What is the difference between an employee, a worker and self-employed?
In UK law these are three distinct employment statuses with sharply different rights, and what your contract calls you does not decide it — a tribunal looks at the reality of the arrangement.
Employee. The fullest set of rights. Works under a contract of employment, with mutuality of obligation (the employer must provide work, you must accept it), personal service, and control over how the work is done. Entitled to: statutory sick pay, maternity and paternity leave and pay, redundancy pay, statutory notice, protection from unfair dismissal after the qualifying period, and the right to request flexible working.
Worker. A middle category that surprises people, covering casual, agency and many gig-economy arrangements. A worker performs services personally but without the full mutuality of an employee. Entitled to: National Minimum Wage, paid holiday, rest breaks, protection from unlawful deductions, whistleblowing and discrimination protection, and pension auto-enrolment. Not entitled to redundancy pay, statutory notice, or unfair dismissal protection.
Self-employed. Running your own business. Very few employment rights — essentially health and safety protection and discrimination protection in some contexts. Responsible for your own tax and National Insurance, can send a substitute, takes financial risk, and works for multiple clients.
The factors that actually determine status: control over how, when and where you work; whether you must perform personally or may send a substitute (a genuine, unfettered substitution right strongly indicates self-employment); mutuality of obligation; who provides equipment; whether you bear financial risk; and integration into the organisation.
This has been heavily litigated. The Supreme Court's Uber BV v Aslam (2021) held that drivers were workers despite contracts describing them as self-employed, because the reality showed control.
Tax status is assessed separately by HMRC and can differ from employment-law status — including under IR35 for those working through a personal service company.