Self-employed consultant claiming wrongful dismissal!

ami66

Can a self-employed person really claim wrongful dismissal?

This self-employed contractor came with the staff that was with a company that the Group purchased about 18 months ago and the company was set up as the Group head office and over several months purchased another 2 limited companies and created another from scratch.

So she was working for a single company as the entire accounts department but is now part of an accounts team working for the Group which is made up of 6 individual Limited companies.

It became quite clear that she was not really up to the standard of accounting knowledge required to work with the intricacies of the more complex accounts and intercompany transactions. She was also known for her bad temperament and frequently upset creditors and debtors. As a final straw to the company directors she started spreading rumours that the Group was insolvent and going bankrupt!

So one Friday she was told her services were no longer required and she should leave immediately.

She is now taking legal action, funded by a no win no fee company, claiming wrongful dismissal on the basis that she had worked enough hours and over enough years that she should have been given an employment contract and therefore could not have been dismissed!!

Any thoughts on how likely a case she has?

Should my bosses loose is she likely to get her job back?

If so I'm leaving, it was unpleasant at times working there before but she would be intolerable if she came back!!

notanewuser

ami66 wrote: »

Can a self-employed person really claim wrongful dismissal?

This self-employed contractor came with the staff that was with a company that the Group purchased about 18 months ago and the company was set up as the Group head office and over several months purchased another 2 limited companies and created another from scratch.

So she was working for a single company as the entire accounts department but is now part of an accounts team working for the Group which is made up of 6 individual Limited companies.

It became quite clear that she was not really up to the standard of accounting knowledge required to work with the intricacies of the more complex accounts and intercompany transactions. She was also known for her bad temperament and frequently upset creditors and debtors. As a final straw to the company directors she started spreading rumours that the Group was insolvent and going bankrupt!

So one Friday she was told her services were no longer required and she should leave immediately.

She is now taking legal action, funded by a no win no fee company, claiming wrongful dismissal on the basis that she had worked enough hours and over enough years that she should have been given an employment contract and therefore could not have been dismissed!!

Any thoughts on how likely a case she has?

Should my bosses loose is she likely to get her job back?

If so I'm leaving, it was unpleasant at times working there before but she would be intolerable if she came back!!

It doesn't sound like she was self-employed at all. Whether or not she was before all the companies merged 18 months ago isn't clear.

If she wasn't self employed she could in theory bring a claim, but getting her job back isn't likely to be the outcome. A compensation payment is more likely.

ami66

notanewuser wrote: »

It doesn't sound like she was self-employed at all. Whether or not she was before all the companies merged 18 months ago isn't clear.

If she wasn't self employed she could in theory bring a claim, but getting her job back isn't likely to be the outcome. A compensation payment is more likely.

Why would she not be self-employed after the merger?

She refused to take part in any h&S training, complete holiday requests or sign in or out of the office as well as refusing to sign for a copy of the staff handbook which contains the Company Employment terms & Conditions as in her words 'I'm self employed it doesn't apply'.

She wasn't paid monthly like the rest of the staff, she submitted an invoice each week for the hours she worked, hours she decided not the company, her invoices were paid as part of the supplier payment run. She also didn't have an employment contract from the Group which the rest of the 'migrating' employees did.

She also submitted a tax return for herself and the partnership that ran the consultancy she invoiced as and paid her own tax & NI.

As long as she doesn't come back I'm happy think the directors may fight it to the bitter end rather than pay her a penny :mad:

harrys_dad

From the information in your last post it does indeed sound as if she was self employed not an employee. HMRC have this which may help:

Employed or self-employed?
In order to answer this question it is necessary to determine whether the person works under a contract of service (employees) or under a contract for services (self-employed, independent contractor). For tax and NICs purposes, there is no statutory definition of a contract of service or of a contract for services. What the parties call their relationship, or what they consider it to be, is not conclusive. It is the reality of the relationship that matters.

In order to determine the nature of a contract, it is necessary to apply common law principles. The courts have, over the years, laid down some factors and tests that are relevant, which is included in the overview below.

