Holiday pay & sick leave | Subcontractor takes on furniture firm in battle for key employment benefits

Subcontractor takes on furniture firm in battle for key employment benefits

A fitter working for a major furniture chain is taking on the firm in a legal battle, amid a row over employment rights, in a battle that campaigners say could pave the way for improved working conditions and employee benefits for gig economy workers across the UK.

David Lockwood, who has been classed as a subcontractor by Sharps Bedrooms, is taking legal action against the company to be classed as a worker and receive workplace benefits such as holiday pay and Statutory Sick Pay.

The 58-year-old from Huddersfield claims that the company denies him agency in his role, subjects him to financial penalties, and denies him the right to carry out work for competitors.

He installs pre-made fitted furniture for Sharps and began his employment relationship with the company about 30 years ago.

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Sharps, based in the Midlands, classes David as a subcontractor, which denies him holiday pay and Statutory Sick Pay, despite David having had no breaks in employment and providing his services only to them.

David is required to work under the contracts drafted entirely by Sharps. David claims that if an installer like him failed to take up the company’s assignments, Sharps would stop giving them work.

Sharps deducts payments directly from David’s wages for taxes, and deducts from his wages for workplace liability insurance, under a non-negotiable agreement. The company labelled this as a ‘Company Subcontractor Insurance Scheme’.

David claims that Sharps would control the dates and times for his work to be provided, and it would impose a financial penalty if he did not give at least 72 hours’ notice if he could not attend a job. The company sets the fees for David’s jobs, and would often quote for less work than was necessary, claims David.

The company requires David to follow an installation manual and draw a plan for every job, and David says that he would face financial penalty if he then deviated from this plan.

Despite being classed as and treated as a subcontractor without access to workers’ rights, allegedly Sharps would assure customers that fittings would be carried out by their own personnel.

An employment tribunal appeal was filed in August 2023. Sharps has informed the Employment Tribunal it denies the claim, according to Leigh Day, the legal firm representing David.

David said: “After working for 25 plus years in full time service to Sharps Bedrooms, I feel totally failed and disrespected by them. I believe that they have used unlawful loopholes to take advantage of hard and loyal workers.”

Ryan Bradshaw, senior associate solicitor at Leigh Day, is assisting Lockwood in his legal battle. He said: “David has been a loyal worker for Sharps Bedrooms Limited for decades, yet the company treat him as a subcontractor and are in control of David’s work setting the fees and parameters of his work.

“Furthermore, they are allegedly assuring customers that David is a member of their staff, yet putting ‘subcontractor’ on his pay statements and terms of engagement. We hope that by bringing this legal claim, David’s employment status can be settled and he will have access to the holiday pay and sick pay that he is owed.”

A spokesperson for Sharps said: “We disagree with the claims made by David Lockwood and Leigh Day and will be robustly challenging any legal action.”

Legal victory could benefit other workers, says campaigner

David’s claim is also being supported by Law for Change, a community interest company, which is challenging the rights of workers in the gig economy.

Law for Change founder, Stephen Kinsella, said: "Our mission is to back legal actions that have a clear social benefit and the erosion of workers' rights under sham self-employed contracts is an area we are particularly concerned about.

“It is clear that a positive outcome for David and the clarification of his employment status could not only secure better contract rights for him but also benefit workers we believe are being denied the benefits and protections they are entitled to."

Gig economy in the spotlight

A major decision was made on many gig economy workers last year when the UK’s highest court ruled that Deliveroo’s delivery riders should not be classed as employees.

The Supreme Court ruled in November 2023 that the gig economy giant’s riders cannot be represented by a trade union for the purposes of collective bargaining.

The Independent Workers Union of Great Britain (IWGB) had tried to represent a group of Deliveroo riders in order to negotiate pay and conditions with the company, Reuters said.

The union was first refused permission in 2017 on the basis that riders were not "workers" under UK labour law and it has since mounted a number of appeals.

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The IWGB took its case to the UK's highest court in April, arguing that it was an unlawful interference with riders' human rights to deny the IWGB's application to be recognised by Deliveroo for collective bargaining.

But the Supreme Court unanimously dismissed the IWGB's appeal in a ruling on Tuesday.

Announcing the court's decision, Judge Vivien Rose said Deliveroo riders do not have an "employment relationship" with Deliveroo and were not entitled to compulsory collective bargaining.

The Supreme Court said in its written ruling that Deliveroo riders could appoint a substitute to undertake a delivery, can work for competitors, do not have to work specific hours or even carry out any deliveries at all.

These features of the relationship between Deliveroo and its riders are "fundamentally inconsistent with any notion of an employment relationship".

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