Long-serving engineer dismissed for private work: unfair dismissal due to no hearing
A security systems engineer with 9 years' service was unfairly dismissed after his employer discovered he had done private work for a client, but failed to hold a disciplinary hearing. The tribunal awarded £25,664 in compensation.
1 min read · Last updated 18 May 2026
Case details
- #long-service
- #self-employed-status
- #competing-work
- #acas-code-uplift
- #holiday-pay
- #employers-contract-claim
Key facts
- Mr Collett worked for LSA as a security systems engineer from 2011 until dismissal on 24 May 2020.
- He was treated as self-employed but the tribunal found he was an employee and a worker.
- He was dismissed after LSA discovered he had been doing private work for a client, Caledonian, in competition with LSA.
- The dismissal was procedurally unfair because no disciplinary hearing was held.
- Mr Collett was awarded compensation for unfair dismissal and holiday pay, but his breach of contract claim for notice pay was dismissed.
- LSA's counterclaim for the loan and damages was partially upheld.
Timeline
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Started work
Mr Collett began working for LSA as a security systems engineer, initially treated as self-employed.
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Request for holiday and pay review
Mr Collett asked for paid holiday and a pay review, leading to discussions about employment status.
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Signed self-employed contract
Mr Collett signed a contract stating he was self-employed, after pressure from LSA.
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First invoice to Caledonian
Mr Collett began doing private work for Caledonian, invoicing them for jobs outside LSA's maintenance contract.
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Lockdown and reduced work
During the COVID-19 lockdown, Mr Collett's work reduced; he received a retainer for seven weeks.
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Dismissal
Mr Collett was dismissed by letter for providing services to Caledonian in breach of his contract.
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Claim presented
Mr Collett brought claims for unfair dismissal, breach of contract, and holiday pay.
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Preliminary hearing on status
The tribunal heard evidence and found Mr Collett was an employee and a worker.
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Final hearing and judgment
The tribunal ruled on all claims, awarding compensation for unfair dismissal and holiday pay, and upholding LSA's counterclaim in part.
The legal issue
The tribunal had to decide whether the engineer was an employee or self-employed, and whether his dismissal for allegedly competing with the employer was fair. It also considered claims for holiday pay and the employer's counterclaim for lost earnings.
The outcome
The tribunal found that the engineer was an employee and a worker, not self-employed as the employer had treated him. His dismissal for providing services to a client was procedurally unfair because no disciplinary hearing took place.
Compensation:
- Basic award: £4,304
- Compensatory award: £514.25
- Holiday pay: £1,800 (estimated from total)
- Total: £25,664.33 (including other elements)
However, the tribunal dismissed his breach of contract claim for notice pay and partially upheld the employer's counterclaim for the loan and damages.
Lessons & takeaways
- Employers must hold a proper disciplinary hearing before dismissing for gross misconduct, even if the facts seem clear.
- Workers treated as self-employed may still be employees in law, depending on the reality of the working relationship.
- Long-serving employees (9+ years) are entitled to a fair process, and failing to follow it can lead to significant compensation.
- Doing private work for a client can be a valid reason for dismissal, but only if the employer follows a fair procedure.
A case about status and process
This case highlights two common pitfalls for employers: misclassifying workers as self-employed and dismissing without a fair hearing. The engineer had worked for London Security Automation Limited for nine years, but was treated as self-employed throughout. When the company discovered he had been doing private work for a client, it dismissed him by letter without any disciplinary meeting.
The tribunal found that the engineer was in fact an employee, because the reality of the relationship — regular work, control by the company, and integration into the business — pointed to employment. The self-employed label the company had imposed did not reflect the true legal position.
What went wrong
The employer's main failing was the lack of a disciplinary hearing. Even if the engineer had breached his contract by competing, the company should have given him a chance to explain. A fair process might have led to a different outcome or reduced any award. The tribunal also noted that the company had not followed its own disciplinary procedure.
Why this matters
For employees, this case shows that being labelled self-employed does not necessarily prevent you from bringing an unfair dismissal claim. The tribunal will look at the actual working arrangements. For employers, it is a reminder that even a clear-cut case of misconduct requires a fair procedure — especially when the employee has long service. The compensation here was modest because the engineer found other work quickly, but the principle applies to all cases.
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