This is a hot topic at the moment with three large employers under scrutiny for their pay structures:
- Uber, the transport company, has been taken to the employment tribunal to face a claim made by two of its drivers, or 'driver partners', that they should be treated as workers, rather than self-employed. The test for a 'worker' is provided for in the Employment Rights Act 1996 and requires work to be done either under a contract of employment or any other contract where the work is done personally and not by a business being run by the worker in question. Obtaining worker status would grant the drivers more employment rights and would protect them from being paid less than the minimum wage, one of the branches of the claim being made. Uber has over 30,000 driver partners in London alone and the case is likely to have large impact on this style of business. Watch this space for updates.
- Meanwhile, Deliveroo, the restaurant delivery app and firm, has written a clause into its contract that its self-employed delivery drivers cannot bring similar claims against the company to contend that they are either an employee or worker. It's probably only a matter of time before such a provision is challenged, however.
- Another employer in the firing line is Sports Direct, which has recently admitted that warehouse employees and other staff were effectively paid less than the national minimum wage due to harsh wage docking penalties for being late and being subject to security checks after they'd clocked off. Following negotiations, Unite the Union reported that workers at Sports Direct's Derbyshire base will receive back-pay of about £1m for the missing wages.
What Should Employers Do Next?
Check to make sure people working for you are properly classified as employees, workers or self-employed. Also, stay tuned for the results of the employment tribunal with Uber.