Employer wants to make permanent employer contract uk

[Cherrywillingham]

My husband’s employer wants to make him a contractor rather than permanent employee, which he is at the moment. He wants to stay permanent. Can they legally force this on him in UK?

There isn't a straightforward answer to this. But in theory yes they can. They would havew to make him redundant from his current role, and any redundancy would have to be legally fair. It would then be his choice as to whether he wanted to accepyt a contractor position or seek employment elsewhere. He can't legally force them to keep him as an employee, but they can't force him to become a contractor, and they certainly cannot easily just change his status overnight. Of course, if he has less than two years service it is moot as he has no redundancy rights, so yes, they can then offer him a new contractor employment and he takes it or leaves it.

Unfortunately many employers are taking similar steps, and if they adhere to the legal processes, they can do it.

How long has he worked there? If less than 2 years then basically, yes they can, unless there's some discriminatory reason behind it e.g. they've decided all the men in the team have to become contractors but all the women will be permanent, or they've decided this because he's a trade union representative or has made protected disclosures or something. Although if they are expecting him to become self-employed but with no other changes to his ways of working then they could be in trouble with HMRC as that doesn't sound like genuine self-employment. But if they're talking about a 0 hours contract or employing him through a third party agency then that would be OK tax-wise.

If more than 2 years it's a bit tricky and it might take them a bit longer, but essentially still likely yes. It would could potentially fall under a fire and rehire situation if there was a genuine business reason why they now need contractors not permanent employees, which would mean they need to give him notice but not much else and it would be up to him whether to accept their offer of new employment on new terms. If he has more than 2 years service this would be challengeable in court (employment tribunal) as a potential unfair dismissal and they'd need to show they'd gone through a fair and reasonable process, but from the employee's point of view this is quite an expensive and long winded thing to do and the compensation is not always that much even if you win as you're expected to mitigate your losses i.e. look for and take another job ASAP and you would only get compensation for the period in between, so unless you've got good legal cover or he's part of a union that would cover the legal fees then it may not be worth it. The way of a lot of employers esp in the private sector would cover themselves for this is treat it as a redundancy although arguably in law it may not be one as the work is still there, so go through a consultation exercise, formally select the people they want out for redundancy, pay out a redundancy payment (statutory unless the contract allows for more, 1 weeks pay per year of service), often pay people in lieu of their notice too then wait a discreet interval (usually 3 months which is the period to put an ET claim in) before offering people new employment on new terms or just rehire new people in contracting roles. Bit dodgy but again providing no discrimination usually doesn't result in tribunal claims. OR the more proper way would be to negotiate a settlement package with the permanent employee so give them a pay-off to leave their job in exchange for their legal agreement not to sue and again either then re-hire them as a consultant or just hire someone new. How much they'd pay for this is totally fact specific, a very long standing and highly paid employee who would likely never find another comparable employment is a massive risk for a humungous tribunal payoff so a company is going to cough up a lot to move them on if they want, whereas someone who's worked there just over 2 years and could easily find other work probably they're looking at a payment expressed in weeks' pay rather than months).

If he's in a trade union I'd approach them for advice, or if not then a solicitor or ACAS so he can understand his options...

Thanks for your replies. Yes, he has about 5 years employment with that firm as a geologist. He is under Uk law (resident here but the company is based in the Middle East (Oil Industry consultants). They want him to become a contractor but not starting yet as they don’t have the work. He also has a clause in his contract which states that he can’t work for another oil company for 12 months, even if he takes redundancy. So they don’t want him but he can’t work for anyone else either. They have just taken on some new people as geologists in the Middle East too, so directly replaced.

I would lay bets that clause isn't remotely enforceable in UK law. But you'd be best advised to get some good legal advice did to the nature of the employers.