{"id":23206,"date":"2018-06-21T14:43:18","date_gmt":"2018-06-21T14:43:18","guid":{"rendered":"https:\/\/oradeo.com\/?p=23206"},"modified":"2018-06-21T14:43:18","modified_gmt":"2018-06-21T14:43:18","slug":"pimlico-plumbers-decision-a-game-changer-for-the-industry","status":"publish","type":"post","link":"https:\/\/oradeo.com\/2018\/06\/21\/pimlico-plumbers-decision-a-game-changer-for-the-industry\/","title":{"rendered":"Pimlico Plumbers decision: A game-changer for the industry?"},"content":{"rendered":"
\n

This week\u2019s Supreme Court decision on employment rights could have ramifications for certain businesses, write tax experts\u00a0Nigel Morris<\/em>\u00a0and\u00a0Gordon Thrower<\/em>.<\/strong><\/p>\n

\"\"<\/strong><\/p>\n

Source:<\/a><\/p>\n<\/div>\n

\n

The recent\u00a0Supreme Court decision involving plumber Gary Smith and Pimlico Plumbers\u00a0has made headline news.<\/p>\n

The court decided that, for employment law purposes, Mr Smith should have been treated as a \u2018worker\u2019 rather than as self-employed and, as a result, he was entitled to a number of employment rights not normally available to the self-employed.<\/p>\n

So what does the decision mean and how will it affect the construction industry in particular?<\/p>\n

Not too taxing<\/h4>\n

The first thing to bear in mind is that the decision does not relate to a worker\u2019s employment status for tax purposes.<\/p>\n

Employment law and tax law have, over the years, evolved independently of each other. Regarding employment status, employment law recognises three categories of individual: employee, self-employed and worker. However, tax law only recognises individuals either as employees or self-employed.<\/p>\n

So it\u2019s quite possible for an individual to be self-employed for tax purposes while being treated as a \u2018worker\u2019 when it comes to employment rights.<\/p>\n

\u201cIncreased costs for a business with large numbers of such workers could be crippling, particularly where margins are tight\u201d<\/p><\/blockquote>\n

This is the position Mr Smith found himself in \u2013 the court decision gives him, among other rights, the right to receive holiday and sick pay and to be paid the national living wage. However, as far as HMRC is concerned he continues to be self-employed and Pimlico Plumbers is not required to operate PAYE on the amounts paid to him.<\/p>\n

CIS relevance<\/h4>\n

Businesses engaging workers in the construction industry will usually have a mix of employees and self-employed individuals on the books, the self-employed group often being paid through the Construction Industry Scheme (CIS).\u00a0The Supreme Court ruling potentially has relevance for the latter group.<\/p>\n

For example, a self-employed individual who has been providing services exclusively to the same business for many years might be regarded as having worker status for employment law purposes, resulting in an entitlement to all the rights of an employee apart from paternity \/ maternity leave, the right not to be unfairly dismissed, redundancy pay and statutory sick pay.<\/p>\n

The potential for increased costs for a business with large numbers of such workers could be crippling, particularly where margins are tight.<\/p>\n

Growing scrutiny<\/h4>\n

How big a problem the Supreme Court decision will be for the sector remains to be seen.<\/p>\n

Comment on the decision ranges from the TUC\u2019s opinion that the case has exposed \u201csham self-employment\u201d, to a reminder from legal experts that the case doesn\u2019t create a precedent, decided as it was on facts that were specific to Mr Smith and Pimlico Plumbers.<\/p>\n

However, it\u2019s clear that the question of \u2018off-payroll\u2019 working is coming under ever-increasing scrutiny from the regulatory authorities, and businesses in the sector would do well to keep the status of their workers under regular review.<\/p>\n

Nigel Morris is tax director and Gordon Thrower a senior tax manager at MHA MacIntyre Hudson<\/em><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

This week\u2019s Supreme Court decision on employment rights could have ramifications for certain businesses, write tax experts\u00a0Nigel Morris\u00a0and\u00a0Gordon Thrower. Source: The recent\u00a0Supreme Court decision involving plumber Gary Smith and Pimlico…<\/p>\n","protected":false},"author":22,"featured_media":23208,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[155],"tags":[],"class_list":["post-23206","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industry-news"],"yoast_head":"\nPimlico Plumbers decision: A game-changer for the industry? | Oradeo<\/title>\n<meta name=\"description\" content=\"| Pimlico Plumbers decision: A game-changer for the industry?\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/oradeo.com\/2018\/06\/21\/pimlico-plumbers-decision-a-game-changer-for-the-industry\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Pimlico Plumbers decision: A game-changer for the industry? 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