Solicitors are divided on whether last week’s Supreme Court ruling in the Pimlico Plumbers employment case will prompt widespread changes to the so-called ‘gig economy’.
In Pimlico Plumbers Ltd and another v Smith the court backed the employment tribunal and the Court of Appeal in ruling that plumber Gary Smith’s work for the company met the definition of ‘employment’ under section 83(2)(a) of the Equality Act. In the lead judgment, Lord Wilson said Smith should be considered a ‘worker’ and therefore entitled to rights, including holiday pay.
Barry Stanton, head of employment law at full service firm Boyes Turner, said the decision changes very little. ‘The gig economy is thriving – this decision will not stop it,’ he said. ‘Those choosing to enter the gig economy will still need to assess the risks and decide how to minimise them or understand what the financial consequences might be.’
Homa Wilson, a partner at London firm Hodge Jones & Allen, said that while many had hoped the decision would provide clarity on worker status each case still ‘very much depends on the facts’.
However, Michelle Morgan, senior associate at regional firm Gardner Leader, said the decision will ‘undoubtedly’ result in changes to the way the gig economy operates. ‘The decision is an important one, as on the one hand there is the need to protect the rights of those who work in the gig economy, while preserving the ethos of such a business model; with flexibility being at the heart of it,’ she said.
Phil Pepper, employment partner at commercial firm Shakespeare Martineau, said employers would have to make immediate changes to accommodate the decision, otherwise Pimlico Plumbers and other organisations could face multiple legal challenges.
He added that the case is sure to have an impact on both the Uber and CitySprint cases – due to be heard by the Court of Appeal and Employment Appeal Tribunal respectively – later this year. ‘Although the legal arguments may vary slightly, the fundamental principles arising from the Pimlico Plumbers case will at the very least influence the outcome of those decisions,’ Pepper said.
The Supreme Court’s decision will allow Gary Smith to take action against Pimlico Plumbers as a worker, including a claim that he was unfairly dismissed.
Charlie Mullins, chief executive of Pimlico Plumbers, warned that UK companies using self-employed contractors face a ‘tsunami of claims’. The five judges ‘had the opportunity to drag our outdated employment law into the 21st century, but instead they bottled the decision’.
Jacqueline McGuigan, solicitor at TMP solicitors which represented Smith, said the judgment goes a long way in clarifying what a worker looks like.
‘I see this judgment as a victory, not only for common sense but for all the workers in the UK being denied basic employment rights. It provides much needed clarity on employment status. Good employers have nothing to fear from this judgment.
’Whilst I have every faith in the courts making the right decisions, I think Parliament needs to step in and legislate to make it easier for workers to enforce legal rights and harder for rogue employers to evade them.’