AN employment tribunal case over false self-employment could open the floodgates to a deluge of claims for notice, holiday and redundancy pay, it is claimed.

Self-employed hairdresser Meghan Gorman, 26, won a landmark legal battle after arguing that, although she had a contract as a self-employed hairdresser, the amount of control over her working practices effectively made her an employee.

Ms Gorman, from Clitheroe, claimed she had to work the hours set by the salon, Terence Paul in Manchester, who kept 67 per cent of her takings, but was not entitled to any benefits such as holiday or redundancy pay.

And now The HR Dept, experts in human resources for small and medium-sized businesses (SMEs), said her win would open the floodgates for many more self-employed people who are considered ‘workers’.

Director of The HR Dept Jill Bottomley said: “It has become standard practice for many salon owners to use self-employed in this way, and the implications of this case are likely to be huge and costly for many business owners in this sector.

“But it’s not the only sector affected. Many self-employed sports coaches, tutors, golf pros, physios, dental hygienists, designers, architects – the list goes on – are often engaged on a self-employed basis for their personal skill and wouldn’t have a right to substitute.

“Part of the problem is that smaller businesses are often encouraged to use such ‘false self-employment’ arrangements by professional advisers, bank managers and accountants who usually lack the ability to offer qualified HR or employment law advice.

“One of the problems is owing to the complexity and different rules relating to tax law and employment law about employment status.

“In tax law, it is binary – somebody is either ‘employed’ or ‘self-employed’ – while in employment law, there is an additional category of ‘worker’ status.

“This is not the same as an employee.

“Many sole trader self-employed individuals, if put to a test about their true status, would likely be a worker if not an employee.

“That is not to say that all self-employed are not truly self-employed people running their own business, but for many the practices are a sham.”

Ms Gorman’s lawyers successfully argued that the amount of control her employer had over her working practices meant she was, effectively, an employee.

She has now won the right to claim for six years of backdated holiday pay, notice and redundancy pay after losing her job when the salon closed in 2019.