The recent EAT ruling in Addison Lee Ltd v Mr C Gascoigne is indicative of the trend of the Courts in dealing with worker status in the gig economy.
Employment status in the UK
Currently there are three categories of status in the UK:
Employees are afforded the greatest protection, with workers receiving some basic rights such as the right to the national living wage, paid holiday and rest breaks, and entitlement to pension.
Case law has developed and established the following test to determine the status of the individual:
- Mutuality of obligation – the requirement to provide work to an individual and the requirement of the individual to perform work
- Personal service – the requirement for an individual to carry out the work personally
- Degree of control – a company’s control over how, when and where an individual provides work to them can be determinative of their employment status
Addison Lee case
The company is best known for providing private-hire taxis and has a fleet of about 4,000 drivers. However, it also has a small courier business of about 500 couriers. Mr Gascoigne joined the ranks of about 30-40 cycle couriers working for Addison Lee in March 2008. He resigned in March 2017 due to problems with his back.
Mr Gascoigne argued that he was a worker for the purposes of the Working Time Regulations [“WTR”] and brought a claim for one week’s paid holiday between 1 and 16 March 2016, which he took but was not paid for.
The Employment Tribunal upheld Mr Gascoigne’s claim, and Addison Lee appealed to the Employment Appeal Tribunal [“EAT”].
Regulation of the WTR 2 provides:
““worker” means an individual who has entered into or works under (or, where the employment has ceased, worked under) –
(a) a contract of employment; or
(b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual; and any reference to a worker’s contract shall be construed accordingly.”
The Employment Tribunal held that Mr Gascoigne fell into the category of a “limb (b) worker” and was therefore entitled to holiday pay.
Addison Lee argued that there was insufficient mutuality of obligation to render Mr Gascoigne a worker since he was free to refuse work at any time by logging out of the app. However, the EAT concluded that, whilst he could log off at any time, that was not determinative. There was no “decline button” on the computer and, if a job was not picked up as expected, a member of the “control team” would call the courier to check why.
Addison Lee stated that Mr Gascoigne’s contract defined him as an “independent contractor” and sought to rely upon the relative freedom Mr Gascoigne enjoyed, including:
- The ability to determine his own hours and days of work by choosing when to log in to the app or not;
- The ability to “largely” choose his own route (although due to the strict delivery deadlines this was somewhat limited);
- He paid his own tax and National Insurance and was registered with HMRC as self-employed.
However, the Employment Tribunal had considered that there were multiple factors which amounted to an employment relationship, including:
- Strict delivery deadlines of within the hour, which required couriers to work quickly and have a tightly controlled working day;
- Allocation of work via controllers who closely monitor couriers’ location via GPS;
- Provision of company materials, including: a radio, palm top computer, GPS tracker, an app, a book of receipts and a branded bag and t-shirt;
- Provision of company insurance for loss or damage of parcels, levied by way of a charge to Mr Gascoigne whether he was working or not;
- The order in which jobs were completed was dictated by the controller;
- In-between jobs, and when still signed into the app, Mr Gascoigne was on stand-by and kept in contact with controllers by radio, phone and app;
- He was provided with statements of pay, which were akin to payslips.
The EAT agreed Mr Gascoigne was a “limb (b) worker”.
Following the hearing in the Supreme Court on 20-21 February 2018, the final judgment is eagerly awaited. Charlie Mullins was deemed a worker of Pimlico Plumbers by the Employment Tribunal and this has been upheld by the EAT and Court of Appeal, watch this space for the long-awaited decision…
The Taylor Review
And finally, the UK government has launched further consultations following its initial response in February to the review by Matthew Taylor into working practices in the current UK economy. In particular, gig economy workers were focussed on and potential changes suggested to strengthen and protect their status. Employment lawyers and businesses have been called upon to contribute to these consultations.
Only with legislation will greater certainty be achieved, and input into these consultations will be crucial to ensuring that a fair spread of views are represented. Until then, we must rely on the growing body of case law, which increasingly affords worker status to those working within the “gig economy”.