“Uber and Out”

“Gig Economy” – Self employed or worker?

With minds focussed on getting through home-schooling, vaccines and the long-hoped-for holiday, it would have been easy to miss the BIG NEWS in the employment law world.

Uber drivers have – definitively – been deemed workers and not self-employed.

After several years going through the various appeal courts, the Supreme Court has, at last, come to this view.

What did the Court decide?

The Supreme Court did not accept that the contract was made between driver and passenger (in contrast to mini-cab or black-cab rides), or that it was acting merely as a platform-based booking agent for the driver.

Rather, the Court found the contract is between the passenger and Uber, which then engages drivers to carry out the bookings.  The reasoning was that Uber exerts significant control over a number of aspects such as: prices for rides; whether the driver can accept or decline rides once they have logged on; the five-star ratings system; and preventing the driver from getting further rides with the passenger.

The consequence is that the Uber drivers are not deemed to be genuinely self-employed operating their own separate business.  Hence their `worker’ status.

What’s more, the Court found that their `working time’ is not limited to when they are driving passengers to their destinations, but includes any period when the driver is logged into the Uber app.

What does being a `worker’ mean?

Workers have a strange intermediate status.  They are not full employees, so are not entitled to full employment rights such as redundancy pay or unfair dismissal protection.

But they are entitled to the minimum wage and holiday pay.  They also receive employer pension contributions, statutory sick pay and statutory maternity pay, assuming they meet the qualifying conditions. Nice.

For companies, having workers can cost quite a lot more in holiday pay, national insurance and pension contributions. There is also a fair bit more paperwork such as PAYE.

What’s the significance?

More and more people work in the so-called “Gig” economy, of which Uber drivers are but one example.  Some of these people are genuinely self-employed, but for many others, it’s less clear. This time, and to Uber’s cost, the courts found one way.

What about delivery drivers and couriers?

In many ways, the Supreme Court’s decision is not surprising.  In the last couple of years, there have a string of employment cases that have found delivery drivers and couriers to be workers and not self-employed: Hermes, Addison Lee, Hermes, Excel, City Sprint.

The basic theme running through the cases is that the companies exercise a significant degree of control over the delivery drivers and couriers, such that they can’t be deemed genuinely self-employed.

However, it is not quite the end of the story.  Last year, the High Court found that Deliveroo drivers were indeed self-employed because their contract gave them the right (which was used in practice) to substitute someone else to do the delivery on any one occasion.

So we may yet see some of these companies starting to use a substitution clause to get around worker rights.  Or, who knows, the Deliveroo case may yet be overturned on appeal.

Confused?

A lot of the problem here is that employment law is not geared towards modern gig economy practices: politicians – where are you?

But the wider question for all of us is the tension created by the modern 24-hour service culture at the touch of a smartphone on the one hand; and, on the other, how much we pay and treat the people who service that culture.

(c) Ben Thornber, Thornber HR Law

Life Outside of Brexit?

Reintroduction of employment tribunal fees

Brexit, Brexit, Brexit… that’s all one hears these days.  What with negotiations on the transition deal with the EU, and now the precarious vote in Parliament, virtually all other government business has seized up.  The world of employment law is no exception, with precious little of significance coming up.  But that said…….

………..It has been reported that the Ministry of Justice (MoJ) is planning on the reintroduction of fees for bringing employment tribunal claims.  The previous scheme was deemed unconstitutional by the Supreme Court in 2017, and so far the MoJ has made refunds totalling £15.8m.

Not surprisingly, since fees were abolished there has been a marked increase in the number of tribunal claims brought.

Undeterred, the MoJ says it will reintroduce a scheme that helps fund the court system while being ‘proportionate and progressive’, although it has no immediate plans of doing so.

Presumably, we’ll hear more about this after the UK has withdrawn from the UK in March 2019 (or not…)

Meantime, there have been some recent interesting cases recently.

Long-Term Disability Benefits – Implied Term not to Terminate

The EAT has held that there is an implied term not to dismiss an employee for incapability if it would thwart contractual entitlement to long-term disability benefits, even if the plan states that the benefits would terminate if the employee was no longer employed: Awan v ICTS

Vicarious Liability – Beware!

Mr Skelton was a senior IT internal auditor with Morrisons.  He was convicted of fraud and other criminal offences for sharing employees’ personal data online and with three national newspapers out of a grudge against Morrisons.

The Court of Appeal held that Morrisons was vicariously liable, ruling that there was a sufficiently close connection between Mr Skelton’s employment and his wrongful conduct – even if his motive was to cause financial or reputational damage to Morrisons.

The lesson here is to check your insurance covers large data breaches by employees, together with as many actions by employees as possible even if not part of their job.  WM Morrison Supermarkets Plc v Various Claimants

Holiday Pay – More Rights

There has been a long line of case-law from the EU Court (CJEU), which has strongly upheld workers’ rights to holiday.  In Max-Planck-Gesellschaft v Shimizu, the CJEU ruled that even if the worker did not take his entitlement to holiday and there was no reason preventing him from doing so (eg illness), the employer would still have to show that it ‘diligently’ and in good time brought it to the worker’s attention that the holiday would be lost if not taken by the end of the year.

Here in the UK, this applies to the 20 statutory days’ holiday, so if you want to be safe it would be a good idea to send out this kind of notice at some point during the year.

Which brings me back to Brexit.  The one area of EU-led employment law which the UK may start to change after Brexit is under the Working Time Regulations.  But there’s still a long way to go before that happens. In the meantime if you have any queries do get in touch.  We are always here to advise and help.

(c) Ben Thornber, Thornber HR Law