More than 100 workers are preparing legal action against online estate agency Purplebricks as they believe they are entitled to holiday pay and pension contributions. This is the latest in a string of high-profile employment status cases (such as Uber, Pimlico Plumbers, Addison Lee, and Amazon) where self-employed people appear to be workers in employment law.
Purplebricks operated a business model that utilises self-employed territory owners who look after a large geographical area with local property experts working under them. Interestingly, back in August, the organisation announced it would be employing all agents directly, providing them with holiday and sick pay, and making pension contributions on their behalf. However, their current practices do not absolve any historical wrongdoing, deliberate or otherwise.
Contractors 4 Justice (C4J) are seeking to gather over 2,500 property agents for their claim. Peter Fletcher, a consultant for C4J, estimates the claim to be worth between £20 million to £100 million, with each agent potentially being owed thousands of pounds each.
In a statement Purplebricks said “We have always taken legal advice in regards to our licensing model — and the advice is very clear that these individuals were operating as limited companies, running their own business and with full control over their own staff.”
Of course, any self-employed agents seeking to be treated as a worker would be sensible to consider whether they paid appropriate tax through their limited company in respect of their Purplebricks income, i.e. if they were inside IR35 did they make a deemed payment to HMRC accordingly. Although tax legislation and employment status legislation are not aligned, it seems likely that HMRC could argue the case if they have not received sufficient monies from someone who’s employment status is found to be a worker.
We will be monitoring this case with interest and will keep you updated of developments.