Uber appealed the Employment Tribunal’s that its drivers were “workers” for the purposes of the Employment Rights Act 1996, Working Time Regulations 1998 and the National Minimum Wage Act 1998 and has lost.
Uber appealed to the EAT on four grounds: (1) the Employment Tribunal had ignored the contractual documentation and therefore had ignored the basic principle of agency law; (2) the Employment Tribunal had erred in relying on regulatory requirements as evidence of worker status; (3) the Employment Tribunal had relied on perverse and inconsistent facts; and (4) the Employment Tribunal it had not relied on facts submitted by Uber which were inconsistent with worker status.
The EAT found that the Employment Tribunal was entitled to ignore the characterisation of the relationship in the contractual documentation and could determine as a matter of fact what the relationship between the parties was because the general provisions of commercial law were overridden by the statutory tests. This was not ignoring the basic principle of agency law, but instead was rejecting the mislabelling which masked the true agreement between the parties. The regulatory requirements in the licensed private hire vehicle area which dealt with “control” were one of many factors which the Employment Tribunal was entitled to consider and should not have been discounted because they arose though regulation. Finally, when considering the Employment Tribunal’s judgment as a whole, it was neither perverse or inconsistent.
The basic facts of the case are set out in our original report here.
The EAT made it clear that in determining whether an individual is a worker for the purpose or a particular statute or regulation, the tribunal must first consider the wording of the particular regulation, then the reality of the obligations and situation and whether the documentation reflected the true agreement between the parties (also having regard to the parties respective bargaining power and expertise). Each case will be fact specific.
When considering the fact of worker status, the absence of a general obligation to work cannot be fatal to those cases where it is accepted that there are gaps between particular engagements or assignments; furthermore, the degree of integration into the business undertaken by another and the degree of true independence in the provision of the service are all relevant. However the EAT did not want to provide any more specificity, because the definitions in the various legislative sources were designed to provide flexibility.
This decision, which is likely to be appealed, continues the recent line of cases casting doubt on the “independent contractor” or “independent business” model used by GIG engagers. Sophisticated documentation will not blind the tribunal from assessing the specific factors of each case to determine whether an individual has worker status. Consequently, GIG engagers who are holding firm and awaiting decisions from higher courts before tweaking their models, would be advised to start planning not only their revised approach, but how they will deal with and manage likely litigation concerning failure to acknowledge worker rights to date.