(Pimlico Plumbers v Smith)
In this case Mr Smith attempted to bring various claims against Pimlico including unfair dismissal. The question was whether or not Mr Smith, a plumber, was an employee of Pimlico. The tribunal at first instance held that he was not an employee, but that he was a worker. Mr Smith appealed.
The EAT considered all of the relevant factors. Those which pointed against Mr Smith being an employee were as follows;
The factors in favour of Mr Smith being an employee were:
Mr Smith could transfer work to other operatives but did not have an unfettered right to substitute.
In upholding the decision that he was not an employee, the EAT held the employment tribunal had been entitled to have regard to the Claimant’s financial risk, the degree of autonomy as to quotations and how work was carried out. It was also of significance that both parties acted as though the Claimant was self-employed.
The EAT also upheld the decision that the Claimant was a ‘worker’, largely because it was envisaged that he would provide personal service. It reaffirmed that an unqualified right to provide a substitute negates personal service but that where prior consent is required to substitute, the right is not unfettered.
Sara Sawicki Says: Although fact specific, this case is a useful reminder of the factors that tribunals will consider when deciding whether an individual is an employee, worker or self-employed. Although Mr Smith did not succeed with his claim that he was an employee, neither did Pimlico succeed in arguing that Mr Smith was not a worker and this is the more interesting aspect of the case. The EAT noted that despite the contract, which held that Mr Smith was self-employed, there was no express provision which permitted substitution. It held that the most Pimlico was willing to tolerate was a form of job-sharing or shift swapping without any legal obligation, which was insufficient to amount to an unfettered right of substitution. Notwithstanding this, we would advise employers who do not wish to create an employment or worker relationship, to include an express substitution clause in the contract and to periodically review such provision against the practices on the ground.