The Tribunal will examine all the circumstances of the case to assess whether the individual was, in reality, and as a matter of law, an employee. The following factors would suggest that the individual may in fact be an employee rather than self-employed:
1. Where the company has an obligation to provide work and, if work is available, the individual has an obligation to carry it out.
2. Where the individual:
a. is not entitled to send along a substitute to do the work instead of him.
b. is subject to a significant degree of control by the company.
c. uses the company’s equipment and work materials rather than his own.
d. is integrated into the employer’s organisation and receives similar benefits to the company’s employees.
e. has no financial risk in terms of the work he provides and, equally, no share of any profits.
f. is not allowed to carry out work for other companies in his spare time.
g. where payment to the individual is by way of a regular fixed wage or salary.
No single factor is decisive and the Tribunal needs to build up a picture of whether the individual was, in law, an employee, and therefore should enjoy the benefit of employment rights.
Businesses which do wish to enjoy the benefits of flexibility in their relationships with workers should carry out a careful audit of existing paperwork and the practical reality of their relationship with individuals to assess the risks of these workers being found to be employees.
Contact
Caroline Carr or David Hoey