Tribunal deals blow to brickworks firm

The judgement at a pre-hearing review has left one firm wide open to expensive employment claims and highlights the risks to others of getting it wrong when it comes to labour-only subbies.

The recent judgement from the London Central Employment Tribunal reinforces why Hudson must continue to work with clients to develop and maintain robust procedures to cement the self-employed status of their subbies.

This particular decision, against Excel Brickworks Ltd, exposes the company to substantial claims for backdated holiday pay, notice, redundancy and unfair dismissal payments when the case goes to full hearing later this year.

In his preliminary hearing judgement, Judge Emery ruled that a father-and-son foreman and bricklayer were employees of Excel in spite of them signing self-employment contracts and having tax deducted under CIS.

The hearing found:

  • Neither had a right to substitute and had to provide a personal service
  • They were required to work set hours
  • Both were under a significant degree of control
  • They had to seek permission to leave a site
  • Excel was not a customer of a business carried on by the claimants
  • There was mutuality of obligation

Ian Anfield, managing director of Hudson Contract, said: “The judgement could lead to more claims from other subcontractors used by the firm and subbies who think they work under similar circumstances with their clients. Excel now faces eye-watering legal costs and the prospect of large out-of-court settlements and disruption to its business.

“On the face of it, Excel should have done better at the hearing. It had contracts in place and the claimants had patchy attendance records, even admitting they had worked for other firms. The judgement shows just how tricky these cases can be.

“The outcome demonstrates why Hudson will not cut corners in its approach to employment status, despite fierce competition from smaller rivals which play fast and loose with the law.

“It also demonstrates why we visit sites to carry out audits and build up evidence to prove our contracts are used correctly by clients and operatives alike.”

 

Hudson has fought off more than 100 similar cases raised against itself and its clients and has engaged more than 170,000 freelancers without a single instance of employment status reclassification.

In our most recent case, which was reported in The Times, the Tribunals Service has just refused permission for the claimant to appeal.

The individual was represented by TMP, the law firm which brought the landmark Court of Appeal case against Pimlico Plumbers.

Mr Anfield added: “Now more than ever with coronavirus restrictions being placed on sites, it is important to contact us should you have any doubts about site procedures or the wording of documents which could confuse employment status.”

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