As a general guide as to whether a worker is an employee or self-employed; if the answer is 'Yes' to all of the following questions, then the worker is probably an employee:

Do they have to do the work themselves?
Can someone tell them at any time what to do, where to carry out the work or when and how to do it?
Can they work a set amount of hours?
Can someone move them from task to task?
Are they paid by the hour, week, or month?
Can they get overtime pay or bonus payment?
If the answer is 'Yes' to all of the following questions, it will usually mean that the worker is self-employed:

Can they hire someone to do the work or engage helpers at their own expense?
Do they risk their own money?
Do they provide the main items of equipment they need to do their job, not just the small tools that many employees provide for themselves?
Do they agree to do a job for a fixed price regardless of how long the job may take?
Can they decide what work to do, how and when to do the work and where to provide the services?
Do they regularly work for a number of different people?
Do they have to correct unsatisfactory work in their own time and at their own expense?

notanewuser

Because it's HMRC who decide whether an individual is self employed or not.

http://www.hmrc.gov.uk/employment-status/#1

Nednats

Even if they were self-employed they maybe a worker and could got to an Employment Tribunal.

Pennywise

HMRC decide on status for tax matters, but an employment tribunal would decide for the employment rights. Each may make different decisions. There are cases where people who have been paying tax as self employed have been found to have "employment rights" by the employment tribunals. As said above, highly unlikely that the end result will be getting her job back - far more likely would be a compensation payment IF the tribunal finds that for employment law she was an employee.

colino

Had one of these clowns involve my organisation a number of years ago and could not believe it went to tribunal. What a farce.
Before end of first day the Chairman asked to clarify position with the company, self-employed contractor, free to engage with non-competitive companies, had to provide evidence of liability insurance, etc., etc. Dismissed the action and she walked out during the Chairmans admonishment of her wasting time and enjoying the business benefits of self-employment.

PlutoinCapricorn

I am disgusted by this. She seems to be trying to get the best of both worlds.

Is there any evidence that she refused certain actions on the grounds that she was self-employed?

Was she earning more than an employee doing the same work would have got?

ami66

colino wrote: »

Had one of these clowns involve my organisation a number of years ago and could not believe it went to tribunal. What a farce.
Before end of first day the Chairman asked to clarify position with the company, self-employed contractor, free to engage with non-competitive companies, had to provide evidence of liability insurance, etc., etc. Dismissed the action and she walked out during the Chairmans admonishment of her wasting time and enjoying the business benefits of self-employment.

She invoiced weekly from her business which she runs with her partner who's a stay at home dad for their two little girls.

I think she's trying to pull a fast one on the HMRC by claiming they ran the accounts service as a partnership when in fact other than this business there seems to be very few other clients.

By claiming self employment she can use the personal allowance for herself and the stay at home dad rather than the PAYE option where his tax allowance wouldn't be used. Effectively getting her wages tax free.

PlutoinCapricorn wrote: »

I am disgusted by this. She seems to be trying to get the best of both worlds.

She certainly is.

As my partner said - Imagine you've hired a window cleaner and he's cleaned your windows every month for the last 18 months. Then you say sorry I can't afford you any more. Can he turn around and claim unfair dismissal because after all that time we've effectively been employing him! :eek:

Is there any evidence that she refused certain actions on the grounds that she was self-employed? [/quote]

Yes she replied to an email asking her to complete holiday requests saying 'I don't need permission I'm self employed and take holiday when I want'.

She was reminded to collect an Employees Handbook again refused via email saying 'doesn't apply to me I'm self employed.

Was she earning more than an employee doing the same work would have got?

Yes again, her business charged £13 an hour for her work but no charge for holiday or sick days whilst the employed accounts team members are on £9.50 an hour, with 33 days holiday and up to 28 days sick pay per year.

She was also invoicing weekly on the Friday and being paid straight away by herself! The directors put a stop to her paying herself and she was then paid the following week but still weekly when the employed staff are paid monthly.

PlutoinCapricorn

Of course, even when both sides agree that someone should work on a self-employed basis, operate on that basis and have this in writing, HMRC may decide that the actual relationship over the years has been that of employer and employee.