement.

It is believed that this decision binds UK tribunals when deciding similar cases and going forward the Brexit withdrawal bill maintains European judgements made before the UK’s exit from the EU.

This recent case shows how Employers who operate with the GIG economy, or who utilise workers on a Self-Employed basis, will continue to be scrutinised over the status of their workers and held accountable for any short comings.

If you would like any further advice on this topic, or any other HR matter, please contact our HR Consultancy Team on 01302 341 344.

By Kris Kerins BSc (Hons) PGC (Tech Mgmt) – Risk Services Adviser

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