The Issues of Employment Law - Assignment Example

Name] [Unit] [Name of the tutor] [Due date] Employment law Since 1945, employment has been seen as a principal model in which work is being carried out. In general, employment can be regarded as a long-term arrangement between the organisation and an individual where work is provided based on continuing basis, that is, day in day out, or even on year basis (Atkinson, 28). The issue of employment have been changing from the past. Traditionally, contractual benefits as well as entitlements were often related to the service based on continuous and seniority service. For individual job has been and still remains a very crucial and valuable asset (29). According to Dickens (5), the traditional model is gender-based and addresses male employment patterns only. As a result, a key challenge to women in the labour market is that although the structures of employment are neutral, they are moulded concerning domestic obligations as well as life patterns of men. Dickens (6) add that the traditional model of employment has been subjected to various changes in a period of more than 50 years based principally on three factors which include: the need for employer for greater flexibility in regard to utilisation of resources; the drive of the employee for cost-effectiveness and greater efficiency; and the challenges, mostly on the law on sex discrimination. The changes to address such issues were initiated as early as 1980s. With a growing diversity employee and the means through which the courts establish it, employee status is very essential. Burchell et al (17) noted that there is a growing diversity in regard to employee status. Historically, the characterisation of labour market was based on two categories of working people, that is, the standard and non-standard workers. Standard workers involve those who are usually employed on full-time basis, open-ended contracts as well as any worker expecting a long as well as a continuous service. This category is still the largest group of work in regard to labour market. The non-standard group involves a wide diversity of employee status and it is a group that has been developing rapidly in recent years. People working under this category can be characterised in many ways among them temporary freelance, part-time, zero and casual hours workers as well as home workers. However, Burchell et al (19) observes that nowadays, the overwhelming majority of workers that is estimated to be more than 85% are either dependent workers or employees while 13% can be clearly identified as independently self-employed. According to the Department Of Trade and Industry (DTI) (6), it has been of increasing importance to appreciate the distinctions existing between the categories that describe working people as employee, worker or independent self-employed. This based on the need to access statutory rights as well as making a determination in regard to contractual arrangements under which one works. DTI add that statutory law draws a distinction but it usually to a very limited extent. The guidance is mostly set out in case law and the government admits that the definition of a worker and employee in regard to legislations are not sufficiently clear and user friendly (DTI, 7). Employment status is very important. It is fundamental for employment law to clearly identify who an employee is, who is an independent contractor or self-employed in that, although the rights in regard to employment status extended to the wider category of the worker (as it can be seen in Davidov, (2005) 34 ILJ 57; Freedland, (2006) 35 ILJ 1), most are still in requirement of employment status. It is worth noting that the statute only provides an outline distinction between the modes in which labour can be sold by a person. The Employment Rights Act 1196, s 230(1) gives a definition of an employee as an individual that works under (or worked under, in case of a ceased employment) or has entered into a contract of employment. However, other Acts contains differing definitions. Among them is the Sex Discrimination Act 1975, s. 82(1) which refers to employment under a contract of apprenticeship or service or a contract personally to execute any labour or work. The Act therefore gives coverage of many workers who under the 1996 Act could be considered as independent contractors (Deakin, & Morris, 162). As the starting point for consideration of distinctions between such categories must be based on the principal of employment statute, the definition provided by the Act is however, insufficient to provide a distinction between the circumstances and the facts of individual working people. Therefore, case law is essential for determination of where a person is a contract employee, an independent contractor, or a worker based on some other contract (165). The distinction becomes more vital based on the fact that only employees qualify for employee protection rights, employee benefits, protection wages in regard to employee insolvency, protection under safety and health legislation, and the benefit of the common law duty of care from employer. The distinction becomes the most important one in our daily basis based on taxation given that the taxation of employees is different from that of self-employed (Deakin, & Morris, 163). Thus the correct category in regard to employment status largely depends on conflicting tests which were established at common law for several decades. The tests were initially formulated in order to decide on when an employee is liable to a third party for the employees’ torts (vicarious liability). This is a subject that is still troubling courts currently (Buchell et al., 6). This means