Employee or contractor case law

Cases and Comment: Employee or Independent Contractor. How does an employee differ from a contractor? Can an employee be an employee under the contract of service? What is employee and independent contractor? But where we most often see problems occurring for our clients is when relationships have evolved over time.

The EAT referred to some prominent High Court and Supreme Court case law in their decision and stated that there is no one single test to identify whether or not an individual is an employee or a contractor.

They stated that each case must be considered in isolation and there can’t be one overall test. A major contributor to the vast amount of case law in employment, over the last century, and in today’s employment environment, though not easy in practice, is the paramount need for employer’s to distinguish between their workforce, whether they are employees (who work under a contract of service) or independent contractors (who work under a contract for services). In determining whether a worker is an employee or an independent contractor the ultimate question is whether the worker is the servant of another in that other’s business, or whether the worker carries on a trade or business of his or her own behalf: that is, whether, viewed as a practical matter, the putative worker could be said to be conducting a business of his or her own of which the work in question forms part? Courts and tribunals look at lots of different factors in order to decide whether someone is an independent contractor or an employee.

Nevertheless, there are three essential requirements for a contract of employment to exist – control, mutuality of obligation and personal service. Therefore, Courts look at previous cases to work out whether you are a contractor or an employee. Traditionally, the High Court used the “control test.

Greater control by the boss implies an employee relationship.

In contrast, an employer exercising little control suggests a contractor relationship. In the absence of any new legislation, existing case law has to evolve to cover new relationships as the gig economy continues to develop. Cases like this one help provide a coherent body of case law , so that employers can correctly determine the status of their workers from the outset of their relationship.

Employment law doesn’t cover self-employed people in most cases because they are their own boss. However, if a person is self-employed : they still have protection for their health and safety an. In other cases , employers have claimed that a person who was formerly an employee has been ‘converted’ into an independent contractor. A recent decision Federal Court decision is an important one for employers looking for case law around the murky world of law concerning whether an individual is an employee or a contractor.

In addition, the Revenue Code provides practical guidance on how to distinguish between an employee and a self- employed worker. And that, in a nutshell, is the reason why employers go the Independent contractor route, but unfortunately if an employee had to challenge the nature of the employment relationship at the CCMA, it would in nearly every case be found that the Independent contractor is in fact an employee. Contractors can be self-employe a worker, or employee if they work for a client and are employed by an agency.

There is a special scheme for self-employed contractor and sub-contractors in the construction industry. In other cases, employers have claimed that a person who was formerly an employee has been ‘converted’ into an independent contractor. The law is pretty clear about the rules and perks of being an employee vs.

If you have additional questions about the law in your area, speak with an employment attorney today. A contractor ’s right to send in a substitute in his place, whether such a right is real, contractual, or in some cases seemingly imaginary – has arguably taken on enhanced importance for businesses and contractors alike in both the employment law and tax spheres. Both cases , though with different sets of facts, draw on the same issues to whether the bicycle courier or the mechanic, was an employee or an independent contractor , of the person who engaged them.

Interestingly, as we explore these decisions, you will notice that the High Court came to vastly different conclusions in the cases explored. IR- Intermediaries legislation IRis the tax and National Insurance contributions law that may apply if you’re working as a contractor through an intermediary company.

It aims to make sure that you pay the same amount of tax as if you had been directly employed. The case is interesting for many reasons, including as a case study on how the on-demand economy presents unique challenges to antiquated labor laws. The alternative is to work under a ‘contract of service’ meaning the individual is an employee. This is an important distinction as some legal protection afforded by UK legislation only applies to employees working under a contract of service. In the UK there are several legal tests that can be applied to help determine if someone is an.

Distinguishing an “ employee ” from a “ contractor or self- employed person” There is no one single conclusive test to distinguish an “ employee ” from a “ contractor or self- employed person”. In differentiating these two identities, all relevant factors of the case should be taken into account. The vast majority of courts that have heard cases in the last decade regarding whether or not a worker had been misclassified as an independent contractor had ruled that the workers were employees.

There were a few notable cases in which the court ruled the contrary, but almost all ruled in favor of the workers, and even those that ruled in favor of the company had “close” decisions.