Changes to the off-payroll working rules in both the public and private sectors have seen changes in how Agencies contract with workers. Unfortunately, many end-user clients now refuse to deal with limited company contractors and as a direct consequence, many contractors have unilaterally been forced into using a Umbrella Company often against their will by the Agency they contract through.As a umbrella worker you face misleading and unfair deductions from you pay. These will include but not limited to, Employers National Insurance Contributions, Apprenticeship Levy, Workplace Pension Contribution and Holiday Pay.As a matter of law, employers which include Umbrella Companies cannot deduct Employers NICS or Apprenticeship Levy from a workers gross pay.

Many organisations are exploiting workers by flouting employment law and not treating workers equally.  Workers doing comparable work to that of an employee, are entitled to receive the same working conditions and basic pay as that given to an employee. C4J will hold these companies to account and help workers get the justice and money they should have received, but did not.Following the judgment in King v Sash Window Workshop Ltd, the Court of Justice of the European Union (CJEU), stated that a worker (even if the employer incorrectly believes that they are self-employed), must be allowed to accrue paid annual leave rights until termination of the arrangement between the worker and engager.This right can go back in some cases to when the European Working Time Directive was introduced in 1998 in the case of holiday entitlement and back to 2012 for workplace pension contributions.C4J are currently supporting thousands of claimants and group-action clients, and we can do the same for you.

As a contractor working under an umbrella company in the UK you are legally entitled to statutory employment benefits, including Holiday Pay. Many umbrella company contractors still believe they are in a form of self-employment, unaware of the full employee rights and benefits available to them.At C4J, we’re here to empower you with knowledge and help you claim what’s rightfully yours. Let’s shed light on the two primary methods of holiday pay distribution for umbrella company employees:Accrual Method: With this approach, your provider sets aside your holiday pay entitlement until you take time off or cease working through the umbrella company. Unfortunately, some unscrupulous umbrella companies have misused this method, resulting in the wrongful withholding of workers’ holiday pay.Fixed Advanced Payment: Alternatively, you may receive holiday pay through fixed, advanced payments.As per the European Working Time Regulations, your annual leave should amount to 5.6 weeks per year, which equates to 28 days, inclusive of bank holidays. Remember, your holiday pay is your hard-earned money and should always be transparently paid to you. If, at any point, your umbrella company has unjustly withheld your holiday pay entitlement, you have a legal claim for unlawful deductions.A significant legal precedent was set in the case of Gary Smith V Pimlico Plumbers Ltd which summarised.“If a worker takes unpaid leave when the employer disputes the right and refuses to pay for the leave, the worker is not exercising the right. Although domestic legislation can provide for the loss of the right at the end of each leave year, to lose it, the worker must have had the opportunity to exercise the right conferred by the Working Time Directive.”.Moreover, it’s essential to note that this right can extend back to 1998 when the European Working Time Directive was introduced, potentially entitling you to compensation for past holiday entitlements.At C4J, we are currently supporting thousands of claimants and group-action clients in their pursuit of justice. Let us do the same for you. Reclaim your unlawfully withheld holiday pay with confidence and assert your rights as a valued employee of your umbrella company.

Every employee or worker is entitled to fair and just treatment in the workplace, regardless of your role, race, gender or age.

Employment Law covers your rights and you may be able to claim compensation, if your Employer has discriminated or acted unlawfully against you.

C4J are currently supporting thousands of claimants and group-action clients, and we can do the same for you.

For expert advice on matters in relation to Employment Tribunal Claims and Disputes, please contact our Employment team today on 08000 99 66 99.

Are you a Supply Teacher?

If so you may be entitled to claim £1000’s in compensation.  The Key areas where you may be entitled to compensation are:

Holiday Pay – Following the Court of Appeal decision in Harpur Trust v Brazel you are now entitled to a minimum of 28 days annual leave, paid at the rate of a normal weeks pay. i.e. if you receive £1000 per week you will be entitled to £5,600 per annum paid holiday. C4J can assist you in claiming for the holiday pay you should have received, but did not.

