Liam Faulkner discusses the importance of employment status within the construction industry.
The traditional concept of an employee working for an employer on a full-time permanent basis doesn’t always apply in the construction industry. For example, fluctuating demands for work on specific projects, along with seasonal downtime, mean that construction companies often use alternative types of engagement to remain commercially viable.
This Q&A begins with an overview of employment status before turning to consider it in the context of some common working arrangements within the construction industry, as well as the Construction Industry Scheme (CIS).
Employees and workers are entitled to certain statutory employment rights. Broadly speaking, the key employment rights for workers are the right to receive the National Minimum/Living Wage and paid annual leave. For employees, in addition to the above, the key right is the right not be unfairly dismissed (after two years’ service in most circumstances).
If an individual has been incorrectly categorised, this could give rise to claims for back payment of, for example, holiday pay and wages, or a successful claim for unfair dismissal. There may also be tax and National Insurance implications, including fines and penalties (while ’employee status’ for tax purposes is not the same as employee status for employment law purposes, determining that an individual is a worker or employee for employment purposes is a strong...
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