Tribunal victory “blows a hole” in agency payroll model

Grant Prior 7 years ago
Share

Unite has won a major legal victory at the employment appeal tribunal (EAT) in its battle against bogus self-employment and the use of payroll companies.

The union said the decision “blows a hole” in the way workers are employed on many sites via agencies using payroll companies.

Unite took the case on behalf of pipe fitter Russ Blakely against the employment agency On-Site Recruitment Solutions Limited and payroll company Heritage Solutions City Ltd.

The original case over the unlawful deduction of wages and employer’s national insurance contributions as well as the non-payment of holiday pay was rejected by Reading employment tribunal.

But the appeal to the EAT was upheld making it an important test case.

The employment appeal tribunal found:

  • The original tribunal was wrong to decide that Blakely was not a worker
  • When determining whether there was a contract (part of the test of whether someone is a worker) the tribunal must consider the intentions of the worker and all surrounding circumstances, not just the intentions of the employer
  • There was a contract between Blakely and On-Site (the agency) – importantly, the use of a payroll company did not circumvent this relationship
  • Blakely (and therefore other agency workers being paid through payroll companies) could be a worker of the agency, the payroll company or both.

Unite assistant general secretary Howard Beckett said: “This is a groundbreaking victory secured by Unite’s Strategic Case Unit in the fight against bogus self-employment in construction and other sectors.

“It blows a hole in the way that employment agencies hide behind payroll and umbrella companies and pretend that they are not responsible for the employment of the workers they recruit.

“The fact the EAT held that a worker could be jointly employed by two organisations is a game changer in the campaign against bogus self-employment.

“Unite will be ensuring that the EAT’s findings are fully utilised to ensure that other workers are not denied their basic employment rights or exploited by agencies and parasitical payroll companies.

“This decision sends out an unequivocal message to all those involved in bogusly self-employing workers, Unite and our Strategic Case Unit is on your case.

“Whilst this isn’t the type of appeal that a mistreated worker might bring on their own, employers should beware, as Unite members have the unwavering support of the country’s largest trade union.”

The case has now been returned to the employment tribunal, to determine who was Blakely’s employer, whether it was On-Site, Heritage or both.

The tribunal will also decide on his compensation, which is expected to be around £2,500.

Latest news

£2bn Edinburgh ‘West Town’ scheme approved

7,000 homes to be built at 205-acre site
14 hours ago

Briggs & Forrester sells maintenance arm

100 engineers to move over to new owner
15 hours ago

Rayner approves Lancashire super prison

Communities secretary overrules planning inspector for 1,700 inmate prison.
21 hours ago

Wates boss returns after collapse of his own contractor

Paul Nicholls was head of the failed Real construction group
2 days ago

Trio secure Birmingham deal to retrofit 3,000 homes a year

Specialist contractors to install insulation, efficient heating and solar panels
21 hours ago

Costain confirms £400m HS2 tunnels win

Work to start early next year on tunnel and lineside mechanical and electrical systems
21 hours ago

First nuclear reactor installed at Hinkley: Video

Watch precision operation at Somerset site
21 hours ago

Winner named for £14m Harbourside revamp

Local Irvine contractor to transform beach front
21 hours ago

New Fair Payment Code goes live today

Latest bid to get subcontractors and suppliers paid within 30 days
2 days ago

Lincolnshire concrete supplier files administration notice

Ever Readymix Concrete & Screed operates three depots and a fleet of 20 trucks
2 days ago

Graham lands first deal on Liverpool’s largest brownfield site

Contractor bags infrastructure package on 10.5 hectare site
3 days ago

Bouygues UK boss to step down

Fabienne Viala to leave after eight years at the helm
3 days ago

Galliford Try scoops £87m brace of London jobs

Firm will redevelop a prominent corner building on Sloane Street in Chelsea
2 days ago

New HS2 boss Mark Wild starts amid prep for final TBM drives

Former Crossrail CEO starts with a sharp focus on controlling costs
3 days ago

Ten consultants land Thames Water major upgrade places

Firms will share £400m of fee work over next five years
3 days ago

Rayner ultimatum to fix all unsafe tall buildings by 2029

Recladding work must start on all 18m+ resi buildings by 2027
3 days ago

ISG administrator finds just £35m to pay down £1.1bn debt

Failed firm was set to report £148m blackhole from legacy jobs
3 days ago

Redesign needed on Colas “bridge to nowhere”

Technical challenges continue as £38m scheme faces further delays
3 days ago

Skanska UK shakes-up boardroom team

Four new board appointments as two directors step down
3 days ago

Ultra rich clamour for Mace super prime resi scheme

Topping out at £2bn 1 Mayfair scheme where homes start at £35m
3 days ago

Watkin Jones wins £48m St Helen’s affordable homes deal

Firm to build nearly 300 homes for housing association
3 days ago

Barratt sets start date for High Barnet station scheme

Latest scheme to be delivered by the £1.9bn West London Partnership
3 days ago

Investors lose £26m after M&E contractor goes under

78 private investors hit by Gallant Building Services collapse
6 days ago

First contractor call for £80bn Government mega-framework

Seven-year deal will cover construction work across all departments
7 days ago

Transport Secretary quits Cabinet

Louise Haigh resigns over stolen mobile phone revelations
6 days ago

NHS modular specialist looks to strike deal with creditors

Catfoss Group Manufacturing applies for Company Voluntary Arrangement
6 days ago

Kier bags £23m Cheadle Eco Business park job

Contractor beats rival Galliford Try to deliver Stockport council's green business park
6 days ago

Willmott Dixon wins £24m Leeds council housing scheme

Firm will build 82 council houses on site of Hough Top school
6 days ago

Welding crisis road bridges revealed

Bridge projects in Midlands, Gateshead and Cornwall impacted
7 days ago

£1bn Bishopsgate Goodsyard phase one go-ahead

London Mayor approves 550,000 sq ft office scheme above Shoreditch station
7 days ago

Contractor services