An employee on a zero-hours contract can be an agency worker. This is the ruling of the Employment Appeal Tribunal.
The case is Matei v Brooknight Guarding Limited. Matei was employed on a zero-hours contract by Brooknight. He mostly worked for one client, Mitie. The Claimant claimed he was an agency worker and entitled to the same basic working conditions as the Mitie staff after 12 weeks of service.
The Tribunal agreed, but Brooknight appealed. The Employment Appeal Tribunal has upheld the original tribunal’s decision which was on the basis that he had been supplied to work temporarily for Mitie, and worked under their supervision and direction. The EAT said the position was temporary as it was not permanent or indefinite and the original tribunal had adopted the correct approach.
Employment rules and legislation is constantly changing. Keeping on-top of this is onerous for businesses who are focussed on doing what they do, not being payroll experts! What we at Payroll Masters do is payroll. Its as simple as that. Payroll, the rules surrounding pay, salaries, personal taxation, calculating benefits and so on, this is what we do. We can usually show a saving in management time, cost and employee satisfaction when we take over as an outsourced payroll provider. You can contact us and talk to one of our experts about any aspect of payroll or matters related to payroll.
“If HMRC don’t understand their obligations under a system they’ve created, how can they expect businesses to get it right?” Says The Association of Independent Professionals and the Self-Employed (IPSE).
A contractor spent over a year working on marketing projects for HMRC as a freelancer. HMRC changed the terms of her contract, requiring her to go onto an agency payroll, a decision that she could not challenge. She then launched a claim to an Employment Tribunal against HMRC, Kinect Recruitment Ltd and three other parties in the contractual chain for unpaid holiday pay in the sum of £4,200 under the Agency Workers Regulations.
The parties settled the case in full for the full amount being claimed by the freelancer on the morning the tribunal was due to start.
The IPSE went on to say that “You can’t just decide someone is inside IR35, shunt them onto an agency payroll and expect someone further down the line to pick up the tab for your obligations like holiday pay.”
HMRC had run her engagement through the Check Employment Status for Tax (CEST) tool and had come to the conclusion that IR35 was applicable in her case.
The government are currently carrying out a consultation on putting these off-payroll changes into the private sector. Our professional body the Chartered Institute of Payroll Professionals has called on government to delay any changes until the CEST tool is fully tested.
Payroll Masters provides outsourced payroll management to a wide range of clients, including large public sector organisations. Please contact our Birmingham head office for more information.