All of us will encounter some form of employment law in our lives, whether as an employee, an employer, a worker or a self-employed individual and there are important rules that apply to each employment status.



All employees are automatically classed as workers but genuine workers (those who are not employees) are difficult to define as there are various definitions in different legislation. However the main features of a worker definition are:

  • Personal service: if the individual can send a substitute he is not a worker; and
  • The lack of a client/customer relationship with the employer.

Workers benefit from some statutory protection (e.g. the right not be discriminated against and the Working Time Regulations) but they cannot claim unfair dismissal, only wrongful dismissal.

 Worker Rights

  • theNational Minimum Wage
  • protection against unlawful deductions from wages
  • the statutory minimum level of paid holiday
  • the statutory minimum length of rest breaks
  • not to work more than 48 hours on average per week or to opt out of this right if they choose
  • protection against unlawful discrimination
  • protection for ‘whistleblowing’ (reporting wrongdoing in the workplace)

 They may also be entitled to:

 Workers usually are not entitled to:

  • minimum notice periods if their employment will be ending (e.g. if an employer is dismissing them)
  • protection against unfair dismissal
  • the right to request flexible working
  • time off for emergencies
  • Statutory Redundancy Pay



Employees are in the strongest position as they benefit from all employment law protection as they work under a contact of service. Unfortunately some contracts do not make it explicitly clear whether workers are employees or not so the common law has developed specific criteria to determine the existence of an employment relationship.

 Criteria for determining if someone is an employee:

  • Are they are paid for their work?
  • Do they perform the work personally (as opposed to hiring someone else as their substitute)?
  • Is the employer under an obligation to provide work and is the individual obliged to perform the work when given it?
  • Does the employer exercise some control over the individual (i.e. controlling what the individual does and where, how and when it is done)?
  • To what extent is the individual integrated into the employer’s organisation?
  • What is the economic reality between the employer and the individual? (i.e. is the employer responsible for the employees PAYE?)

 Workers who can satisfy the majority of the above points may be considered employees.

 Employee Rights

All employees are workers, but employees have extra employment rights and responsibilities which do not apply to workers who are not employees. These rights include all of the rights workers have and:

  • Statutory Sick Pay;
  • maternity, paternity and adoption leave and pay;
  • minimum notice periods if their employment will be ending (e.g if an employer is dismissing them);
  • protection against unfair dismissal;
  • the right to request flexible working;
  • time off for emergencies; and
  • Statutory Redundancy Pay

Some of these rights require a minimum length of continuous employment before an employee qualifies for them. An employment contract may state how long this qualification period is.


Self-Employed Individuals

Self-employed individuals do not benefit from any employment law protection as they are not deemed employees. They work under a contract for services rather than a contract of service and they are sometimes referred to as independent contractors.


Hours, Leave and Pay

There are legal requirements on working hours and leave:

  • Workers must not work more than an average of 48 hours a week (over a period of one year) unless they voluntarily agree to waiver these rules (The Working Time Regulations). Any agreement must be in writing and signed by the worker.
  • Part-time workers have the right not be treated any less favourably by employees in comparison to full-time workers. For example, holiday should be calculated on a pro-rata basis.
  • Employees have the right to the national minimum wage. This is currently£6.19 for adults aged 21 and over.
  • You must deduct your employees’ tax and NI contributions from their wages and pay them to HM Revenue & Customs under PAYE (Pay As You Earn).


Dismissing Employees

Dismissal is when you end an employee’s contract. When dismissing staff, you must do it fairly. There are different types of dismissal:

1. Fair dismissal

A dismissal is fair or unfair depending on:

  • your reason for it
  • how you act during the dismissal process

2. Unfair dismissal

Even if you think you’ve dismissed someone fairly, they could still claim unfair dismissal against you if they think that:

  • the reason you gave for the dismissal wasn’t the real one
  • the reason was unfair
  • you acted unreasonably, e. g by failing to give them plenty of warning about their dismissal

 Automatically unfair reasons for dismissal

Even if you’ve acted reasonably, some reasons for dismissal are classed automatically unfair. These are to do with the following areas:

  • pregnancy: including all reasons relating to maternity
  • family: including parental leave, paternity leave (birth and adoption), adoption leave or time off for dependents
  • acting as an employee representative
  • acting as a trade union representative
  • acting as an occupational pension scheme trustee
  • joining or not joining a trade union
  • taking part in official (‘lawful’) industrial action
  • being a part-time or fixed-term employee
  • discrimination: including protection against discrimination on the grounds of age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex and sexual orientation (in Northern Ireland, this also includes political beliefs)
  • pay and working hours: including the Working Time Regulations, annual leave and the National Minimum Wage
  • whistleblowing

 Penalties for unfair dismissal

If a tribunal finds that an employee has been unfairly dismissed, you might be ordered to:

  • reinstate them (give them their job back)
  • re-engage them (re-employ them in a different job)

 You might also have to pay compensation, which depends on the employee’s:

  • age
  • gross weekly pay
  • length of service

 Note: unfair dismissal only applies to employees who have been in employment for at least 2 years. It does not apply to workers.

 3. Constructive dismissal

This is when an employee resigns because you’ve breached their employment contract. This could be a single serious event or a series of less serious events.

 An employee could claim constructive dismissal if you:

  • cut their wages without agreement
  • unlawfully demote them
  • allow them to be harassed, bullied or discriminated against
  • unfairly increase their workload
  • change the location of their workplace at short notice
  • make them work in dangerous conditions

 A constructive dismissal isn’t necessarily unfair – but it would be difficult for you to show that a breach of contract was fair

 4. Wrongful Dismissal

This is where you break the terms of an employee’s contract in the dismissal process, e.g. dismissing someone without giving them proper notice.

Wrongful dismissal isn’t the same as unfair dismissal. If an employee thinks you’ve dismissed them unfairly, constructively or wrongfully, they might take you to an employment tribunal.


Employment Disputes

An employee can take you to an employment tribunal over various issues, including:

  • pay
  • dismissal
  • discrimination

 The tribunal is independent and can ask you to pay compensation or reinstate the employee if you lose the case. In such cases, it may be necessary to seek legal advice but if you are a small business, you may benefit from Acas’ Pre Claim Conciliation Service which is free if you are eligible.

 Where the dispute is being dealt with as part of your disciplinary or grievance process, your rules should follow the Acas Code of Practice on Disciplinary and Grievance Procedures.

 Click here for more information from Acas detailing the best practice for resolving workplace disputes with employees, including sample letters and rules.


Source: www.gov.uk