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Union’s new hit squad challenges umbrella companies

By May 15, 2017Case Review
Umbrella Company | HR Solutions

The union Unite has launched a tribunal appeal targeting umbrella companies, the first under its new Strategic Case Unit.

The case involves Unite member Russ Blakely, who worked as a pipefitter on an NHS funded project last year. The main contractor for the project was Kier Fascel was the mechanical contractor.

Background to the case

Mr Blakely got the job through an employment agency. He had to pay a weekly fee of £18 to the umbrella company who issued his wages. Mr Blakely also had to pay the employer’s national insurance contributions, marked on his wage slip as HMRC Payment NIERS. In total, he had to pay £324 in management fees and £725.59 in employer NICs.

Employment tribunal

Mr Blakely, with the support of Unite, took his claim to the employment tribunal for unlawful deduction of wages. This included the management company deductions and the employer’s national insurance contributions. His claim also included accumulated holiday pay he had earned but not received. But the Reading Employment Tribunal dismissed the claim on the basis that Mr Blakely was not a worker.
Unite has now lodged an appeal, with the hope that the outcome will set a legal precedent.

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