By Richard Renouf, Independent Flooring Consultant
Who is responsible when a customer complains about a problem caused by poor fitting? Some companies employ their fitters and so there is no question; any fitting problems are dealt with as part of the retailer’s normal service. But for many years now, the majority of flooring businesses have tried to offload all the responsibility for fitting to the fitters themselves. The retailer takes the money for the order, but tells the customer that they must pay the fitter direct and that the fitter is liable for his or her work, thereby implying they are not. I receive calls every week from customers who have been left high and dry by fitters who have ‘gone absent’ and retailers who stonewall them and deny any liability.
I often have to look at flooring retailer order forms and the terms and conditions quoted. So many companies use Ts and Cs that they’ve copied from others and most of these are identical to, or a slight variation on, terms and conditions used by a major retailer who went out of business not too long ago. The older version contains unfair contract terms and the newer version, which I wrote, was based on a number of other essential agreements that had to be made between the company and each individual fitter in order to create the right legal relationship for the terms to apply. Every time I read yet another copy I wonder if the company and fitters have implemented the necessary agreements to make the terms valid?
How would you know? If any of the following phrases are on your paperwork, check to see how they got there:
Help us to help you: Rooms must be clear of furniture and old floorcoverings before the fitters arrive…
We act as agents for self-employed fitting contractors…
Fitters are responsible for their work…
…and ask yourself: ‘Do our customers know who the fitter is before they turn up? And do they receive his or her business details in case of any complaint (not just a mobile number)?
The key issue at the time the aforementioned retailer’s terms and conditions were reviewed was whether or not the fitters were self-employed or employees. A fitter working primarily for one business is more likely to be considered an employee and so the retailer would be liable for their unpaid/undeclared income tax and National Insurance contributions. The only way around this that the senior tax lawyer (a QC at the time) could find was for the fitters to legally appoint the retailer as their agents (saying this was the case is not enough) so they could book the fittings on their behalf but had no liability for poor performance, just like a celebrity’s agent would not be liable for failures of the celebrity. If you’re one of the retailers using this plagiarised wording, it will be worth seeking legal advice before you and your fitters are challenged.
Finally, there’s the issue of VAT. A self-employed fitter may receive income below the VAT threshold and so may be able to charge a customer without adding VAT, which clearly is a benefit to the consumer. But most reasonable fitters should be earning above the VAT threshold and if they do not register for VAT and get caught, the VAT liability may actually fall on the retailer. This happened in 2020 to a company supplying bathrooms and introducing bathroom fitters to the customers under what they claimed was a direct arrangement. Their website claimed: “We provide the complete service…” and the customer had no say on who the fitter was. The company was receiving any and all complaints and even though they then sought to get the fitter to return to do any necessary remedial work, HMRC found the retailer was responsible for all the uncharged VAT on the fitting elements of all the retailer’s orders going back as far as the Tax Office was allowed. The bill was huge. Far more than the cost of professional advice to ensure you’re fully compliant.
Richard Renouf is an experienced customer service and flooring consultant and expert witness. He can be contacted via The Stocklists’ editor – lauren.mccarthy@kick-startpublishing.co.uk – and your questions may even find their way into future articles to help others dealing with similar situations. Please note that this article is not intended to be, or to be a substitute for, legal advice.