Self-employed contractor Gary Smith has won a long legal battle against his former employer Pimlico Plumbers over whether he was entitled to working rights.
Heating engineer and plumber Gary Smith argued he was entitled to certain working rights when he was dismissed after six years working at the company, he claims on unfair and discriminatory grounds.
An employment tribunal found that although Smith had not been an employee under a contract of employment, he should be classified as a "worker" under the Employment Rights Act, which Pimlico Plumbers disputed.
The Supreme Court today upheld the earlier ruling and now means that Smith is able to pursue his former employer for unfair dismissal, now that he has been classified as a worker.
Pimlico Plumbers denied it had unfairly dismissed Smith, saying they had asked him not to work on health and safety grounds after he suffered a heart attack.
Its chief executive Charlie Mullins said he was "disgusted" by the judgment and that it would lead to a "tsunami of claims".
Speaking to City A.M., he said Smith "found a loophole in our 70-year-old contract and exploited it". "This isn't about the money, this is about the bigger picture for the industry and the country," he said. "This shows our employment laws are very outdated. The Supreme Court had the opportunity to bring them into the 21st century."
Smith's lawyer, Jacqueline McGuigan, told City A.M. the judgment set a precedent for self-employed workers throughout the UK.
"It has been a long hard battle since 2011 and Gary has won every step of the way," she said. "The Supreme Court has done a brilliant job in explaining in simple terms the test for worker – the ordinary person will be able to read this judgment and understand it."
She said the likes of Uber and Deliveroo, who have also faced similar claims over the status of their workers, should be concerned, "because this is now going to be the legal test for the gig economy that employers have to meet".
She said the judgment would have huge ramifications for Uber whose drivers were integrated into the business and therefore could not be considered a "genuine self-employed contractor".
Uber lost an appeal against a tribunal ruling that it must give its drivers employment rights back in November last year.
The ride-hailing app went to the Employment Appeal Tribunal (EAT) to challenge an earlier ruling by the Employment Tribunal which said Uber drivers are entitled to basic workers' rights, but the EAT rejected Uber’s argument that it is merely an agent that connects drivers and passengers.
Uber applied to the Supreme Court to rehear the case.
Frances O'Grady, the head of the TUC union, tweeted:
Important Supreme Court decision against Pimlico Plumbers. Sham self-employment is being used to deny workers their basic rights. Time to end the Wild West in the gig economy. https://t.co/4OSLCQ1dSU— Frances O'Grady (@FrancesOGrady) June 13, 2018
Sean Nesbitt, a partner and employment specialist at law firm Taylor Wessing said: "This case truly serves to provide guidance for the future and, in context; it is one of two important judgements in this area – the other being the Deliveroo case heard on 12 June 2018. I would expect this to impact every manner of organisation, whatever the industry, in how they construct and operate their contracts."