Fire and Security Engineer wins constructive dismissal after being paid through CIS scheme without consent
A tribunal found a fire and security engineer was constructively dismissed after his employer paid him through the Construction Industry Scheme without his informed consent, denying him employment rights. He was awarded £2,519.
2 min read · Last updated 18 May 2026
Case details
- #constructive-dismissal
- #employment-status
- #cis-scheme
- #holiday-pay
- #pension-contributions
- #private-medical-insurance
- #unlawful-deduction
Key facts
- The Claimant was offered employment as a Fire and Security Engineer with a salary of £35,000 and benefits including pension and private medical insurance.
- The Respondent paid the Claimant through the CIS scheme without his informed consent, treating him as self-employed.
- The Claimant raised concerns about his employment status and benefits in February and April 2021.
- The Claimant resigned on 1 April 2021 and started a new job with higher pay.
- The tribunal found the Claimant was an employee and was constructively dismissed due to the Respondent's breaches of contract.
Timeline
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Interview
The Claimant attended an interview for the position of Fire and Security Engineer.
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Offer of employment
The Respondent emailed an offer of employment with a salary of £35,000, working hours 08:00-17:00 Monday to Friday, plus overtime and some Saturdays, and benefits including pension and private medical insurance.
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Acceptance of offer
The Claimant accepted the offer of employment.
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Start of employment
The Claimant started work and completed an induction.
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Chased for contract
The Claimant chased Mr Nejad for his employment contract.
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Called out while unwell
The Claimant, feeling feverish and coughing, attended a call-out to Evalina Children's Hospital at 2am.
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Positive Covid test
The Claimant tested positive for Covid-19.
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Query about payslip
The Claimant emailed querying his payslip and stating he should have been paid SSP; he was told he was on CIS and not entitled to SSP.
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Resignation
The Claimant wrote to Mr Nejad stating he wished to resign, asking about notice period and holiday entitlement.
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Final email before leaving
The Claimant emailed again, stating the 'final straw' was realising the Respondent had not been paying national insurance contributions for him.
The legal issue
The tribunal had to decide whether the engineer was an employee, whether he was constructively dismissed, and whether the dismissal was automatically unfair for health and safety reasons or for asserting a statutory right.
The outcome
The tribunal decided that the engineer was an employee and was constructively dismissed. However, his claims for automatic unfair dismissal under sections 100 and 104 of the Employment Rights Act 1996 did not succeed.
The key reason was that the employer's breaches of contract—paying through CIS without consent, failing to provide a contract, and not providing pension or private medical insurance—went to the heart of the employment relationship, justifying resignation.
Compensation breakdown:
- Lost pension contributions: £454.34
- Private medical insurance: £267.55
- Unlawful deduction for overtime: £100.92
- Holiday pay: £1,696.21
- Total: £2,519.02
Lessons & takeaways
- If you are offered employment with benefits like pension and private medical insurance, ensure you receive a written contract and that these benefits are actually provided.
- Being paid through the CIS scheme without your informed consent can be a sign that your employer is treating you as self-employed, which may breach your contract.
- If your employer fails to address your concerns about employment status and benefits after you raise them, this can amount to a fundamental breach allowing you to resign and claim constructive dismissal.
- Keep records of all communications about your employment status and benefits—they are crucial evidence in tribunal claims.
This case shows what can happen when an employer fails to honour the terms of an employment offer. The engineer accepted a role with a salary of £35,000 and benefits including pension and private medical insurance. But from the start, the employer paid him through the Construction Industry Scheme (CIS) without his informed consent, effectively treating him as self-employed. The engineer raised concerns in February and April 2021, but the employer did not resolve them. He resigned on 1 April 2021, citing the 'final straw' of discovering no national insurance contributions were being paid.
The tribunal found that the engineer was an employee, not a contractor, and that the employer's actions amounted to a fundamental breach of contract. The employer had not provided a written contract, had not paid the promised benefits, and had misled the engineer about his employment status. This meant the engineer was constructively dismissed.
What the employer could have done differently
The employer could have avoided this claim by simply honouring the terms of the offer. Providing a written contract, paying through PAYE, and enrolling the engineer in the pension and private medical insurance schemes would have prevented the breach. If there was a genuine misunderstanding about the engineer's preference for CIS, the employer should have documented the engineer's informed consent. Instead, the lack of documentation and the failure to address the engineer's concerns led to a finding of constructive dismissal.
Why this matters for similar claims
This case is a reminder that employment status is determined by the reality of the working relationship, not by what the employer calls it. Employees who are promised employment benefits but are paid through schemes like CIS may have strong claims for breach of contract and constructive dismissal. The award of £2,519, while modest, covers the financial losses from the missing benefits and holiday pay. For anyone in a similar situation, the key is to raise concerns in writing and keep evidence of the original offer and subsequent communications.
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