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Plumbing Firm Loses Appeal In Landmark Gig Economy Ruling

In the greatest victory yet for a gig economy tribunal hearing, a plumber has won an employment rights case for a second time despite an appeal by his ex-employer.

Gary Smith worked as a self-employed plumber for the revered London firm Pimlico Plumbers over the course of a six year period. He took the firm to tribunal in 2011 to challenge his official status as a self-employed worker. After winning his case in 2014, Pimlico Plumbers launched an appeal which was finally heard in February 2017 and again saw Mr Smith win.

This marks a major ruling in employment law, as it is the first major undertaken by an employer of the gig economy to be rejected at tribunal. This loss is not a good sign for other businesses hoping to reverse recent tribunal rulings of a similar nature.

The claim brought by Mr Smith challenged legislation deeming him a self-employed contractor rather than a full employee. Although Smith was VAT-registered and paying tax in accordance with self-employed regulations throughout his six years at Pimlico Plumbers, he did not work for any other business during that time. He claimed this was due of a contract agreement that made him “tightly controlled” by the firm, and therefore found it it difficult to seek additional employment.

After Mr Smith suffered a heart attack in 2010 he requested the business reduce his working hours from five days a week to three. Pimlico refused and Mr Smith was allegedly dismissed shortly afterwards because of this.

Pimlico Plumbers founder, Charlie Mullins, disputes the claim, saying that workers are hired on a self-employed basis with a generous fee of £80,000, for which the company in return expect workers to provide their own materials for their daily job duties .

Pimlico Plumbers is one of the most prestigious plumbing businesses in Britain, having acquired a value in the region of £75 million since Mr Mullins, a prominent Tory Party donor, founded the company 45 years ago.

Mr Mullins expressed relief that gig economy law is now being clarified for employers. He claims Pimlico Plumbers has benefited from the change and joked “Like our plumbing, now our contracts are watertight.”

Key businesses of the gig economy like Deliveroo, Uber and City Sprint have been in the spotlight recently in publicised cases launched by employees with concerns over their status as a self-employed worker, and what the expected duties of this should involve.

Each of these businesses has lost at tribunal, resulting in Deliveroo having to pay all self-employed staff the minimum wage, City Sprint needing to pay self-employed workers holiday pay, and Uber no longer being able to class workers as self-employed at all.

Lord Justice Underhill, a Court of Appeal Judge at the Pimlico ruling, believes employers should not accept the result as an indication of forthcoming legislation for the gig economy: “They should be careful about trying to draw any very general conclusions from it” he said.

A team of legal experts has been commissioned by government officials to determine a fair criteria for the expectation of gig economy workers. The investigation will be led by Mathew Taylor, the chief executive of the Royal Society for the Arts.

Issues for the team of analysis will include issues of pay during periods of holiday, sickness and maternity leave, and issues of pension employment and job security. The findings are due for publication later this year.