Case law: Long-established contractor can be 'worker' entitled to holiday pay
Businesses who use sub-contractors over a period of many years should carefully consider the extent to which the contractor is integrated into the workforce. Otherwise, they risk those sub-contractors acquiring workers' rights, such as a right to holiday pay.
This update was published in Legal Alert – October 2014
Legal Alert is a monthly checklist from Atom Content Marketing highlighting new and pending laws, regulations, codes of practice and rulings that could have an impact on your business.
In a recent case, a self-employed sub-contractor had worked with a business almost exclusively for 16 years but did not legally have to offer him work and he did not have to accept work offered. He claimed he was a 'worker' and therefore entitled to holiday pay.
Ordinarily, someone is only a worker if there is 'mutuality of obligation' – the employer is obliged to offer work and the worker is obliged to accept it. However, the Employment Appeal Tribunal (EAT) in this case accepted the sub-contractor was a worker – despite the lack of mutuality.
The EAT ruled that the following factors in this case meant he had integrated into the workforce:
- the length of time involved;
- the fact the business regularly offered him work;
- he would turn up to do it when it did;
- that he worked with minimum supervision;
- he wore the business's work clothes;
- he drove the business's vehicles.
The sub-contractor was therefore entitled to holiday pay.
Disclaimer: This article from Atom Content Marketing is for general guidance only, for businesses in the United Kingdom governed by the laws of England. Atom Content Marketing, expert contributors and ICAEW (as distributor) disclaim all liability for any errors or omissions.
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