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Self-employed agreements – March 2017

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Self-employed agreements and employment status

Employment status in the so-called ‘gig economy’ is currently a hot topic in the press and keeping up-to-date with the developments is vital for those in the dental industry. The recent decision in Pimlico Plumbers Ltd & Anor v Gary Smith (the “Pimlico case”) has left dental practice owners in a state of flux, after the Court of Appeal dismissed the appeal by Pimlico Plumbers, upholding the ruling that the employment status of the plumbers is that of a worker, rather than a self-employed contractor.

Mr Smith worked under a self-employed operative agreement with Pimlico Plumbers (“Pimlico”) for almost six years before he suffered a heart attack, following which Pimlico terminated the agreement as Mr Smith wanted to cut his five-day week to three. Mr Smith brought a number of Tribunal claims which were dependent upon him establishing that he was an employee or a worker. Under the operative agreement, Mr Smith was responsible for his own tax, VAT and insurance, and provided his own tools. There was also no requirement for the company to offer him work or for him to take up work. However, he was required to wear a company uniform, drive a company van and work fixed hours.

As stated by the Master of the Rolls, ‘this case puts a spotlight on a business model under which operatives are intended to appear to clients of the business as working for the business, but at the same time the business itself seeks to maintain that… there is a legal relationship of… independent contractor rather than employer and employee or worker’.

Whilst it has generally been accepted by HMRC that Associate Dentists are self-employed, developments in this area could mean that this may no longer be the case, or perhaps that one can be self-employed for tax purposes whilst being in a different category when it comes to establishing entitlements to employment rights. It must also be noted that those on self-employed Hygienist and Therapists Agreements pose an even higher degree of risk here. Although the Pimlico case is fact sensitive, this is just one of many cases, with well-known firms such as Deliveroo and Uber also in battles over the employment status of their riders/drivers.

Whether you’re an Associate, Hygienist, Therapist or practice owner knowing what rights you or your staff are entitled to is of upmost importance, as those engaged on a self-employed basis are not entitled to basic rights, such as sick pay, holiday pay, reasonable adjustments and the national minimum wage, but to name a few. If you don’t want to be liable for employment rights, or contrastingly you want to be able to rely on them, then you need to seek advice from a dentally aware firm as soon as possible. If you would like us to review your self-employed agreements, then please do not hesitate to get in touch with our Employment & HR specialists here at FTA Law.

The team at FTA Law provides advice to clients across the commercial and healthcare sectors with many of our instructions coming from referrals from long standing clients and industry contacts.

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