Unlawful Deductions from Pay – Many supply teachers are forced to provide their services via an Umbrella Company and as a result suffer unlawful deductions from wages namely Employers NIC’s, Apprenticeship Levy, Work Place Pension and Holiday Pay. C4J can pursue the Umbrella Company and/or Agency for those unlawful deductions you have suffered.

Equal Pay – If you work via an Agency your pay rate will be generally lower than the rates for teachers in regular employment. Under Agency Workers Regulations 2010 (AWR) if you are engaged on the same assignment for 12 weeks, then you are entitled to receive the same “basic pay” and conditions as you would have received if you had been employed directly by the employer.  These “basic pay” and conditions cover rates of pay, hours of work and annual leave. C4J will ensure you receive your entitlement to “basic pay” and conditions.

Pension rights – Since January 2007, if you are a supply teacher who is directly employed by an authority or school you will be automatically pensionable under the Teachers’ Pension Scheme (TPS). However, if you work by or through an Agency you do not receive this benefit as Agencies are not currently permitted to participate in the TPS. C4J will pursue this issue on your behalf as it contravenes the AWR rules on “basic pay” and conditions.

Supreme Court Decision in Harpur Trust v Brazel

Holiday Pay Post Brazel

We at C4J Ltd have worked tirelessly to find a resolution for Contractors or Workers affected by the Loan Charge Legislation.

During this time we have seen numerous challenges  in the Courts with cases such as Hoey (First Tier Tribunal and Appeal to Upper Tier Tribunal) and Finucane (Court of Session), and while we don’t profess to have found a way to defeat the Loan Charge,  we have identified in conjunction with both Leading Tax and Employment QC’s another angle to mitigate the tax liabilities being imposed by HMRC.

In short, we can reclaim the tax suffered by contractors/workers from the Agencies or Clients they worked through. In addition, we can also claim Holiday Entitlement that contractors/workers should have received but did not.

So how does this all work?

The contractor or worker is chargeable to Income Tax and Class 1 NICs on sums earned under the Income Tax (Earnings and Pensions) Act 2003 (“ITEPA”) on the basis that:

• The sums constitute “earnings” from employment under the general provisions in ss 10 and 62 ITEPA; and
• The sums earned are to be treated as “earnings” from employment under the provisions relating to persons providing services through an agency in s 44 ITEPA (and corresponding provisions relating to NICs) (“the agency rules”).

The Agencies are to be regarded as the employer for the purposes of the PAYE rules;

(a) accordingly, under those rules, those parties were liable to (but did not)

(i) deduct the income tax and Class 1 NICs due in respect of the earnings from sums paid by them under the arrangements or account to HMRC for such income tax,

We would add that HMRC was entitled to but did not take action to enforce such obligations against those parties, and they are as culpable as the Agency.

It is both our and Counsel’s view that as a consequence of the above:

• Accordingly, the contractor or worker is entitled to claim for any loss suffered as a result of the loan charge due to the negligence of the Agency in their failure to operate PAYE under the Agency Rules.
• The contractor or worker is entitled to claim from the Agency for any loss suffered due to the Intermediary placing you into a tax avoidance structure. Under the Law of Principal & Agent, where the Principal (The Agency) is liable for the actions of their Agent (The Intermediary) and if you suffered loss as a result of the Intermediary’s actions, then the Principal is responsible in Law for that loss you suffered.

Under normal circumstances, the Law of Tort allows a claim to be brought within three years of someone finding out they have a claim and allows a claimant to go back six years from that date. However, under certain circumstances, this can be extended to 15 years where it can be shown and proven the person was “Wilfully Neglect or Negligent.”

We believe we can plead Wilful Neglect as the judge defined this in R. v IRC ex p. Chisholm (1981) STC 253, who stated “Wilful” means ‘deliberate’ or ‘intentional.’ The persistent failure to deduct tax must therefore have been ‘wilful’, which is also supported by the advice received from QC. 

So how much is this going to cost?

C4J operates on a “no win no fee” basis also known as a conditional fee arrangement that allows you to make a compensation claim without financial risk. You only ever pay anything if your claim is successful.