Understanding Employment Status in the UK

Your type of employment affects what rights you’re entitled to and what responsibilities your employer has. Here are the main categories under UK employment law:

Employee

An employee is hired under a contract of employment and enjoys full statutory rights, including:

• • Protection against unfair dismissal

• • Redundancy pay

• • Maternity/paternity leave

• • Mandatory tax and National Insurance contributions via PAYE

  
  

Employees typically work exclusively for one employer and are an integrated part of the organisation.

Self-Employed Individual

Self-employed individuals operate under a contract for services. They run their own business, so they:

• • Work for clients or customers

• • Bear financial risks

• • Don’t receive employee benefits such as paid leave

• • Might be classified as “workers” if their services form part of someone else’s business

  
  

They’re mostly protected by contract and tort law, rather than employment law.

Worker

This category sits between employee and self-employed. All employees are workers, but not all workers are employees.

Workers are entitled to:

• • The minimum wage

• • Paid holiday

• • Protection against discrimination

  
  

Workers must carry out their work personally and cannot be considered clients of the business.

Zero-Hour Contract

This type of agreement offers no guaranteed hours and no obligation to accept work. A person on a zero-hour contract may be:

• • An employee

• • A worker

• • Or neither

  
  

It depends on the actual nature of the relationship, such as the presence or absence of mutual obligations. While these contracts offer flexibility to employers, they are subject to special protections, such as:

• • A ban on exclusivity clauses (employees can work elsewhere)

How Is Employment Status Determined?

Courts assess the real nature of the working relationship, not just job titles or contract wording. They consider:

• • The level of control the employer has

• • Mutual obligations between parties

• • How integrated the individual is in the business

📌 Not sure about your own employment status or rights? Feel free to get in touch—I’d be happy to help clarify things! 💬