that common law tests are important as they are established by the courts in order to distinguish whether a person is self-employed or an employee. These law tests are: control test; integration test; the economic reality test; mutuality obligation; and multiple tests. The control test concerns the degree of control in which an employer can exercise. Courts indicate that the test puts into consideration who lays down what is required to be done, the way and means to be done as well as the time to be done (Lane v Shire Roofing Co (Oxford) Ltd [1995] IRLR 493). Based on self-employment, the test has great autonomy as well as discretion in which work is carried out (Brodie, 140). Integration test involves consideration of the ways in which the person is contributes and is part of the organisational structure. If there is an establishment of integration, then the person is likely to be an employee (Brodie, 142). The economic reality test addresses the issue of who bears financial risks and who provides the resources in order to do work. It provides a clear answer concerning whether an individual is in the business on their own account. That is, the extent to which an individual is independent or dependent of a particular paymaster in regard to financial exploitation of his talent (Buchell et al., 6). Mutuality obligation is an important test where the courts use it to determine whether a person is an employee or not, or whether an employee contract exist or not. The essential requirement is for the court to establish whether an employer has an obligation in regard to employee relationship, to offer work to an individual and whether an individual has an obligation to undertake offered work (Deakin, & Morris, 165). In addition the second level of mutuality involves the mutual promises in regard to future employment relationship. This is characteristic of employee relationship of standard worker. If this level is missing, then it is possible that there is no contract of employment. For genuine self-employed, they are free to pick the work they do in regard to mutuality of obligation (Deakin, & Morris, 168). Based on the multiple tests, the court established that any decision on employee status doesn’t involve mechanical checking off of factors. Overall view must be taken of the circumstances and facts which puts into consideration whether an individual makes own arrangements in regard to social security contributions and tax. Such an overall view involves weighing of significance of various factors as well as putting into consideration the behaviour and intention of parties where appropriate. However, mutuality of obligation, control as well as payment of wages is very essential (Deakin, & Morris, 166). Conclusion Employment status is very important as it gives an indication of who is an employee and who is an independent contractor. Although the Act is insufficient to provide a distinction between the circumstances and the facts of individual working people, it is essential for determination of where a person is a contract employee, an independent contractor, or a worker based on some other contract. This distinction becomes more vital based on the fact that only employees qualify for employee protection rights, employee benefits, protection wages in regard to employee insolvency, protection under safety and health legislation, and the benefit of the common law duty of care from employer. The distinction becomes the most important one in our daily basis based on taxation given that the taxation of employees is different from that of self-employed. However, the correct category in regard to employment status largely depends on conflicting tests which were established at common law. The tests (control test; integration test; the economic reality test; mutuality obligation; and multiple tests) were initially formulated in order to decide on when an employee is liable to a third party for the employees’ torts. This means that common law tests are important as they are established by the courts in order to distinguish whether a person is self-employed or an employee. The regulation of the relationship of employment still continues to be subjected to two parallel developments in regard to law. Initially, the statute law is progressively in determination of minimum rights’ framework that would lead to moulding of the terms of contract of employment. Other contracts for carrying out work personally are also under the influence of statutory requirements. They cover two essential bases concerning employee relationship that include pay and working time regulation. The employment law acknowledges that the people in flexible market are entitled to minimum rights and that the general restriction concerning access of statutory rights to employees that are full-time has stopped to be defensible. Work cited Atkinson, J. Manpower Strategies for Flexible Organisations’, Personnel Management, (1984): 28-31 Dickens, L. Whose Flexibility? – Discrimination and Equality Issues in Atypical Work .London: Institute of Employment Rights, (1992): 4-9 Deakin, S. and Morris, G. Labour Law . London: Butterworth. 1998 Burchell, B. et al.The Employment Status of Individuals in Non-standard Employment, Employment Relations Research Series 6. London: Department of Trade and Industry. 1999 Department of Trade and Industry. Discussion Document on Employment Status in Relation to Statutory Employment Rights.. London: Department of Trade and Industry. (2002) Davidov, G. ‘Who is a Worker?’, (2005) 34 ILJ 57 Freedland, M. From the Contract of Employment to the Personal Work Nexus’, (2006) 35 ILJ 1 Brodie, D. The Contract for Work’, Scottish Law and Practice Quarterly, (1998):2. Read More