Engaging casual workers? Be aware of their employment rights!

Published, 5 years ago

You’ve been slogging away, working all hours to meet your deadlines and need help so you take someone on. Potential bear traps await. Unanticipated legal consequences may arise if an individual is considered an employee or a “worker”.

Status

An individual’s legal rights differ depending on whether they are:

1. an employee;

2. a worker; or

3. self-employed.

Employment status is determined by the contract AND how the relationship works in practice and is ultimately a matter for the Tribunal’s determination where a dispute arises.

Employees

Employees enjoy the highest level of legal protection including:

1. the right not to be unfairly dismissed (after two years’ service);

2. entitlement to a statutory redundancy payment (after two years’ service); and

3. entitlement to family and pay rights.

Workers

Although less protected, workers still have valuable statutory entitlements e.g.:

1. the national minimum wage;

2. paid annual leave and other working time rights;

3. protection under discrimination and whistleblowing legislation.

The fashion business often experiences sporadic, unexpectedly busy periods e.g. during fashion show assignments or where external factors demand immediate completion of a project such as grant funding, the weather, client demands.

Therefore arrangements tend to be informal assuming little or no obligation between the parties. So-called “zero hour” contracts or variants are used. Yet, the relationship may evolve into something very different and change the employment status of a casual worker over time. Regular patterns of work may occur or an umbrella contract arises and full statutory protection could be claimed. It is of note that the Government is currently consulting on regulating the use of “zero hour” contracts.

There are also rules that apply specifically to agency workers because of the issues that can arise out of the tripartite nature of the arrangement. These rules are outside the scope of this article.

Self-employed

Self-employed individuals generally only have contractual rights but may be protected from unlawful discrimination.

Establishing employee status

Where an individual and the fashion company are working closely on a project the lines can become very blurred so bear in mind that personal service (i.e. the individual must do the work personally and not via a substitute), mutuality of obligation and sufficient control over the individual’s work by the company are likely to indicate an employment relationship. However, other factors may be relevant e.g.

a. who provides and maintains necessary tools and equipment;

b. the degree of financial risk;

c. the degree of investment in and management of the business;

d. whether the individual can profit from their performance; and

e. whether there is a fixed wage or salary.

The risk of sham contracts

An individual, ostensibly engaged on a self-employed basis, may subsequently claim his or her status is protected either as a worker or employee and claim a statutory right. A Tribunal may determine from the facts that the contractual documentation is in fact a sham. The applicable employment rights may then apply together with retrospective tax and NIC liabilities.

Seek initial advice

The temptation is to dive in and take someone on without appropriate documentation or with documentation that does not accurately reflect the situation. If in doubt, seek advice on how best to proceed before engaging an individual. Your time and fees incurred in the heat of a dispute may far outweigh the costs of initial advice before “subcontracting” the work.

Peter Rawlinson is a lawyer based in Sheffield and advises businesses in the creative and manufacturing sectors with other specialist freelance lawyers at Excello Law. Penny Morrison specialises in employment law.

For all initial enquiries please contact Peter on prawlinson@excellolaw.co.uk or 0114 2755517 or 07899906476.

Liked what you read? Share the article!

Share on facebook
Share on twitter
Share on pocket
Share on whatsapp
Share on linkedin

Get with Fashion Rider.

Get the recognition you deserve. Portfolio, Jobs, Social Media promotion and much more. All in one membership. 

You might also like

How to Keep a Well-Maintained Home

A well-maintained home is essential for several reasons. If you’re having guests over, or you’re selling your home, then you want to make as good …

Read More

Finally, a job board for 2021 you can get on board with!

Whatever your reason, we understand how exhausting searching for jobs can be. That’s why we have a job board for 2021; you can get on board with!

Read More

Happy New Year!

The team and I would like to raise a glass (or maybe two) to everyone who has not only supported Fashion Rider through what has …

Read More

Merry Christmas from Fashion Rider

2020 is fast coming to an end (hooray, we hear people shout), and we would like to take this opportunity to wish all our members, …

Read More

Utilising Every Possible Income Stream

Many resources tell you to focus on just one thing rather than having too many monetisation strategies. While I agree with that, if you can …

Read More
Best tips on working from home

6 Best Tips on Working From Home During Covid

People are choosing to work from home. No matter what your reasons for working from home, you can find it challenging adjusting. These the best tips on working from home to ensure you have a productive day!

Read More

Events for creative inspiration

At Fashion Rider, we have been working hard behind the scenes and we have not only redeveloped and overhauled our site, but we have really …

Read More

4 most practical hair tips for healthy hair!

With these practical hair tips for healthy hair, you can have beautiful long, resistant, and ultra-shiny hair which is the dream of all women.

Read More

7 things on how to be fashionable on a budget

Staying on-trend can be a significant expense. You might struggle to change your style with the season if you don’t have an extravagant budget to …

Read More

We use cookies to offer you a better experience and analyze site traffic. By continuing, you consent to the use of the cookies in accordance to our privacy policy