Understanding employment status in the UK

Employment status determines the rights and protections an individual has at work. In the UK, there are three main categories: employees, workers, and the self-employed. Each has different entitlements. There is also a distinct framework for agency workers. Getting status right is essential, as rights cannot be contracted out of or waived.

We have provided below a short overview of these categories, but this is a complex area of law, so please contact us if you need any assistance with the issues raised. 

1. Employees

Employees have the most employment rights. To qualify as an employee there must be mutual obligations: the employer must provide work, and the individual must perform it personally as the employer directs. Employees benefit from wide protections including:

1. Statutory sick pay and maternity, paternity and shared parental leave
2. Minimum notice periods and the right not to be unfairly dismissed (currently after 2 years, will be after 6 months with the implementation of the Employment Rights Act 2025). 
3. Redundancy pay (after 2 years’ service) 
4. Paid annual leave (5.6 weeks for full-time)
5. Protection from discrimination and detriment
6. TUPE rights during business transfers

Employees also have protection against unlawful deduction from their wages and the right to an itemised payslip.

2. Workers

Workers sit between employees and the self-employed. They perform work personally but without the full obligations of employment. They are entitled to:

• National Minimum Wage
• Paid annual leave
• Rest breaks and limits on working time
• Protection from discrimination
• Protection from unlawful wage deductions

Workers do not have rights such as unfair dismissal, redundancy pay, or family leave (unless contractually agreed). 

3. Self-employed

Self-employed individuals run their own business and take on financial risk. They have very limited statutory workplace rights, generally only:

• Protection from discrimination (in limited circumstances)
• Health and safety protections when working on a client’s premises

They do not have paid holiday, minimum wage rights or protection from dismissal.

4. Agency Workers

Agency workers are supplied by a temporary work agency to end-user businesses. After 12 weeks in the same role, they gain rights under the Agency Workers Regulations 2010, including:

• Equal treatment on basic working conditions (pay, annual leave, working time)
• Day-one access to collective facilities (canteens, childcare, transport)

Agency workers do not gain employee or worker status with the hirer unless the working relationship genuinely supports this. They are usually employed by the agency rather than the end client. 

As noted above, the law in this area is complex and our lawyers have seen how the tribunals drill down into the detail of the relationship in practice to determine the true categorisation, always noting that regardless of the documents, it is the reality that shows the position. 

For advice and support relating to the issues raised in this blog or to make an appointment with our Employment Law Team please call 01635 896 336 or email employment@fentonelliott.co.uk

Disclaimer: This summary is for general awareness and insight, not legal or professional advice and readers should seek professional advice for their situation.