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In the latest of a series of Court decisions it has once again been confirmed that when reviewing whether an individual is actually self-employed or is in fact a worker, the main factor is how the contract is performed rather than what the parties have set out in writing.

In a recent case Mr A Boxer v Excel Group Services Ltd (in liquidation),Mr Boxer worked 9 hours per day 5 days per week as a cycle courier for Excel Group Services (“Excel”). His contract with Excel defined him as a subcontractor and he was registered as self-employed with HMRC. Excel did not pay Mr Boxer when he took a week’s holiday between 8 and 15 March 2016 and he decided to claim for his holiday pay.

Excel offered to pay Mr Boxer for his holiday but would not make any concessions about his employment status. Mr Boxer sought a declaration about his status and succeeded in persuading the Tribunal that he was not an independent contractor but was in fact a worker with rights to holiday pay.

In determining the status of Mr Boxer the Employment Tribunal considered a number of factors and in particular the nature of Mr Boxer’s relationship with Excel. It was noted that there were a number of features that distinguished his activity from that of a contractor agreeing to take on a series of jobs including that:

  • Mr Boxer had signed a contract with Excel but he had had no choice about the terms or pay and there was no negotiation or tendering involved;
  • the Excel required Mr Boxer to work 5 days per week under the control of a manager, with Mr Boxer being expected to pick up jobs as and when allocated and deliver the packages in the prescribed order. He was expected to work, and in return was entitled to expect a steady stream of jobs but he was also expected to stand by in between jobs in specific locations. Whilst he enjoyed some flexibility, this had to be by arrangement and with notice, so that when Mr Boxer needed time off he would have to run this by his manager in advance;
  • Mr Boxer had no other full-time work, although on occasions, he took time off to attend auditions as an actor or to do a job for a visa company which sometimes offered him work;
  • Mr Boxer had no input into the arrangements between Excel and its clients and he was paid at a fixed rate for his work, which was non-negotiable and he played no part in computing the rate. His pay was communicated to him in a ”Driver Memo” which the tribunal found to be a payslip; and
  • Excel provided Mr Boxer with the radio and app to install on his personal mobile phone. He also wore Excel’s branded clothing.

In this case the Employment Tribunal decided that Mr Boxer’s status should not be decided by reference to what was recorded in the contract but should instead be based on how the employment contract was performed. The Tribunal also indicated that Excel sought to maintain an appearance of operatives working for the business whilst at the same time wishing to distance itself from the burden of engaging such individuals as workers. Mr Boxer was in fact a worker and he should be entitled to holiday pay.

There has been a string of similar rulings which emphasises the willingness of the courts to look beyond the employment contract that exists between the parties and examine the reality of the relationship between the parties.