Engaging the services of Independent Contractors?

Employers, particularly those who engage the services of independent contractors, should keep a look out for the latest case given the go-ahead to proceed following the decision in Pimlico Plumbers back in February 2002. 

This new appeal in the EAT involves a number of medical couriers who continue with their claim for unlimited backdated holiday pay against The Doctors Laboratory (TDL). Some claims for backdated holiday pay reach as far back as 1999.

In 2018, in the ET the claimants won backdated holiday pay stretching back two years, arguing that their status was more akin to worker than self-employed and therefore they were entitled to annual leave. Their status as ‘worker’ was not confirmed by the tribunal.

Their appeal was paused to allow for the outcome of the Smith v Pimlico Plumbers case and will now be heard in the light of the decision. As we wrote at the time, it was held that if they were workers, the worker was able to bring a claim for backdated holiday pay and unused annual leave, just as long as the claim was brought within three months of the contract end date. 

The upcoming appeal should help to clarify the distinction between worker and self-employed, and could in turn pave the way for as many as 1.6 million temporary workers being able to claim a good deal of “missing holiday pay” if workers are allowed to claim beyond the current two-year period.

It is a timely reminder that employers can help to avoid these claims by more accurately assessing whether those engaged by the business are employees or workers with their employment status properly set out. Employers should be aware that if there is any debate as to whether an independent contractor may actually be a worker or employee, individuals could bring claims for holiday pay on termination of the contract and that following Pimlico Plumbers this backdated pay may not be time-limited.

Posted on 03/02/2023 by Ortolan

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