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Definition of employment ‘includes self-employed contractors’

Posted: 15th October 2020   In: Business Employment, Individual Employment

The Administrative Court has made a declaration clarifying that the legal definition of "employment" includes people who provide their services on a self-employed basis as an independent contractor.

The declaration was made after the Simply Learning Tutor Agency Ltd and eight other similar agencies applied for a declaration that the Employment Agencies Act 1973 does not apply to their businesses, which introduce tutors to families for the provision of private home tuition.

According to the applicants, they do not do anything which results in "employment" of tutors by either themselves or the parents who hired the tutors; nor do they provide a tuition service or oblige tutors to do so.

Consequently, they claimed that they should not be treated as employment agencies or employment businesses and that they were not bound by the terms of the Act or by the Conduct of Employment Agencies and Employment Business Regulations 2003.

The Administrative Court rejected the application.

It held that according to the Act, "worker" included those employed "by way of a professional engagement or otherwise under a contract for services". That meant that the business of providing information for the purpose of finding workers employment amounted to an employment agency within the meaning of the Act.

The Act broadened the definition of "employment" to include "certain engagements under contracts for services" as well as employment in the strict sense of engagement under a contract of employment.

It was intended to include all arrangements through which a business supplied people personally to perform work for a third party, whether or not that was regarded as employment, professional engagement or self-employment under a contract for service.

That interpretation reflected the broad purpose of the Act and the Regulations to protect not only those seeking work through employment agencies, but also those receiving their services through such agencies, and vulnerable people who might be the subjects of such work.

The Regulations also applied to those who provided their services through a limited company.

Therefore, where a business held itself out as a "middleman" between a person who needed services and a person offering to supply them, the protective terms of the Act and the Regulations would usually apply to that business for the protection of work-seekers, hirers and work-users.

Please contact Faith Widdowson if you would like more information about the issues raised in this article or any aspect of employment law.

Definition of employment ‘includes self-employed contractors’
[2020] EWHC 2461 (Admin)
SIMPLY LEARNING TUTOR AGENCY LTD & 8 ORS v SECRETARY OF STATE FOR BUSINESS, ENERGY & INDUSTRIAL STRATEGY (2020)
QBD (Admin) (Helen Mountfield QC) 18/09/2020

 

 

 

Posted by: Faith Widdowson
Employment
Luton Office