What’s the big deal?
A worker’s employment status is relevant to the question of their employment rights. These differ depending on whether you are a worker, employee or self-employed.
A worker is an individual who undertakes to do the work personally for a business but the business does not exercise a sufficient degree of control over the individual.
Workers are entitled to various legal rights under UK and EU law including but not limited to, the National Minimum Wage, rest breaks, paid holiday, protection from discrimination, unlawful deduction of wages and whistleblowing protection. They do not have unfair dismissal rights which is a key legal right available to qualifying employees (who are employed and have two years’ continuous service with their employer).
An employee is acting under a contact of employment and is entitled to all of those rights applicable to a worker, in addition to rights including statutory sick pay, unfair dismissal rights, statutory redundancy pay and maternity leave and pay.
A self-employed individual does not have the employment rights that an employee or a worker has. They generally control their work, tax and national insurance payments.
Case law round-up
We bring you a round-up of the recent cases relating to employment status in our current “gig- economy”.
Aslam and Farrar and others v Uber BV
On 10 November 2017, the Employment Appeal Tribunal (‘EAT’) upheld the tribunal’s earlier decision that Uber Drivers were in fact ‘workers’. Uber sought to argue that the drivers were self-employed. The original ruling in 2016 was a significant step forward for taxi drivers and other causal workers.
The decision that the drivers were workers and not self-employed gave rise to some employment rights such as the right to be paid the National Minimum Wage and holiday.
Following this decision, numerous cases on similar grounds have come to the fore.
Dewhurst v CitySprint UK Ltd
On 12 January 2017, the employment tribunal heard a claim by Maggie Dewhurst who was seeking payment of two days’ unpaid holiday. She worked for CitySprint as a cycle courier. The issue hinged on the question of employment status: Was Ms Dewhurst a worker or employee or was she self-employed and therefore not entitled to any payment of holiday.
Paragraph 14 of the tribunal judgment sets out that “it is CitySprint which has the power to regulate the amount of work available, and it keeps it couriers busy by limiting the size of the fleet”. This was key as it reflects the inequality of bargaining power in the relationship between Ms Dewhurst and CitySprint. Ms Dewhurst in fact worked for CitySprint rather than herself. Her claim succeeded.
Pimlico Plumbers Ltd & Anor v Smith
Gary Smith had worked for Pimlico as a Plumber for six years. He was required to wear a uniform, used a van leased from the Pimlico and worked a minimum number of hours. Following a heart attack and a request to reduce his hours, he had his van removed and contract terminated. Mr Smith bought various claims in the employment tribunal including that he had been unfairly dismissed, he had not received his contractual entitlements and had been subjected to disability discrimination. The tribunal ruled that he was not an employee so a number of his claims, such as unfair dismissal were dismissed. However, worker status was found and his claims for disability discrimination, holiday pay and arrears of his pay could continue.
Pimlico appealed. This case has been given permission to appeal to the Supreme Court however this is not likely to be heard until 2018.
Gascoigne v Addison Lee Ltd
In September 2017, the tribunal held that the thousands of drivers for Addison Lee are workers. The Claimant’s stated: ”they worked for the Respondent [Addison Lee] personally as drivers in accordance with requirements, policies and systems designed by the Respondent; and that the Respondent was not a customer of any business these drivers ran”.
Addison Lee argued that they were self-employed as “although the drivers leased their cars from an associated company of the Respondent, they were free to obtain a vehicle elsewhere. Further, they could choose when to work”.
Uber is seeking permission to ‘leapfrog’ the Court of Appeal and go direct to the Supreme Court, to seek to overturn the EAT’s decision that its drivers are ‘workers’ and therefore entitled to certain legal rights. It may be (although it is yet unknown) that an application is made to hear this case at the same time as the appeal in the Pimlico Plumbers case.
There has been an increase in litigation in this area in recent years and there is a need for better clarity regarding employment status. This is one of the reasons that the Government launched a review on workers’ rights in July 2017, which is continuing.